COBRA Date Error

[Guest AHayhow]

We administer COBRA for a large national client and we receive the QE information via an electronic file.

Originally, the plan was set up that all employees are covered through the end of the month in which the qualifying event occurs. We recently discovered that the benefit term date as an active employee can be different between participants. Some participants' active coverage is starts mid month. Unfortunately, we set our administration system up based on the original logic (everyone covered through the end of the month).

The good news is that we discovered it. The bad news is that some Qualified Beneficiaries were notified in the Election Notice that they were covered through the end of the month, when in fact the coverage terminated the day after their qualifying event. Some of these participants incurred expenses between their QE date and the date printed on the election notice (i.e., last day of the month in which the qualifying event occurred).

I need to determine how we should handle this situation. We start by making sure that all future dates are accurate. However, I cannot find any guidance in the regulations or in the publications we subscribe to that addresses how to handle this situation.

Does anyone have any suggestions? Thanks for your help

[oriecat]

I don't really know, but I just have some thoughts on this - what does the SPD or certificate of insurance say about termination of benefits? Does it clearly specify that coverage will end on the day after termination or the end of the month or ?? Wouldn't that documentation in the plan take precedence over what the COBRA notice itself said? Also, what do the HIPAA certs say as when coverage terminated?

Are you actually dealing with a claim issue where the ex-employee is trying to get claims paid past the termination date because the COBRA notice date was different?

[Guest AHayhow]

The SPD and other plan documentation indicates that the coverage is terminated on the last day worked as of midnight (this is a union plan).

Also, there is a claim issue - the former employee has an outstanding claim that was incurred between the last date covered as an active employee and the date that the COBRA notice told him he would be terminated.

The HIPAA cert is issued by the carrier so it should reflect the last date worked since that is the date the carrier was told to terminate coverage. I will double check on this.

Do you think we should issue a corrected COBRA Election Notice? Thanks

[oriecat]

Sounds like it might be a good idea, especially if they are still in their election period, so they could elect coverage to get that claim paid.