I was just let go from my job, my last day was this past Monday. I want to continue our healthcare coverage using COBRA, but the quote I received is much higher than the 102% amount mandated by COBRA legislation. If anyone can provide some insight into whether or not this is legit, or if there is a way around the higher cost, please help! Here’s the background:
(for simplicity and privacy, I have rounded all the dollar amounts)
- My former employer is a smaller company and all HR is managed by a third-party company.
- My employer covered 75% of our healthcare premiums. My monthly contribution was $300, while my employer paid $900/mo. (This info is from my pay stub.) So the total cost is $1200/mo.
- I saw online that according to COBRA legislation, employers can charge a 2% administrative fee, but the total cost is not to exceed 102%. So my total cost should not exceed $1224.
- I received a quote from the third-party company that manages their healthcare. Their quote for COBRA coverage was not $1224— it was $2,000/mo!!!!!! — more than 50% higher than the amount I figured from my pay stub!
- I asked my former employer’s HR administrator about this, and he agreed with me that my estimate from the pay stub should be accurate. He wasn’t sure why they quoted a number so much higher.
So I emailed the third party company and asked for some clarity on this, and here’s the response I received:
“The monthly admin fee that [your former employer] pays for [our] services includes allocations to offset certain costs – including the group health plan. When an employee loses their coverage (terminated) all the allocations go away and the employee is billed the full cobra rate that is charged to Insperity from our carriers.”
This is infuriating, and is such a vague answer, the cynical part of me interpreted it as “we found a looophole in COBRA legislation and we’re just going to charge you whatever we want.”
I Googled the heck out of this and came up empty. Does anyone with expertise on the subject know if I have any recourse here? I‘d like to ask them for some kind of documentation justifying the cost, because frankly this seems like BS. It’s going to be hard enough covering the 102%, let alone adding an additional $700+ on top of it. I need help.
THANKS!
submitted by /u/growlingdoggie
[link] [comments]
I was just let go from my job, my last day was this past Monday. I want to continue our healthcare coverage using COBRA, but the quote I received is much higher than the 102% amount mandated by COBRA legislation. If anyone can provide some insight into whether or not this is legit, or if there is a way around the higher cost, please help! Here’s the background: (for simplicity and privacy, I have rounded all the dollar amounts)
My former employer is a smaller company and all HR is managed by a third-party company. My employer covered 75% of our healthcare premiums. My monthly contribution was $300, while my employer paid $900/mo. (This info is from my pay stub.) So the total cost is $1200/mo. I saw online that according to COBRA legislation, employers can charge a 2% administrative fee, but the total cost is not to exceed 102%. So my total cost should not exceed $1224. I received a quote from the third-party company that manages their healthcare. Their quote for COBRA coverage was not $1224— it was $2,000/mo!!!!!! — more than 50% higher than the amount I figured from my pay stub! I asked my former employer’s HR administrator about this, and he agreed with me that my estimate from the pay stub should be accurate. He wasn’t sure why they quoted a number so much higher.
So I emailed the third party company and asked for some clarity on this, and here’s the response I received: “The monthly admin fee that [your former employer] pays for [our] services includes allocations to offset certain costs – including the group health plan. When an employee loses their coverage (terminated) all the allocations go away and the employee is billed the full cobra rate that is charged to Insperity from our carriers.” This is infuriating, and is such a vague answer, the cynical part of me interpreted it as “we found a looophole in COBRA legislation and we’re just going to charge you whatever we want.” I Googled the heck out of this and came up empty. Does anyone with expertise on the subject know if I have any recourse here? I’d like to ask them for some kind of documentation justifying the cost, because frankly this seems like BS. It’s going to be hard enough covering the 102%, let alone adding an additional $700+ on top of it. I need help. THANKS!
submitted by /u/growlingdoggie [link] [comments]Read Morer/HealthInsurance