Q.- We have an employee who is currently on long-term disability. Company policy is to discontinue an employee’s medical benefits if they are on leave longer than 6 months. Next week will be 6 months. What would be the Qualifying Event reason for offering COBRA coverage?
A.- If employment is being terminated as any other employee would be terminated, “termination of employment” would be the qualifying event. If employment is not being terminated and only health benefits are ending due to the extended leave of absence, “reduction of hours” may be a more appropriate qualifying event reason. Either event will make 18 months of continuation coverage available to the individual.
We suggest that you consult with your legal counsel to see if there are additional circumstances the company should consider due to the individual being absent due to disability.
Benefit Allocation Systems (BAS) provides best-in-class, online solutions for: Employee Benefits Enrollment; COBRA; Flexible Spending Accounts (FSAs); Health Reimbursement Accounts (HRAs); Leave of Absence Premium Billing (LOA); Affordable Care Act Record Keeping, Compliance & IRS Reporting (ACA); Group Insurance Premium Billing; Property & Casualty Premium Billing; and Payroll Integration.
MyEnroll360 can Integrate with any insurance carrier for enrollment eligibility management (e.g., Blue Cross, Blue Shield, Aetna, United Health Care, Kaiser, CIGNA and many others), and integrate with any payroll system for enrollment deduction management (e.g., Workday, ADP, Paylocity, PayCor, UKG, and many others).
This article is for informational purposes only and is not intended as legal, tax, or benefits advice. Readers should not rely on this information for taking (or not taking) any action relating to employment, compliance, or benefits. Always consult with a qualified professional before making decisions based on this content.
