2025 COBRA Compliance Report - Free Download

1. Critical COBRA Deadlines You Can't Miss

⚠️ Warning: Missing These Deadlines = Automatic Penalties

The DOL does not accept "we forgot" as an excuse. Each missed deadline can result in penalties starting at $110 per day per affected beneficiary.

Deadline	Action Required	Penalty for Missing
14 days	Send election notice after qualifying event notification	$110/day per beneficiary
30 days	Employer notifies plan administrator of qualifying event	$110/day
44 days	Plan administrator sends election notice (30+14)	$110/day per beneficiary
60 days	Qualified beneficiary election period	Loss of coverage rights
45 days	First premium payment after election	Coverage termination
90 days	General notice to new plan participants	$110/day

2. DOL Penalties and How to Avoid Them

ERISA Penalties

$110 per day - Per beneficiary for late/missing notices
$110 per day - Maximum $500,000 per year cap
$100 per day - Failure to provide requested documents

IRS Excise Tax Penalties

$100 per day - Per qualified beneficiary during noncompliance
$200 per day - If violation is more than de minimis
$500,000 - Annual maximum for unintentional failures

Real-World Example

Case Study: A 50-employee company forgot to send COBRA election notices to 3 terminated employees. The oversight wasn't discovered for 6 months.

Result: $110/day × 3 employees × 180 days = $59,400 in penalties

3. 25-Point COBRA Compliance Checklist

Notice Requirements (5 items)

General Notice process established (90-day deadline for new enrollees)

Election Notice template ready (14-day deadline)

Qualifying Event Notice process (30-day deadline)

SPD includes COBRA information

Notice delivery method documented (certified mail/electronic)

Qualifying Event Management (5 items)

Termination procedures include COBRA

Hours reduction monitoring system

Dependent status change tracking

Death benefit procedures include COBRA

Medicare entitlement tracking

Premium & Payment Processing (5 items)

Premium calculation method documented (102% of cost)

First payment instructions clear (45-day deadline)

Monthly payment processing system (30-day grace period)

Non-payment termination process

Premium change notification system

Coverage Duration & Extensions (5 items)

18-month coverage tracking (termination/hours reduction)

36-month coverage tracking (divorce, death, dependent status)

Disability extension process (29 months)

Second qualifying event procedures

Maximum coverage end date tracking

Recordkeeping & Audit Preparation (5 items)

6-year document retention policy

Open enrollment rights documented

DOL audit file organized

Annual COBRA compliance review scheduled

4. Qualifying Events Guide

Events That Trigger COBRA (18 Months Coverage)

Voluntary or involuntary termination (except for gross misconduct)
Reduction in hours making employee ineligible for coverage

Events That Trigger COBRA (36 Months Coverage)

Death of the covered employee
Divorce or legal separation
Employee becomes entitled to Medicare
Dependent child loses dependent status

Events That DON'T Trigger COBRA

Termination for gross misconduct
Employer goes out of business
Employer drops health coverage entirely
Employee never enrolled in health plan

5. Notice Requirements

General Notice

When: Within 90 days of coverage start
To Whom: Each covered employee and spouse
Content: General COBRA rights and procedures

Election Notice

When: Within 14 days of receiving qualifying event notice
To Whom: Qualified beneficiaries
Content: Rights, procedures, deadlines, premium amounts

Notice of Unavailability

When: Within 14 days of receiving notice if COBRA not available
To Whom: Individual requesting COBRA
Content: Why COBRA is not available

Early Termination Notice

When: As soon as practicable after decision to terminate
To Whom: All affected qualified beneficiaries
Content: Reason and date of termination

6. DOL Resources and Templates

Official DOL COBRA Templates

Model General Notice (English & Spanish)
Model Election Notice
Model Notice of Unavailability
Alternative Election Notice
COBRA Premium Subsidy Notices

Download All Templates:
Visit www.dol.gov/agencies/ebsa/laws-and-regulations/laws/cobra

Additional Resources

DOL COBRA FAQ for Employers
IRS COBRA Premium Assistance Guidelines
EBSA Compliance Assistance Materials
Model CHIP Notice

7. How to Automate COBRA Compliance

The Problem with Manual COBRA Administration

Average HR team spends 5-10 hours per month on COBRA
67% of companies have received DOL penalties for COBRA violations
Manual tracking leads to missed deadlines
Customizing notices for each situation is time-consuming

Benefits of COBRA Automation Software

✅ Automatic deadline tracking and reminders
✅ Pre-populated, DOL-compliant notices
✅ Integrated with payroll and benefits systems
✅ Complete audit trail for DOL reviews

💡 HRMax Solution

Generate all COBRA notices in under 2 minutes

Simple form-based interface
All DOL-required notices included
Automatic deadline calculations
Just $25/month - no per-employee fees

Try it free for 7 days: app.hrmax.ai/signup

COBRA Compliance Report

Table of Contents

1. Critical COBRA Deadlines You Can't Miss

⚠️ Warning: Missing These Deadlines = Automatic Penalties

2. DOL Penalties and How to Avoid Them

ERISA Penalties

IRS Excise Tax Penalties

Real-World Example

3. 25-Point COBRA Compliance Checklist

Notice Requirements (5 items)

Qualifying Event Management (5 items)

Premium & Payment Processing (5 items)

Coverage Duration & Extensions (5 items)

Recordkeeping & Audit Preparation (5 items)

4. Qualifying Events Guide

Events That Trigger COBRA (18 Months Coverage)

Events That Trigger COBRA (36 Months Coverage)

Events That DON'T Trigger COBRA

5. Notice Requirements

General Notice

Election Notice

Notice of Unavailability

Early Termination Notice

6. DOL Resources and Templates

Official DOL COBRA Templates

Additional Resources

7. How to Automate COBRA Compliance

The Problem with Manual COBRA Administration

Benefits of COBRA Automation Software

💡 HRMax Solution

About This Report