DVA Renal Health Inc. v. Gordon Group Inv. L.P.
A health plan sent several notices to a qualified beneficiary. The first notice informed her that the plan terminated her CORBA coverage. The second notice informed her that her COBRA coverage was reinstated and the last notice set a new deadline allowing an additional period for the qualified beneficiary to pay the premium for the month when coverage was reinstated. The qualified beneficiary did not receive any of these notices. The qualified beneficiary learned of the termination from the health care provider and stopped paying the COBRA premiums. When the qualified beneficiary learned of the reinstatement over a month later, both the due date and grace period for the intervening month’s COBRA had passed. After the extended deadline for paying the reinstated premium passed without payment, the plan terminated the COBRA coverage. The current and past due premiums were then paid, but the plan refused the payment.
The court concluded that the plan had acted improperly when it refused to accept the premiums. The court reasoned that the qualified beneficiary had no reason to pay the premium while she reasonably believed that she had no COBRA coverage. Therefore, the court determined that the due date for the missed premium payment could not have been earlier than the date that the qualified beneficiary actually learned of the reinstatement. It held that the premium which was paid fewer than 30 days after the notice of reinstatement was timely and that the qualified beneficiary was entitled to benefits during the entire COBRA coverage period.
Even though recent authorities appear to support a COBRA notice’s mailing date as the date it is deemed to have been provided, this case shows that courts do not always follow the “date sent” rule.
