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A Service of OnQue Technologies, Inc. |
| Notification Requirements When Terminating
COBRA |
December 1, 2005
By Scott Haines, President
OnQue Technologies, Inc.
Santa Rosa, CA |
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The
following is an excerpt from Questions and Answers from the COBRA Help Desk–Part
I.
Client: I understand that we have 30 days to
notify a former employee that his 18-month COBRA benefits are going to expire.
Is that correct?
OnQue: That is incorrect.
The Department of Labor(DOL) 2004 regulations require plan administrators to
notify qualified beneficiaries in writing when terminating COBRA coverage
early (prior to the end of the maximum coverage
period).
Early
Termination
It is interesting to note that the regulations do
not set a specific time frame for notification in the case of early
termination. Instead, the regulations require the plan administrator to provide
the notice "as soon as practicable" following the decision to terminate
coverage. While that language may seem somewhat vague, it is necessary because
it allows for circumstances in which it is not possible or "practical" to
provide the notice well in advance of the COBRA termination date. Though not
recommended, the administrator may even provide the notice after the COBRA
termination date, provided the action was taken as soon as practicable
following the decision to terminate coverage. (Listening to attorneys argue
about what is practicable and what is not would be very interesting,
indeed.)
Normal
Termination
Plan administrators are not required to notify
qualified beneficiaries about the normal expiration of their COBRA coverage
(coverage that has gone full-term). However, if a conversion option is
available, COBRA qualified beneficiaries must be notified of their right to
elect that option within 180 days prior to the expiration of COBRA continuation
coverage. The best way to handle this is to provide a notice that reminds the
qualified beneficiary that his or her COBRA coverage is about to end. That
notice should include an explanation of conversion rights. |
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| Related COBRA Tips |
| Do
You Know When It's OK to Terminate COBRA Coverage
Early? |
| You May
Need To Offer Conversion Coverage When COBRA Ends |
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This information is provided by
OnQue Technologies, Inc. for educational purposes only and does not constitute
legal advice. If legal advice or other professional assistance is required, the
services of a competent professional should be sought.
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