Process COBRA qualifying event notifications and continuation coverage setup

Steps

1. Detect the qualifying event (termination, reduction in hours, divorce, loss of dependent status) via an HR system event or payroll termination trigger.
2. Within the federally mandated timeframe, notify the plan administrator of the qualifying event — for employer-sponsored plans, the employer has 30 days to notify the plan, which then has 14 days to send the COBRA election notice to the qualified beneficiary.
3. If using a COBRA third-party administrator (TPA) integrated with Gusto, confirm that Gusto transmits termination events to the TPA via its integrations or export; retrieve terminated employee benefit data via the Gusto API to prepare the notification package.
4. Track the 60-day election window from the date of the COBRA notice; if the beneficiary elects coverage, the premium (up to 102% of the full plan cost) becomes due retroactively to the coverage loss date.
5. Record the COBRA election and premium payment status; terminate COBRA coverage upon exhaustion of the maximum continuation period (generally 18 months for employment-based events, up to 36 months for other qualifying events).