WHAT HAPPENS IF MY COBRA PAYMENT IS LATE?
The election notice for COBRA continuation coverage of your group health plan contains all the pertinent information you need regarding payments: how much you will have to pay, when payment is due, and what happens if a payment is late. The plan is required to detail the fixed cost of the plan for each 12 month cycle.
You have the option of paying for 12 months in full, and the plan may allow you to pay at other intervals (weekly or quarterly), but at a minimum the plan must allow you to make monthly premium payments.
When you take continuation coverage, you are not required to send payment with your election notice. You are, however, required to make the first payment within at least 45 days of the date you notify the plan. If you fail to make the first payment within 45 days, you may lose your right to COBRA coverage.
Your plan will provide you with a payment schedule. At a minimum, you will be allowed to make monthly premium payments. Each payment must have at least a 30-day grace period. Any payment made beyond the grace period is considered a late payment.
Late and/or Short Payments
If you make a late payment, your plan is allowed to terminate your coverage. If, however, you make a payment that is close to the full amount, the plan is required to provide you with notice of the deficiency, and provide a reasonable amount of time (generally another 30 days) to make up the difference. Keep in mind that within that second 30 day grace period you must still make whatever other premium payment may be required.
It is important to note that the plan is not required to provide you with monthly premium notices. The only notice you have about payment will be the initial election notice. The plan is required to notify you of termination of coverage for failure to make a payment. It is your responsibility to ensure that your premium payments are made in full and on time.
Need Help? Call RedQuote Today!
RedQuote helps beneficiaries understand their COBRA plan benefits and payment options and can provide them with information about individual plans. We can help them choose the best plan for their age, budget and coverage preferences. If your company might be interested in hiring us to manage COBRA benefits for beneficiaries coming off your group medical plan, contact us today!
Published January 2, 2018.