Couple says insurer denied their COBRA rights

PARKERSBURG -- A woman and her husband claim their insurance company wrongly denied them their COBRA rights after the woman had to terminate her employment due to a medical condition.

Conn and Sandra Feamster filed a complaint April 5 in U.S. District Court for the Southern District of West Virginia against Mountain State Blue Cross and Blue Shield and Relational Management Services.

The Feamsters claim Sandra Feamster began working for Relational Management Services on Sept. 15, 2007, and received Mountain State Blue Cross and Blue Shield employment-related health insurance through her employment with the company.

In March 2008, however, Sandra Feamster had to leave her employement with Relational Management Services because of a medical condition she does not specify in her complaint, according to the complaint.

Under COBRA, which allows employees to retain their insurance for a certain period of time under a qualifying event, Sandra Feamster should have been able to keep her health insurance coverage, the suit states.

"Plaintiff Sandra Feamster's reduction in hours, leave from her employment in March 2008, and subsequent termination of her employment were qualifying events under COBRA," the complaint says.

In fact, Sandra Feamster claims she attempted to continue to pay for her health insurance coverage and Mountain State Blue Cross and Blue Shield accepted her payments. However, the insurance company denied her rights to continued coverage, citing a small company exemption under COBRA, according to the complaint.

In order to assert the small company exemption, Mountain State Blue Cross and Blue Shield misrepresented the number of employees at RMS, the suit states.

In their five-count suit, the Feamsters allege failure to provide notice of COBRA continuation coverage requirements, estoppel, breach of fiduciary duty and misrepresentation.

The couple seeks a reimbursement for all their medical expenses that should have been covered under COBRA, a reinstatement of their benefits, attorneys' fees, costs, statutory penalties for the defendants' failure to provide COBRA continuation coverage and other relief the court deems just.

Jeffrey V. Mehalic of the Law Office of Jeffrey V. Mehalic in Charleston and Roy F. Harmon III of Harmon and Major in Greenville, S.C. will be representing them.

The case has been assigned to Judge Joseph R. Goodwin.

U.S. District Court case number: 6:10-cv-241