An employee has been off work (over 6 months) for W/C and has NOT paid any of the monthly medical insurance premiums. Can we terminate her employment and offer COBRA?

You can always terminate an employee for any reason (depending on your state, that is).You would have to make COBRA available, unless employee is terminated for gross misconduct. Workers comp will be responsible to cover incident related medical bills up to and including life (or until eligible for Medicare. Is the employee still an active employee, or on leave? If on leave, employee is responsible for premium payment of health insurance, unless this particular employer is 'particularly generous'. If the former, health insurance can be dropped if the premiums have not been paid by the empolyee.

Before you terminate anybody in these circumstances, you better get the advice of a labor law attorney.

Check your state WC statutes. Some states require you to continue employer contributions to group medical for a certain duration on a WC disability.