The initial COBRA notice needs to spell out what you owe and when payments are due. If you follow instructions in the notification, usually there are no issues.
The COBRA plan administrator is required by law to give you a 30 day grace period and accept it if they receive it within less than 30 days. As long as the administrator receives it during the 30 day grace period, you should not be cancelled.
Were you paying the insurance company directly or sending to a health plan
administrator?
Some mini COBRA laws assign COBRA administration to the insurance company. If you paid the plan administrator, they may have forwarded your payment late. The insurance company will only do something after receiving a demand letter from an ERISA lawyer. Again, if you make the payments to the administrator and follow the plan rules, cancelation should not be our problem.
The employer/administrator does not chose to apply payments to one month or another, because there is no gap in COBRA, each check has to be applied in other to the current balance. COBRA does not start when you send the first check, it is made retroactive to the date of cancellation of your old health plan. You cannot skip months and pay for other months, just because that's when the payment is sent. COBRA must start exactly where the old coverage ended. You nor the administrator have any choice in the start date.
If you are rightfully canceled for late payment, you have to decide on your goals, a) get reinstated or b) get your medical claims paid. Trying to sue your way back into health plan is a doomed and expensive strategy. Use honey by sending a letter to the highest officer in your previous employer's that you can find and request reinstatement. Then follow up with phone calls and emails. The longer it takes to get reinstated, the harder it will be for management to get the administrator to make an exception, in possible violation of the plan rules.
If the administrator or management will not reinstate you, and you are facing huge medical bills, request a payment plan from when you were uninsured. You can also consult a lawyer about a medical bankruptcy, which are very common now.
If you are wrongfully canceled for late payment, you have to decide on your goals, a) get reinstated, b) get your medical claims paid c) sue the administrator If you are terminated from COBRA within the grace period:
Browse DOL Government Contacts and tell them you want to report a potential COBRA violation.
Prove you sent the payments timely either but a log or certified mail, or bank statements
If you get your check copies returned or online, the date on the check and when it was cashed are also good proof.
Put together a time line based on your recollection and the dates made out on your premium checks.
Do a free consult with an ERISA lawyer, get 30-60 minutes of advice and find out if you have a case.
Hire / retain a lawyer depending on the damages and they may or may not request a retainer.
Send a letter to the highest officer in your previous employer's that you can find requesting reinstatement.
Get a copy of your plan rules if possible from your old HR.
Contact the IRS about conducting a health plan audit.
If you can gather the above supporting evidence, the administrator may have a serious problem, esp. if they violated the health plan rules and you huge medical bills.
Often the participant does not find out he was canceled until he files a claim or fills a prescription. What were the plan's rules for handling claims? If the claim is denied, usually you must be given notice (around 90 days) of the denial in writing generally after the claim is filed. Read more about Medical Claims Denial.
Cancelation of COBRA can be very expensive in the middle of a medical procedure, and there could be legal issues you should go over with a benefits lawyer in person. Even though over 90% of COBRA lawsuits are settled before trial, rulings can still go either way.
Craig Casey is an Writer, Coach, Blogger, Husband, and Former Health Insurance Agent helping people on the web since 1999 with their health insurance problems.
blog comments powered by Disqus
