COBRA Where Employee Had Individual Coverage Only?

[Christine Roberts]

Employee never enrolled in employer's group health plan for economic reasons.

Employee experienced serious medical problems.

Employee applied for and eventually obtained catastrophic-only coverage from a state program available to otherwise uninsurable persons.

Employer paid for employee's premiums under the state coverage scheme.

Employee went on Family and Medical Leave.

Twelve-week maximum leave period expired, triggering COBRA obligation.

But, is there a COBRA obligation?

Even though there is no group health coverage, does employer's payment of premiums for individual policy create an expectation or entitlement to COBRA (presuming employer did not expressly state that it was not bound by COBRA in subsidizing the coverage while the individual was actively employed)?

[mroberts]

I guess I don't really understand your question. The employee purchased an individual plan in which the employer paid for it. He is now no longer with the company so he can pay for the individual policy himself. Since he never signed up for the group policy, he wouldn't be entitled to continue it after termination. Even for employees who are under a group plan, the employer doesn't pay for the coverage upon termination.

[GBurns]

As mroberts points out , Where is the issue?

The employee is not at risk of losing coverage as he would have been if he had participated in the employer's group plan.

An employee going on COBRA has to start paying premiums out of his own pocket, which is just what this employee will now have to do.

In both cases the employers contribution is now lost.

The only issue that remains is to determine what is required by the "state coverage scheme" to which you referred. There does not seem to be any COBRA issue but there might be a state issue.