Cobra

[Gstone]

Hey Guys.......need a little help here. If a company is terminating an employee say November 7th and the company agreed to pay their health insurance until next March doesn't that time have to be considered COBRA and not just continuing on their plan? They have a third party adminastrator for the COBRA. I also thought you had to term the employee from the policy and pay through COBRA because after the six months of the employer paying the ex-employee would need to tell the insurance company their last day worked. Am I correct on this. Thanks!

 

[cbg]

The DOL told me, when I asked a similar question, that all the time was COBRA regardless of who paid for it, starting from the date coverage would normally end. At the employer where I was at the time, coverage ended on the last day of the month in which employment ended; where I am now it's last day of employment. So at the first company it would be COBRA from December 1; where I am currently it would be COBRA from November 8. Who is paying for it is irrelevant to the amount of time the employee is entitled to remain covered.

 

[hrforme]

It might also depend on who holds the insurance contract and what their rules are along with any state insurance rules/laws. Generally I agree with cbg on the fact that it is best to move them to COBRA immediately and just have the employer pay the premium during the severance time. However, I have seen plans where severance coverage is allowed because they have a different definition of "the date the coverage would normally end".

Definitely ask your carrier prior to leaving them on the contract as "active" employees.

 

[Gstone]

Thanks guys I'll tell them to check their plan doc to see whats in there. Thanks again!