As I have mentioned in my previous blog, my concern for small business owners is being compliant with the federal “Affordable” Care Act.
This brings to mind a recent situation that I would like to use as an example of how good, honest intentions can get derailed. Scenario: New employee starts June 15. Employer has a 90 day waiting period for benefit eligibility. So, the thought here is that at the end of 90 days, either the employee or employer will know that this arrangement is a good fit and then benefits become available. Such as benefits, sick leave, vacation time, comp time, etc. This is very easily confused with new hire enrollment period and the ACA. So, I leave Employer A and I waive my COBRA offer because Employer B just went through the renewal process and it is open enrollment for “existing” employees. The HR person/owner says, “Hey, timing is everything, we’re at our open enrollment/renewal time.” Submits the application to the carrier without the assistance of an agent. With a proposed effective date of, now. The carrier comes back, issues ID cards, sends the welcome packet for their effective date of 60 days out.
Everybody’s happy. The employee gets sick, presents his ID card only to find out that his coverage isn’t effective…yet. So, now we have an employee without coverage AND at a time of need. The insurance carrier cannot, and will not, make an exception for the misunderstanding because it’s a federal law and therefore this would be viewed as discrimination. So, good, honest intentions turn into a huge liability because anybody can fill out a form and submit it, why do I need an agent? Not good business.
Please call. Our services are FREE. The consequences of being in violation of a federal law aren’t something I would sign up for if I could opt out.