Guide to Adding or Ending Employee Health Insurance
Guide to Adding or Ending Employee Health Insurance Coverage
Q: What is group health insurance?
A: Group health insurance allows groups with similar interests to combine to obtain more cost effect benefits. Read this article from the National Federation of Independent Businesses.
Q: What do I need to do if I hire or rehire employees?
A: All new hires and rehires must submit a new employee application including the Medical History Questionnaire within 31 days of the employee’s eligibility date. The effective date of coverage will then be determined by the group probationary period. To avoid retroactive billing, new hire and rehire applications should be received by medical Mutual of Ohio prior to the employee’s effective date.
Q: What happens if we miss the application deadline?
A: If the application for any new hire is not received by Medical Mutual of Ohio within 31 days of eligibility, the applicant will be considered a late entrant.
All late entrants may apply for coverage during their employer’s annual election period, which coincides with the employer’s renewal. The late entrant will have the month prior to the effective date of the renewal, as well as the month in which the renewal is effective, to enroll. If the application is received outside of the two month open enrollment period, the application will be returned.
Late Entrants with a Qualifying Event—the HIPAA Certificate of Creditable Coverage is not valid documentation for a late entrant with a qualifying event. Download the details from this chart (include chart from pages 9-11 in Benefit Plan Summaries & Program Guidelines)
Retirees are eligible for coverage if the following criteria are met:
- The retiree was continuously employed by the covered under the group health plan by the company for five years prior to retirement.
- The retiree’s total length of service with the company plus his or her age equals 60 or more.
- The retiree is not eligible for group health insurance elsewhere as an active employee.
- The company contributes at least 25 percent toward the health insurance program.
- The retiree has been covered under the company’s health insurance continuously from the date of retirement.
- Surviving spouses of former employees of former owners or of former retirees are NOT ELIBIBLE for coverage on the group policy, except to the extent required by law, such as COBRA for companies regulated by such laws.
Q: What are the ins and outs of Termination of Coverage?
A: If you have not remitted the full premium amount due, in accordance with its policies, Medical Mutual of Ohio may elect to cancel your coverage. Benefits will terminate on the last day of the month of your ineligibility, or the last day of the month in which you have paid premiums to Medical Mutual of Ohio, whichever comes first. When terminating group health care coverage, the employer must give a written notification to Medical Mutual of Ohio at least 31 days prior to the requested termination date. Failure to provide written documentation of cancellation will result in termination of coverage due to lack of payment.
When Your Coverage Stops
- By termination of the Group Contract including termination for non-payment. This automatically ends all of your coverage, and you are not offered a conversation privilege. It is the responsibility of the Group to notify enrolled employees of such termination.
- On the date a covered person stops being an eligible dependent or the date the full-time student status ends. You are responsible for notifying Medical Mutual of Ohio immediately of any change to the eligibility status of a full-time student.
- On the date that the certificate holder becomes ineligible, when a covered person stops being an eligible certificate holder.
- At the end of the period for which the premium was made when a covered person does not pay the next required contribution.
- On the day a final decree of divorce, annulment or dissolution of the marriage is filed, a certificate holder’s spouse will no longer be eligible for coverage, subject to any available conversion offer.
- Immediately upon notice if:
- A covered person allows a non-covered person to use his/her identification card to option or attempt to obtain benefits; or
- A covered person intentionally misrepresents a material fact provided to Medical Mutual of Ohio or commits fraud or forgery.
Employee termination requests must be received within 31 days of the requested termination date to be eligible for any retroactive billing adjustment.
Q: What is COBRA?
A: If you employ 20 or more individuals, you may be subject to the provisions of the COBRA Continuation Law of 1985 as amended. Medical Mutual of Ohio has contracted with Ceridian to provide administrative services for you and your employees. This service is provided at no additional cost to you and is required of all Medical Mutual of Ohio groups unless you have specifically waived this service. If you think your company qualifies for COBRA and you are not currently utilizing this service, please contact Ceridian at 1-800-488-8757. Please note that upon plan renewal, it is your group’s responsibility to notify Ceridian of any new plan(s) annually.
Q: How do you update your carrier?
A: COBRA regulations consider you, the employer, to be responsible for interaction with your carrier as part of ongoing plan administration. Once a month, Ceridian will send you a complete summary of activity for the previous month, together with a check for the premium collected. Please use this report to update your carrier. Please reference your COBRA Compliance Implementation Kit from Ceridian for complete details regarding COBRA administration.
Q: What is a COBRA qualifying event?
A: Any of the following events which cause a loss of coverage by a Qualified Beneficiary is considered a qualifying event.
- Termination of the employee’s employment for any reason (other than for gross misconduct)
- Reduction of hours worked by employee
- Death of the employee
- Divorce or legal separation
- Dependent child ceasing to meet eligibility requirements
- If dependent coverage is lost because the active employee (or COBRA continuant) becomes entitled to Medicare
- Corporate bankruptcy
Q: What is Ohio State Continuation?
A: Ohio revised Code, Section 3923.38 (the twelve-month continuation-of-coverage statue) provides an opportunity for eligible employees to continue their group hospital, surgical and medical insurance for a period of twelve months after the insurance coverage would otherwise end because of termination of employment. Unlike COBRA, the twelve-month continuation period is available to terminated employees of a group regardless of group size. The twelve-month continuation-of-coverage statue also sets forth: who is considered an eligible employee for purpose of coverage; what events trigger the right to continuation; the cost of the continuation coverage; and what events will cause a cessation of continuation coverage.
1. Eligible Persons
As stated in subsection (B) of the continuation statue, continuation coverage is available to eligible employees and their eligible dependents. Pursuant to subsection (A) of the statue, an “eligible employee” includes any employee who:
1. Has been continuously insured under a group policy during the entire three-month period preceding the employee’s termination of employment;
2. Has been involuntarily terminated, other than for gross misconduct;
3. Is not and does not become covered by or eligible for Medicare coverage; and
4. Is not and does not become covered by or eligible for group hospital, surgical or medical coverage and under which the person was not covered immediately prior to his or her termination.
It should be noted that each of the four conditions noted above must be met before the person is considered an “eligible employee” for purposes of continuation coverage.
2. Qualifying Events
The sole qualifying event under the continuation statute is termination of employment. Unlike in the conversion statute (Section 3923.122), events such as death, divorce, annulment and reaching the limiting age of coverage do not trigger an individual’s continuation rights.
3. Employer’s Responsibility
When the employer notifies the employee of his continuation right at the time of termination of employment—a requirement under the statute—the employer must also inform the employee of the amount of contribution required. When the employee elects to continue coverage, he or she must tender the first contribution, and it must be received by the employer not later than the earlier of the following dates:
- 31 days after the date the employee’s coverage would otherwise terminate; or
- 10 days after the date the employee’s coverage would otherwise terminate, if notice of the continuation right was provided to the employee prior to that date; or
- 10 days after notice is provided, if notice is provided after the date the employee’s coverage would otherwise terminate.
4. Termination of Continuation Rights
- Continuation coverage for an eligible employee will terminate in any of the following instances:
- The employee becomes eligible for coverage under Medicare;
- The employee becomes eligible for a group hospital, surgical or medical coverage;
- The six-month continuation period ends;
- The group policy is terminated, or the employer terminates participation under the policy.
For more information, visit the Ohio Department of Insurance www.ohioinsurance.gov
Questions? Contact us at memberservices@cose.org or call 216-592-2222