COBRA Compliance 101: What You Need to Know

The Consolidated Omnibus Budget Reconciliation Act (COBRA) is a federal law that generally requires employers with 20 or more employees to offer continuation of certain benefits when employees experience qualifying events, such as job loss or reduced work hours.

Why COBRA Compliance Matters

COBRA compliance is a critical yet often overlooked challenge for employers. It is important to know how to navigate these complexities to avoid penalties and legal risks. Noncompliance can result in:

• IRS Excise Tax Penalties - $100 per individual / $200 per family per day
• Department of Labor Fines - $110 per day per person for failure to provide proper notices.
• Lawsuits & Legal Fees - Noncompliance can lead to employee lawsuits and costly legal fees.

For employers, staying compliant isn’t just about avoiding fines—it’s about protecting your business and ensuring a seamless benefits experience for employees. That’s why you need a trusted COBRA solution.

The Most Common COBRA Pitfalls Employers Face

Even well-meaning employers can make costly mistakes, such as:

• Missed Notice Deadlines - COBRA election notices must be sent on time to avoid penalties.
• Incomplete or Incorrect Notices - A small error can create compliance risks.
• Mismanagement of Premiums - Tracking payments, grace periods, and reinstatements can be challenging.
• Overlooking COBRA-Eligible Employees - Internal miscommunications can lead to unintentional noncompliance.
• Ignoring State-Specific Rules - Many states have continuation coverage laws beyond federal COBRA requirements.

How Lifetime Benefit Solutions (LBS) Helps Employers

COBRA compliance doesn’t have to be a burden for you. LBS offers a comprehensive solution that assists with compliance, minimizes risk, and streamlines administration. Our partnership benefits employers by providing:

• Automated Compliance Solutions - Provides timely and accurate COBRA notices.
• Regulatory Expertise - Keeping up to date with federal and state requirements.
• Seamless COBRA Administration - Managing eligibility tracking, premium collections, and reporting.
• Risk Mitigation Strategies - Helping clients proactively avoid costly mistakes.
• Broker Support & Resources - Equipping you with tools to educate clients and strengthen your advisory role.

Let’s work together. Contact us today to learn how we can support you with expert COBRA administration solutions.

**Lifetime Benefit Solutions, Inc. is not a law firm. Any information provided for in this material has been prepared for informational purposes only and does not constitute legal advice. For any questions with respect to the information contained herein, you should consult with your own legal counsel**