Does Second Qualifying Event Trigger COBRA Notification Requirements?

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in Human Resources

Look once: You fulfilled your obligation to inform employees and their beneficiaries of their COBRA rights triggered by a qualifying event, such as termination. Look twice: Do you provide another notice if a beneficiary informs you of a second triggering event? You might have thought you didn't have to, but look again.

Take A Look At This

A former employee's son, who was a qualified beneficiary, received COBRA benefits as a result of her termination. A second qualifying event, which warranted an extension of his COBRA coverage, occurred when he turned 25 years old and lost dependent status. The employer supposedly should have then re-notified him of his COBRA rights but it didn't, so he sued.

 

The employer said it would have provided a COBRA notice if it had received proper notice of the qualifying event. You had that information, the son countered. His father, another qualified beneficiary, had informed the employer of the age change. The question that faced a court then was whether notification from a qualified beneficiary, rather than the covered employee (i.e., the mother), would trigger the employer's obligation to provide notice of COBRA rights.

 

The court found that notice from any qualified beneficiary, e.g., the father, fulfilled the duty to notify the employer of a second qualifying event, thereby triggering the employer's notice obligations. (Birkhead v. St. Anne's-Belfield, Inc., W.D.VA, LEXIS 18836, 2005)

 

Look No Further

Providing an initial notice of COBRA rights after the initial qualifying event could fulfill your notice obligations should a second triggering event take place, as long as it contains:

  • an explanation of qualified beneficiaries' rights created by a second qualifying event (e.g., divorce or legal separation from covered employee; loss of dependent child status); 

  • a requirement that the covered employee or any qualified beneficiary provide timely notice of a second COBRA-qualifying event; and 

  • an explanation that once the employer/plan receives notice of the event, the coverage period extension is automatic.

On second thought: Since the 2004 final notice rules did not specifically address qualifying events, your safest bet would be to provide that second notice if you believe, but aren't 100% certain, the event triggers your notice obligations.

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