mroberts

I tend to agree with maverick. If the pillow came from the chiropractor's office and the doctor has certified the need for it, I would reimburse the employee. If the employee went to the store and picked it up or ordered it off of TV, then that's a different story.

Insurance carriers always write basic life insurance with 100% participation assumed since the employer is paying for the benefit. If an employee did not want to be in the plan because he or she wanted the $5 or $10 per month the company is paying for the life insurance, that would not be allowed since the carrier is going to get adverse selection (the healthy employees will want the money while the unhealthy employees ones will keep the life insurance). However, since this employee does not want to be enrolled in the plan because of religious reasons and since this is only one employee, the insurance carrier should allow the exception. If you have less than 10 lives insured, that may cause a problem, but even then, I'm fairly certain something could be worked out.

Obviously less competition is going to breed higher rates. The more competition, as with any product, is going to lead to better plans with lower costs. When carriers have less competition, inefficiencies and waste which would normally be addressed in a tighter market go unfixed for longer periods of time. Are the increases going to be significant? Probably not, however, if you're going from three carriers to two or from two carriers to one, then the costs may be siginificant since it would almost be a monopoly.

Also, if it's a vision discount plan, then a 5500 would not be required. If it is actually insurance, then follow papogi's advice.

Thanks for the insight on that age 21 thing papogi. I wasn't aware of that.

I'm not sure where you're getting your info SLuskin. As indicated previously, you can differentiate between classes of employees. Hourly can be considered a class, salaried can be considered a class, seasonal can be considered a class, exempt can be considered a class and so on. You can't have a different waiting period for employees under 21. That's age discrimination. Hourly and non-exempt should not be used interchangeably since you can have a salaried non-exempt employee. Salaried and exempt can be, however, I would recommend using exempt and non-exempt to avoid any confusion since you can have some overlap if you simply indicate hourly or salaried. Feel free to send me an email if you wish to discuss further.

Yes. An employer can be discrimatory on a class basis and this is extremely common. What the employer can't do is have a longer waiting period for employees over age 40, or for a protected race or for anyone who's last name begins with the letters A, H and P.

It's a good point and do your best to make sure you can coordinate it so that both are on a 8/1 cycle.

Additionally, Massachusetts, Illinois, Minnesota, Louisiana and Iowa also have state laws that require pay out of accrued vacation time upon termination. Remember, vacation time is not required. Any time an employer provides you with vacation time, it is a benefit they are providing to you and therefore, can determine how to adminster it.

And running it on your fiscal year rather than calendar year could also pose complications if your medical renewal is on a 1/1 cycle. What if you have to increase copays or deductibles next year to help offset the medical renewal increase you're going to get next year? You might get a lot of moaning and whining from people who are having surgery or other expensive procedures that they would have liked to increase their spending account dollars for to account for the increased expenditures. If at all possible, have your section 125 plan run on the same cycle as your medical plan.

You could always do better than COBRA, but I wouldn't. I've heard every excuse in the book when it comes to employees being out on disability and when they will return. Your facing two possible problems here. First, say six months goes by and you are still treating this employee as active and you just now find out she's not coming back. You now have to offer her COBRA, however she hasn't been working the past 6 months. The carrier might not approve the COBRA offering at this point if they realize that you continued her coverage for 6 months without her being active. The second problem you run into has to do with your claims experience. Participants on COBRA utilize benefits 50% more often than your active employees. Trust me when I say you don't want to extend an inactive employee's participation on your health plan as long as possible. This is only one employee and your claims experience isn't going to be 100% credible, nonetheless, who knows what kinds of claims are going to occur 13 months down the line if she elects COBRA.

You should offer this employee COBRA. Reason being what if she tells you she'll be back in two weeks, which turns into two months, which turns into two years...... The situation would start to get ugly and you'll eventualy have a problem with the insurance carrier not wanting to grant this employee any further coverage. Offer her COBRA since she was exhausted her FMLA and when and if she comes back to work, put her back into the active group.

Why wouldn't he be able to terminate health insurance? If the employee is refusing to pay his or her share of the premium, then the employee has in effect canceled his or her health insurance. Just because the employee is out on worker's comp doesn't afford him or her any greater rights than an active employee. Of course, if there is some verbage in some contract that was signed between the employee or the employer that would override the previous statement then that would be the determination. However, assuming normal employment, this employee should be termed.

Although it seems like a great idea, the hard part is getting buy-in from the top level employees. Regardless of how much they make, these employees always want everything paid. So, if you're currently contributing 50% or 60% for the executives' coverage, good luck getting their approval to not pay anything going forward. It's not to say it's impossible, but what I would do is contact someone in HR at Outback Steakhouse and see how they implemented thier plan. Their health plan contributions are structured by salary levels and they have received a lot of publicity lately about their unique plan.

COBRA participants have the same rights regarding open enrollments as your active employees. While it would be nice to pretend they don't exist, they need notification. I will let someone else who is an HR consultant or works in HR explain how the handle the notification process.

There was a post on consumer driven health plans a couple months back that went into some detail. Take a look for it and this should provide you with plenty of information. Unfortunately, these plans are very new. They have been around since the early 90's, however, managed care was actually working back then and up to 1999. Therefore, there was no real need for employers to flock to these since it is a different philosophy than offering an HMO or PPO. Cosumer driven plans are here to stay. They probably will go through many revisions from what we have today, but BCBS, UHC and Aetna are rolling out some form of consumer driven health plans, so if it was simply a fad, I don't think these carriers would be allocating so many resources to creating them.

This was only a proposal. I would find it hard to imagine something is agreed upon even in 2003. Laws dealing with medical insurance aren't exactly high priority in Congress. Nonetheless, I just read an article published by Kaiser that is estimating medical increases to be over 20% for 2003. If this is the case, we could see a lot of medical legislation, such as the FSA rollover, taken care of by the end fo the year or early 2003.

If you have less than 50 employees and want the interest to go to your employees, you can set up a Medical Savings Account. If you need more information on MSAs, please let me know.

Since you're self-insured it really depends on how you want to handle it. Just remember that by making an exception your are setting a precedent, so just be careful. What I would advise is to start the coverage effective 2/1/02 and have the employee make up premiums for those months. Since you are inclined to make an exception I would assume there is a fairly good cause behind it, not that she's desperately sick. She shouldn't be allowed to have medical coverage for four months without paying for it.

This wouldn't be illegal, however, it would be extremely hard to enforce. What if on January 1st a spouse is working part-time and on February 1st he or she's working full-time? Do you expect the employee to pop into your office and say please charge me more for medical insurance? The factor that you should be looking for is whether or not the spouse is eligible for medical benefits from the company he or she is working for. If he or she she is eligible and doesn't want to take the medical insurance then go ahead and charge that employee more. If he or she is not eligible then treat it the same way as you would treat an employee with a househusband or housewife. Either way, there is going to be some administration involved, however, focusing on the issue of eligibility for medical insurance is a better way since you have Section 125 on your side then. You've indicated that you're a small company and self-insured. How many lives does your company have?

As far as I understand it, it's company discretion as to whether or not they want to offer COBRA to domestic partners previously covered under their medical plan. Therefore, even though you were allowed to have your domestic partner on the plan while you were an active employee, you may not have that same right. Do you know if they have offered COBRA to other domestic partners of ex-employees? If they have, then they would have set a precedent and you could pursue this further. Otherwise, you're unfortunately SOL.

My take is that it would mean 60 days from the effective date of change. For example, if your negotiations with the union ended today and you agreed to make changes to your health plan for 1/1/2003, then you would need to provide this info to your employees by 3/2/2003, not two months from today.

maryc - you are definitely correct that I misread the post. I thought it was referring to the time needed to make an election. I recant my previous post. Don't beat me!

First off, an employee has up to 60 days from notification to elect COBRA benefits. Therefore, if you are not notifying your employees out on disability of this right until after the 26 weeks are up, you can't turn around and only allow them to continue coverage for only 12 months. Additionally, employees who are disabled have a right to continue benefits for 29 months, not 18. What I would do is run FMLA concurrent with any short-term disability. After the 12 weeks is up, I would go ahead and advise these employees of their COBRA rights. You can go ahead and indicate how long the company is going to pick up the insurance premiums in this letter and after a certain point, the employees will have to take over payments. I would also change my handbook so that there is no question in any employee's mind as to how long coverage is going to continue for and how much the company is going to pay towards it.

I'm not sure where it's spelled out in the IRS regs. Perhaps someone else can help you with that. I'm not aware of any way the employer/employee can avoid the tax hit since we're talking about individual policies. This is one of the reasons GROUP insurance was created.