Chambers of Commerce Group Insurance Plan: Liabilities and Solutions

Transcription

1 Chambers of Commerce Group Insurance Plan: Liabilities and Solutions Presented by: Tamara Dundas, Benefits Advisor Brenda Cubbon, Benefits Coordinator

2 Introduction Tamara: Joined Wiegers Financial & Benefits in 2009 Has worked in the financial services industry since 2000

3 Our Service Team The Wiegers Group Benefits Department has a Service & Support Team of 7 people, two of whom work exclusively with our Chamber of Commerce Group Insurance Plan clients: Chantel Holinaty Krista Gray Joined Wiegers Financial & Benefits Spring 2012 Joined Wiegers Financial & Benefits Fall 2011

4 Introducing Online access for all Chamber of Commerce Group Insurance Plan administration Paperless User-friendly Immediate changes for billing Located at

5 Fine Print Liabilities: The Enrolment Process The Chamber plan s standard waiting period is 3 months but you have the option of changing it to 6 months Remember: you always have the option to waive the waiting period altogether for a new hire, provided he or she will work at least 20 hours per week (a requirement of any employee to join the plan) All benefits become effective on the 1 st of the month following the waiting period

6 Fine Print Liabilities: The Enrolment Process An eligible employee and his or her dependents must be enrolled on the group plan no later than 31 days after the employee s eligibility date Otherwise, the employee and his or her dependents will be treated as late applicants

7 Fine Print Liabilities: The Enrolment Process What is a late applicant? A late applicant must include a completed Statement of Health (at minimum) with his or her enrolment form If the questionnaire raises any red flags about the applicant s health, the Chambers of Commerce has the option to disallow the applicant from joining the group plan or from certain benefits (e.g. no disability coverage)

8 Fine Print Liabilities: The Enrolment Process If the employee is allowed on the plan, he or she will have reduced Dental coverage the first year on the plan (i.e. $250 in coverage for the employee and each of his or her dependents) This is a potential liability to your company

9 Fine Print Liabilities: The Enrolment Process Why does the Chambers of Commerce care about late applicants? Anti-selection! Why should you care about late applicants? Anti-selection! Is why participation in the plan should be mandatory (Firms on the Chambers plan with fewer than 5 employees must meet 100% participation)

10 Fine Print Liabilities: The Enrolment Process Remember to also provide each eligible employee with an employee booklet when joining the plan It is up to you to update an employee s family status within 31 days (e.g. new spouse or child) Update employee salaries to ensure benefit volume is current Always check your billing carefully for irregularities that will prevent errors and billing issues

11 Fine Print Liabilities: The Enrolment Process Use my-benefits.ca to: Add or terminate employees from the plan Make changes to family status Update salaries

12 Fine Print Liabilities: The Enrolment Process

13 Fine Print Liabilities: The Enrolment Process

14 Fine Print Liabilities: Maximum Benefits What is a non-evidence maximum (NEM) benefit? The maximum benefit to which an employee is entitled, regardless of his or her health Depends on the employee s gross annual income Applies to the income-based benefits only, i.e. Life Insurance (on some plans) Short-Term Disability Insurance (on some plans) Long-Term Disability Insurance

15 Fine Print Liabilities: Maximum Benefits What is an overall maximum benefit? The total maximum benefit that is available to an employee Typically includes an NEM plus a top-up The NEM is still (as always) guaranteed An employee must apply and be medically approved for the top-up

16 Fine Print Liabilities: Maximum Benefits Top-Up (proof of health required) Non-Evidence Maximum (no proof of health required) Overall Maximum Benefit

17 Do You Know Your Group s NEMs and Overall Maximum Benefits? Liability: 1. You do not advise employees of their option to apply for top-up Life, Short- and/or Long-Term Disability insurance 2. You do not immediately advise your group insurance carrier of every employee salary update An employee dies or becomes disabled In part because you did not advise the employee of the option to apply for more insurance and/or did not advise your carrier of salary updates, a lesser benefit is payable than what might have been payable had the employee applied and been approved for the top-up

18 Do You Know Your Group s NEMs and Overall Maximum Benefits? Liability solution: Signed Decline to Apply letter (when a particular employee s salary entitles him or her to apply for a top-up) Look online ( & Resources/Enrolment/Administration) for this letter in template form

19 Sample Decline to Apply Letter

20 Life Insurance

21 Fine Print Liabilities: Conversion Privilege Life/Dependent Life Insurance, Health and/or Dental Conversion Privilege An employee has the option to convert his or her group Life/Dependent Life Insurance, Health and/or Dental coverage to a personal insurance policy after leaving your company (for any reason) As long as the employee does this within 31 days of leaving, he or she does not have to provide proof of health

22 Fine Print Liabilities: Conversion Privilege The cost and type of coverage will differ from what is available through the group plan but the coverage is guaranteed.

23 Fine Print Liabilities: Conversion Privilege Liability: Your company does not advise a soon-to-be or nowformer employee of this option It is now longer than 31 days since the employee left your company and because of the employee s health, he or she cannot get personal coverage The employee argues that your company bears some responsibility for failing to advise him or her of the Conversion Privilege option

24 Fine Print Liabilities: Life Insurance It s also a good idea to remind your employees to regularly review their Life Insurance beneficiary designations In the event of a life change (e.g. marriage, divorce, children, etc.), they might want to update their beneficiary designations through the group plan Employee will have to complete a Change Form

25 Fine Print Liabilities: Life Insurance

26 Fine Print Liabilities: Dependent Life Insurance Dependents (like employees) have 31 days to join a group plan following their eligibility date Liability: you do not advise employees that within 31 days of their getting married or having a new baby, they must enroll their new dependent(s) on the group plan or face late applicant status

27 Fine Print Liabilities: Extended Healthcare and Dental Benefits Waiver of Extended Healthcare and/or Dental An employee can only waive one or both of these benefits if he or she has coverage under a spouse s group benefits plan Example: Jill has Extended Healthcare coverage under her husband s group plan so she can, if she chooses, waive Extended Healthcare coverage under her own plan She must, however, enroll her husband and her for her company s Dental benefits

28 Fine Print Liabilities: Extended Healthcare and Dental Benefits All Life insurance (including Dependent Life) and Disability insurance benefits are mandatory An employee must enroll for family coverage even if waiving both Extended Healthcare and Dental Be sure to indicate the spouse s and children s names on the application form, even if waiving both Health and Dental

29 Fine Print Liabilities: Extended Healthcare and Dental Benefits Waiver of Extended Healthcare and/or Dental If an employee loses spousal coverage, the employee has 31 days to join his or her own plan before being considered a late applicant Example: Jill s husband decides to resign from his place of employment effective July 1 st, thereby losing his and her group Extended Healthcare benefit Jill has until July 31 st to enroll both her husband and herself for Extended Healthcare through her own group plan If she waits any longer, they will both be considered late applicants with respect to the Extended Healthcare benefit

30 Fine Print Liabilities: Extended Healthcare and Dental Benefits Waiver of Extended Healthcare and/or Dental Liability: you do not advise employees that within 31 days of losing their spousal coverage, they and their dependent(s) must enroll on the group plan or be treated as late applicants

31 Sample Policy Manual Insert

32 Fine Print Liabilities: Survivor Benefits The Chambers of Commerce Group Insurance Plan includes Extended Healthcare and Dental survivor benefits Duration: 24 months after the death of the employee Liability: You do not inform your deceased employee s dependents that they qualify for survivor benefits Liability solution: Advise Wiegers Financial & Benefits of any death claim

33 The Special Support Program (SSP) Is a provincial initiative aimed at partially or wholly subsidizing prescription drug costs for eligible citizens Covers prescription drugs listed on the Saskatchewan Formulary drug plan Currently includes approximately 4,250 prescription drugs A person s eligibility is based on a number of factors including: Combined family income Prescription drug costs over previous six months Number of dependents Other government coverage available

34 The Special Support Program (SSP) Every Saskatchewan citizen can and should apply, regardless of current need It can take several months for the government to process an application A person s prescription drug needs and expenses can change instantly Applies to every member of a family

35 The Special Support Program (SSP) What does the SSP have to do with your group benefits plan? The Chambers of Commerce Group Insurance Plan will suspend paying an employee s or dependent s prescription drug claims once they reach $1,000 in a year If an employee submits hardcopy claims for reimbursement, he or she will be sent a letter with instructions to apply to the SSP; if he or she uses the Drug Card, the pharmacist will verbally advise the employee of the need to apply

36 The Special Support Program (SSP) The employees must submit proof to their group insurance carrier of their application to the SSP before the carrier will resume paying claims Is a positive thing with respect to your group plan! The Chambers of Commerce Group Insurance Plan will then reimburse all or a portion of whatever is not covered under the SSP

37 The Special Support Program (SSP) Remember: The SSP only covers prescription drugs included in the Saskatchewan Formulary drug plan SSP reimbursement levels vary from person to person, depending on eligibility

38 Benefits and Maternity Leaves

39 Benefits and Maternity Leaves An employee who is about to go on maternity leave has the option to continue or discontinue her group benefits for the duration of her leave She must make her decision prior to starting her leave Whatever she decides, ask that she sign a letter that clearly indicates her decision Advise the Chambers of Commerce Group Insurance Plan of the decision

40 Benefits and Maternity Leaves If the employee decides to discontinue her benefits, she loses all coverage until she resumes working at the expiration of her leave No waiting period is required upon her return to work

41 Benefits and Maternity Leaves If the employee decides to continue her benefits: She will be covered for all benefits for the duration of her maternity leave If she becomes disabled while on leave and remains disabled at the end of her leave, she will qualify for disability insurance benefits on her intended returnto-work date (assuming she meets the group plan s definition of disability) She will continue collecting disability benefits until she can resume working

42 Benefits and Maternity Leaves For example: Emma decided prior to beginning her maternity leave that she wants to continue her group benefits throughout Her leave began on January 1, 2012 and is scheduled to end on December 31, 2012 She is involved in a collision during her maternity leave that leaves her disabled with a severely broken leg Effective January 1, 2013 Emma can apply for group disability benefits Her benefits will continue until she can return to work (assuming she meets the group plan s definition of disability)

43 Benefits and Maternity Leaves What about her group insurance premiums? In the interest of practicing non-discrimination, Wiegers Financial & Benefits recommends that you continue the same cost share arrangement during her leave as before her leave Collect from her either a full year s worth of premium payments or a sufficient number of post-dated cheques prior to her beginning her leave

44 Benefits and Maternity Leaves The letter you require her to sign should indicate that if she fails to provide payment or her cheques are not honoured, she will have two weeks (or whatever length of time your company decides is appropriate) to arrange payment or her benefits will be terminated immediately

45 Benefits and Maternity Leaves The Chambers top-up an employee s Employment Insurance (EI) benefit with group Short-Term Disability (STD) Insurance benefits following childbirth The Chambers will top-up an employee s EI benefit for 6 weeks in the case of a vaginal delivery or 8 weeks in the case of a Caesarean Section The Chambers automatically coordinate an employee s disability benefits with her maternity leave benefits If a pregnant employee must leave work early for health reasons, she will need to apply for the STD benefit

46 Benefits and Maternity Leaves The process is as follows: 1. The employee must telephone the Chambers to have a Short-Term Disability claim form mailed or ed to her 2. She will be sent a letter with all pertinent instructions 3. If the claim is approved, her benefits will begin 4. Once she delivers the baby (or babies), she must advise the Chambers of the birth date and type of delivery, and provide a copy of her first EI benefit stub so that the Chambers can determine the amount of the top-up

47 Benefits and Maternity Leaves The employee must have all coverage in place until she delivers her baby (or babies) and applies for the STD topup Once this is approved, her employer can remove her from the plan if she opted to discontinue her group benefits while on maternity leave

48 The Extension of Extended Healthcare and Dental Benefits to Disabled Employees Disabled employees will collect disability benefits for as long as they meet the Chambers definition of disability While on Short-Term Disability claim, all group insurance premiums must continue to be paid The length of time that an employee remains on your plan for all benefits is determined by your company s internal policy While on Long-Term Disability claim, Short- and Long-Term Disability premiums are waived Life insurance might continue too: Life insurance waiver of premium

49 The Extension of Extended Healthcare and Dental Benefits to Disabled Employees Most employees assume that if they go on disability claim, they will continue to have Extended Healthcare and Dental coverage but Extended Healthcare and Dental benefits are not guaranteed to disabled employees

50 The Extension of Extended Healthcare and Dental Benefits to Disabled Employees Wiegers Financial & Benefits recommends that your company implement a policy that clearly stipulates the length of time a disabled employee can continue to have group Health and Dental benefits Typically, one or two years

51 The Extension of Extended Healthcare and Dental Benefits to Disabled Employees Why? You want to help your disabled employees but Disabled employees are often high claimers This could negatively impact the insurance rates that your entire team must pay, potentially until the disabled employee turns 65 years of age Insurance carriers sometimes frown on quoting on groups with disabled employees Could be a problem if you want to change carriers

52 The Extension of Extended Healthcare and Dental Benefits to Disabled Employees Why not simply terminate a disabled employee from the Extended Healthcare and Dental benefits if/when the employee s claims become problematic? Risk of being perceived as discriminatory A better idea is to implement a company-wide policy procedure before any employees become disabled

53 Other Reminders Re: Disability Claims Make sure you know the proper procedure for an employee going on a disability (e.g. which forms must be completed and where to send them) Get Wiegers Financial & Benefits involved if you have issues or need help with an appeal Even if the injury happened at work, it might be worthwhile applying through the group plan

54 For Your Information: The EI Premium Reduction Program Is a provincial initiative that allows employers to pay EI premiums at a reduced rate if their employees are covered by a group Short-Term Disability insurance plan An employer must return a portion of its savings to employees: Cash rebate (taxable income) Paying for new or enhanced group benefits Employee functions You needn t reapply each year; your entitlement will continue until you change or cancel your approved plan

55 For Your Information: Coverage for Post- Secondary Students Children who are over the age of 21 and attending a postsecondary education institution on a full-time basis generally qualify to remain as dependents on their parents group benefits plans Typically until the age of 25 The Chamber will notify an employee that his or her dependent, who will soon turn 21 years of age, will be removed from the group plan unless supplied with proof that the dependent is enrolled in a post-secondary education institution on a full-time basis

56 For Your Information: Coverage for Post- Secondary Students If a dependent child must pay premiums for coverage through school, can usually waive this coverage (and required insurance premiums) in lieu of dependent coverage under parent s plan Coverage is often better under parent s plan Doesn t cost anything extra if the parent would have family coverage anyway Is usually a very small window of opportunity at start of school year to waive coverage under school plan

57 For Your Information: Termination of Employee From Plan Remove employees from your company s benefits plan as soon as their employment terminates Can be done online or in hardcopy but ensure it gets done promptly to avoid: Paying premiums for a terminated employee The employee utilizing the plan past his or her termination date as these claims will impact the claims experience and, by extension, future insurance rates for your group as a whole It could be irreversibly costly if you don t!

58 For Your Information: Termination of Employee From Plan An employee s disability benefit ceases on the last day worked. All other benefits remain in-force until the end of the month

59 Out of Country Health Coverage Advise your employees to let the Chamber know if they are leaving the country There may be restrictions on coverage due to recent health issues or drug changes Some countries require proof of health coverage upon entry (e.g. Cuba) The Chamber will supply a letter to prove coverage for the travel dates

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