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Cobra Reimbursement?

A new employee is on a COBRA health plan that costs her $289/month. She wants to stay on this plan until November because she already hit her deductible. If she joined our plan now, it will cost the company $480/month, and she would have to pay a full deductible again.

She asked if the Company reimburse her the $289/month from July through October, since it will cost us less AND be beneficial to her.

It doesn't seem like this is a reimbursable business expense, however it is saving us $. Anyone have any thoughts? Thank you.

Answers

Topic Expert
Wayne Spivak
Title: President & CFO
Company: SBAConsulting.com
LinkedIn Profile
(President & CFO, SBAConsulting.com) |

Pay the Cobra, record it as insurance expense and be happy that everyone is happy.

Richard Baikie
Title: Director of Finance
Company: Super King Markets
(Director of Finance, Super King Markets) |

I would make sure that you record the expense in the same area you would record your health insurance premiums. it is a "people" cost (ie benefits) not a general insurance cost. That way if you ever need to look at the people cost of your company, its in the right place.

Topic Expert
Wayne Spivak
Title: President & CFO
Company: SBAConsulting.com
LinkedIn Profile
(President & CFO, SBAConsulting.com) |

That's where I would put it and maybe should have been more specific.

Thanks for the assist.

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