Hardship distribution

[Guest cosmo01]

We have a situation where an employee was terminated and is not currently entitled to a distribution from the plan. Therefore, the employee is submitted medical claims for hardship distributions. The employee also wants a distribution in the amount of 3 months worth of COBRA premiums. Is this OK? Would this qualify as a "necessary for these persons to obtain medical care described in section 213(d)"? 1.401(k)-1(d)(2). Section 123(d) does not specifically state that premiums for COBRA are within the definition of medical care.

[Guest Dook]

Why would premiums under cobra, or any health plan premiums be necessary to obtain medical treatment? They are only necessary to maintain coverage under the health plan.

[Guest jashendo]

Actually, amounts paid for health insurance are within the definition of "medical care" under 213(d)(1)(D). The standard is not "necessary to obtain medical treatment" -- it is "necessary . . . to obtain "medical care described in section 213(d)". Premiums would seem to be covered.

The only question I would have is whether the 2% add-on (assuming it is charged) would be included, since technically that is not an insurance premium.