The courts determined the following:

The termination was voluntary as the letter of resignation was turned in prior to the last day worked, and that this was not a gross misconduct situation.
The qualifying event occurred on the last day worked, and the ex-employee and family were eligible for COBRA.
The award for this case was over $130,000 and included over 6 years of daily fines for COBRA notification violation, totaling over $45,000.

The good news? COBRA fines are avoidable

Looking at the potential COBRA penalties can be a little intimidating, but the good news is that these fines can be avoided with a little diligence and know-how. Here are a few things to keep in mind when it comes to COBRA compliance:

Have the proper documentation on hand for each beneficiary, including, but not limited to, name and address, qualifying event date, type of COBRA coverage received, copies of COBRA notices, and a copy of the employer's letter to the insurance company plan administrator notifying them of a qualifying life event.
Make sure you have a documented process in accordance with COBRA requirements, and be consistent in following it.
Remember to send notices to all qualifying beneficiaries, including a spouse and children. If the beneficiaries don't ALL live under one roof, you must notify beneficiaries at each address.
Don't forget that many states have "mini-COBRA" state laws to consider, on top of the federal regulations. Consult your state insurance regulatory office or Department of Labor to get accurate information on your state's COBRA laws.

When in doubt, remember that a third-party administrator can handle the notices, the processing, the payments, and keep track of all COBRA regulations, so you have peace of mind.

Instant Insights /

The costs of COBRA noncompliance

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