partially funded health plan denial

[bradweiser]

What is the name of your state? Missouri

I switched jobs in July 2002. I became covered under my new company's insurance plan Sept 1, 2002. For the month of August, I paid for COBRA coverage on my previous employer's health plan. My previous employer's plan was a partially-funded plan. I received a letter from my previous employer's health insurance company stating that I was covered thru August 31 via the COBRA. I submitted claims for the month of August and the insurance company is now delaying processing the claims due to administrative and/or financial issues with the employer's plan. The President of my previous company had mentioned to me previously that they owed the insurance company some money and couldn't pay them right now. Can the insurance company deny my claim if my previous employer fails to pay their partially-funded amount? If so, shouldn't I get a refund on my COBRA payment?

 

[CIAA]

bradweiser ,

We would say yes and yes.

An employer can discontinue the health plan(s) at any time.

The insurance company's delay may be due, in part, to the fact that their letter accepting coverage thru Aug. 31 isn't accurate; probably due to the fact that the premiums had been billed to the employer, albeit not paid.

If coverage properly terminated prior to the occurence of your claim, the claim wouldn't be covered.

Usually, your COBRA premiums are made payable to the employer, who then pays the premium; otherwise he should refund any premiums collected and not remitted.

 

[bradweiser]

thank you for responding. I actually made my COBRA payment to COBRAServe. I guess maybe I need to talk to them about getting refunded for the cobra payment.

I had been told prior to incurring the medical expenses that my previous company had paid the premium for the month in question. However, I know that with the partially funded plan, my previous company is also responsible for paying the insurance company for the first $10,000 in claims by an employee.

Can I still be denied if the amount my previous company owes is actually some of the partially funded share and not the actual premium?

thanks for your help.

 

[CIAA]

It seems that if the coverage was in force no premium would be refundable and the claim should be considered. You might call and talk to the insurance company now that some time has past, they may be able to tell you more.