Cobra Benefits For Employee Sponsored Plan

[Guest SHELLEY CINTRON]

As an employer are we required by law to offer COBRA benefits - in this case dental, to employees who terminated their employment. Our dental plan is an employee sponsored plan, that means, employee pay for the premium, as employers we do not contribute to the plan, right now we just enroll and terminate when an employee resigned.

[KIP KRAUS]

If you are subject to COBRA laws, dental must be offered.

[GBurns]

I think that you need to clarify what you mean by "employee sponsored" and how the plan got there in the first place.

The term employer sponsored has nothing to do with who pays the premium, it has to do with the promotion and the making available etc.

I have never heard of "employee sponsored".

[KIP KRAUS]

Shelley:

GB’s post makes sense. From your original post it sounds as if you have a group dental plan that is 100% employee paid and you are required by the insurer to remit premiums on behalf of the plan participants. In this case I can’t even imagine how cost effective the plan could be to employees. I also am amazed that any insurer would write such an adversely selective plan. Only people who know that they are going to have claims exceeding their premiums are likely subjects for coverage. The premiums have to be astronomical.

In any event, if it is a group dental plan COBRA is applicable.

[Guest BStrangfeld]

COBRA generally must be offered for employee pay-all plans "if the coverage under the plan would not be available at the same cost to an individual but for the individual's employment-related connection to the employer." See COBRA reg 54.4980B-2, Q&A-1(a). This question typically comes up for employee pay-all dental plans and cancer insurance.