Non payment during LOA - COBRA eligible?

[Guest Jet352]

We have an employee who had been initially on what was supposed to be worker's comp leave. However, that was denied as it was an old injury and not related to her current job.

During that time when she was being eval'd for the W/C situation, she became eligible for FMLA. We sent her the paperwork which she never returned. Unless there was documented evidence of a need for leave, she was supposed to return to work by yesterday which she did not.

She also did not pay her portion of benefit costs which she was warned would end her coverage for non-payment in 30 days (which would bring us to 10/8)

Soo....

Her QE for COBRA was 9/27; her last payment for ANY coverage was 9/3; her "30 day grace period" ends 10/8.

Is she COBRA eligible? What would her first payment consist of, considering she would still owe from 9/3 - 9/27?

[Mary C]

If she is on FMLA, coverage may be canceled when premiums are 30 or more days behind only after she is given a 15 day waring. Once the 15 day warning expires, coverage may be canceled retro to the last day a payment purchased coverage. However, neither the act of canceling or the date of cancellaiton is considered a COBRA event. The COBRA event is the expiration of the 12 week FMLA leave or if she states she will not return to work, if sooner. COBRA begins on the event date (expiration of the leave) and she pays from that date. You cannot go back and recover costs from 9/3-27 under COBRA.

[Guest Jet352]

Though she was denied the W/C claim, she was provided the FMLA papers and instructed by letter to submit all the necessary FMLA forms if she wanted any leave of absence under FMLA. She never submitted anything.

Absent any reason for her to be out, she was instructed that she was to either return to work by the due date of the FMLA papers (9/27) or we would accept her continued absence as her decision to resign from her position.

So, no FMLA in place.

[Mary C]

Non-payment of premium is considered a voluntary cancellation of coverage. No COBRA event.

[Guest Jet352]

Since she was still technically in the "warning" period regarding the loss of her benefits if she didn't pay, does that play into COBRA?

Do we say....

"if you want the benefits under you need to pay the balance due by the end of grace period at which point your benefits would be paid and you would be eligible for COBRA " ?

I should explain that our TPA thinks that just the fact that her employment has term'd regardless of her payment status, would make her COBRA eligible. I had always heard that non-payment during non-FMLA leave cancelled the benefit during leave thereby making the person not have an active benefit at time of termination from employment.

[jsb]

I would be very nervous about never making a COBRA offer to somebody who lost benefits due to a reduction in hours or termination of employment. Even if someone failed to pay FMLA premiums (though under our plan, employer paid ee coverage is always provided) I would still turn around and offer them COBRA, just so there will never be any question as to whether you did or you didn't. Your case sound potentially hazardous - denied WC claim, non-response to FMLA info requests, termination of employment based on a deemed resignation. Go with your TPA and send COBRA. Odds are you won't hear from her and you're all done. And if she does try to come back on you in the future, your offer is documented and your defense in place.