COBRA payments

[Guest Karen Renee]

Here is my situation. An employee elects COBRA and his new employer pays the first premium. Coverage is later canceled for lack of payment. 4 months later, it is found that we had received payment, but since it was from a company we do business with, it was credited to their account. There was no remittance advice, or any information attached that it was for COBRA. The employee was sent the HIPAA certificate of coverage when the coverage was canceled (so he should have known that his coverage was canceled). Are we obligated to accept that payment towards the COBRA and retroactively reinstate coverage? If the crediting error was ours, I would say of course, but in this case I'm not sure.

Thanks,

Karen Barnes