Can COBRA coverage be continued if a participant moves outside the plan service area?
The COBRA qualified beneficiary has the same right to transfer coverage, as does a similarly situated active employees. If active employees moves out of the covered geographical area can change coverage, or if the plan permits employees to switch to other coverage at any time, the qualified beneficiary / COBRA participant must be given the same opportunity.
IRS final regulations specify that an offer of alternative coverage must be made within a reasonable period after a request by a qualified beneficiary / COBRA participant who moved outside the plan coverage area. The new coverage becomes effective on the date of relocation or, if later, the first day of the month following the month in which it was requested.
If a qualified beneficiary moves outside the plan's service area prior to electing COBRA coverage, it may be advisable to offer coverage regardless of whether it is available in that geographic area. However, the plan is not required to incur "extraordinary costs" to provide alternative coverage in an area where there are no active employees.
If the qualified beneficiary moves back within the plan's service area during the original 60-day COBRA election period, he is entitled to elect COBRA with no lapse in coverage.
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.
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