The employer notifies the qualified beneficiary of his or her right to continue, and if elected, the employer pays the premium to the carrier and is reimbursed by the qualified beneficiary. We recommend that the employer keep records of either a declination or acceptance of state continuation.

As a sponsor of the group plan, the employer may dictate when premiums must be received and when coverage will terminate if premiums are not received within the grace period, if applicable. Employers must ensure that their policies regarding such are consistent and compatible with the provisions of their medical contract (e.g., an employer cannot allow a 60 day grace period and retroactively terminate coverage back 60 days if a carrier only allows a 30 day retroactive termination).