COBRA Election Notice Timeline

[BellaBee41]

Hello. We have some layoffs happening at the end of the month, which employees have already been made aware of. If benefits also end on the last day of the month, are we able to provide the COBRA notices early (now for example) and will they be able to elect COBRA prior to their termination date on 6/30? Or is there a law that states they cannot elect COBRA until the qualifying event occurs (6/30 term date)?

[Brian Gilmore]

Sorry about the layoffs.  You can provide the COBRA election notice early and allow the termed employees to elect COBRA in advance.  The timing rules are just outer deadlines, but nothing prevents doing this in advance. 

Those rules generally put the outer deadline at 44 days from the loss of coverage to provide the election notice, and 60 days from the date the notice is provided to elect COBRA.  However, if you provide the election notice in advance of the loss of coverage, the employees will generally have 60 days from the loss of coverage (as opposed to date notice provided) to elect.  So if you provided the election notice tomorrow (6/20), employees would generally still have 60 days from the 6/30 loss of coverage date to elect.

 

Here's the cites for reference--

 

29 CFR §2590.606-4:

https://www.ecfr.gov/current/title-29/subtitle-B/chapter-XXV/subchapter-L/part-2590/subpart-A/section-2590.606-4

(b) Notice of right to elect continuation coverage.

...

(2)   In the case of a plan with respect to which an employer of a covered employee is also the administrator of the plan, except as provided in paragraph (b)(3) of this section, if the employer is otherwise required to furnish a notice of a qualifying event to an administrator pursuant to §2590.606-2, the administrator shall furnish to each qualified beneficiary a notice meeting the requirements of paragraph (b)(4) of this section not later than 44 days after:

(i)   In the case of a plan that provides, with respect to the qualifying event, that continuation coverage and the applicable period for providing notice under section 606(a)(2) of the Act shall commence with the date of loss of coverage, the date on which a qualified beneficiary loses coverage under the plan due to the qualifying event; or

(ii)   In all other cases, the date on which the qualifying event occurred.

 

Treas. Reg. §54.4980B-6:

https://www.govinfo.gov/content/pkg/CFR-2012-title26-vol17/pdf/CFR-2012-title26-vol17-sec54-4980B-6.pdf

Q-1. What is the election period and how long must it last?

A-1. (a) A group health plan can condition the availability of COBRA continuation coverage upon the timely election of such coverage. An election of COBRA continuation coverage is a timely election if it is made during the election period. The election period must begin not later than the date the qualified beneficiary would lose coverage on account of the qualifying event. (See paragraph (c) of Q&A-1 of §54.4980B-4 for the meaning of lose coverage.) The election period must not end before the date that is 60 days after the later of—

(1) The date the qualified beneficiary would lose coverage on account of the qualifying event; or

(2) The date notice is provided to the qualified beneficiary of her or his right to elect COBRA continuation coverage.

[Roberta Casper Watson]

They can elect early, but they can revoke elections until the election due date.