Health Insurance Laws for Employers

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Health insurance laws for employers vary by the size of the employer. Smaller employers are exempt from certain requirements of larger plans. Every year, congress passes new legislation regarding the requirements for employers to follow on health coverage. As of August 2009, there's a pay or play reform proposed for larger employers. There are legal requirements for all plans that span all sizes of companies. Even an oversight might be very expensive if the employer doesn't know group health insurance laws. There are some laws that are Federal mandates and others come from state insurance law.

No Discrimination

  • Supply all employees with the information and paperwork necessary to purchase medical, disability, life or dental insurance if you offer it. Do not discriminate because you believe it might cause your premiums to escalate. Discrimination isn't about race, but more often, due to age, disability or ability have children. Make certain that you give all employees information about your plan and equal benefits. Non-discriminatory practices are federally mandated.

Required Coverage

  • Check with your state laws. Some states require all employers with over a specific number of employees carry group health insurance. If your business is in Massachusetts, that number may be as low as 11 employees.

Maternity Coverage

  • Find out if you need to include maternity coverage. Not all states require that you offer maternity coverage as part of your health package. In some states, such as Indiana, the requirement for maternity coverage is only for companies that employ over a specific amount of workers. This number might be as small as five people, so you need to check with the insurance carrier to see if you need maternity coverage in your state.

Participation in Premiums

  • You may be responsible for a partial portion of the bill. While many insurance companies don't offer group plans if the employers don't participate in premiums, some states require it by law. The amount varies according to the insurance statutes of the state.

COBRA

  • Notify terminated employees about their right to sign up for COBRA coverage if you had more than 20 full time employees the previous year. Federal law allows these employees to carry coverage with your group plan for up to 18 months if they pay for it. There are penalties for non-compliance with notification requirements concerning COBRA coverage. COBRA laws are federally mandated and effective in all states.

HIPAA

  • Check the requirements of the Health Insurance Portability and Accountability Act of 1996 (HIPAA). You must offer new employees health insurance with no preexisting conditions applicable if they had continuous coverage, or no longer than a 63 day lapse in coverage before they sign up for your health benefits. Some states allow for a longer lapse in coverage. If the employee had no treatment for a condition and none suggested six months before enrollment, the pre-existing condition clause is not applicable. The longest a preexisting conditions clause lasts, according to federal law is 12 months. State law may shorten this waiting period.

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