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Employer Sponsored (Group) Insurance
About Employer Sponsored (Group) Insurance (ESI)
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Group health insurance is typically offered by employers. Or, if you are a member of a union, professional association, or other group, you may be able to get group coverage through that organization.
 
Some employers allow employees to choose between several plans, including both indemnity insurance and managed care. To learn more about the differences in these types of plans, visit types of health insurance. Other employers offer only one plan. Some group plans offer dental and/or vision benefits, as well as medical benefits. So it is important to compare plans to find the one that offers the benefits you need most.
 
All employers except those that self-insure are required to include certain state benefits in their plans. Click here for a list of mandated benefits in Oregon (.pdf). You may have to ask if your employer self-insures because even those employers hire insurance companies to administer their plans. Also, self-insured health plans operate under federal regulation, instead of state laws.
 
Once you enroll in a health insurance plan, you usually cannot change to another plan until the next open enrollment, usually set once a year.
 
When group health insurance is an employee benefit, your employer usually pays a portion or all of the premiums. This means your costs for health insurance premiums will be lower than they would be if you paid the entire premium alone.
 
Your employer may or may not allow you to add dependents - a spouse and/or children - to the plan at work. Employers may pay all, part, or nothing to add dependents to your plan. If you can't get insurance for your dependents at work, you could buy an individual plan for your dependents. If you cannot afford the premium to add your dependents, see the information on FHIAP and the Healthy Kids Program.
 
When you get group insurance through membership in trade or professional association, you usually will benefit from being a member of a large group. You may pay less for premiums than an individual would pay. However, the organization often does not pay a share of the premium, meaning you may be responsible for paying the entire premium yourself.

If You Lose Group Coverage
If you leave a job where you have had employer-sponsored health insurance, you will want to ensure that you have continued protection against the high costs of health care. Whether you leave the job on your own or are forced to leave, there are laws that may help you to maintain coverage.
 
COBRA/State Continuation "Mini-COBRA"
 
Under the Consolidated Omnibus Budget Reconciliation Act of 1986 or COBRA, group plans sponsored by employers with 20 or more employees are required to offer continued coverage for you and your family for 18 months after a "qualifying event." A qualifying event may be an employee's death, termination of employment (voluntary or involuntary - mother than for reasons of gross misconduct), reduction of hours, or entitlement to Medicare. These reasons would not only qualify an employee for COBRA, but a covered spouse and children as well.
 
In some cases, the COBRA period may extend past 18 months. For example, a disability can extend the 18 month period of continuation coverage for a qualifying event that is a termination of employment or reduction of hours. To qualify for additional months of COBRA continuation coverage, the qualified beneficiary must:
  • Have a ruling from the Social Security Administration that he or she became disabled within the first 60 days of COBRA continuation coverage
     
  • Send the plan a copy of the Social Security ruling letter within 60 days of receipt, but prior to expiration of the 18-month period of coverage
If these requirements are met, the entire family qualifies for an additional 11 months of COBRA continuation coverage. Plans can charge 150 percent of the premium cost for the extended period of coverage.

Under COBRA, participants, covered spouses and dependent children may continue their plan coverage for a limited time when they would otherwise lose coverage due to a particular event, such as divorce (or legal separation). A covered employee’s spouse who would lose coverage due to a divorce may elect continuation coverage under the plan for a maximum of 36 months. A qualified beneficiary must notify the plan administrator of a qualifying event within 60 days after divorce or legal separation. After being notified of a divorce, the plan administrator must give notice, generally within 14 days, to the qualified beneficiary of the right to elect COBRA continuation coverage.

Divorced spouses may call their plan administrator or the EBSA Toll-Free number, 866-444-EBSA (3272) if they have questions about COBRA continuation coverage or their rights under ERISA.
A covered child may also become eligible for COBRA when they cease to be covered as a dependent under the insurance plan's rules.
 
In order to continue your coverage under COBRA, you must notify your employer that you intend to do so within 60 days of losing your employers health coverage. Your coverage can include the medical, prescription, dental, and vision insurance. You will most likely have the same plan as you did previously, but be aware, if your employer changes plans, you may be subject to change as well.
 
On COBRA, You must pay the entire premium cost of the coverage. You have probably heard someone say "my COBRA premiums are so high!" More often than not, it is not because the insurance premium has gone up. Although COBRA premiums may increase, if costs to the plan increase; generally they are fixed in a 12 month premium cycle, with premiums costs increasing at the beginning of plan year. It is more likely the person has never seen the entire cost of their premium. As an employee, the employer may have paid all, or a significant part, of the premium. As a former employee, you will most likely pay the full premium now - whatever you contributed before (if anything), plus what your former employer had paid. There is a limit on what administration fees may be charged, the maximum is two percent. The plan must allow you to pay monthly, if you make a request. The plan may offer other payment options, as well.
 
To remain eligible for COBRA, the plan must remain in effect for active employees. If the employer discontinues the plan, no coverage will be available for active or inactive employees. Click here for information on the Oregon Medical Insurance Pool (OMIP), for people who have lost or exhausted COBRA options. Also, look under "Other Choices" below.
 
For more information on COBRA visit the United States Department of Labor website: http://www.dol.gov/dol/topic/health-plans/cobra.htm.
 
Employer Tip: Make sure to let your employees know the value of all the benefits you provide. Many employees do not realize the true costs of their insurance premiums, until after they leave employment; while some never do - counting it up the "cost" of COBRA. A simple way to communicate the value of an employee's benefits is on a paycheck, or for those with automatic deposit, a paycheck stub. List the health plan name and the amount that you are contributing. Also, make sure you communicate the premium amounts each year at an annual enrollment meeting, or informational handout.
 
State Continuation of Coverage
If your employer has less than 20 employees, Oregon has State Continuation of Coverage. "State continuation" is similar to COBRA, and has been referred to as "mini-COBRA." State continuation allows employees to keep their employer's health plan under circumstances ranging from loss of job, to divorce (or legal separation), to the death of a spouse. Unlike COBRA, state continuation allows the employee to keep the coverage for six months, or until they are eligible for other coverage (including Medicare), whichever is shorter. The coverage may include medical, prescription, dental, or vision coverage.
 
The Oregon Medical Insurance Pool helps those that exhaust their insurance options, or look below for other choices.

Other Coverage
If you lose your group health insurance coverage, and cannot afford to keep it, you may be able to purchase other coverage. Here are some choices:
 
Portability
This is a type of individual policy that may be available from the same insurance company that provided your group policy through your employer.
 
In Oregon, to be eligible for portability you:
 
MUST:
  • Apply within 63 days of losing your group coverage.
  • Be an Oregon resident.
CANNOT BE:
  • Eligible to remain enrolled in your group coverage.
  • Eligible for Medicare.
  • Enrolled in another health plan.
To be eligible for portability, you qualify under Oregon's rules, or under the federal Health Insurance Portability and Accountability Act (HIPAA).
 
Oregon's Rules
 
You may qualify if you:
  • Have been enrolled in your Oregon-based group coverage for at least six months.
- OR -
  • Have been enrolled in your non-Oregon-based group coverage for at least six months, while residing in Oregon.
     
  • Have exhausted your state continuation or COBRA coverage IFyour coverage was in a "self-insured" plan. Note: You do notneed to exhaust COBRA or state continuation, if the group coverage was not self-insured.
 
Health Insurance Portability and Accountability Act (HIPAA) Rules
 
You may qualify if you:
  • Have at least 18 months of prior insurance coverage, with the most recent being in a group plan.
 -AND-
  • Have exhausted COBRA or state continuation coverage; however, you may become eligible under Oregon's rules before this is exhausted.
 
Portability Plan Options:
  • Prevailing Benefit Plan - A plan similar to most group plans.
  • Low Cost Plan - A plan with higher deductibles and co-payments.
In most cases, your insurer is the same one that you had with your group coverage. The Oregon Medical Insurance Pool (OMIP) is your insurer, when you:
  • Were enrolled in a non-Oregon-based plan.
     
  • Were enrolled in a "self-insured" group plan.
     
  • Qualified for your Oregon-based insurer's portability plan, moved out of their service area, but still reside in Oregon.
     
  • Qualified for your Oregon-based insurer's portability plan, but your insurer stop servicing the area in which you live.
You will not be charged extra for your premium when you qualify for a plan from OMIP.
 
Portability plans must cover pre-existing health conditions, which may be of interest to those with pre-existing health issues.
 
Individual/Family Plan
Known as "individual" health insurance plans, these plans may be purchased for those that are single or by those with family. They are termed "individual" because they cover individuals, rather than covering a group of people - such as the group an employer may wish to cover. You may buy an "individual" plan for yourself or family, directly from an insurance company. See individual and family plan.
 
Short Term Insurance
These plans fill a temporary need, such as when you are between jobs, just graduated from college; or are waiting to be covered under a group medical plan. They are best suited for healthy people, because they may not cover pre-existing conditions.