Tricky offer is it legal?

Balloonman1

Situation, have a potential employee we are considering making an offer to. We are partially self funded on our health insurance. (Deductible 15K)
During the last interview he volunteered a chronic condition his wife has, $$$$$ but said he only needs insurance on him and the kids.

Is there any legal issue with conditioning the offer to include only coverage for him and children since that is what he has told us?
Thought about have one more conversation to ask who will be enrolling as we are deciding total compensation package.

Have not ever had this one come up, would have been easier if he had just kept his mouth shut. But he volunteered all this.......
Looking for your $0.02 worth.
DJ The Balloonman

Jewel

What if, you hire this person and down the road he needs to bring his wife on the medical coverage due to her loss of coverage. Would you terminate him?

I'd say that you'd be buying the whole package, so to speak, if you decide to make him an offer. If his wife doesn't need coverage - then good - it will save on your experience rating. I don't think you can deny him coverage but then again, I'm not an attorney. Just keep in mind, if you do it for him (assuming that it's legal to do), then you must do it for others as well - just to keep it fair and balanced.

Good luck with this one!

LarryC

First of all, I assume you mean that your stop loss is 15K. Second, if she qualifies as a dependant, there is a qualifying event, and she wants to enroll, I don't know of any way of keeping her off the insurance that would not run afoul of ERISA.

SMace

I would not lower his other benefits to compensate for his wife's insurance costs. In an ERISA plan you cannot discriminate against someone because of a health condition. I would think this could be easily established if you went down that road. I would get with your insurance carrier and see what they can do to help minimize everyone's costs. Maybe they have some sort of disease mgmt plan that can help. Your stuck and your playing with fire if you do anything else.

pork1

BALLOONMAN 1: What does your Medical Plan Document say about "previous exsisting conditions"? Surely the plan clearly lays out that this previous condition would not be covered. Now, given you know that would there be a closing date on the condition or is it open-ended and continuous? After one year of being a member of the plan as a covered person the plan then, most likely, must pick up the condition. I once made the error of paying the ee to come to work and paid a portion of the COBRA coverage to the ee. He did not list spouse until he had been an employee for one year, then he applied for her membership in our plan, still not well and now she had to wait a year. The company ended up eating her 2nd year medical bills from the bottom line. He was a specialist at welding pipe and a good one at that, we did waht was necessary to keep him on board. The carrier would not cover her medical expense until she had been a covered member for one year. My point, be careful, but at the same time you can not make a hiring decision on a medical fact of a family member, unless he is not otherwise qualified.

Don D

>BALLOONMAN 1: What does your Medical Plan
>Document say about "previous exsisting
>conditions"? Surely the plan clearly lays out
>that this previous condition would not be
>covered. After one year of
>being a member of the plan as a covered person
>the plan then, most likely, must pick up the
>condition.

Pork, surely you know that the original intent and demand of HIPAA (portability) was to ensure that people would have portable coverage from one employer to another without having these imposing 'pre-existing condition' clauses we all used to have in our policies. Under HIPAA the new employee and his family and all of their medical conditions are covered under the new plan as soon as he is eligible to enroll, UNLESS the guy had a lapse in coverage, under which condition, the one year rule would apply. No matter what your plan says about pre-existing, which violates the law, under the HIPAA regulations, more than likely she would be eligible without regard to health issues.

I would never go close to setting up some sort of agreement whereby a potential hire would agree, as a condition of employment, that he would not attempt to get an ill family member on the policy.

pork1

Don: Thanks for pointing out the "lapse in coverage" item, my thoughts were running much to fast for these old fingers. My situation was three employers ago before HIPAA, and you are right, that is when we all had previous exsisting condition provisions. I was thinking of a new hire that had been out of work and without coverage for the spouse, but did not do a good job of communicating it, and recommending investigating more with the potential new employee to understand more about the situation. That is where I was trying to drive "to be careful" of previous exsisting conditions and offers for employment. Under todays rules, we accept all cost for new hires, if there is no lapse in medical coverage!

The PORK was with alittle to much FAT, this time!

Still good but!

PORK

dynamite9551

typically - employees may choose who they want to cover on their group insurance - if the plan is tiered (single, double, family). Insurance company will look at who is put on the policy. i would assume he already has a separate policy on wife or she is covered through her employer if she works. not really a legal issue and many times we have had to "structure" a special employment agreement to meet the damands of the professional we want to hire. sometimes their expertise will benefit us in ways that will "recoup" expenses such as health premiums.

good luck.

Dutch2

To me the bottom line would be, is he the most qualified for the job? If yes, then offer him the job. Every new ee brings their own luggage with them. Some of us wait until we get on board to dump it all on you.
Good luck,
Dutch2

System

Another problem besides ERISA: If the wife is disabled, the ADA prohibits discrimination against the husband because of his relationship with her. I just saw an article about this in the Subscribers Area of HRhero.com, "Seventh Circuit sheds light on relationship discrimination under ADA," Indiana Employment Law Letter.

James Sokolowski
HRhero.com