Election made timely, retro initial payment only included first 2 instead of 3 months coverage ... out of time?

[Erik Read]

QB elects timely, sends initial payment within 45 days, however, the payment did not cover all three of the retro months owed at the time of payment.

My question is - does the initial payment HAVE to include all retro, or can the QB have the remains of the 45 days to make a second payment?

Trust document specifies that the initial payment must include all retro amounts, but we cannot find supporting law other than the initial payment must be made with in the 45 days.

Thanks.

[oriecat]

You can always be more generous than the law requires, so it seems to me that if the plan doesn't want to require the full retro, then sure. Or are you wanting to deny the coverage because the full amount wasn't paid?

What are all of the relevant dates?

[jsb]

Could the QB want coverage only for the time period paid, and would you accept payment if that was the case? If you reject the initial payment as insufficient, wouldn't the QB still have the balance of the 45 days to pay in full? I think the safest bet is to provide the full 45 days for payment to bring the COBRA payments current, and even then "current" is really only to the end of last month because there is still a 30 day grace period for this month! Make sure that your Trust document doesn't inadvertently violate COBRA payment provisions as they have evolved through case law.

[Kirk Maldonado]

ERead:

Because the person has 45 days to make the entire payment, by definition, the payment isn't deficient until the end of that period. To try to argue that you can take away some of the person's statutorily mandated period in which to make the initial payment because the person paid some of it early is foolish, to say the very least.

Also, remember that even if the person doesn't pay all of it, that doesn't mean you can refuse to give him the coverage. There are special rules in the regulations about what to do if the payment is short.

[Erik Read]

Right, we're not proposing to deny coverage for the period paid, only that since the amount paid did not include the full retro amount, in this case, the system we use, terminated the COBRA coverage for the missed third month payment (payment was past due by statute, but could have been made within the 45 day period).

Hope that helps, thanks everyone for the input. I'm arguing that we need to give the full 45 days, and getting some hessitation from the legal team - since the document states the initial payment must include all retro amounts.... sooooooo time to teach the lawyers again.