A proposed class action out of Florida claims WCA Waste Systems, Inc. has failed to send adequate notice of continued health insurance coverage to participants in the company’s health plan who experienced a “qualifying event” as defined by the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA).
As the plan sponsor, WCA is responsible for notifying participants who’ve lost health insurance coverage under certain circumstances, such as termination, of their right to elect to continue their coverage under COBRA, the lawsuit says. According to the case, the defendant’s COBRA notices failed to meet strict criteria set by the statute in that they failed to disclose participants’ termination dates for continued health insurance coverage and the plan administrator’s identity.
The lawsuit claims that because WCA omitted “several critical information items” from the COBRA form sent to eligible plan participants, the notice was not “written in a manner calculated to be understood by the average plan participant,” which the case notes is another COBRA requirement.
Stressing that proper COBRA notice “is of enormous importance” to consumers in deciding whether to maintain health coverage, the lawsuit says that the U.S. Department of Labor has attempted to “facilitate compliance” by issuing a model COBRA notice that contains all required information. Instead of utilizing the model notice, however, the defendant has intentionally omitted critical details from its form in order to discourage plan participants from electing to continue coverage, the suit alleges.
According to the case, the defendant’s practice is to include details concerning when continued coverage will terminate and the identity and contact information of the plan administrator in a second COBRA notice sent only to those who elect coverage. The case argues, however, that plan participants cannot make an informed decision about whether to elect to continue health coverage without knowing who is administering such and when they will be uninsured.
The lawsuit claims WCA’s allegedly deficient COBRA notice confused the plaintiffs and caused them to lose valuable health insurance coverage for their family.
The plaintiffs seek to represent all participants and beneficiaries in the defendant’s health plan who, within the applicable statute of limitations period, were sent a COBRA notice after a qualifying event and did not elect continued COBRA coverage.