Employer Sends COBRA Election Notice to Incorrect Address

On February 7, 2024, in Schinnerer v. Wellstar Health, Inc., the Federal District Court for the Northern District of Georgia denied the defendant’s motion for summary judgment on the issue of failing to timely provide a COBRA election notice. Although not a focus of this article, the court also addressed the defendant’s motion for summary judgment on the plaintiff’s False Claims Act retaliatory termination claim, which was granted.

The plaintiff was an employee of the defendant from May 2020 to October 2021, when his employment was terminated. Prior to his termination, the plaintiff was placed on administrative leave from May 18, 2021, until he was terminated. During the administrative leave, the plaintiff had no access to the defendant’s systems. Also, during the leave, the defendant changed his residence. Because he had no access to the defendant’s systems, the plaintiff could not change his address in the system, so he called the defendant’s human resources department and gave them his new address in August 2021.

Upon the plaintiff’s termination, a COBRA election notice was sent by the defendant’s COBRA administrator by first-class mail to the plaintiff’s address in the defendant’s system, which was the plaintiff’s former address. Since the notice was not sent to his current address, the plaintiff did not receive the election notice until months after his termination.

COBRA regulations do not require actual delivery of COBRA notices to the intended recipient. Rather, the regulations require that notices be sent in a manner “reasonably calculated to ensure actual receipt.” Defendant contended that they had met that standard and filed their summary judgment motion (judgment without a trial) based on that contention. But the court denied the defendant’s motion for summary judgment, observing that it could not conclude as a matter of law that mailing the notice to the wrong address after being informed of the correct address “months before” counts as “reasonably calculated to ensure actual receipt.”

Summary judgment on this issue does not end the case — it only means that there will now be a trial (unless the parties settle first) on the timeliness of the COBRA notice question. But the result does act as a reminder for plan sponsors/administrators to keep employees’ records up to date in all their systems and to pass that information to vendors who use the information to complete their tasks. Failure to do so can result in time-consuming and costly litigation. One way to avoid this situation is by confirming departing employees’ current addresses in writing and correcting the information immediately in the system if it does not match.

Schinnerer v. Wellstar Health, Inc., 2024 WL 476960 (N.D. Ga. 2024) »