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Domestic Partners & COBRA: What You Need to Know

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Most people assume that since domestic partners are permitted on active coverage, they are automatically entitled to COBRA. This is not true. Read on to learn more.


Question: Our plan covers domestic partners. What are our obligations to domestic partners under COBRA when an employee’s employment terminates or the domestic partnership dissolves?


Answer: If a plan covers domestic partners as dependents, then there will be some COBRA obligations to pay attention to.


First, it is important to remember that only employees, spouses, and dependent children may be Qualified Beneficiaries under COBRA. Domestic partners do not fall into any of these categories and therefore do not have independent COBRA rights, even if they are recognized as dependents under the terms of the plan.


An employer may choose (subject to carrier/stop loss vendor approval) to offer COBRA-like continuation coverage to domestic partners, in which case it should ensure that its plan document describes the terms of this coverage. But when not specifically permitted by the plan, a domestic partner who loses eligibility for coverage under a plan (e.g., due to dissolution of a domestic partnership) may not independently elect COBRA continuation coverage.


Therefore, it will be necessary to review the terms of the plan document to see whether it addresses continuation for domestic partners. If the plan document does not explicitly address continuation rights for domestic partners, then the statutory provisions will apply.


Second, while domestic partners themselves do not have independent COBRA election rights, this doesn’t prohibit an employee who loses eligibility for coverage from covering a domestic partner as a dependent under the employee’s continuation policy. In other words, domestic partners may continue to be covered as dependents under an employee’s COBRA policy even though the domestic partner could not elect COBRA coverage themselves.


Finally, note that a child of a domestic partner who is considered a “dependent child” under the terms of the plan may be a Qualified Beneficiary under COBRA in a case where they lose eligibility (e.g., due to termination of employment or dissolution of a domestic partnership). Therefore, even when a domestic partner is not a Qualified Beneficiary, their child may be.


Example 1:

Amy and Nicole are domestic partners. Amy’s employer (Employer A) sponsors a plan that covers domestic partners and defines “dependent child” to include children of domestic partners. However, the plan does not extend COBRA-like continuation coverage to domestic partners.


Amy, Nicole, and Nicole’s two daughters are covered under Employer A’s plan. Midyear, Amy’s employment terminates and she, Nicole, and Nicole’s two daughters lose eligibility for coverage. In this case, Amy is a Qualified Beneficiary and may elect COBRA continuation coverage. Nicole is not a Qualified Beneficiary; however, Amy may choose to cover Nicole under her COBRA plan. In addition, Amy may cover Nicole’s daughters as dependents under that coverage, although the daughters would themselves be Qualified Beneficiaries and have independent COBRA rights.


Example 2: Same facts as above, except that instead of terminating employment, Amy and Nicole decide to end their domestic partnership midyear. As a result, Nicole and her two daughters lose eligibility for coverage under Employer A’s plan. Nicole is not a Qualified Beneficiary. Therefore, Nicole is not able to elect COBRA. However, because her daughters are considered dependent children under the terms of the plan, their loss of eligibility for coverage does trigger a COBRA continuation right. Therefore, her daughters may elect COBRA continuation coverage for the maximum allowable coverage period.


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From Benefit Comply – 9.9.2020