How do we avoid screwing over a coworker's health insurance?
February 27, 2013 8:49 PM   Subscribe

My husband got a new job and it looks like his health insurance will be better and cheaper for us than what we have through my employer. Problem is, my office is tiny and if we drop off our insurance, only one person in the office will remain on the group plan and a group of one is not eligible for a group plan. If we drop off the plan, I want to ensure she doesn't get screwed over. Can you help me figure out what questions she and I need to ask the owners and our insurance broker and/or come up with creative solutions to pose to the owners of the company? (I realize that this is really the coworker's issue but we're a very tight-knit office and my coworker wants this help.)

Key considerations:

  • The owners of the company will (almost certainly) have no issues taking what they contribute for my insurance coverage and applying it to the coworker's increased monthly costs (she pays nothing out of pocket). That'd give her up to $1000/mo for a policy.
  • Owners aren't around on a day to day basis; they stop in maybe once a month, at most. Company is hurting and if this year is like last year they may shut us down. I haven't had a raise in the years I've worked there, no bonuses, lots of budget cuts. We're working hard to stay in business, though!
  • The owners of the company haven't been on the insurance they offer for 10+ years (never in one case) and the other 2 eligible employees both dropped off the insurance in the last 3 years for their spouse's better plans. I'm not going to be guilted into staying on the insurance just because I'm the last one eligible.
  • Husband and I care about this coworker. We all met when selecting insurance for this year to discuss her needs. She had some expensive tests that had to be done so she asked if we'd be willing to go to a higher cost (to us), lower deductible plan. We readily agreed. It's possible that in the last two months she's already hit her deductible. I'm certain that if she had to fulfill a deductible again this year, she'd be screwed.
  • Husband and I are ready to start a family and this is the last month I'll be on the Pill. Saving money is important to us.

I'm nearly sure the owners will take what they contribute for my insurance and apply it to coworker's newer, likely more expensive plan but what about what she's already paid toward her deductible? Does that ever transfer or to new plans if she has to change for reasons beyond her control? I don't imagine so. What can we propose to the owners to help make up for what she's contributed towards the deductible already? Can you think of anything other than asking the owners to pay possibly thousands of dollars to the coworker to make up for what she's already contributed towards the deductible? This will be a HUGE deal for my coworker.

Alternatively, would it be legally possible to keep me on the insurance AND go on husband's better insurance (as my primary insurer - I wouldn't ever make a claim against the one I share with the coworker) and then ask the owners to reimburse me what I pay out of pocket to make up for what I could have saved if we dropped it (that'd be less than our deductible)? If so, do we draft a contract or something that I sign saying we're keeping the insurance so coworker remains eligible and I promise not to use it?

Any other ideas? Can you think of better ways to frame these questions to our insurance broker? When I called to talk to her today, she was of no help.

I desperately want my coworker to not suffer financially for the good fortune of my family. If it matters, this is in Montana, USA.
posted by adorap0621 to Work & Money (9 answers total) 1 user marked this as a favorite
Is your coworker eligible for Medicaid? Or former military/military dependent?
posted by spunweb at 8:52 PM on February 27, 2013

I don't believe you can keep the insurance and not use it. If you are insured through your employer, that is your primary insurance. Doctors will bill them first. So if your insurance covers 70% but hubby's covers 90%, your insurance will pay the 70% and his will cover another 20%. His insurer is not going to be cool with covering it all when they are not legally obligated to do so.
posted by Michele in California at 9:14 PM on February 27, 2013

You can absolutely be on 2 plans at the same time. It could even be of benefit to you. You need to call your current insurance and ask them what their "Coordination of Benefits" provision is. My guess based on the likely type of plan you have and it being in Montana would indicate that both plans would pay with the total payment not being more than the total allowed amount. The regulations on group plans in Montana are such that, if both plans are considered group insurance plans regulated by the state, then that should be the way it works.

Your coverage through your employer would be the primary insurance though. You would be required to submit to them first. However, on the bonus side, that would also mean that you would potentially be able to have the child with no cost at all to you for your maternity as long as you stick to providers contracted with both plans.

For your coworker, they would not be able to carry over the deductible to the new plan automatically though.

Another thing to check on would be what is called a "conversion plan". That is where a person losing their group plan converts to an individual plan. Rates are generally higher, but it may be the only option available to them.

Finally, if you are looking for a semi-short term solution, keep in mind that the insurance exchanges under the new health care legislation will be starting up in the next few years. Not sure what Montana's time frame is for it though.
posted by slavlin at 9:44 PM on February 27, 2013 [1 favorite]

BTW- You cannot promise not to use the insurance. Most plans have specific requirements outlining which insurance must pay first. Generally, if you are covered due to your own employment on a group plan, that has to be primary.

If you make the choice not to file a claim by not telling your doctor/physician about it, then your husband's insurance could come back after money they paid as primary for several years after the fact. You will likely get a letters at least asking if you have other insurance and knowingly falsifying that information can even be grounds to be dropped from a policy since you would be submitting inaccurate information on purpose.

None of this is to scare you. I am just putting it down so you know what options you need to specifically avoid.
posted by slavlin at 9:52 PM on February 27, 2013

The most simple option is to move fully over to your husband's policy - - and your employer would convert your coworker to an individual policy with similar coverage. The savings your employer realizes with you dropping off could subsidize your coworker's out of pocket or monthly premium. This is not uncommon, especially in smaller orgs.

Separately, you should consider the ramifications (potential) of being dependent on your husband's health policy.
posted by Kruger5 at 4:57 AM on February 28, 2013

Talk to the insurance company; when I worked in insurance, there were several "groups of one" -- a "group" was a count of eligible employees, not only employees taking the coverage. If there were four employees but all but one were on their spouse's insurance we still covered them. That was almost ten years ago now and for BCBSND, so I can't say it's the same now, but talking to the insurance company would be a good idea before creating a complicated system to solve a problem that might not be there.
posted by AzraelBrown at 5:26 AM on February 28, 2013 [1 favorite]

Thanks everyone! I feel like we'll be able to talk to the insurance folks more clearly and then communicate the issues and options to the owners a lot better.
posted by adorap0621 at 5:43 AM on February 28, 2013

While you're looking, be sure and look into which plan covers maternity costs. Where I am, individual plans do NOT cover any sort of pregnancy/maternity costs, but group plans do. It's not clear to me if your husband's plan is an individual or group, but my understanding (having never had them) is that babies are expensive....if you were in my area, it'd be worth it to stay on the group plan that covers them. Sorry I don't have any advice on making it easier for your coworker if you don't stick with the group plan!
posted by csox at 6:33 AM on February 28, 2013

I'm in much the same situation, and when I dropped my employer plan for a couple of years (to save my small place some $$$), I ended up paying extra for my spouse's plan. Like, $125 more a month extra. His company charges more if a spouse has access to their own employer-sponsored plan and doesn't take advantage of it -- check those policies!

So, for a couple of different reasons it might be best to keep your employer-sponsored plan. I've been dual-plan for more than 5 years now, and it's actually kind of nice to have the backup coverage. Particularly if you're facing pregnancy -- we paid a grand total of $200 for Kid1 despite the fact that I had a long and complicated delivery. We weren't going broke trying to pay 80% of two different insurance premiums, though (Coverage by both employers at the time was very generous. Things have changed.)

Last but not least, at my workplace, if you qualify for but choose to opt out of insurance coverage, you get a monthly stipend as a thank you for saving them the money.
posted by hms71 at 2:01 PM on February 28, 2013

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