Compliance Stuff

Consolidated Omnibus Budget Reconciliation Act (COBRA) compliance often gets treated as a “set it and forget it” administrative task, particularly when employers outsource to third-party administrators. But the legal obligation to provide compliant COBRA notices ultimately rests with the plan administrator, not the COBRA vendor . That makes periodic reviews of COBRA notices essential . A deficient notice is not just a technical error; it can expose the plan (and employer) to statutory penalties, litigation costs, and participant claims. In practice, we routinely see COBRA notices that do not fully comply with COBRA, even when prepared by experienced vendors. Common issues include vague or incomplete election instructions, no reference to the name of the plan, missing deadlines, or unclear premium information . These deficiencies are often discovered only after a participant challenges the notice, at which point it is too late to correct the problem without consequences. Recent experi...

On March 5, 2019, Magistrate Judge Joseph C. Spero of the U.S. District Court for the Northern District of California issued his opinion in  Wit v. United Behavioral Health , in which he attempted to significantly change how Employee Retirement Income Security Act (ERISA)–governed health plans were administered, particularly third-party administrators’ reliance on medical necessity guidelines and the application of the abuse of discretion standard. The Ninth Circuit ultimately reversed the portions of the decision that were the most troublesome for ERISA plans and third-party administrators. In  K.K.; I.B. v. Premera Blue Cross , issued on February 6, 2025, the Ninth Circuit provided another indication that the approach taken by the district court in the  Wit  matter is in the past. There, the Ninth Circuit affirmed the district court’s grant of summary judgment in favor of the ERISA plan administrator and the self-funded plan. Quick Hits On February 6, 2025, the Ni...