Health Plan Coverage After Rehire Under CARES Act

[Benefits Vet]

I am wondering if anyone has thought about or encountered this issue:

Fully-insured plan covers employees who are "actively at work"

An employer who receives a CARES Act loan has employees on the payroll who are not actively working because of the shut down of non-essential businesses.

Would the employer be in technical violation of the medical insurance policy if coverage continues for the employees?

Is there anything in the CARES Act about this? 

[leevena]

Most times this can be done.  Whether fully insured or self insured, the employer needs to work backwards and verify with all the vendors that this is allowable.  

[Lois Baker]

Some states are requiring insurers to be lenient in this regard; you might check with the state insurance commissioner.  We're posting them as we find them, but we certainly don't have all of them. 

I know I've seen Ohio and Washington State; this article lists others but it's from 3/18:  https://www.mercer.com/content/dam/mercer/attachments/global/law-and-policy/gl-2020-covid-19-spurs-irs-relief-for-hdhps-state-insurance-guidance.pdf

Also, some insurers are acting voluntarily: https://www.ahip.org/health-insurance-providers-respond-to-coronavirus-covid-19/

[leevena]

2 hours ago, Lois Baker said:

Some states are requiring insurers to be lenient in this regard; you might check with the state insurance commissioner.  We're posting them as we find them, but we certainly don't have all of them. 

I know I've seen Ohio and Washington State; this article lists others but it's from 3/18:  https://www.mercer.com/content/dam/mercer/attachments/global/law-and-policy/gl-2020-covid-19-spurs-irs-relief-for-hdhps-state-insurance-guidance.pdf

Also, some insurers are acting voluntarily: https://www.ahip.org/health-insurance-providers-respond-to-coronavirus-covid-19/

Are you seeing states requiring coverage of furloughed employees?  Thanks

 

[Lois Baker]

What I've seen (so far) is state regulation of the insurers -- which was the original question above (i.e., whether the terms of the insurance policy would permit an employer to continue coverage).

Haven't seen anything specific as to employer requirements (yet), but as more states/localities enact "quarantine leave" rules, it's possible employer mandates will be included. 

Looks like the exact answer will depend a whole lot on where the employer is located.

 

[leevena]

Thank you so much.

[Benefits Vet]

Thank you!

[Chaz]

Ohio is actually requiring insurers to permit its clients to defer paying premiums for up to 60 days.  I find that amazing.  (I'm not sure about Washington.)

[sharonfoster]

Both Ohio and Maine are requiring insurers to allow employers to continue coverage for employees furloughed or reduced hours. Employer cannot select specific employees. 

[Benefits Vet]

20 hours ago, sharonfoster said:

Both Ohio and Maine are requiring insurers to allow employers to continue coverage for employees furloughed or reduced hours. Employer cannot select specific employees. 

I have also been told that at least Blue Cross and UHC are voluntarily following the same policy- to continue coverage even if furloughed employees would normally lose coverage. The broker I spoke with mentioned Illinois and Massachusetts specifically but thought that this would likely be the case nationally.