Should I make back payment of COBRA?

Question

I've been paying for family COBRA coverage for several months, through April. At the beginning of may I did not make a payment, as allowed by the grave period to make late payments. It is now the end of May.

I qualify for coverage with my new job June 1. Now (it is now the end of may) I am ready to terminate my COBRA coverage. Is there any reason to pay for the [past] month of May when I did not have any medical claims? Can the insurance company pursue me for technically covering me for the month of May?

Answer 1

If you have any medical conditions that the new policy might consider pre-existing, you may want to keep the COBRA coverage so their is no break in coverage. Find out if there is a pre-existing clause first.

Answer 2

If you do not incur any medical bills for the month of May (you still have a few days to go--Murphy's Law applies here), no you do not need to pay for COBRA. They will not pursue you for the payment. They will notify you that the COBRA has terminated April 30,2008. COBRA administrators usually do not even send due bills-and they usually tell you when you first get the notification of election for COBRA that once the grace period is passed, your opportunity for coverage is gone and cannot be renewed. As long as you are SURE that you will have insurance through your new employer June 1st, there is little risk here. If something (God forbid) does happen, you may be able to Tele-check or phone charge the premium for May.