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COBRA & Medical Insurance Compliance


Guest parrot87

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Guest parrot87

If an employer (40 participants) had been offering health insurance to all it's employees who worked at least 20 hrs/wk., then realizes that the carrier has a 25 hrs/wk underwriting guideline....can they offer those employees who had been previously working less than 25 hrs. AND participate in the health plan COBRA coverage?

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Guest Benefit Specialist

I do not believe that is a qualifying event. Here's the only choices for a qualifying event and that would not fall into any of these choices.

End of employment

Reduction in hours of employment

Death of employee

Divorce or legal separation

Entitlement to Medicare

Loss of dependent child status

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Guest Sieve

I think the employer voluntarily could offer continuation coverage to any former ("retired" in the regs) employees that it wants to, assuming that the employer was willing to self-insure or could find an insurer willing to cover these individuals. Certainly the current carrier will not cover them. But, these individuals were, in fact, not eligible for coverage, and truly were not covered by the terms of the plan, so I don't think COBRA coverage is mandated. For now, however, I'd be concerned that the carrier might seek reimbursement from the employer for claims paid to the ineligible employees above and beyond the premiums collected for them--or that they'll cancel coverage--when they discover the employer's error..

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