That same evidence of mailing is required for Summary of Material Modifications (SMMs), which are written amendments to the Group’s Plan Document, as is required for COBRA notices. 

In Custer v. Murphy Oil USA, Inc.,  the participant in this case was terminated after becoming disabled due to a non-work related injury.  About a year before he was injured, his company’s group health plan had been amended to remove a provision under which,  disabled terminated employees received coverage until age 65.  The participant sued on several grounds, including that a summary of material modification (SMM) describing the amendment had not been provided.  The company claimed that it had sent a timely SMM by first-class mail.  The court ruled in favor of the company and determined based on testimony from the company’s benefits manager, whose general description of the company mailing procedures was confirmed by other employees, including mail room employees.  The court found that the participant could not prove that they did not receive the SMM that was mailed to them.

The fifth circuit reversed the trial court’s ruling.  The fifth circuit court found that more direct evidence was required to show that the SMM was mailed to the participant (such as business records, proof of mailing receipts or certified mail receipts).  In particular, the court took issue with the company’s failure to provide evidence that the envelopes, stuffed by benefits department employees were actually mailed and to whom.  The missing link, according to the court, was evidence from mailroom employees, who, according to the court, did not know what was in the sealed envelopes delivered by the benefits department and did not keep any records concerning what was mailed or what addresses were affixed to the envelope. 

To see our previous article, Evidence of Mailing, in the August 2006 Archives or under COBRA archives on the blog.  Click the link below:

http://soundbytes.dpath.com/post/Evidence-of-Mailing-Required!.aspx