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COBRA payment (answered by EBG) |
shearn
Joined: Sep 13, 2001
Posts: 57 |  Posted: 2002-11-04 12:49
I went to a COBRA seminar and was told that employees who waited the full 60 days to send in their COBRA acceptance letter were then granted an additional 45-day grace period to make their first payment. Can anyone confirm or deny this? We have a new hire here who needs COBRA until her benefits kick in here in 3 months. Her prior employer told her that they won't sign her up unless she sends a check with her acceptance form.
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ForumHosts
Legal Forum Host
Joined: Jul 09, 2002
Posts: 825 | Posted: 2002-11-04 13:00
The information you left the COBRA seminar with is correct. An employee can wait up to 60 days to accept COBRA and then an additional 45 days to make their first payment.
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shearn
Joined: Sep 13, 2001
Posts: 57 | Posted: 2002-11-04 13:56
What happens if the employee claims they want it at the end of the 60 days and then, before the end of the 45-day grace period, changes their mind and doesn't want it. Can they rescind their election with no financial obligation?
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ForumHosts
Legal Forum Host
Joined: Jul 09, 2002
Posts: 825 | Posted: 2002-11-05 06:42
Assuming the employee has made no premium payments, the answer to your question is: yes.
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aljh
Joined: Sep 13, 2001
Posts: 447 | Posted: 2002-11-05 07:01
It is a good policy to wait until you recieve payment before you reinstate coverage. Coverage is then reinstated retroactive to the cancellation date. This way if the person fails to pay there is no administrative headache to rescind coverage. You should state this in your COBRA notice so employees know what to expect.
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shearn
Joined: Sep 13, 2001
Posts: 57 | Posted: 2002-11-05 07:33
So if they waited the full 105 days to make the first payment (60 days + 45 days) and the employer waited the same length of time to notify insurance company of election, would the insurance company still accept the COBRA election so long after the lost coverage?
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nork3
Joined: Feb 12, 2002
Posts: 3876 | Posted: 2002-11-05 08:05
I don't believe they have a choice.
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ShadowHR
Joined: Sep 13, 2001
Posts: 368 | Posted: 2002-11-07 08:34
You'll just need to show the insurance company the election form with the date showing election was done within the 60 day limit.
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