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Continuation Of Health Insurance If Not COBRA? New York

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  • Continuation Of Health Insurance If Not COBRA? New York

    I seriously wish these things were easy enough to research myself, but I keep getting sent in circles! Yes, I even googled the question, it wasn't that easy.

    Anyway...

    We terminated an employee on July 25, 2011 who was part of our group health plan coverage. They were terminated for "not being a good fit" which may or may not be considered gross misconduct, but they were rather disrespectful to their boss in little ways, and the boss decided that such an individual with that type of "attitude problem" was no longer welcomed to be employed by us. The two of them just were oil and water.

    Anywho, we continued coverage of their health insurance through August because I had already paid the premium. I then filed with the health insurance company that the employe's coverage would terminate at 8/31/2011.

    The employee has contacted me asking for information regarding COBRA. As I am very new to this type of benefits management/coordination, I have gone online to research what I could, and can only find that Federal COBRA requires that employers have 20 or more eligable employees within the last 6 months of the calander year. We don't even come anywhere close to that. Therefore, I can safely say that I don't think we'd be required to provide continuation of coverage under federal COBRA.

    But I can't find anything regarding New York State individual mandates. I know better than to assume because I can't find it doesn't mean it don't exisit. I've checked the NYS DOL website, and various others, but cannot find where NY State in and of itself would require that we provide a continuation of health insurance coverage for an employee, and how I would know if as an employer I'm required to.

    Thanks everyone for your help. I'm kind of under the gun here because I have to make payment for September's premiums, and I don't want to have to make a payment on behalf of this terminated employee to cover my butt, and then find out they don't have the money to foot the bill. That would really suck.

  • #2
    I have information about what states have mini-COBRAs and the requirements at home, but I won't be home until quite late tonight. If no one else has it, I'll try to get it to you tomorrow evening. Don't hesitate to PM me if I forget.
    The above answer, whatever it is, assumes that no legally binding and enforceable contract or CBA says otherwise. If it does, then the terms of the contract or CBA apply.

    Comment


    • #3
      Thanks!

      Mini-Cobra...okay, I'll try to type that into google. Hopefully it won't send me to sites about midget snakes!

      Comment


      • #4
        Yup, mini-COBRA, that brought me right to the Q&A. Thanks again. All these fancy HR terms...errg

        Comment


        • #5
          It sounds like you found the info you were looking for.

          The NY citation re health ins. continuation is N.Y. Ins. Law 3221 - 4304 & 4305.
          Too often we underestimate the power of a touch, a smile, a kind word, a listening ear, an honest compliment, or the smallest act of caring, all of which have the potential to turn a life around. Leo Buscaglia

          Live in peace with animals. Animals bring love to our hearts and warmth to our souls.

          Comment


          • #6
            Originally posted by VeterinaryGroup View Post
            I have to make payment for September's premiums, and I don't want to have to make a payment on behalf of this terminated employee to cover my butt, and then find out they don't have the money to foot the bill.
            To avoid the issue you raise, most employers will routinely terminate insurance coverage on the date the terminated employee would normally lose coverage, then reinstate coverage once the former employee properly exercises their right to COBRA (mini-cobra) continuation. The insurance carriers are familiar with this reinstatement practice. (I did not read the details of NY mini-cobra but will assume it parallels the Federal rules as to timelines for exercising it and reinstatement.)

            If you continue to pay premiums you do run the risk of not getting reimbursed by a terminated employee. And if the terminated employee has any claims paid by the carrier after their termination, in my experience the carrier will not terminate coverage retroactively and you, the employer, are out the premium you paid.

            You might want to verify the reinstatement procedure with your carrier if the former employee exercises their mini-cobra rights.

            Edited to add:

            (1) You state the employee contacted you for info on COBRA. Again, assuming NY rules follow Federal, the employer has an obligation to notify terminated employees about their COBRA rights and (under Federal COBRA rules) a further obligation to inform employees about COBRA at their time of hire/insurance eligibility.

            (2) I'm not a COBRA expert, but from everything I've read, "gross misconduct" has a pretty high bar, typically embezzlement, maybe extreme violence. Perhaps one of the COBRA experts will add a comment on this.
            Last edited by Law Firm Business Manager; 08-25-2011, 07:57 AM. Reason: Additional information
            While I may work for lawyers, I am not an attorney. Comments I make are based on my working experiences and should not be interpreted as legal advice.

            Comment


            • #7
              Also not a COBRA expert, but I have also heard that denying COBRA because of "misconduct" also has a very high bar. The OP might want to talk directly to federal DOL prior to rolling that particular set of dice. FYI, we would routinely recommend to any employee denied COBRA to routinely file a complaint with federal DOL against the employer. It might work. It might not work. But either way, there is no potential downside to the employee, just the employer.
              "Reality is that which, when you stop believing in it, doesn't go away".
              Philip K. **** (1928-1982)

              Comment


              • #8
                I haven't looked at the rules for the state mini-COBRA yet (I'll have a chance to, tonight) but if there are less than 20 employees overall, then Federal COBRA, Federal COBRA requirements, and Federal COBRA notification laws do not apply.
                The above answer, whatever it is, assumes that no legally binding and enforceable contract or CBA says otherwise. If it does, then the terms of the contract or CBA apply.

                Comment


                • #9
                  http://cobrahealthinsurance.com/Reso...COBRA_FAQ.html

                  Note links below re increase in continuation period....



                  http://www.ins.state.ny.us/cobra/cobra_ext_36.htm

                  http://www.ins.state.ny.us/cobra/cobra_prem.htm
                  Too often we underestimate the power of a touch, a smile, a kind word, a listening ear, an honest compliment, or the smallest act of caring, all of which have the potential to turn a life around. Leo Buscaglia

                  Live in peace with animals. Animals bring love to our hearts and warmth to our souls.

                  Comment


                  • #10
                    Thanks,

                    Thanks everyone,

                    We are not obligated under Federal COBRA, as we have much less than 20 employees at any one time or within the year.

                    NY State mini-COBRA, from what I have researched, requires all employers regardless of size to extend health insurance for 36 months regardless of reason for separation. In other words, boss and employee being "oil and water" wouldn't float. Employees can be made responsible for 102% of the premium.

                    I made this employee aware of COBRA rights when we terminated her back in July with a canned notification supplied by our payroll/HR company, so from July 25 to August 25 is only 30 days. She was also given a canned COBRA notification form from our payroll company at hire, but really, who the hell reads those?

                    I was simply under the assumtion that the health insurance company would take care of everything once I process all the paperwork and made notification that the employee was electing COBRA on Sept 1. After the employee contacted me, I called the HI company, and they informed me that I was responsible for it since I am the "Plan Administrator." Ah, live and learn. I am learning alot on the fly here. Never been a "Plan Administrator" before. Thus far, it has only been alot of filling out online forms.

                    Anywho,

                    The same HI company also sent our company a letter at the start of August saying that they were discontinuing their retroactive policy. In other words, if they don't recieve payment at the time payment is due, they are cancelling the policy and we're crap out of luck. Therefore, if I don't make the Sept payment on time before the first of the month, they will cancel our policy, and regardless of when they actually do recieve payment doesn't matter, they won't retroactively apply it to the policy.

                    So I'd hate to have to reneotiate a whole new freaking HI coverage because payment was late due to lack of payment. Yeah, we're probably going to eat another month of coverage for said terminated employee.

                    I have also called and mailed said employee a notice telling them that payment on the premium is due Sept 30, which I will retroactively apply to their Sept premium, but the employer HI will actually be applied a month in advance. If I need to cancel, I'm pretty sure the HI will simply credit the cancelled premium forward, which is what they did when I terminated a different employee who decided not to elect COBRA after I'd paid the premium for the month following termination.

                    Comment


                    • #11
                      Originally posted by VeterinaryGroup View Post
                      The same HI company also sent our company a letter at the start of August saying that they were discontinuing their retroactive policy.
                      While I understand it is not a priority issue for you, I would contact the NY State Insurance Department and inquire whether the HI company's policy that they would not reinstate coverage retroactively violates the NY mini-cobra law. From the little I've read of the NY mini-cobra law, it seems to closely follow the Federal rules. Assuming the HI company also insures employers who are subject to the Federal COBRA law where they have to reinstate coverage to the date of loss, doing the same for mini-cobra situations doesn't seem like a big deal.
                      While I may work for lawyers, I am not an attorney. Comments I make are based on my working experiences and should not be interpreted as legal advice.

                      Comment

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