COBRA in M&A - Question

[Guest EMC]

Background: Corporation A sells all of its assets to Buyer. After the asset sale, Corporation A continues to maintain one GHP for 3 employees left in the corporation to wind up its affairs (it is a national Corporation and will cancel all of its other regional GHP's in locations where it had employees). According to Example 8 in the the 1999 Proposed Regs, 54.4980B-9, Q&A 8(d), it looks as if Corporation A maintains COBRA liability for any M&A qualified benficiaries as long as it maintains the one GHP for the employees winding up the affairs of the Corporation.

Question: If the one GHP maintained by Corporation A after the asset sale is a purely regional health plan, but the M&A qualified beneficiaries are in other regions/states (and could't benefit under the GHP), what does Corporation A need to do in order to fulfill its COBRA obligations?

Thanks for your thoughts.

[This message has been edited by EMC (edited 05-01-2000).]