It’s open enrollment time at my job. This is where you can make changes to your insurance coverage if you wish.
sigh:rolleyes: I remember the good 'ol days when my coverage was completely paid for, and I only had to pay $7 extra every 2 weeks per dependant. "…memories…la…le la la!
Anyway, heres the question: say an employee get’s sick and falls into a coma for 3 months. For those three months he can’t pay the premium on his medical insurance.
What happens? Does he wake up to a huge bill? I’m sure the answer is somewhere in the handbook, but have you ever seen one of these books? It’s a lawyers wet dream!
I’m thinking **pkbites ** means physically paying the premiums, rather than having the funds available.
Something similar happened to me when I was in a coma earlier this year - some bills went unpaid because no-one knew about them - my credit rating sank like a stone.
If not, the employee could be terminated. Then there is another contingency. If the employer is covered by COBRA, the employee, or someone acting for him, can make the COBRA election and pay the COBRA premiums. But COBRA premiums are almost always higher than the employee’s share of health insurance premiums paid while employed.
In either case, the employee remains responsible for premiums (unless the employer has very generous policies).
Some states pay health insurance premiums for some individuals who currently have health insurance, but can no longer afford to pay the premiums:
I think I am qualified to answer this one because I work for a large HR outsourcing company and control whether hundreds of thousands of people remain eligible for lots of different kinds of insurance (in a direct way I mean. I control the logic and feeds that go between lots of different companies and the transfer of premium payments on the other side).
Eligibility is usually controlled by your employer so there has to be something in their system that would kick you out on a feed and turn you ineligible. I can’t see that happening in any reasonable circumstances and if it did by some mistake, it can be fixed retroactively. The premium payment to the insurance company is made by your employer as well if it is a group plan and you are still actively on the payroll. The insurance company only cares if your employer makes the right payment and these payments aren’t as linked to individuals as you might think. It is basically the closest aggregate that the company can calculate they owe to the insurance company. The employer them triggers payroll deductions on the employee’s check to get the money to make the payment but those processes aren’t usually linked directly.
A salaried employee shouldn’t have much to worry about in those cases although it could go into a few different processes like short-term disability, long-term disability, or possibly COBRA. Some companies may even decide to just leave you as a regular employee.
The point is that, if things get screwed up, it is controlled by the employer rather than the insurance companies. Your employer send the file that shows what insurance you have to them and I can’t see any reasonable company triggering something that would drop your coverage during an event like that.
But if the employee doesn’t have disability coverage and is not getting a check, the employer will have to cover the employee’s share of the health insurance premium. If not, the insurer will not accept the employer’s share as full payment, and will ultimately terminate coverage. I thought that’s what the OP was asking about. In other words, if the employee isn’t getting a check (because he is on FMLA leave, other disability leave, or simply terminated), and doesn’t have savings or other income to cover his contribution to health insurance coverage, somebody is going to have to make up the difference. The insurer won’t, so it’s the employer, the state, or nobody. If nobody pays it; it gets turned off. And that assumes that the employer is contributing its share even though the employee isn’t working (required under the FMLA, but the FMLA doesn’t cover everything). Am I missing something?
I just had to give a lecture on this today. In short, the employer sends a file of who is eligible for a given insurance to the insurance company. A month or two down the road, the employer sends payment to the insurance company saying here is X dollars for the Y number of employees that you covered for us last month and that is calculated by the employer or an outsourcing company that represents the employer (you would probably guess that the insurance company just sends a bill but it doesn’t work quite that way). The employer controls the whole thing really so they could leave a person on the file or on the payroll or both if they want to. The processes don’t have to be linked directly. The employer could and probably would cover the premiums during that period and just do a payroll adjustment later. Of course it could break off into a few different scenarios as well but I can’t see coverage getting dropped in any reasonable case.
I should add that there is a type of COBRA called direct bill where an employee does pay some or all of his/her insurance directly. That may apply in a case like this and the person would need to send in payment. I suppose you could lose coverage if there was no one to pay the bill at all but it may take a while and coverage can usually be extended retroactively.
The employer really doesn’t have the final say in eligibility. Typically the policy will require an employee to be working full-time, or at least showing up to work. I’ve seen cases where the insurer gets a big medical bill and audits the file. When they figure out that the employee was not eligible, they stop paying, demand indemnity from the employer and the employee, and do all kinds of other mean stuff.
It seems like we have differing experiences because of the scales of the employers with which we have dealt. I have represented mostly small companies. My company gets a bill for insurance premiums. As do most of the clients I have represented. I know my people would never pay a premium they weren’t legally required to. On the other hand, I once had a client who owned a small trucking company consult me about a similar situation. An employee had been injured in an accident that was not related to work. The client had been paying the employee and providing health insurance coverage for more than a year. He wanted to know if he could stop.
If the employer is very large or has a union, there may be disability policies that deal with some of this stuff. Not to mention, the employer is probably covered by FMLA, and will have to pay its share of the employee’s health insurance premiums. I believe some unions have ERISA trust funds to pay for health insurance premiums for disabled union members.
