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A former podcast from Lockton’s ERISA Compliance Consulting team 

You’ve reached the home of ERISA is a Friend of Mine, an informal and informational podcast series that Lockton’s ERISA Compliance Consulting team produced from 2019 to 2022. Scroll down to view and listen to any of the podcast episodes. NOTE: These podcasts have not been updated since their publication dates.

For the latest information and content on ERISA and other employee benefits issues, click below to visit Lockton’s Compliance Consulting webpage, and to learn more about our services and Lockton People Solutions.

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  1. All Episodes
  2. Cousin Eddie on the COBRA doorstep: Do you really have to open the door?

Cousin Eddie on the COBRA doorstep: Do you really have to open the door?

Apr 25, 2022

In the larger scheme of corporate mergers and acquisitions, benefits issues are just nuisance issues ... until they're not. Buyers in stock and asset purchases are often stunned to learn that they may own COBRA liability related to the seller's former employees (and their dependents). And they might be required to open the doors of their group health plans to unwanted guests – the metaphorical Cousin Eddie – for up to 36 months.

In this, the final substantive episode of the final season of ERISA is a Friend of Mine, Ed and Scott unravel the beguiling mysteries of COBRA (and health FSA) coverage in the M&A. The episode explores:

  • Why and how does the stock vs. asset nature of a sale affect COBRA liabilities?
  • If the parties to a corporate transaction contractually assign COBRA responsibility, what happens if the obligee drops the COBRA ball?
  • How is sorting the COBRA obligations in an M&A like Scott trying to get all his kids out the door in the morning?
  • How can buyers and sellers deal with health FSA coverage to make the corporate transaction painless for enrollees in the seller's FSA?