KIP KRAUS

I like that idea Jeanine. Let our famous INS give PRose some guidance. That should be interesting.

Hank: Thanks for the enlightenment regarding no cases related to COBRA and its applicability to illegal aliens. I seem to recall reading something related to illegal aliens be eligible for Medicaid benefits. Not to be argumentative, but if there are a significant number of these illegals in this company offering them COBRA could be detrimental to claims experience if any of them or their dependents have major medical problems, which would cost considerably more than postage. This of course assumes that Prose’s plan is experienced rated. I agree that some special interest group would be a likely suspect for taking a case of this nature. I guess that’s what happens when people don’t have real jobs, and the court system seems to allow any and everything to come before it, especially when the big bad employer is the suspected culprit. I’m not an attorney of any kind, but that doesn’t mean I’ve lost total ability think logically. On the other hand, it seems that very often logic doesn’t prevail in litigation. Boy, I hope I never have to have a jury of my peers.

Hank Having said what you said, would you take this case? If, as I contend, they have no status under COBRA, why would a court even allow this to be presented? While I appreciate your conservative approach to this cituation, I would advise my employer to not offer COBRA.

The only covered aliens that I ever recall reading about in any employee legislation are legal. I may be wrong, but I don’t think illegal aliens are covered by COBRA, and I wouldn’t offer it to these employees. The fact that they were covered as employees before they were discovered to be illegal aliens, in my opinion gives them no status.

What did you do?

The simple maters of fact are that 99.9% of group medical plans do not cover medical procedures that are not “medically necessary”. If you are administering a plan that does not at least make this statement, then your plan is in trouble. If the plan does make a similar statement why not tell the irate participant that a written diagnosis from her doctor will determine the “medical necessity”. Sounds to me like the employee must have some suspicion that the procedure she had was not medically necessary. In my opinion, whether or not you specify what is needed to prove medical necessity it is common practice to require it before a claim is processed. If a TPA is paying every claim that crosses his desk without knowing if the procedure was medically necessary he is not adjudicating claims properly and is providing a disservice to his clients. I would tell this participant that the claim is not going to be paid until evidence of medical necessity is received. Her doctor should have enough sense to know what is required to prove medical necessity. Before some of you out there accuse me of giving advice let me say that all of the above are my opinion based on experience and common sense.

It doesn’t surprise me that insurance companies would not want to offer domestic partner coverage to a fully insured small medical plan. They probably don’t want the extra claims to jeopardize the experience pool. You may be hard pressed to find an insurer willing to do this. If you have a good employee benefit broker, he/she should have all of the major group insurance markets covered and should know what he/she is talking about. This doesn't mean you shouldn't check with other brokers just for satisfaction. Call some and ask the question. They don't charge for questions.

In my opinion if you are eligible for FMLA leave, and you opt to be covered by it your employer cannot charge you more than your regular premium. If you are not covered by FMLA you may be out of luck.

Tara; I’m going to take a logical stab at this and assume that the doctor is a HCE for purposes of testing the discriminatory set up of the cafeteria plan. If so, since the regs. say only that you cannot discriminate in favor of the HCEs I’d conclude that you could discriminate against a HCE. I would conclude that the client could set up the eligibility in the plan with two classes; doctors and all other employees provided there are no other doctors employed by your client. I wouldn’t expect that the doctor would want to pay after tax dollars for her medical coverage when she could do it on a pre-tax basis. I also think there has been similar threads on this Message Board that discuss discriminating against the HCEs, but I don’t know how to tell you to get there.

Your SPD should define Medical Necessity so you should be able to site such definition. In addition, the SPD should have language that substantially states that the Plan Administrator or insurer if the plan is insured, has the right to request medical evidence that a medical procedure is medically necessary. On the other hand, no claim should be processed if the doctor doesn’t provide a diagnosis for the procedure he/she is performing. Check the claims procedures in the SPD.

I have no idea what a CPAP machine is, but if the insurance would cover it as an active employee it should cover it under COBRA. COBRA coverage must be the same as active coverage. You could check the SPD, but I would be surprised if that particular piece of equipment would be mentioned in it. In any event, follow the appeal procedures in the SPD.

Why not call them and ask them for a copy? Maybe you should also ask if you had disability coverage. My guess though is that if you were not disabled at the time you terminated employment with your former employer you wouldn’t be eligible for benefits. Why do you need to see it?

GB: I'm not sure that what a person is being paid for in January is an issue. Employees are on a cash basis accounting therefore if they are recieving pay in January even if it was earned in December I don't think it is an issue. They've earned it but are not entitled to it until January. Does this make sense?

Why don't you ask the CPA for this information since he is saying it is illegal?

Athena: I’m going to guess that if you convert your COBRA coverage to an individual health policy with the insurer that is providing COBRA that they would not exclude diabetes. You need to contact them to see what they say. If you don’t like the answer you get then contact the insurance department in the state or commonwealth where you live and ask them.

Ruth: That’s a new one on me. Are you talking about AD&D coverage exclusions or medical plan exclusions. I could see where an insurer may exclude such activities in an AD&D plan. I’ve never seen those types of exclusions in a medical plan. Of course now days any thing is possible.

If these employees are eligible to participate in the union 401(k) plan then it would make sense to me that they would be excluded for testing purposes. If benefits are the subject of collective bargaining I don’t think they need to be included. This is strictly my interpretation. I don’t have any site for my opinion. Maybe some one out there does.

My understanding is not unless you are totally disabled as determined by the Social Security Department.

I don’t see how this employee would qualify for a hardship withdrawal to help a child purchase a house. I wouldn’t accept that as a qualifying hardship in our plan. Even if he/she is eligible, the main draw back to the withdrawal is the 10% tax penalty and payment of regular taxes. If a loan can be taken it would be the best way to go.

Let’s see. You pay for medical expenses on a pre-tax basis from money deducted from your pay and instead of taking the reimbursement in cash you want it direct deposited to a money market account. I guess my question would be why would the IRS care what you do with the money as long as it’s being reimbursed from a FSA for qualified expenses? Unless the plan administrator doesn’t want to do it, why not allow it? I have no regulation to quote you. This is just how I would view the situation. O.K. now you legal beagles out there can jump in.

I agree with Greg and in some cases stop-loss coverage is considered casualty coverage and not group insurance coverage when purchased separately. Even an ASO product with a group insurance company has stop-loss coverage, but the plan can be considered self-insured.

John: If you are talking about the company purchasing individual disability policies I’m not sure that ERISA even applies. As far as my understanding individual policies of insurance are not ERISA plans. If the insurance company underwriting the policies will not issue a policy to someone on the basis of medical evidence, I don’t see what you can do about that. So is it the company being discriminatory or the insurance company? If the employer is really concerned about the 68-year-old, or the person that couldn’t satisfy the medical evidence, they may want to consider self-insuring the supplemental disability benefit payments from general assets. I’m just guessing from your post that the employer has a group LTD plan and just wants to supplement that plan for executives.

Project X Incentive Bonus

I don’t know what they do in California, but it doesn’t make sense to me that Cal. Law would care about an employer offering Med. & Dent. As separate coverages or making them mandatory as combined coverages. I may be wrong, but it has always been my understanding that if an employer offers Med. & Dent. as separate coverages then both coverages, or either coverage can be purchased under COBRA. We do it as separate coverages.

If the plan is self-insured there may not be a conversion policy available. However, if it is insured application for a converted policy will have to be made directly with the insurer. If I were you I would see if I could get the insurer to give me the conversion information. Conversion policies are governed by state insurance law. The insurer must give you the information. You should also look into your summary plan description for conversion information.