mroberts

Yes.

Agreed. The employer noticed the error and corrected it by extending the coverage another month. The employer sent the notice within the 14 or 44 days so all seems fine to me.

Two different documents probably means two different booklets. You can have 43 different classes and still assign the same plan number to all the LTD plans.

None unless the group forms a MEWA or self-insured trust and makes itself subject to the same rules that would apply to any other employer. Insurance carriers aren't interested in writing association plans because at the end of the day they are always a loser. The young healthy individuals will get healthcare through a spouse or on their own while the older, unhealthier individuals will cling to the association.

HMO's should be allowed to supply large claims information. As long as you're not asking for any employee's identity, it shouldn't be an issue. And if the group is so small that it could be obvious who the high claims utilizers are, you could always ask for the amount of claims without prognosis and diagnosis. I agree that some lazy employees at insurance carriers are going to use the HIPAA excuse to try and cut down extra work, which is really sad.

There's nothing illegal about how the employer is currently administering the plan. The employer is offering the insurances as a "bundled" product. Therefore, if you elect one, you elect all of them. Most employers take the unbundled approach. 95% of the time employees will make the same election for dental and vision as medical unless the employer doesn't contribute much to those coverages.

Answers to your questions: 1. It depends. If there is not enough of a financial incentive, then you're probably not going to get the migration you're looking for. A lot of employers who choose this option usually give a perntage of the savings, say 50% or 25%. 2. Not really, since you are only talking about having the dependent spouse or children get coverage through a different employer's plan. Additionally, you should require to see proof of insurance elsewhere before compensating your employees to ensure they are not forsaking healthcare coverage on dependents for a few hundred dollars in their pocket. If you were applying the same principle to employee only coverage, then yes, you would run into adverse selection, amongst other problems. 3. Yes the money paid to the employees would be taxable. Most employers who set up this kind of arrangement, however, do it through a cafeteria plan. Therefore, if employees wanted to purchase other types of benefits with this extra cash, they could do so. Just my $0.02....I'm not too high on these types of plans. I find it easier just to lower the contribution % that the employer is paying for dependent coverage. The "payoff" option creates a lot more administration (verifying other coverage, verifying whether the pouse is working elsewhere and is eligible for other coverage if you decide to make this option mandatory....) and it's not without cost (you do have to pay the employees some decent percentage to make it worthwhile). One could argue that lowering the contribution percentage could hurt attraction and retention of employees, however, so could forcing an employee's spouse on to a plan that is either significantly more expensive or has significantly less coverage.

I am not an advocate of PEO's. I have heard of way too many horror stories. It doesn't sound like they staff themselves properly and can't seem to keep their clients straight. I have a client who recently pulled out of a PEO and I think she would commit suicide if the company was forced to go back into one. A better solution may be to go to an HR consulting firm and hire one of its employees for a couple days per week. This is a very common practice for a company that might not need someone working 40 hours per week in HR. The HR professionals are usually very well trained and have a whole office of backup if they need it.

I don't see how an employer can DENY coverage if the spouse is eligible for medical insurance elsewhere. I can see the employer indicating that they will make no contributions to pay for the spouse's coverage if he or she has coverage elsewhere. It would seem to me that you would have a problem with eligibility since you as the employer can't be very well consistent (people are going to lie). Any thoughts?

I'm guessing the $200 would only go to pay for single coverage. Thus the Section 125 plan would allow employees to pay for dependent coverage on a pre-tax basis. In answer to the original question, yes it can be done - either through a cafeteria plan or the setting up of a Section 105 plan by the employer. Touch base with your flex plan administrator.

The plan can simply state that any unused funds out of the $4000 are forfeited. Most employers do NOT allow the employees to take the leftovers as cash since the money is there for benefits. You'd end up getting too many nitwits running around uninsured because they wanted the $4000.

I would definitely check with the insurance carrier as well. Most carriers will not write any business based on these contribution percentages. Adverse selection is much more likely than if the percentages were flipped and the employer was paying the greater share. A rule of thumb is that the employer needs to pay at least 50% of single coverage. Now if participation is excellent, the carrier may be willing to overlook this.

Kip is correct. The new carrier is not going to be at all responsible since the employee did not meet the actively at work requirement and because they were not informed about any disabled employees prior to the effective date. Can you still go back to the old carrier and file the waiver claim? (Of course, we're assuming you have the waiver of premium provision, which is standard.) Unfortunately, carriers only allow a few month window and if an employee does not file within that time frame, his or her request can be denied. As far as whether the last two parties are responsible, it depends. If the broker was supposed to ensure this employee was to be transfered to the new plan, it's not inconceivable that it could be an E&O claim. And if the employer failed to provide the employee with the necessary forms for waiver of premium, the employer could be responsible. To what degree, a court would have to determine.

The purpose of vacation time is for employees to relax, refresh and recharge. To give employees a financial incentive to not use vacation is going hurt your workforce more than help it. Unless you're in a state that mandates payout of unused vacation, I wouldn't even consider anything but a use it or lose it policy. Now getting off my soapbox, you could create a cafeteria plan where employees can buy the number of vacation days they want per year. You might want to give everyone 5 days and additional days can be purchased at the employee's rate of pay. Again, I would highly discourage this, but it's always a company's own perrogative.

Yes, but as oriecat points out, you come back to the same issue in 18 months. If you know these employees are only going to want medical insurance on a short-term basis, then COBRA would suffice. However, if these employees want to be permanent part-timers, it's better to deal with the situation now rather than later.

I don't see why this wouldn't be the case. You could argue that it would make sense that services provided by a doctor should be more expensive than a nurse, however, that's not the way managed care works.

I think it depends on a variety of factors: 1. How many total employees are on your health plan? If you only have 25 and you want to include 3 part-time employees, your health insurance carrier probably isn't going to say yes. If you have 500 employees and want to cover 3 former full-time employees, then the carrier shouldn't have any problems. 2. As maverick points out, there has to be some parameters on what is defined as part-time. Most health insurance carriers probably won't put up a stink if each of these employees is still working at least 20 hours per week. But if it's 20 hours per month, that's a problem. 3. How many other part-time employees do you have? How does this number compare to total employees? Again, as maverick points out, it's not worth hurting morale for the sake of a couple employees. My first inclination would be to say no, but you'll have to decide on how valuable these employees are to your company and what the carrier can do to accomodate your needs.

Why even go through the hassle of charging back the employees? The employer is saving 7.65% on all deferred amounts, which usually ends up making the program pretty close to free if not in the employer's advantage anyway. For whatever reason, participation in FSA's are already low. Charging your employees for the right to use them is just going to further reduce participation and make offering the benefit less and less attractive. If the whole purpose of offering benefits is to attract and retain employees, do you think this practice is going to be successful?

I would suggest waiting to implement this change until 2004 if you're SPD exlcudes them. It can't hurt to wait and get further guidance. Additionally, most employees probably didn't fund their FSA accounts in the hopes that OTC drugs would be approved this year, so it's kind of a moot point.

Yes and no on the response about being able to offer health insurance on a discriminatory basis. Your health insurance carrier is going to require you to set a rule for eligibility that must be adhered to. And most carriers will not accept a definition that's discriminatory. Now, if you are self-insured, that's a different story. However, if you're asking this question, I would tend to make an assumption that you don't have hundreds of employees.

I would suggest contacting either an insurance carrier (Definity Health, Destiny Health, Lumenos....) or a TPA for a sample copy.

Agreed. There's no legal requirement to notify employees 30 days before a rate increase. It's a smarter thing to do, but unfortunately sometimes an employer can not help it depending on how bumpy the renewal process went.

See the post a couple threads down - Wellness Programs.

Wellness programs focus on enhancing the health of an organization's employees through health awareness education, behavior and lifestyle change, and peer support programs. Wellness programs have been found to boost employee health and productivity, reduce absenteeism, and most importantly, trim employees' use of healthcare benefits. There are many types of wellness programs to choose from such as the following: Mental health; Onsite fitness centers; Prenatal services; Cardiovascular care; and Smoking cessation. A good wellness program should be able to lower health costs in the long run.

I agree that the employee should be allowed to elect the employer's health plan due to the special enrollment provision via HIPAA.