To minimize their risk, many employers have decided not to apply the gross misconduct exception at all, but, instead, to extend COBRA to all terminated employees regardless of the reason for the termination. "An AEI is someone who, in the time period between April 1 and Sept. 30, 2021, is eligible for Coverage is from April 1 to September 30, 2021, and is also available to people already on the program. Fired for Gross Misconduct How to Appeal a Denial of COBRA Benefits. This law makes it mandatory for covered employers to give eligible employees the ability to continue health insurance coverage for a limited time when coverage under the plan would otherwise end due to certain qualifying events, including termination of employment. Additionally, under existing COBRA law, employers are not required to offer COBRA to employees who were terminated for gross misconduct, and so employers are not required to provide those employees and their dependents the ARPA subsidy if they were denied COBRA due to gross misconduct. By Daniel Schwartz on May 16, 2008. That means it’s up to employers to determine whether their gross misconduct definition meets the standards that were previously ruled on from past court cases as well as regulatory and legal developments. The COBRA statute does not specifically define the term gross misconduct, so the courts have taken the lead on deciding whether to apply it on a case-by-case basis. Employers may be liable for a penalty of up to $110 per employee or family member for each day of noncompliance. Until further guidance is issued, employers, for purposes of the ARPA subsidy, should not classify an employee’s involuntary termination as “gross misconduct” unless the employee intentionally engaged in deliberate misconduct or acted recklessly with knowledge … Employers should discuss with counsel whether an involuntary termination is for gross misconduct before deciding not to provide COBRA (and the subsidy) to a … Also, individuals who are eligible for coverage under another group health plan or eligible for Medicare are not assistance-eligible individuals. https://graydon.law/what-rises-to-the-level-of-gross-misconduct-under-cobra termination is not considered a COBRA -qualifying event and the employer does not have to offer COBRA continuation coverage to the ex-employee, or the ex-employee’s covered spouse or dependent child(ren). 1:10-cv-1306 (AJT/JFA) (E.D. When a covered employee is terminated for gross misconduct, there is no qualifying event for the covered employee, spouse, domestic partner, or dependent children. Under COBRA, employees and their families that suffer certain defined qualifying events may be able to continue coverage under the employer’s group health plan except when an employee is terminated for “gross misconduct.” COBRA administration is shared by three federal agencies. The Consolidated Omnibus Budget Reconciliation Act, also known as COBRA is a law that was passed in 1985 by the United States Congress and signed by President Ronald Reagan. 2007). COBRA continuation coverage to the ex-employee, or the ex-employee’s covered spouse or dependent child(ren). Family members of an employee also qualify for COBRA coverage along with the employee or in the event of the death of the employee, divorce, or if the employee gains eligibility for Medicare. 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