Federal laws protecting continuation of employer-sponsored health insurance coverage
There are federal laws which give people the chance to continue employer-sponsored medical insurance coverage when a person experiences a “qualifying event” (defined under “COBRA” below). There are no laws that guarantee the right to adequate or affordable medical insurance coverage.
COBRA (Consolidated Omnibus Budget and Reconciliation Act of 1986)
COBRA gives people the right to temporarily continue health insurance coverage at the employer’s group rates, but these rates are usually much higher than those you paid when employed. This coverage is available when coverage is lost due to certain “qualifying events,” such as stopping work, reducing work hours, divorce or legal separation, the covered person becoming entitled to Medicare, a dependent child no longer considered to be dependent according to the terms of the plan, or the death of the employee.
COBRA allows people to continue coverage of their group medical insurance for a certain period of time, depending on the qualifying event. For example:
- Up to 18 months of coverage is allowed if you stop working or reduce the number of hours you work.
- 29 months of coverage is possible if a beneficiary is considered disabled. (This determination of disability is made by the Social Security Administration.)
- 36 months of coverage is available in cases of divorce or legal separation, the covered person becoming entitled to Medicare, death of the employee, or when a dependent child is no longer considered to be a dependent.
If a person is fired for gross misconduct, he or she will not be eligible for COBRA.
COBRA is not provided automatically but must be chosen by the former employee within 60 days of getting the written COBRA notice; it is not always within 60 days of when you stopped working. The employer must notify an employee that COBRA is available, usually around 2 weeks after the qualifying event occurs. But there is also a deadline for notifying the plan administrator of the qualifying event, which varies according to the qualifying event. And whose responsibility it is to notify the plan administrator also depends on the qualifying event. In some cases it may be the beneficiary’s responsibility. Contact the employer’s human resources person, your insurance company, or check your policy to find out the details of what must be done and who should do it in your situation.
Continuing insurance coverage is available if the premium is paid and until the person becomes covered under another group policy. Premiums cannot be above 102% of the cost of the plan for employees in similar situations who have not had a “qualifying event.” COBRA coverage may be lost if you go above the limits of the coverage, your former employer stops offering all health plan coverage, or you become entitled to Medicare after you choose COBRA.
COBRA is administered by the U.S. Department of Labor and they can give you more detailed information about its coverage. Families often have concerns about being able to continue paying the premium for COBRA. If this is the case, you should talk to your team social worker who may have suggestions about how to help with these costs.
The Health Insurance Portability and Accountability Act of 1996 (HIPAA)
This bill has many clauses that might benefit cancer patients:
- It allows a person who has had health insurance for at least 12 months with no long loss of coverage (usually more than 63 days) to change jobs and be guaranteed other coverage with a new employer who also offers group insurance. In this situation there may be no waiting period and the pre-existing condition exclusion may be reduced or not applied. Also, the employee and his or her dependents cannot be denied coverage because of a pre-existing health problem.
- If a cancer patient were uninsured before and takes a job with an employer offering group insurance, the pre-existing condition exclusion period cannot be longer than 12 months.
- The plan requires insurers to renew coverage for all employers and individuals when premiums are paid.
- The act also guarantees the availability of group insurance coverage for employers of small businesses of 2 to 50 people.
The Family and Medical Leave Act of 1993 (FMLA)
This act requires employers (with at least 50 employees) to provide up to 12 weeks of unpaid, job-protected leave to eligible employees for certain family and medical reasons. Employees are eligible if they have worked for a covered employer for at least 1250 hours in the previous 12 months. For the time period of the FMLA leave, the employer must maintain the employee’s medical insurance coverage under any company group health plan. This act is regulated by the U.S. Department of Labor’s Wage and Hour Division. They can give you more information. Check the telephone directory in your area under U.S. Government, Department of Labor.
The Americans with Disabilities Act of 1990 (ADA)
This Act offers protection against discrimination in the workplace to anyone who has, or has had, certain disabilities, including any diagnosis of cancer. Parents of dependent children with cancer are also protected under this law. It requires private employers who employ 15 or more people, labor unions, employment agencies, and government agencies to treat employees equally, including the benefits offered them, without regard to their disabling condition or medical history. It also does not allow employers to screen out potential employees who have children with disabilities. This act, along with the Family and Medical Leave Act, makes it easier to change jobs and move from one group insurance arrangement to another. This law is administered by the U.S. Equal Employment Opportunity Commission (EEOC). They can answer questions and give you more information on a special telephone line.
Who regulates different kinds of insurance plans?
The private group plans (or fully insured plans) purchased from insurance carriers by employers as a benefit for employees are overseen by the commission or department of insurance in each state.
Self-funded plans (or self-insured plans) that employers or unions create rather than purchase are overseen by the U.S. Department of Labor’s Employee Benefits Security Administration.
Managed care plans are regulated by several state and federal agencies. Your state commission or department of insurance can provide specific information for an individual plan in question.
Medigap policies are regulated by federal agencies, as well as some state laws. Their sale is restricted to people who are covered with Medicare.
Medicaid is controlled by the state department of social services. Medicare is run by the U.S. Social Security Administration. TRICARE (originally CHAMPUS) is overseen by the U.S. Department of Defense.
Government-funded insurance plans
Medicare is a federal program funded through the Social Security system. It provides health insurance for persons who meet certain criteria. Young people with cancer may receive Medicare benefits after collecting Social Security benefits, under the Supplemental Security Income program, for two years. You can get more information from the nearest Social Security Administration office (check the blue pages of your local telephone book), or by talking with the team social worker. Medicare is also federal health insurance for people who meet any of the following criteria:
- those who are at least 65 years of age
- those who have been permanently disabled and are receiving disability benefits from Social Security
- those who have permanent kidney failure treated with dialysis or a transplant
Medicare is divided into parts:
Part A pays for hospital care, home health care, hospice care, and care in Medicare-certified nursing facilities. It is free.
Part B covers diagnostic studies, physicians’ services, durable medical equipment used at home, and ambulance transportation. There is a cost.
Part D is optional. It helps pay for prescription drugs that are usually bought at a retail pharmacy.
HMOs that have contracts with the Medicare program must provide all hospital and medical benefits covered by Medicare. However, you must usually obtain services from the HMO network of health care providers.
Medicare provides basic health coverage, but it won’t pay all of your medical expenses. It may cover the costs of prostheses or bras, and the number covered per year may vary from state to state. Recently, Medicare has increased their coverage of the number of items for ostomy supplies used per month. If you have questions about Medicare, call 1-800-633-4227 or your local Social Security office.
Private insurance coverage that can be added to Medicare: If you are on Medicare, you may be able to add more coverage with a Medicare Supplement Insurance (commonly called Medigap) policy or a Medicare HMO sold by a private insurance company. There are 10 standard Medigap policies, each of which offers a different combination of benefits. Each is offered in all 50 states, although all plans may not be identical in all states. The plans are identified by letters A through J. It is important to compare Medigap policies because costs can vary, and some of the plans expect you to use only certain doctors or hospitals.
Medicaid
Medicaid is another government program that covers the cost of medical care. To receive Medicaid, your income and assets must be below a certain level. These levels vary from state to state. Not all health providers take Medicaid. Some examples of eligible groups for Medicaid include the following: low-income families with children, Supplemental Security Income (SSI) recipients, infants born to Medicaid-eligible pregnant women, children under age 6, and pregnant women whose income is below the family poverty level.
Medicare beneficiaries who have low income and limited resources may get help paying for their out-of-pocket medical expenses from their state Medicaid program. For more information, contact your state Medicaid office.
State-sponsored children’s health insurance programs
There are special state-supported programs that pay for medical services for children. Most states offer some type of free or low-cost health insurance for eligible children. Usually, the child must be younger than18 and live in a family with a family income at or below 200 percent of the Federal poverty line for a family of the size involved. The program covers doctor visits, medicines, hospitalizations, dental care, eye care, and medical equipment. It is funded by state tax dollars. People enrolled in Medicaid usually are not eligible for state sponsored health insurance programs.
Veterans’ benefits
If you are a veteran or a veteran’s spouse or dependent, you may qualify for government benefits. Veterans’ benefits change frequently, and the number of veterans’ medical facilities has been declining in recent years. To get the most accurate information, call the Department of Veterans Affairs.
TRICARE is a federal program (formerly known as CHAMPUS) that provides approved inpatient or outpatient medical care for dependents of active-duty, retired, or deceased members of the military. This program has been set up to work more like a managed care system.
Breast and cervical cancer screening and treatment for low-income women
Breast cancer testing is now more available to medically underserved women through the National Breast and Cervical Cancer Early Detection Program (NBCCEDP). This program provides breast and cervical cancer early detection testing for women who are uninsured, or in some cases under-insured, for free or at very little cost. The NBCCEDP tries to reach as many women in medically underserved communities as possible, including older women, women without health insurance, and women who are members of racial and ethnic minorities. Each state offers the program and the Centers for Disease Control and Prevention (CDC) provides matching funds and support for each state program. The CDC can be contacted at 1-800-232-4636 or at the NBCCEDP Web site: www.cdc.gov/cancer/nbccedp. You can also contact your state’s Department of Health for further information.
In 2000, the Breast and Cervical Cancer Treatment Act was signed into law. This Act enhanced the National Breast and Cervical Cancer Early Detection Program (NBCCEDP) by providing money to pay for breast and cervical cancer treatment in certain uninsured women. This new option will help women focus their energies on fighting their disease instead of worrying about how to pay for treatment. As in the Early Detection Program, individual states must adopt the program to receive the matching federal funds. Even though it is channeled through each state’s Medicaid program, it helps women who are not eligible for Medicaid. The women must be under age 65 and without health insurance. As of May 2004, all 50 states had completed the required steps to accept this new Medicaid option. If you are trying to get treatment in this way, you can visit the Web site noted in the above paragraph and click “Find a Local Program” under the “View by Topic” list on the left side of the page. Or you can call the CDC number above.
Shopping for insurance coverage
If you are not already insured, the following are things to think about when looking for coverage:
- An independent broker may be able to help you find a reasonable benefit package. Group insurance is better for most people than individual insurance.
- Getting employed by a large company is the surest way to gain access to group insurance.
- Some states have “guaranteed issue” individual plans that are available regardless of health history. Also, some states have state-subsidized health insurance options for low-income residents.
- Explore whether there are health maintenance organizations (HMOs) or health care service plans in your community. Coverage can be quite comprehensive through these plans. Many offer one period of open enrollment each year during which applicants are accepted regardless of health history.
- If you have been covered under your employer-sponsored plan for 1 day or more you should be able to keep your medical insurance through the Consolidated Omnibus Budget Reconciliation Act (COBRA). Your employer should be able to tell you, in writing, about your COBRA option.
- Parents of school-age children with cancer should explore school life insurance.
- Find out whether you can apply for group insurance through fraternal or professional organizations (such as those for retired persons, teachers, social workers, realtors, etc.). Look for a “guaranteed issue” plan.
- Explore your eligibility for Medicare, which covers most people who are 65 or older, or who are permanently disabled and have been receiving Social Security benefits for approximately 2 years.
- See if you are eligible for state or local benefits, such as Medicaid if you are in a low-income bracket or are unemployed. If you are currently employed, don’t leave your job until you have explored insurance conversion options through your current plan. Many group plans have a clause that allows people to convert to individual plans, but premiums may be much higher. These individual plans usually must be applied for within 30 days of termination.
- A few hospitals and other non-profit medical facilities receive funds from the federal government so they can offer free or low-cost services to those who are unable to pay. Each facility chooses which services it will provide at no or lowered cost. Medicare and Medicaid services aren’t eligible for Hill-Burton coverage. However, Hill-Burton may cover services not covered by other government programs. Eligibility for Hill-Burton is based on family size and income. You will need to find out if there is a facility in your area that has any Hill-Burton obligation for which you may qualify. If you are cared for at such a facility, you may apply for Hill-Burton assistance at any time, either before or after you receive care. Call the Hill-Burton Program for more information on this program.
In looking at insurance options, be aware of differences in coverage. Ask about choice of doctors, protections against cancellations, and increases in premiums. Find out what the plan really covers, especially in the event of catastrophic illness. What are the deductibles? (Sometimes higher deductibles go along with better comprehensive coverage.)
If you feel an insurance company has treated you unfairly, contact your state insurance commission for further information.
- cancer.org -
(To be continued)