When are my payments due?
There are different rules for the initial premium payment and for ongoing COBRA payments.
Initial Election Payment. You have 45 days from the date of your COBRA election (either the date you elect online, the date you fax or email the Election Form, or the postmark date on the mailed envelope) to pay all premiums due from your COBRA start date through the current month. (Your COBRA start date is the day after your previous coverage ended and the “First Day of COBRA” is located on your COBRA Continuation Coverage Election Notice). COBRA provides continuous coverage; therefore, you are required to pay retroactive premiums to the date your active coverage ended, with no exceptions. You are not required to submit a payment at the same time as you make your COBRA election. However, payment must be made within the initial 45-day payment period. Importantly, the process of reinstating your coverage with the health insurance company cannot be started until Vita COBRA receives your first full monthly premium. Therefore, to facilitate the reinstatement process, it may be advantageous for you to return the Recurring Payments form or include a check payment with your COBRA Election Form.
Ongoing Monthly Payments. After you are established on your COBRA coverage, ongoing monthly payments are due the first day of each month. There is a grace period of 30 days from the due date for ongoing monthly premium payments. If you mail your payment, it must be postmarked within the 30-day grace period.
Will I receive payment reminders?
If you sign up for recurring ACH payments, a notice of the upcoming draft will be sent via e-mail prior to the draft being made. If you do not sign up for recurring ACH, you will receive a monthly courtesy payment remittance notice reminding you of the amount due for your next payment. However, you will not receive a reminder notice later in the month if your premium is not received. You can send your payments to Vita COBRA without the formal payment remittance coupon as the reminder notices are for your convenience in tracking when payments are due. Regardless of whether or not you receive a monthly courtesy payment remittance notice, it is your responsibility to ensure that full premiums are paid in a timely manner, even if the payment remittance notice is never received.
Is there a grace period?
The COBRA law allows for a 30-day grace period, after the premium due date, for paying or postmarking your premium. Please note, 30 days does NOT mean 31 days. There is no way to extend the deadline, even if you are out of town or forget to make your payment.
Can an exception be made occasionally?
No. Unfortunately, the grace period requirements are a matter of federal law. The contracts of the insurance carriers that provide coverage to you through your former employer allow for premium payments through the grace period, but not beyond that.
What happens if I make a late payment?
Coverage will be canceled if your full payment is not paid or postmarked within the prescribed payment grace periods. Payments received after the end of the payment grace period which are sent from an electronic postage machine that does not include a postmarked mailing date will not be accepted. Once COBRA coverage is canceled, there is no option for reinstatement.Note that waiting until the end of the grace period to make payment may not allow enough time within the grace period to reconcile payment if your check is lost in the mail or is rejected by your bank.
What happens if a payment bounces?
If a check submitted for payment or an electronic payment transaction is rejected by your bank, coverage is subject to termination unless a replacement payment is provided to Vita COBRA within the original prescribed grace period. The payment grace period will not be extended.
If an electronic payment transaction is rejected for any reason, you are responsible for ensuring you make a replacement payment by either mailing a check or money order, or setting up a one-time electronic payment draft, within the payment grace period. Otherwise, coverage will be canceled with no option for reinstatement.
Vita COBRA charges an administration processing fee for any payments rejected by your bank. This fee is currently $25 per rejected transaction which you must send to Vita COBRA by a separate check or money order.
Vita COBRA is not responsible for informing you of any rejected transactions. You are responsible for ensuring that COBRA premiums are paid with negotiable monies within the grace period and you must notify Vita COBRA immediately of any rejected E-Payment transactions. You can log into your Vita COBRA account online or contact the Vita Concierge Team to confirm your payment status.
What happens if my payment is short?
If your premium payment fall short of the full COBRA premium due, you will be required to make up the premium in order to continue coverage. If the premium shortage is considered a significant shortage (10% of the COBRA premium or $50, whichever is less), you will be required to make up the premium payment within the normal grace period. If the premium shortage is considered not a significant shortage, you will be issued a notice and you will have 30 days from the date of the notice to make up the premium shortage for that payment. In either case, if payment is not made within the time guidelines, coverage will be cancelled retroactively back to the last fully paid month (and any partial premium payment made for a subsequent month will be refunded to you.
Can I track payment online?
Yes. Your payment history, including payments made, payments due, payment amount, and balance due can be accessed via your Vita COBRA individual online account at www.vitalogin.com.
Premium Payments Recommendations
Choose Electronic Payments: We recommend making electronic payments such that premium payments are automatically drafted from your bank account. This assures that your payments will be made on time.
Avoid End of Month Payments: We recommend that you avoid paying premiums late in the month. Mail delays and personal delays can cause premiums to be inadvertently missed. When this happens, your coverage will be retroactively canceled (back to the last fully paid month of coverage).
Check Online to Confirm Payment was Received: You can log in to your personal COBRA account and confirm that your payment was received and processed.
Horror Stories to Avoid
Premium Due Date Confusion: Sometimes people who pay late can “slip” a little bit, which will cause a problem. For example, if your premiums are postmarked on June 28th (for June) and on July 30th (for July), and then on September 1st (for August), the August premium was paid on day 31, thus it would be a late premium payment. Your check would be returned and your coverage would be retroactively canceled back to the last timely-paid month. In this example, it would be July, but you would likely not be aware that your August coverage was canceled until well into September.
Mail Box/Postmark Problem: It does not matter when you put the payment in the mailbox. It matters when the USPS actually postmarks the envelope. If you put the payment in the mailbox after the mail has been picked up on the last day of the grace period and it is postmarked the following day or if the post office makes a mistake in postmarking your envelope and it is postmarked outside of the grace period, your premium payment will be considered late and your coverage will be retroactively canceled. In addition, payments received after the end of the payment grace period which are sent from an electronic postage machine that does not include a postmarked mailing date will not be accepted.
Bounced Checks: If your check bounces and you either do not know about it or are unable to provide a replacement payment before the end of the grace period (30 days), your coverage will be canceled retroactively for not paying your premium on time.
It is NOT like a phone bill!
If you pay your phone bill late, you can get caught up on your payments later and get your phone re-connected. COBRA coverage does NOT work this way. If you pay your COBRA payment after the 30 day grace period, coverage is terminated with NO option for reinstatement.