My employer's insurance rates doubled, and I want out!

[spedroogie]

What is the name of your state? California

My employer offers a choice of three health insurance plans to its employees, and covers $240 per month of whatever the plan costs.

This year, the cost per health care plan has almost doubled, however, my employer continues to only cover $240 per month, forcing its employees to pay more per month out-of-pocket.

My question is, if i choose to decline benefits from my employer and get health insurance on my own, is my employer still obligated to subsidize $240 of my health insurance cost?

It does not seem fair for my employer to offer its employees help with insurance cost by subsidizing a certain portion of monthly health care cost, but only through the insurance company of their choice.

Wouldn't this be some sort of conflict of interest?

Thank you for your time, any responses are greatly appreciated.

 

[cbg]

More detail is needed. Are you saying you want to drop your coverage? Is someone saying you can't? Who? Why? How much did your portion of the coverage go up? And very, very important - does your share of the premium come out of your paycheck pre-tax or post-tax?

 

[spedroogie]

employer health care plans

nobody is saying i cannot decline coverage, but my out-of-pocket cost will increase $150 a month. I would like to find my own insurance plan, because the plans offered by my employer are now outrageously expensive.

The company subsidizes $240 per month if we choose one of the plans they offer. Do they still need to offer this $240 per month even if we decline the plan they offer and choose to go on our own?

It seems like a conflict of interest of some sort if they only offer the $240 for the plans they offer the employees.

My share of the premium comes out pre-tax.

Thank you for your speedy response.

 

[cbg]

At the time I posted my answer, there was no detail in your post.

I do not have good news for you on any front.

The employer has NO obligation to provide any contribution towards your health insurance if you are not electing one of their plans, and it is neither a conflict of interest nor illegal discrimination for them to refuse to do so. If you elect one of the plans they offer, they will make a contribution towards it; if you choose to find your own health insurance, you are on your own.

When you start investigating the cost of your own health plan, you may very well find that, outrageous as the cost of your employer's plans may be (and I'm not arguing with you - the cost of insurance has gone up drastically) it is even more expensive for you to buy an individual plan. The whole point of group coverage is that it keeps the costs down by spreading the risk around. Individual health insurance is just as costly as group insurance, if not more so, and no one else is going to help you pay for it.

If you still want to find your own coverage, you need to be aware that if your share of the premium is coming out pre-tax, your insurance is covered by a Section 125 plan. On a Section 125 plan, you CANNOT legally make changes to the coverage you elected, (and that INCLUDES dropping it altogether) unless there has been what is called a "qualifying event" OR it is the annual open enrollment period. Open enrollment is generally the 30 days before a plan renewal - if your rates went up January 1, then your open enrollment was December and it's already over. A qualifying event means either that you lost your coverage for some reason, or else that there was a marriage, death, divorce, birth or adoption requiring that you add or delete someone. Electing, of your own choice, to find other coverage is NOT a qualifying event and your employer would be violating the law if he allowed you to drop coverage without one. Your only hope of doing this would be if the rate change is February 1 and you are in open enrollment right now. Section 125 plan provisions are Federal law; while they are good for both the employer and the employee by allowing the pre-tax deduction, they have strict regulations because of the pre-tax option and your employer has NO choice about what they are.

I suspect you're stuck with the high cost premiums until next year.

 

[spedroogie]

Well i guess that isnt very good news for me.

This site has kind of boggled my mind that such knowledgable people are so quick and eager to help total strangers with free advice.

Thanks alot for your great help, cbg.

 

[Beth3]

spedroogie, even though you probably can't make a change at the present, I do suggest you contact some local insurance agents and investigate the types of insurance coverages available to individuals and the premium costs. It will serve to either (a) prepare you with the necessary information to make a change to a private plan the next time open enrollment rolls around, or (b) confirm that despite the cost to you, your employer's health plan is the best deal you can get.

If you do opt out of your employer's plan at a later date, BE SURE to find out the particulars of when and how you can get back in. You never know what the future holds and you don't want to find yourself without a health plan.