mroberts

I don't believe it's covered anywhere in the regs. I saw a couple of accounts do it when I was at Marsh.

I've dealt with companies that had to do this. It's not a very good idea however. Who did the underwriting for the account? How many employees do you have? It's always best to be a little conservative in figuring out equivalency rates so that you don't have to hit your employees over the head twice in a year. Shoot me an email if you would like to discuss further.

I would suggest purchasing reinsurance or stop loss coverage. What if one of our employees has a premature baby or cancer? Do you really want your employee coming out of pocket for $100,000? That would be devastating. How many employees do you have? Something tells me that your company is small and shouldn't be self-insured to begin with.

You can roll the funds into the new plan. There's a lot less administration involved rather than worrying about two plans.

I agree that you can't recoup the funds. Additionally, a hard look really needs to be made at your enrollment process. If someone is coming back to you six months later saying they sent in the form, my question to them is why did it take you six months of collecting additional money to realize this? Going forward, you really should focus on getting this adjusted. It sucks that you're in a situation filling someone's shoes after they allowed this. If an employee opts out of the section 125 plan, then he or she should not be able to get back into the plan that year unless they have a qualifying event. You might want employees to sign a waiver going forward indicating that they are opting out of the coverage and want the additional money just so you don't get any lame excuses as well. Plus, you may also want to check and see how your insurance carriers feel about this. If any of these coverages are voluntary, I don't think they're going to like the fact that late enrollees are signing up whenever they wish.

This is going to be a company policy situation. It really depends on how you handle the situation too. For instance do you pay the employees a lump sum or disperse the opt out balance evenly over the course of the year? Do you pay dollar for dollar on the opt out plan? Also, why are the employees requesting a change mid year? Do they have a qualifying event triggering the request? If so, is it consistent with them adding coverage?

I read the same thing jeanine. It would be very interesting to see how something like this played out. I could see it being a tough sell to some VPs and Presidents of a company however. But if they are interested in doing the right thing, ya never know.

By the way, I highly do not recommend offering retiree coverage. It's a big liability. If you have union employees and it's mandated by the contract, then you really don't have a choice. But if this isn't the case, I would not want to add some extra liability to the books.

That's a good question. I have two thoughts on it: first, if J2D2's company is experience rated, it wouldn't really make too much of a difference. If the company forgot to offer COBRA and this employee happened to run up claims, then the company has the problem of dealing with the extra renewal increase. Secondly, since the company has been paying this employee as a "regular" one, the insurance carrier really wouldn't know about the situation. If the company now changed the employee to COBRA, the carrier would extend coverage for 29 more months.

Rochester gets tons more snow since we're on the east side of the lake, unlike Chicago being on the west side. Other than that, the temps are pretty similar. Are you right in Chicago or a suburb or down south?

Where are you in IL by the way? I grew up in Chicago. Are there any coverages in particular you are looking at this for? Texas and Florida has to have stuff put into the SPDs for certain coverages no matter where the contract is sitused. I would either go to your broker or the carrier in which you are insured through. If you would like to discuss further, just send me an email.

You may be self-insured, but they pay the claims, which follows state guidelines. As far as I know, UHC is located in all 50 states. All you have to do is call them up and ask them and they will provide you with anything you are looking for.

UHC should be able to provide this to you. Isn't that your major carrier?

It's going to be state by state, however, almost all of the requirements of the SPD stems from the federal goverment. Most states just follow what the government mandates, however, there are a couple states that will require more info.

We went through this before and I don't see how this is legal. The reason that a section 125 gets tax-favored treatment is because of the risk associated with it. I would like to see a legal expert explain to me why this is legal. Furthermore, studies have shown that everything pretty much balances out in the end. Meaning that just as many employees leave a company with balances in their section 125 account than people who max out their allotment before all the deductions are made. Why go through a big hassle to save $42.36?

I couldn't agree more. I was in a rush before when I typed my last response.

charles - all insurance companies are in it for the money regardless of whether or not they are designated as non-profit companies. If you are asking because your company is non-profit and somewhere in your company ideology you would prefer to work with another non-profit, the following are health insurers in Texas that I can recall: BCBS of Texas Humana Unity Healthcare Aetna CIGNA Great Waste (West) There are probably some smaller outfits, but those are the ones I remember from my last marketing.

Agreed. If the disability payments are going to the disabled directly from the insurer, there's no way to make deductions. If you are looking to offer the benefit of pre-tax deductions for medical insurance, change your disability plan to a salary reimbursement plan. This way the checks from the insurer will come directly to you and you reimburse the employee through payroll. I would only do this for short-term disability, however, since you only have an obligation for 13, 26 or 52 weeks at most.

You're out of luck. Call it a day and move on.

Depends on what plans you're talking about and it depends on what your insurance carriers think. For example, if you have a contributory LTD plan or an optional life plan, good luck with your carrier saying no problem. Most carriers probably wouldn't allow them when it came to medical because there would be nothing in place to stop an employee or dependent from abusing the plan and then dropping coverage.

Sometimes discount programs still carry a monthly or annual premium. I'm not too familiar with a lot of dental discount carriers, but I know Lens Express for vision is a discount carrier with an annual fee.

Thanks for the input benefits lawyer!

Awww yes....sorry, I was thinking medical and saw your post regarding LTD and I was confused....hey, it was early in the morning. If the bargaining agreement leaves the employees worse off than the law prescribes I would assume the agreement would have to be modified. Just because it's a union agreement doesn't make it exempt from any federal law. If the agreement you currently have is "better" than what is prescribed by law, you can definitely leave it alone since there's no rule that you can't be more than generous. I would be interested in seeing a comparison between your union contract and the passed laws.

Seems to me that he has to put something down in writing as to how he is determining who's eligible, when they are eligible and how much is going to be paid towards their medical insurance. Is it possible the employees he's paying for medical insurance now are all in management? Is there some class distinction or is it completely random. Even if it's years of service, that can be used as a distinction. It sounds like the hiring of some extra workers is what can be driving this, since he would now be paying substantially more for insurance than what he thought at the beginning of the year. But I would assume an increase in workers would usually mean business is good and adding some medical insurance could go hand in hand.

What new claims rules are you referring to?