An employee became disabled in March, 2003. While
not entitled to Social Security disability, he can no
longer work as a pipefitter.

The Plan has extended health coverage at no cost
to the employee for the past 22 months. This ends
in March, 2005.

My question is whether this employee would have COBRA
election rights in March? He was never given an
election form in 2003, but the plan has covered him
longer than the 18 month continuation period.

Thanks for the input.

My question is whether this employee would have COBRA
election rights in March? He was never given an
election form in 2003, but the plan has covered him
longer than the 18 month continuation period.

Yes, the employer must offer the employee COBRA coverage regardless of how long the employer paid his premium. Had the employer sent him a COBRA notice in 2003 and then agreed to pay his COBRA premium, their obligation would have ended after his COBRA coverage period ended. Since he was never sent a COBRA notification, they must do so now.

You may want to look at this from the regs


Q-7: If health coverage is provided to a qualified beneficiary after a qualifying event without regard to COBRA continuation coverage (for
example, as a result of state or local law, the Uniformed Services
Employment and Reemployment Rights Act of 1994 (38 U.S.C. 4315),
industry practice, a collective bargaining agreement, severance
agreement, or plan procedure), will such alternative coverage extend the
maximum coverage period?
A-7: (a) No. The end of the maximum coverage period is measured
solely as described in Q&A-4 and Q&A-6 of this section, which is
generally from the date of the qualifying event.
(b) If the alternative coverage does not satisfy all the
requirements for COBRA continuation coverage, or if the amount that the
group health plan requires to be paid for the alternative coverage is
greater than the amount required to be paid by similarly situated
nonCOBRA beneficiaries for the coverage that the qualified beneficiary
can elect to receive as COBRA continuation coverage, the plan covering
the qualified beneficiary immediately before the qualifying event must
offer the qualified beneficiary receiving the alternative coverage the
opportunity to elect COBRA continuation coverage. See Q&A-1 of Sec.
54.4980B-6.
© If an individual rejects COBRA continuation coverage in favor of
alternative coverage, then, at the expiration of the alternative
coverage period, the individual need not be offered a COBRA election.
However, if the individual receiving alternative coverage is a covered
employee and the spouse or a dependent child of the individual would
lose that alternative coverage as a result of a qualifying event (such
as the death of the covered employee), the spouse or dependent child
must be given an opportunity to elect to continue that alternative
coverage, with a maximum coverage period of 36 months measured from the
date of that qualifying event.

Was disability the result of a work related injury? If so, and depending on the state you're in, workers' comp laws may dictate how you would "normally" want to handle this type of situation.

Is the 2 year extension of benefits part of a union or other agreement, or has this person just "fallen through the cracks" for the past 2 years?

Based on the limited facts presented, offer COBRA as of the date coverage will be lost in March, 2005. If it is not the intent of your company to provide coverage for this length of time, review your policies and union agreements, and send COBRA offers when the reduction of hours occurs. However, you will need to be prepared to terminate coverage if someone does not positively respond to your offer of free coverage. As noted above, check your workers' comp laws if the reduction in hours is due to accepted industrial injury.

The case is currently being litigated to determine
if the injury was work related. However, the Plan
will provide the 24 months of disability coverage no
matter whether the injury was work related or not.

Nice benefit huh?

Compared to the cost of actually litigating a case, the cost of providing those benefits for that period of time is negligible.

Mal,

Yes, very nice benefit. Very benevolent. What a wonderful employer! Sign me up...

I think (for the future) you could still set up the plan to trigger COBRA and satisfy the employer's obligation. But as noted by KJohnson, this should entail an election between COBRA and the "alternative coverage" of the disability plan paid health insurance benefits. If you are unionized, good luck with that take-away.