How is a "qualified beneficiary" defined?

• A. An employee who signs up for coverage.
• B. A person who is eligible for benefits through payroll deductions.
• C. A person who is covered by the employer's group health plan on the day before a qualifying event.
• D. A dependent who loses coverage after a qualifying event.

Answer: (C)

The key idea is that COBRA rights attach to people who were actually covered by the employer’s group health plan just before something triggered the continuation option. A qualified beneficiary is anyone who was enrolled in the plan on the day before a qualifying event (such as termination of employment, reduction in hours, or a loss of dependent status) and who would be eligible to elect COBRA to continue coverage. This includes the employee and, if they were covered, spouses and dependent children. Being merely eligible for benefits or signing up for coverage doesn’t alone grant COBRA rights; the important factor is having active coverage on the day before the qualifying event. The other options describe eligibility or situations after a triggering event, which don’t define who is a qualified beneficiary.