Resources for Laid Off Employees

Resources for Laid Off Employees
You may be forced into the difficult decision of laying off some of your employees. If you have to do so, here are some options to recommended to them for health coverage during this time.

  1. By law they have access to COBRA.  They can continue their coverage on your group health, dental and vision plans.  Of course, they would need to pay the full premium without the advantage of the employer contribution.  If the company has 20+ employees, the employee can keep the coverage for 18 months.  If the company has under 20 employees, the employee can keep the coverage for 12 months. 
  2. Extend your re-hire policy.  You can establish a re-hire policy in most cases that can extend the number of months allotted to re-hire without having the employee go through the new hire waiting period.  Upon underwriting approval benefits could begin at the date of re-hire or the 1st of the month following.  
  3. They could enroll in an individual/family health insurance plan.  Regular open enrollment for these plans comes at the end of each year for January 1 effective dates.  However, when an employee is laid off, they qualify for a special enrollment.  Depending on income and family size, the employee may be able to qualify for a Federal health insurance subsidy that could pay for all of part of their premium through healthcare.gov. 
  4. You can put them on administrative leave and keep them on your group plan.  Your company would pay the employees premium.  This way, even in the event of a lay-off you could keep them enrolled on your group health plan and would not need to meet new hire waiting periods when you rehire them.
  5. A Short-Term Medical plan is an option.  This may be an option to the laid off employee if they cannot afford COBRA and you are not keeping them on the plan.  Short-Term plans are temporary.  They can purchase them for 6 months, and then renew them for another 6 months.  12 months is the maximum.  These plans are much less expensive than traditional health plans, but they only cover major medical/catastrophic type medical needs. They do not cover prescriptions, preventive care, or pre-existing conditions. 
  6. Health Share plans are an option.  These plans are less expensive than traditional insurance.  However, they are not insurance and the payment of claims is not guaranteed.  Pre-existing conditions are not covered.  

For more information contact your insurance agent who can help you navigate your options. To find an agent visit http://nahu.org/looking-for-an-agent/find-an-agent