COBRA notices have specific deadlines. Missing one is not a technicality.
Continuation coverage is mostly paperwork delivered on time. The penalties for getting it wrong land on the employer rather than on whoever actually missed the date, and the most expensive failures are the quiet ones — a notice never sent to someone who later needed coverage.
Five deadlines, in order, every time.
These are the counts the regulations actually impose. They are not difficult. They are simply unforgiving, and they start running whether or not anyone noticed the event.
Employer to Administrator
Thirty days from the qualifying event. If your payroll or benefits platform defaults a termination to voluntary and nobody corrects it, this clock is already running against a record that is wrong. We set up the administrator to reconcile each separation and hours reduction against payroll, so an event keyed late or coded wrong is caught while the window is still open. Reductions in hours are the easiest events to miss, because nobody leaves the building.
Administrator to Qualified Beneficiary
Fourteen days to issue the election notice. Sent to the last known address, documented, and provable — because proof of mailing is the defense if it is ever questioned. The notice has to be written for the beneficiary to act on, with the election deadline, the premium and how to pay spelled out. Where a spouse or dependent lives at a different address, they need a notice they can actually receive, which is why addresses are checked before mailing.
Election, Payment and Grace
Sixty days to elect, forty-five days to make the first payment once elected, and a thirty-day grace period on payments thereafter. Coverage is retroactive, which is why a beneficiary who elects late still has to be handled precisely. In practice, a beneficiary can wait for a claim, then elect and pay, and coverage is reinstated back to the loss date. During that window the administrator should report coverage as pending, not terminated.
Twenty employees is the federal line, and the state line is somewhere else.
Size and geography both decide what you owe, and the two answers rarely match.
Michigan, Specifically
Federal COBRA applies to employers with twenty or more employees. Michigan has no state mini-COBRA, so a Michigan employer under twenty has no continuation obligation at all — federal or state. That is genuinely unusual, and it is worth knowing before you promise an exiting employee something the plan cannot deliver.
Other States
Several states extend continuation rights to smaller groups, with their own durations and mechanics. If you employ people outside Michigan, their state’s rule can apply to them while nothing applies to your Michigan staff. State continuation laws apply to insured plans, often through the carrier, and they can differ in who gives notice and how long coverage lasts. We map which rule attaches to each employee’s location before a separation, so the notice matches the law that applies.
Which Events Count
Termination and reduction of hours are the obvious ones. Divorce, a dependent aging out and an employee becoming entitled to Medicare also trigger rights — and those depend on someone telling you, which is why the initial general notice matters.
Plans Beyond Medical
Dental, vision and most health FSAs and HRAs carry continuation rights too. Employers routinely offer COBRA on medical alone and never notice the omission. The fix is to list every group health plan the employer sponsors, including an EAP that provides counseling, and confirm each one appears on the election notice with its own premium.
Administered, not outsourced into a gap.
Notices and Elections
General notices at enrollment, election notices on the event, and a record of both. The documentation is the product. The general notice goes to the employee and a covered spouse when coverage starts, and it is what makes them responsible for reporting a divorce or a dependent aging out. We check that the administrator keeps a copy of each notice, the address it went to and the date it was sent, since that record answers any later claim that nothing arrived.
Premium Billing and Collection
Invoicing, collection and termination for non-payment handled on the calendar, so a lapsed payment does not become a coverage dispute months later. Direct billing for retirees and other continuants runs the same way. The subtle risk is a short payment: a shortfall that is not significant must be accepted or the beneficiary given a chance to cure it, and cutting coverage over a few dollars invites a dispute. We confirm the administrator’s rules for partial payments before the first invoice goes out.
The Termination Reason, Corrected
Because no payroll integration passes the reason for a separation across the wire, we confirm it with a person before the notice goes out. That single field decides eligibility. Termination for gross misconduct is the rare case where COBRA may be denied, and it should rest on documentation rather than a payroll code. Nearly every other separation, voluntary or not, triggers rights, so treating a questionable reason as misconduct is the costly mistake.
Coverage that continues off payroll still has to be billed.
COBRA is one way people keep benefits after a paycheck stops. Retirees, employees on unpaid leave and anyone the plan lets stay on have the same problem: no deduction, so someone has to collect the premium.
Retiree Billing
Retiree coverage enrolled, billed and collected, with eligibility kept against your retiree policy and premiums passed to the carriers on time. Retiree coverage often outlasts the people who designed it, so the eligibility rules, what each retiree pays and the point where Medicare changes the arrangement should be written down and checked against every bill. We set up the billing service, reconcile it against the carrier invoice and flag retirees whose status has changed.
Direct Billing
Employees who keep some benefits while off payroll are billed directly for their share, so coverage does not lapse just because no deduction was taken. Typical cases are an employee on a leave the plan allows, a schedule too short for a deduction, or a severance period where the employer keeps paying part of the cost. Each needs a written rule for when non-payment ends coverage, so the answer is the same for everyone in the same situation.
Leave-Of-Absence Billing
Benefits continued through an unpaid leave, with the employee’s share collected and the coverage kept in step with the leave, so both end on the same day. During FMLA leave, group health coverage must continue on the same terms, and the rules for dropping it after a missed payment are specific. If the employee does not return, the COBRA clock starts, so the leave record and the benefits record have to agree on the date.
What employers ask about COBRA.
What are the real deadlines?
There are two handoffs and both are timed. The employer notifies the administrator, the administrator notifies the qualified beneficiary, and each has its own window. Missing one is not a technicality — exposure accrues per day, per person. Penalties, excise taxes and the medical bills of someone never offered coverage can all land on the employer. The fix is a written handoff: who reports the event, by when, and who confirms receipt.
Does Michigan have its own continuation rules?
Michigan has no general state continuation law of its own, so federal COBRA does the work here. Employers with staff in other states may be subject to a state continuation requirement there, often starting at a smaller employer size. For a Michigan employer under the federal threshold, no continuation offer is required. A departing employee can still buy individual coverage through the Marketplace, since losing group coverage opens a special enrollment period.
Is it only medical?
No. Dental, vision and health FSAs can all be COBRA-eligible, and the plans beyond medical are where missed elections usually happen. Health FSAs follow a narrower rule: continuation can end with the plan year and is owed only when the account holds more than the employee would still contribute. HRAs are group health plans with full COBRA rights, which is easy to overlook.
COBRA is rarely a job on its own. It starts with a termination somebody entered in payroll, and it breaks when those two systems are handled as separate errands.
COBRA Administration in Bloomfield Hills Without the HR Headaches
When someone leaves your company, a clock starts. Notices must go out, elections must be tracked and premiums must be collected. Many HR teams looking for COBRA administration in Bloomfield Hills are simply tired of chasing these steps by hand.
We are an independent employee benefits consulting firm, in business since 2007. We are not the COBRA administrator. We find, set up and oversee the administrator, and we hold it to its contract so the work gets done right.
COBRA Administration
COBRA is a federal law. It lets employees and family members keep their group health coverage for a time after they lose it, for example after leaving a job. The person usually pays the full premium plus a small fee. The event that starts COBRA is called a “qualifying event.”
COBRA administration covers the steps behind it. That means sending the first notice, sending election notices, tracking deadlines, collecting premiums and ending coverage when it runs out. A good administrator does all of this and keeps records.
Our part is to compare COBRA administrators, set the service up with your carrier and payroll, and check that it runs well. When a former employee calls with a problem, our customer service team helps and follows up with the administrator. We also help keep you ERISA compliant.
Do Michigan employers have to offer COBRA?
It depends on your size. Federal COBRA applies to employers with 20 or more employees. Michigan has no state continuation law. So if you have fewer than 20 employees in Michigan, there is no continuation duty.
Some states have “mini-COBRA” laws for small employers. Michigan does not. If you have staff in other states, the rules there may differ, and we can check them with you.
Should a small employer outsource COBRA?
For most employers with 20 or more employees, yes. Missed or late notices can lead to penalties and lawsuits. Tracking payments and deadlines by hand is easy to get wrong, and HR staff change over time.
An outside administrator keeps the process on schedule. You still own the plan, so it pays to watch the administrator’s work. We do that part for you and flag problems early.
Common questions
Who pays for COBRA coverage?
Usually the former employee pays the full premium plus a small fee. Some employers choose to help pay for a period, often as part of a severance. Employer-paid COBRA works best written as a fixed period, after which the former employee pays in full. When the subsidy ends, the administrator must switch to billing the full amount, so the severance agreement and the COBRA setup need to say the same thing.
Does COBRA cover dental and vision too?
Yes. COBRA applies to group health plans, which include dental and vision plans. A former employee can often keep some plans and drop others. That is why the election notice lists each plan and its premium separately, and why a health FSA follows its own, narrower rules.
Do you serve employers outside Bloomfield Hills?
Yes. We help with COBRA administration in Bloomfield Hills, Troy, Auburn Hills, Detroit and across the whole state of Michigan. We also support employers with staff in other states, where a state continuation law may apply alongside federal COBRA, and our Colorado Springs and Houston offices work with employers in those markets.
Talk to us about COBRA administration in Bloomfield Hills
Book a 30-minute call or send us your renewal, and we will review how COBRA is handled today. Our office is at 41000 Woodward Avenue, Suite 350 East, Bloomfield Hills, MI 48304. Call 248.370.8853.
Send us your renewal.
We’ll tell you whether it looks competitive, where we see opportunity, and the five questions we’d put to your carrier. No cost, and no obligation to move anything.
The renewal letter
Your current plan summary
Contribution split by tier
Enrolled counts by tier
Four documents — two more if your group is 50 or more. Nothing else; every extra one is a reason to postpone.
An independent employee benefits consulting firm. We look at the entire benefits program — cost, plan performance, risk and administration.
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