Covered Dependents Do Not Require Separate COBRA Notice

August 16, 2004 ( - Plan sponsors do not have an obligation to send an individualized notice of Consolidated Omnibus Budget Reconciliation Action (COBRA) rights to a former participant's minor daughter who resided with the plan participant.

US District Judge Joan Ericksen of the US District Court for the District of Minnesota, in denying the former employee’s request for summary judgment, found no provisions in COBRA requiring an employer to send individualized notice to covered dependents.   “[T]he Court concludes under the facts of this case that there is no COBRA requirement entitling (daughter Gabrielle) Cotton – a minor child living in the same household as her father – to a separate COBRA notice,” said Ericksen.  

Additionally, the court found the COBRA notice received by the employee sufficiently detailed COBRA rights for the participant and covered dependents, including the monthly premium amount.   Thus, “a reasonable fact-finder could conclude that the notice was sufficient to allow [the covered dependent] to make an informed decision to elect coverage,” the court said.

Case History

Gary Starr worked as a furniture refurbished for Metro Systems from June 1997 through February 2000.   During his employment, Starr participated in the company’s medical benefit plan under which he received medical and dental coverage for himself and Gabrielle Cotton.   Cotton is Starr’s minor daughter, and he has both legal and physical custody of her.   Consequently, they never made any election to continue their benefits under the Plan.

Metro terminated Starr’s and Cotton’s coverage under the Plan in June 2000.   In August 2000, Cotton’s appendix ruptured. She had surgery and later experienced complications associated with her ruptured appendix. The medical expenses associated with Cotton’s appendectomy and complications totaled $116,187.86.

In June 2001, Starr filed a complaint alleging the company was liable for failing to provide timely notice to Cotton of her rights to elect continuation of coverage as required.    He sought reimbursement from the company for the medical expenses incurred.

The case is Starr v. Metro Systems Inc. , District of Minnesota, No. 01-1122.