Health Insurance Payment to EE's Over 65?
Mel in CO
54 Posts
We are a company size of 55 employees currently providing a self funded health insurance plan to our employees which hasn't proven to be as beneficial as we once thought. Our median age is 47 so we have a lot of people on maintence meds, seeing the doctor more frequently, etc. which is increasing our premium costs this coming year. Since we are self funded, we get to see the utilization of the plan every six months - not who has utilized the plan, just what services were utilized (i.e. how many people went to the hospital, the medications that are billed to our plan, etc.). The president of the organization has come up with an idea that if he can get the people over the age of 65 (the people who qualify for Medicare) off the plan, it would help our preimums. So, he is proposing that we "entice" the over age 65 employees to drop our company provided health insurance, enroll in Medicare with us assisting them, and then the company will give the employee the employer paid amount as part of their taxable income - around $365 / month. We are only offering this to employees over the age of 65 and not to employees who may just want to go and find external coverage. If an employee who is 35 years old just opts not to enroll in our plan, we are not going to be offering the same payment. This seems to scream to me age discrimination against the younger employees but I wanted to everyone's thoughts.
Comments
(C) Prohibition of financial incentives not to enroll in a group health plan or a large group health plan.—It is unlawful for an employer or other entity to offer any financial or other incentive for an individual entitled to benefits under this title not to enroll (or to terminate enrollment) under a group health plan or a large group health plan which would (in the case of such enrollment) be a primary plan (as defined in paragraph (2)(A)). Any entity that violates the previous sentence is subject to a civil money penalty of not to exceed $5,000 for each such violation. The provisions of section 1128A (other than subsections (a) and (b)) shall apply to a civil money penalty under the previous sentence in the same manner as such provisions apply to a penalty or proceeding under section 1128A(a).
In this case, the prohibition is not due to discrimination issues, but rather a desire by the SSA to keep Medicare secondary whenever possible.