Honor system.
We accepted the employee’s statement of the spouse’s employment-insurance status.
Same as with the lower rate on group life insurance for non-smokers – if you say you don’t smoke, we believe you.
Getting picky here, I know, but was the “extra cost for the family plan” the premium that the employees paid for the family plan or was it the full amount that the insurer charged the employer?
I may be an idiot, but at any point are you thankful that you can get any sort of health insurance? Or have we gotten to the point in this society where affordable health insurance is a worker’s right and not a benefit like it used to be?
On the contrary. I would prefer that employers get out of the healthcare and retirement business, pay employees their full market worth, and let us use that extra money to seek our own healthcare solutions on the open market. You can lick your company’s boots if you want, but I resent the status quo in which companies trim our salaries and use it to fund medical plans that do not meet our needs, dump tons of money into smokers and the obese, and penalize us for having spouses that seek employment.
Some states have tried (pdf) to make it a right. Hawaii does.
And see, http://www.statecoverage.net/cyberseminar/butler.pdf (pdf) (discussing ERISA issues)
http://statecoverage.net/pdf/primer2000.pdf (pdf) (same)
http://www.ihps.org/pubs/2005_Apr_IHPS_SB2_DSup_ERISA.pdf (pdf) (discussing ERISA implications of state pay or play statutes)
The premium. The company didn’t charge employees the full amount, not even close.
At the time I left, the company was paying the claims administrator/“insurer” $250 for single coverage and $500 for family coverage, plus an extra amount to cover catastrophic costs for cancer, heart transplants, etc., plus a per-employee fee for administration costs.
Employees were paying anything from zero to $200 a month (family coverage). Hourly (union) employees had a zero premium option with a higher deductible and out-of-pocket. Salaried employees didn’t have that option.
The monthly payment to the insurance company averaged around $500,000, for 2,000 employees, if I remember right.
I was responding to SaintCad.
So if I was an employee with a working spouse who had declined coverage, how much would I pay for health insurance, including the Working Spouse Fee?
At the time I left (three years ago), it would have been about $270 a month, $220 for you and your family, and $50 for the working spouse fee.
I actually side with the Bossman on this one.
The way I figure it, my employer is probably still paying let’s say… at least 2/3rds of my medical expenses. I can’t get the coverage I’m getting now for $200 on the open market. In fact, I would probably be paying over $600.
Here’s what I see Bigcorp saying:
Mr. Slant, we’re glad to pay for most of your health benefits. If you marry, we’re glad to pay most of your new family’s health benefits.
However, if your wife works for another company that has our deal, we think it’s only fair that OtherBigCorp pay their fair share towards you wife’s health care, rather than us having to pay our fair share AND their fair share.
So, Mr. Slant, if your wife has another employer, put her on THEIR insurance so we don’t get screwed. Or else we’ll slap you with this surcharge, which will minimize some of our pain, even though we’d still be better off if Mrs. Slant just used OtherBigCorp’s benefits plan for her insurance.
As an aside, all this stuff has zero to do with BigCorp’s vision, life insurance, dental, etc. I can opt my family in or out of those at my option.
And re: the enforcement question I saw, it’s an honor system thing, but they do threaten random audits. I do not personally know anyone who has caught the random audit.
Ok. I get it. Pretty much what I thought. I’ve always thought that calling it a “fee” was a bad way to go. The employer is still paying almost half of the health insurance premium ($500 for family plan). They are charging employees whos spouse works and declines coverage a bit more for coverage. Those employees are still better off than I am, BTW, because my employer only pays for the single coverage. Our employees have to pay the entire cost of insuring their spouses and families (employees pay over $500/mo for family coverage).
As an ex-smoker, yikes! Wouldn’t the coverage have been voided if they found out that you were, after all, a smoker? In any case, I always did the right thing, since the difference in premium was miniscule.
It depends. Surprised?
Heck yes. They’d not only void the coverage, the employee would be fired.
But it never happened – HR handled benefits, and we were too busy to check on stuff like this.
I never fully understood the way the company handled medical benefits. We were self-insured – we paid every covered medical expense.
Early on, employees would bring their bills to HR and we’d calculate/track the deductibles and write the checks to the providers. Later, when the company grew and started using “insurance” companies to do this, they paid all the bills PLUS the administration fees. A “broker” who acted as a go-between was paid a set amount for the number of employees covered – it was about $10,000 a month, just for him, in addition to the admin fees.
I suppose it was still cheaper than doing it in-house, but I don’t think we got our money’s worth. We still had to ask employees to watch for possible fraud and mistakes in billing, because the admin didn’t do any of that.
Oh, my fault entirely for not being more clear. I mean that upon the covered person’s death, if it were discovered by the insurance company that the person was indeed a smoker, wouldn’t/couldn’t coverage just be automatically denied? Although I see from Gfactor’s link, it depends. So if I don’t expect to die of lung cancer I could save a buck by claiming to be a non-smoker – well, I am, now, but I have the occassional cigarette with friends, so now I don’t know how that works. Actually I may still be paying the smoking premium because I think the qualifying question during last open enrollment was “longer than one year.”
I thought about that, after I posted the response. I suppose the carrier could say there was fraud and refuse to pay, or they might play nice and just deduct the higher premium – what the deceased employee should have paid – from the pay-out.
Geez, I’d hope so anyway.
One tip-off to the insurance company that you are a smoker is if your doctor codes a claim with an ICD-9-CM code of 305.1 – tobacco use disorder. Another code that may pop up is V15.82 – history of tobacco use. They’re mostly used as secondary diagnoses; that is, the patient usually has some physical disorder that is smoking-related.
For certain contracts (i.e. those who charge smokers more), those codes will flag the claim and send it along for further review. What happens after that is up to the carrier.
Robin
Do you think that lying about smoking would be more important if the insurer had the option to deny coverage to smokers?
In my former employer’s case, employees have group life coverage regardless of smoking or medical history. Employees can’t be denied coverage.
Yeah, I think lying about smoking would be more important if that denies employees coverage, particularly since tobacco is still legal. That said, however, I think employers who want a smoke-free workforce have a responsibility to help employees quit.
Robin
Mine did. Back when they outlawed smoking inside the plant and offices, they provided nicotine patch prescriptions for free, and sponsored a hypnotist.
(They also had $5 vasectomies for awhile, but never did get around to outlawing pregnancy. 
)