Insurance premium refund

[IggyKatz]

Colorado... Hi, I recently signed up for health insurance through my employer with what should have been a start date of May 1st. The insurance company, BCBS, didn't even receive my application until May 20th and the enrollment process was not completed by my company's payroll company until June 1st. I am requesting a refund of the May premium since I had no access to that insurance and of course, the payroll company is refusing. Do I have a legal leg to stand on? Could I sue them in small claims court for the refund?

 

[Zigner]

Colorado... Hi, I recently signed up for health insurance through my employer with what should have been a start date of May 1st. The insurance company, BCBS, didn't even receive my application until May 20th and the enrollment process was not completed by my company's payroll company until June 1st. I am requesting a refund of the May premium since I had no access to that insurance and of course, the payroll company is refusing. Do I have a legal leg to stand on? Could I sue them in small claims court for the refund?

If your effective date for insurance was May 1st, then you have no "legal leg to stand on." Why? Because you could have seen the doctor during that time and you would have been reimbursed.

If your effective date is actually June 1st, then yes, I would think you'd be entitled to credit for May.

 

[cbg]

I know this is six weeks old and we don't generally respond to old posts, but I didn't see this one initially. This is exactly what I do for a living; if the OP worked for my employer I'd be the one he'd be talking to about this. For benefit of future readers I want to add an explanation of what happened here and why.

Since this is employer based coverage no, you do not have a leg to stand on. The coverage is retroactive to May 1 and if you had incurred any eligible bills during the month of May, they WOULD have been paid. At worst, you might have had to pay up front and be reimbursed after the fact. But the coverage was effective May 1, even if BCBS did not receive the application until May 20th.

How do I know this for sure? Because that's the law. IRS regulations require that all employer sponsored coverage that is not elected during Open Enrollment, be effective the actual date of whatever the Qualifying Event is. That might be a new hire, the birth of a baby, a marriage, loss (or gain) of other coverage, or some others. I know it wasn't an Open Enrollment (though if it were, the ONLY possible date would be the first day of the plan year) because the election was made after the effective date. That does not happen during an Open Enrollment, but it DOES happen during an IRS approved qualifying event. In that case, there is a 30 (occasionally in very rare circumstances 60, but mostly 30) day window to make elections, and that window STARTS on the date of the qualifying event. If the QE was May 1, then as long as the elections were made between May 1 and May 30, the effective date of coverage is May 1. That is the law. There is no other answer.

And since the coverage effective date was May 1 (even though retroactively) then the OP owes the premium for the month of may. Making coverage effective June 1 was NOT a legal option.