COBRA Notices Defined

Initial General Rights Notice

The initial notice communicates to plan participants their COBRA rights and obligations generally. The initial notice must be furnished by the plan administrator to the covered employee and spouse when plan coverage first begins. The DOL’s COBRA regulations provide that this requirement is generally met if the initial notice is delivered within 90 days after coverage begins.

Qualifying Event Notice

The qualifying event notice gives qualified beneficiaries information regarding their rights and obligations with reference to a specific qualifying event. When a qualifying event occurs, the plan administrator must furnish an election notice to each qualified beneficiary (including the covered employee, covered spouse, and any covered dependent child) who loses plan coverage in connection with the qualifying event.

Election Confirmation Notice

OCA will send a letter to the qualified beneficiary confirming the details of the qualified beneficiary’s election (including types of coverage elected, duration of coverage, premiums, and payment due dates). The confirmation could also remind the qualified beneficiary to notify the plan administrator of events that either extend or prematurely terminate COBRA coverage.

Payment Coupon Books

Plans are not required to send billing statements for COBRA premiums. Coupon books or monthly statements (with remittance slips) can serve two useful functions: (1) to remind the qualified beneficiary of the due date and of the date that the 30-day grace period expires; and (2) to obtain representations from the qualified beneficiary that he or she remains entitled to COBRA coverage (that is, for example, a representation that the qualified beneficiary has not become entitled to Medicare or become covered by another group health plan).

Information Change Notice

The COBRA premium for a qualified beneficiary may change because, for example, he or she elects different coverage during open enrollment, the plan elects to charge the increased premium permitted during a disability extension period, or the insurance company providing coverage increases or decreases premiums. As we have discussed, premium increases may be charged to a qualified beneficiary only at certain times. The plan administrator must notify qualified beneficiaries of COBRA premium increases in advance.

Insignificant Payment Notice

A COBRA premium payment that is insufficient by only a small amount may have to be accepted as full payment by a plan. Payment of such an insufficient amount must be treated as satisfying the COBRA payment requirement unless the plan notifies the qualified beneficiary of the amount of the deficiency and grants a reasonable period of time for payment of the deficiency to be made.

Early Termination Notice

Under the DOL’s COBRA regulations, when COBRA coverage terminates before the end of the maximum coverage period, the plan administrator must provide a written notice of termination to each affected qualified beneficiary.