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Providing cash to employee to waive coverage - Prohibited by PPACA?


Guest MarieNo
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Guest MarieNo

Has anyone thought about whether the regulations issued for the pre-existing condition insurance plan program (i.e., the high risk pool program under PPACA) prohibit employers from offering cash to employees to waive employer-sponsored health coverage? I am curious about whether these cash incentives could be considered insurer dumping under 45 CFR 152.28. How are you handling this? Are you discontinuing the cash incentives? Thanks.

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Are you saying that the employer was/is offering cash to employees, with pre-existing conditions, to opt out of health insurance coverage?

George D. Burns

Cost Reduction Strategies

Burns and Associates, Inc

www.costreductionstrategies.com(under construction)

www.employeebenefitsstrategies.com(under construction)

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Guest MarieNo
Are you saying that the employer was/is offering cash to employees, with pre-existing conditions, to opt out of health insurance coverage?

Not specifically to employees with pre-existing conditions, but to all employees. For example, an employer might offer employees $100 per month cash to decline health coverage, perhaps contingent on the employee certifying that he or she has coverage available through a spouse. But what if instead the employee ends up enrolling in the high risk pool. It now looks like he received a financial incentive to leave employer group coverage and sign up for the pool, which is a problem. Many employers offer these cash incentives for employees to decline coverage. I am just wondering whether anyone thinks that these high risk regulations should make us question continuing this practice.

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