Refund of COBRA premiums?

A member asks:

My sister became eligible for Medicaid benefits beginning October 1, 2009. She paid the COBRA premium through December 31, 2009. Is she eligible for a refund of the COBRA premium since becoming covered by Medicaid? If so, how would she go about proceeding with that process?

OnlineAdviser responds:

We suspect that there might be more to this story than you realize. An employer's group medical insurance is always a month-to-month contract and insurance companies do not accept premiums more than one month in advance. In fact, other than the initial premium billing, we have never seen a On the other side of this situation, a person covered by COBRA or other insurance is not eligible for Medicaid coverage. The details of this provision very slightly from state to state and we are not familiar with the specific procedure your state welfare office follows in making a determination of eligibility but we suspect that the office was not aware of the COBRA plan and it was not disclosed on your sister's application for benefits.

It seems likely that your sister might have an individual conversion policy or some other type of COBRA alternative that operates on different principle than COBRA. In either case, you sister should call the plan administrator and if a refund is not offered then follow up with a written request. Your state insurance laws prevent an insurance company from accepting premium to cover a person who is known to be covered by other insurance.

While this is not a clear "yes" or "no" answer to your question, we hope it gives you more information to allow an investigation into the issue. If we were to guess the outcome of your efforts, it seems most likely that her Medicaid benefits will take over when the current coverage expires.

Columnist Tony Novak answers guest questions in a wide range of consumer finance issues. Health insurance questions and responses are published here to help others with the same issues. Personal information is removed from the question prior to publication. Novak has addressed more than 50,000 consumer finance questions in newspapers, radio television and Internet over a span of 24 years. An expanded biography is published at www.tonynovak.com. Novak is frequently compensated for endorsement of the companies covered in the forum. Advise is from sources believed to be reliable but cannot be guaranteed. OnlineAdviser comments represents the opinion of the adviser only and not represent the position any other person or business. This service is provided without charge on a best-efforts basis. Neither Freedom Benefits nor the adviser assume any liability for the effects of reliance on this advice.

Refund of COBRA premiums?

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