Neg Flex and Cobra

[Wynn Moore]

Does having a negative balance in my flex spending account allow my employer to say I am not qualified for COBRA? Thank you for you answer.

[hr for me]

Here's what SHRM has to say " For those who have ‘underspent’ accounts, COBRA must be offered, but it may be terminated at the end of the plan year in which the qualifying event occurs. COBRA coverage does not need to be offered to QBs who have ‘overspent’ their accounts at the time of the qualifying event. "   (underline mine)

https://www.shrm.org/resourcesandtools/tools-and-samples/hr-qa/pages/howdoescobraapplytohealthflexiblespendingarrangements.aspx

I am unsure as to why you would even want to do so unless you are hoping to pay a few more premiums, but yet use up the last of your annual balance before paying your full annual balance.  Any premiums paid would most likely be aftertax anyway, so you wouldn't be saving anything.

[Wynn Moore]

Thank you for this information.  Are you suggesting that I look at the government market for health insurance?

[hr for me]

I am not suggesting anything.  You should still be able to COBRA health insurance, dental, etc. FSAs just have a few differences in COBRA when you have a negative balance.

[acm_acm]

When you say "not qualified for COBRA" do you mean COBRA for the FSA or for your group health plan?  One should not affect the other.  If you were covered by the group health plan before termination, then you should be COBRA-eligible for that group health plan regardless of the position you are in with regards to your FSA.

I know that I have been in an "overspent" situation for my FSA a few times, but was able to continue my health coverage using COBRA provisions.

[Luke Bailey]

As stated, the negative FSA balance only effects your COBRA rights to the (nonexistent) FSA balance. This does not affect your rights to get COBRA notice, make election, etc., under the employer's insured or self-insured group health plan.