Compliance November 5, 2004

Certified Mail OK for COBRA Notice

November 5, 2004 (PLANSPONSOR.com) - A federal judge has thrown out a lawsuit against an Illinois company after ruling that the firm complied with federal continuing health insurance coverage laws by sending the required legal notice to the employee via certified mail.
Reported by

>According to an EBIA report, the third-party administrator (TPA) for an employer’s group health plan sent a Consolidated Omnibus Budget Reconciliation Act ( COBRA) election notice to a terminated employee’s home address using certified mail. The post office notified the employee three times that he had certified mail, but the employee did not retrieve the mail because he did not recognize the name of the sender, according to the EBIA. Later, the employee sued the company claiming, among other things, that the employer had failed to provide a COBRA election notice.

>The Northern District of Illinois judge cited several cases holding that first-class mail (including certified mail, which is a type of first-class mail) is a sufficient method way to provide COBRA election notices. The court reiterated the rule that only proof of a delivery method reasonably calculated to reach the former employee is required, not proof of receipt. 


The case is Powell v. Paterno Imports, Ltd., 2004 U.S. Dist. LEXIS 21724 (N.D. Ill. 2004).

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