change in company, now no coverage??

K_Lynch · June 2003

I have a member of upper managment that became disabled the end of April. Our company changed short term disability coverage carriers, effective May 1. The policy states that the ee must be actively at work on the effective date to qualify for coverage. It has been suggested that I "change" the paperwork to reflect a May 1 last day at work.
I am not comfortable doing this, however, otherwise, it appears that this person has no coverage. Test results indicate the ee will be out maybe a total of 16-20 weeks.
HELP

LindaS · June 2003

Have you contacted the insurance company to be sure there isn't any coverage for this individual? In my experience with changing carriers the one thing that happens is all individuals who were eligible with the last carrier are also eligible with the new carrier.

sonny · June 2003

I agree with Linda. The way it is written, you wouldn't be covered if you were off on a days vacation. Could it be active employee?

K_Lynch · June 2003

The plan book says "must be actively at work on a full-time basis on the scheduled effective date or dates."..............."If you are not actively at work on any date part of your insurance is scheduled to start, we will postpone that part of your coverage until the date you return to active full-time work."

LindaS · June 2003

I would call your contact at the insurance company to determine coverage. I find it difficult to believe a company would engage in the process of changing carriers without having SOME type of rider for employees who are currently out on STD. We recently switched LTD and life insurance carriers and made sure any individual who was not currently working (on STD) was "grandfathered" into the plan to ensure their coverage was maintained.

K_Lynch · June 2003

I have been instructed NOT to contact the company. It is times like this that I am glad to be the "lowly" HR assistant, not the super HR guy who elected these new plans. It's not my job on the line. I think if the ee had been grandfathered, someone would have let me in on it by now. I am learning much on this forum, and this lesson I will take forward with me as I step up in my career.

crawfod · June 2003

A couple of thoughts. One, I would not attempt to manipulate any effective dates. You could end up jeopardizing any legitimate claims by falsifying dates, and honesty is always the best policy. Plus disability carriers almost always rely on doctor's records, so assuming your employee saw a doctor in late April, that date will be on record.

Two, I may be misunderstanding something, but you indicated you changed carriers on May 1, which implies the PREVIOUS carrier was still covering your employees until May 1. Therefore, I would think your employee would be able to file a claim with the previous carrier being responsible. I wouldn't expect the new one to be responsible for anything prior to May 1, unless, as suggested above, your contract allows this.

K_Lynch · June 2003

Under what circumstances would the old company continue to pay once the coverage it termed? With the switch date effective May 1, we have not paid premiums for any time after that to the old company. Does the old company continue to have some responsability to the ee??

MS HR · June 2003

yes, the old company is responsible.
there are several provisions in contracts that would allow this.
contact the old company and discuss situation with them. if negative answer,
contact the new company and send them old policy and see if new company can provide you with guidance. it's worked for me a couple of times.

Pearce · June 2003

The first thing I would do is get out the contract or policy for both the previous and current STD carriers. Read everything that you can before you make the phone calls. I agree with Crawford that in most cases if the person went out on disability covered under the first carrier and that disability continued, the fact that you are no longer providing coverage through that disability carrier should not impact the employee's claim for benefits.

crawfod · June 2003

And just to add to Pearce's post, since paying premiums is part of this, did you pay the old carrier for April? Combining payments plus the contract should result in coverage for your employee. You'll be a hero to your senior manager.

change in company, now no coverage??

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