COBRA: Required Notices
To administer coverage under the Consolidated Omnibus Budget Reconciliation Act (COBRA), employers and plan administrators are required to provide specific notices and disclosures to covered individuals and qualified beneficiaries. The following COBRA notices are required to be provided:
General (or Initial) Notice: A general description of COBRA rights under the plan must be provided to covered individuals within the first 90 days of coverage.
Election Notice: This describes the right to COBRA coverage and how to make an election. It must be provided to qualified beneficiaries within 14 days after the plan administrator receives notice of a qualifying event (44 days under certain circumstances).
Notice of Unavailability of COBRA Coverage: This notice informs an individual that they are not eligible for COBRA coverage (or for an extension) and must explain the reason for denying a request for coverage. It must be provided within 14 days after the request for coverage (or request for an extension) is received.
Notice of Early Termination of COBRA Coverage: When a group health plan decides to terminate continuation coverage early, the plan must give the qualified beneficiary this notice as soon as practicable after the decision is made. It must describe the date coverage will terminate, the reason for termination and any rights the qualified beneficiary may have to elect alternative coverage.
Qualified beneficiaries are required to notify the plan administrator when certain qualifying events occur, such as a divorce or a dependent child’s loss of dependent status. Plan administrators must establish reasonable procedures for covered employees or qualified beneficiaries to provide notice of a qualifying event within certain time frames.
Delivery Requirements
Employers must use delivery methods reasonably calculated to ensure actual receipt of the required information by plan participants and beneficiaries (i.e., by mailing the documents to employees’ homes or distributing them to employees at work).
Employers may deliver documents electronically to (1) employees with work-related computer access and (2) other plan participants and beneficiaries who consent to receive disclosures electronically.
Many employers mail COBRA notices rather than using other delivery methods.
Model Notices
The Department of Labor (DOL) has a model general notice and a model election notice for employers to use.
Employers are not required to use the DOL’s model notices.
The use of model notices, however, will constitute a good-faith effort to comply with the requirements for these notices.
This Compliance Snapshot is not intended to be exhaustive nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel for legal advice. ©2023 Zywave, Inc. All rights reserved.