Kosten durch falsche oder verspätete COBRA-Deckung

Definition

COBRA requires that continuation coverage be identical to the coverage offered to similarly situated active employees and that it begin as of the date coverage would otherwise terminate. Manual COBRA administration often causes errors in effective dates (coverage starting late or not at all despite a valid election and payment), eligibility status (wrong dependants coded as ineligible or left active after entitlement ends) and early termination reasons. These errors lead to improper denial of claims that must later be reprocessed and, in some cases, to plan liability for uncovered medical expenses if a court finds that COBRA rights were impeded. Conversely, keeping ineligible individuals covered leads to payment of claims that should have been terminated and subsequent, often unrecoverable, refunds or premium adjustments. Each large claim can run into tens of thousands of AUD equivalent, and internal rework consumes significant staff time.

Why This Matters

The Pitch: Insurers and benefit funds in Australia 🇦🇺 servicing US COBRA plans incur avoidable claim corrections and dispute management costs, often equal to 1–3 FTEs plus write-offs of misapplied claims. Automated COBRA eligibility tracking and integration with claims systems can cut these losses materially.

Affected Stakeholders

Claims manager, Eligibility and enrolment specialist, Customer service teams, Legal and complaints handling teams, Third-party administrator operations managers

Related Business Risks