Even when an employer outsources COBRA administration to a third-party administrator (TPA), such as a COBRA vendor, the plan administrator continues to hold direct responsibility for COBRA compliance.
The Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) requires employers that sponsor group health plans to offer continuation coverage to employees, their spouses, and their dependent children in certain circumstances under which they would otherwise lose that coverage. Note that group health plans must designate a plan administrator, typically named in the plan documents. If no plan administrator is named, the role defaults to the employer sponsoring the plan.
This guide provides an overview of the essential COBRA compliance considerations for employers. It notes the coverage types that are subject to COBRA and explains how to identify COBRA qualified beneficiaries and COBRA qualifying events and durations, including special rules that apply to domestic partners. In addition, it describes the rules for calculating COBRA premiums and distributing time-sensitive initial notices, election notices, and COBRA open enrollment packets. Finally, it examines some of the special COBRA administrative considerations related to mergers and acquisitions, deferred losses of coverages, required group health plan notices, and international and retiree benefits. Employee lawsuits seeking to enforce COBRA rights are common, and employers should consult with legal counsel for specific advice regarding COBRA’s application to their benefit plans.
Download the COBRA Guide