Hi,
I'm new to this board and I have a dilemma. I was working for a small employer in California (less than 20 employees). Upon satisfaction of my 3 month company-defined waiting period, I was enrolled in a Blue Shield HMO plan, that was paid 100% by the company. If I elected to have a PPO or more comprehensive HMO plan, I had the option to have the additional premium deducted from my paycheck, however, I elected for the standard coverage to avoid additional costs. Shortly after becoming enrolled in the HMO plan, I began the process of obtaining the necessary preapprovals from my Primary Care Physician to have a major surgical procedure. I went through all the steps, and received my authorization, and surgery was scheduled for this past August 10th. On Tuesday, August 7th (3 days before the surgery, and 1 day before I was scheduled to leave on medical leave for 10 days), I heard a rumor around the office that we no longer had health coverage. Since I was planning on having a major (& expensive) procedure in the next few days, I confronted my boss. Only after asking about the rumor, was I informed that our coverage was scheduled to be cancelled THE FOLLOWING DAY! And a full 2 days prior to my scheduled surgery. Apparently, my employer stopped making the premium payments, and neglected to notify ANY of the employees of the impending cancelation of the policy. I cannot seem to locate the correct resource that would govern the employer's obligations and requirements to properly notify their employees, if there is one, however, it is not my primary concern. My employer advised me that they would "take care of it" and to continue with the surgery. I've now had the surgery, along with the required 3 night hospital stay, and was only required to pay approx $300 (possibly a copay for the hospital?) upon admittance at the hospital. Since then, I've learned that my employer did NOT "take care of it", and our policy was officially canceled as of August 9th (the day prior to my surgery). They are now saying that they are attempting to get me enrolled in a Conversion Plan with Blue Shield on a PPO plan, so there would be no need for Re-doing my Prior Authorizations. Everything I seem to read on the subject specifically mentions that you're only eligible for a Conversion Plan or to be considered "HIPAA Eligible" only if the cancelation was not due to "YOUR failure to pay plan premiums." I'm extremely concerned at this point, because the definition of "Your failure" is the difference between a $300 copay and a bill for $35,000. Since I was not personally responsible for the non-payment of the premium, do you believe I can still be eligible? Or is Non Payment of premium a reason for disqualification, regardless who the responsible debtor was? I plan on contacting the California Major Risk Medical Insurance Program tomorrow during business hours, but I'm trying to find any and all information possible ASAP. Please let me know if you have ANY advice! (Also, since I"m sure it will be suggested, the company is on the verge of bankruptcy any day now, and I have subsequently quit my position there due to pure disgust with the owners/management in this issue, so even if I were to sue the company, it would be included in a bankruptcy and I'd most likely receive nothing). Thank you for listening and your advice!

1) Who is being spoken to when you relate "your failure to pay plan premiums"-- you, or the employer?

2) Even if they file bankruptcy, there are still assets to be sold off. Employee salaries and benefits will be first in line for whatever's left (I'm not sure if that's before or behind the attorneys fees). Furthermore, in our area, I've seen the bankruptcy courts force the insurance carrier to continue providing benefits even when there's no premium payment.

1) - In all the literature I've found, it was directed towards me directly, not to the employer. So, how I'm interpreting the wording is that as long as "I" personally was not responsible to pay premiums for my coverage, that this clause wouldn't apply. Of course, that's what I'm hoping it's interpreted as. I haven't been able to find anything that addresses what happens when the employer doesn't make the payments, which has me concerned that they consider my employer and me as the same thing when it comes to non-payment of premiums. I'm just interested on how others are interpreting the clause.

2) Very helpful - I'm actually planning on contacting an Employee Rights lawyer to gauge whether it's worth pursuing.

Thank you for your response!

"I cannot seem to locate the correct resource that would govern the employer's obligations and requirements to properly notify their employees, if there is one, however, it is not my primary concern"

State insurance laws. If you live in Fla, the ins co has to give the e/r 45 days notice and the e/r has to notify e/es in a reasonable time after getting notice.

You should have a legal case against your employer, for your employer to pay your expenses out of his pocket, but those cases are tough.

Maybe you can assign your rights to collect from the e/r to the hospital in exchange for their agreement not to collect against you so they can collect directly from the e/r?

You are right that there's generally no conversion or COBRA rights if cancellation is for nonpayment of premiums.