COBRA Policies and Procedures Reign Supreme
A recent Northern District of Ohio case reminds plan administrators of the importance of a well documented well communicated COBRA procedure. In the case of Rayle v. Wood County Hospital, 2013 WL 1654898 (N.D. Ohio, April 16, 2013), a COBRA disability extension was denied because the qualified beneficiary did not follow the proper notice procedure.
As background, COBRA provides up to 18 months of health coverage continuation in the event of termination of employment or reduction in hours. The 18 months of continuation can be expanded to 29 months, in the event that a qualified beneficiary is deemed disabled by the Social Security Administration, and as long as the plan is advised of this notice in accordance with relevant procedures. In this matter, the employer had knowledge of the disability, but the COBRA qualified beneficiary did not follow the requisite procedure.
The District Court has upheld the plan employer position that the disability extension should not be granted. The moral of this story is, if you want qualified beneficiaries to follow certain procedures, have a clearly defined policy and be sure it is accurately communicated.
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