Between Termination + Cobra Decision
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How do you handle the period between an employee's departure and the date by which they must decide to take Cobra?
Do you cancel their coverage and then retro it back to the term date if they choose Cobra or do you immediately put them on Cobra and then cancel retro if they waive it or fail to respond?
Do you cancel their coverage and then retro it back to the term date if they choose Cobra or do you immediately put them on Cobra and then cancel retro if they waive it or fail to respond?
Comments
Typically an employee knows right away if they are going to want it or not, so I try to get some kind of answer out of them before they leave. If they say they do want Cobra, I tell them even though they have 60 days, they should fill out the forms and pay their premium right away to avoid any problems.
In the last six years, everyone that has ever elected Cobra has done it within the first couple of weeks.
Good luck...
I used to work for a TPA. There we always terminated as if the employee was not going to take COBRA, but told any provider who called to verify coverage that the employee was still in his election period, or had elected but not yet paid the premium. When the employee paid, we made coverage retro from the date of termination (by the way, that doesn't necessarily have to be the last day of coverage, like the last day of the month, but can be from the last day of employment).
Also, the common thinking there among staff was that if you ever left an employer, and had good health, you should wait the full 60 days and then elect COBRA and then wait the full 45 days before deciding NOT to pay the premium...unless, or course, you were able to get coverage somewhere else before that. The idea was that you left your options open until you made sure you had coverage. Then if something came up before you had your other coverage, you could always go back and make up your premiums. I must admit though, that in the real world I have rarely seen it handled that way by terminating employees.
Good luck!