Fifth Circuit: Employee's Retirement is a Qualifying Event Triggering COBRA Notice Obligations, Dec. 9, 2021

For COBRA qualification purposes, a "qualifying event" that triggers COBRA obligations can be a reduction in hours or termination of employment that causes the employee to lose employer-sponsored health coverage. In this case, the employee was placed on paid administrative leave, exhausted her paid leave benefits and was then placed on unpaid leave until she later retired. The employer paid the employee portion of her insurance premiums until her retirement. Later, an insurance claim was denied and the employee was notified that she owed back insurance premiums and at that point received a COBRA notice. The court found that while placement on unpaid leave was not a qualifying event, her retirement did constitute a qualifying event because she experienced a loss of health coverage since she was unable to keep her insurance at the same rate. That retirement triggered the employer's COBRA notice obligations. The court was clear that there is no requirement that the qualifying event be "contemporaneous" with the qualifying event--but instead may occur within 18 months of the qualifying event. Because the employee did not receive her COBRA notice on time, there was a violation. For more information on COBRA notice requirements, see Q 373.