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.
Cobra Reimbursement?
Answers
Pay the Cobra, record it as insurance expense and be happy that everyone is happy.
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.
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That's where I would put it and maybe should have been more specific.
Thanks for the assist.