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Health Insurance

Furlough

 

Social Worker is Quarantined or Contracts COVID-19

 

Grace Period for Premium Payment

 

COBRA Insurance During Lay-off

 

Special Enrollment on Federal Exchange

 

Furlough and Layoff: As a general rule, the terms “furlough” and “layoff” are synonymous in labor law unless the parties give one or the other term a special meaning. For purposes of unemployment compensation law, it makes no difference what the employer calls it, if the employer's reason for separation or a reduction in hours is a “lack of work.”

 

 


Furlough

 

If a social worker is “furloughed” (e.g., required to take one or more days without pay, or partial pay), the social worker would likely still qualify for health insurance if the employer continues providing coverage to employees under the group policy. If an employment contract or employee handbook exists, a review of the terms of the contract or handbook is necessary in order to determine whether health insurance is covered during a furlough.

 

The Ohio Department of Insurance has frozen the ability of insurers to drop coverage for employees who work less than the number of hours the insurer requires for participation in its group health insurance plan. On March 20, 2020, the Ohio Department of Insurance issued Bulletin 2020-03, which provides relief from certain insurance regulations. The Bulletin states that until it expires (upon the expiration of the state of emergency declared by Governor DeWine on March 9, 2020), insurers “must permit employers to continue covering employees under group policies even if the employee would otherwise become ineligible due to a decrease in hours worked per week.” Insurers “are required to permit employers to continue providing coverage to employees under group policies regardless of any ‘actively at work’ or similar eligibility requirements in the policy” and “are prohibited from increasing premium rates based on a group’s decreased enrollment or participation due to COVID-19.” Therefore, if an employee would normally become ineligible under the terms of the group insurance policy due to a decrease in hours worked per week, the Bulletin requires the Company’s group policy insurer to permit the Company to continue coverage under the group insurance policy. 

 


Social Worker is Quarantined or Contracts COVID-19

As noted above in the Section 3 above, if a social worker is quarantined or contracts COVID-19, they may be eligible for up to 10 days of paid sick time under the Families First Coronavirus Response Act. The social worker would still pay their share of the health insurance premium in accordance with any contract or employment agreement. 


Grace Period for Premium Payment

The Bulletin also states that insurers “must give their policyholders a 60-day grace period for premium payments.” This grace period is based on the original premium payment due date and must be interest-free. The employee could choose to inquire whether the employer will defer their own premiums as well. But there is no right under the Bulletin for the social worker to defer payment of premium on her own.

 

By amending the current rules surrounding payment of insurance premiums, the Ohio Department of Insurance creates an opportunity to free up cash flow at a critical time. Specifically, premium payments may be deferred, interest free, for up to 60 calendar days from each original premium due date.

 

Note, however, that the Ohio Department of Insurance’s Bulletin 2020-03 only applies to health insurance coverage. The Bulletin does not impact Dental, Vision, Life, or Disability coverage. Therefore, if the employee inquires about the deferral of healthcare premium payments, the employee may wish to also ask the employer and their insurance carriers that provide Dental, Vision, Life, or Disability coverages if they will be offering premium extensions for these benefits. 


COBRA Insurance During Lay-off

 

There is no requirement that an employer carry insurance for an employee after the employee has been laid off unless an employment contract requires it. If social workers are laid off, they may elect continuation of coverage as follows: 

 

COBRA Continuation Coverage

 

For health plans with at least one active employee enrolled, all former employees that work for an employer with 20 or more employees are eligible for continuation coverage under COBRA. For employees that
lose coverage, there will also be a special enrollment period and waiver of certain enrollment procedures when coverage is purchased on the federal exchange.

 

Employees that work for an employer with fewer than 20 employees may elect to continue coverage under state continuation coverage for up to 12 months, as long as one person remains actively employed and enrolled in the plan. If no active employees remain covered under a plan, COBRA and a continuation coverage are not available. However, the impacted employees will be eligible for a special enrollment period in which they can enroll in new coverage. 


Special Enrollment on Federal Exchange

Employees may enroll on the federal exchange or may purchase a policy outside of the federal exchange. Individuals and their families applying for coverage on the federal exchange can qualify for premium subsidies if they meet the criteria for those subsidies. Plans are effective on the first day of the next month after enrollment. If employees buy policies outside of the federal exchange, the insurer must waive normal special enrollment procedures and allow applicants to obtain coverage effective the day after the loss of their employment.


 

 

 

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