An employee terminated from Montefiore Medical Center sued her former employer for, among other things, failure to provide a proper COBRA notice. The former employee was terminated from employment after failing to return to work after medical leave.
The former employee claimed that the Medical Center failed to properly notify her of the right to continue coverage because the individual, who lived in the town Cornwall on Hudson, NY, said the COBRA notice was improperly addressed to Cornwallonhuds, NY. The plaintiff sought damages of $110 per day from the date the Medical Center was supposed to provide notice, until the date judgment was granted, along with attorney’s fees.
The New York District Court found in favor of the Medical Center on the COBRA claim. The Medical Center used a third party COBRA vendor to administer continuation coverage notice and billing collection. The third party administrator was able to provide a copy of the notice mailed to the former employee, along with a summary of processes relating to notification of COBRA events and notice mailings.
The Court referenced earlier cases, which held that COBRA does not require actual receipt of notification by the plan participant, only a good faith attempt by the plan administrator to notify. The good faith standard requires employers to use notification processes that are “reasonably calculated” to reach plan participants.
The former employee admitted to receiving at least 18 pieces of mail from the former employer using the same city abbreviation. The employer was able to show that it used, and followed, standard operating practices for COBRA notice distribution by using a third party vendor. These two facts led the court to find in favor of the Medical Center.
It is important for employers to maintain and follow procedures with respect to COBRA notifications. BAS’ Cobra Control Services, LLC is a third party COBRA notice and billing processor that can help employers comply with the complex COBRA rules. For more information about how CCS can help with COBRA administration, contact your account manager or solutions@BASusa.com.
