Employer terminated health coverage

[Trudi Snodgrass]

My employer in Mississippi terminated employee health insurance, but failed to notify any of the employees. Money has continued to be withheld from our paychecks for almost two months for a non-existent policy. I have requested that this money be refunded to me, but also have medical bills for the time I was not covered. Is my employer obligated in any way to pay these bills?

 

[cbg]

Very possibly, but it would depend upon state law. Try calling your state insurance commission; they are also the ones that you would file any claims against your employer with.

Do you know whether or not the employer cancelled the policy, or whether the insurance carrier cancelled it for non-payment? It won't eliminate any liability your employer has, but it might make a difference in regards to whether there is a violation for his taking the deductions for the insurance. (He'll owe you the money back either way.)

 

[Trudi Snodgrass]

I was told by our accountant that the carrier cancelled the policy due to a late payment.

 

[cbg]

In that case, there was almost certainly no willful intent in his continuing to take the deductions out of your check, or, for that matter, in his failure to notify you. Late payment cancellations are almost inevitably done retroactively; i.e. if he didn't make the payment due February 1, the company wouldn't cancel the policy until sometime in mid-March. During that time, the policy would be in effect, and the cancellation would be done retroactively.

If this is a first offense, it's possible that the insurance company may reinstate the policy if payment of the back charges are made. It's unusal in the extreme for an insurance carrier of group insurance policies to refuse to accept back payments or allow reinstatements unless the insured (meaning the employer) has a history of late payments to the point of cancellation. If that is the case, at some point (usually the third or fourth offense) the insurance carrier has the right to say, no more, we won't take you back as a client.