Submitting employee enrollment applications and coverage updates to carriers is something nearly all employers need to contend with when they offer benefits. It’s a task that no one finds to be particularly fun or exciting, but here are a few ways to ensure that it at least doesn’t become a massive headache.
- Make sure carriers are provided updates in a timely fashion
Most carriers give a little breathing room when it comes to deadlines for when they need to receive an enrollment application for processing – often within 30 days of the requested effective date of coverage. However, best practice is still to get the application in their hands as soon as possible. Applications received after the deadline are only processed on an exception basis and it’s not guaranteed that those exceptions will be granted which could result in the employee not being able to enroll until open enrollment. We recommend setting a deadline for your employees that is stricter than your carrier’s to ensure that application is received on time.
And remember, the earlier you send an application to a carrier, the earlier the employee gets their ID cards in their hands. Remind your employees how much nicer receiving an ID card is versus getting their application rejected due to late submission.
The same rule goes for terminations. When the Affordable Care Act passed, carriers were required by law not to terminate coverage retroactively. There are a couple of exceptions, but as a rule a carrier can only retro terminate 60 days as an exception. Carriers need to be notified to terminate coverage for an employee. Any late notifications could result in you paying premiums on employees for days or even months when they weren’t even employed. Avoid wasting company funds by submitting those termination requests promptly.
- If your company pays 100% of the coverage premium, make sure you are enrolling all eligible employees
Many carriers have it written in their policies that when the employer pays 100% of the premium for coverage for their employees, they require all employees to be enrolled in that coverage. A good example is life insurance provided by a company for all full-time employees. If an employer is paying 100% the carrier is guaranteed to be receiving premiums for the company’s entire employee population covered, they can offer coverage at a discounted rate. This controls the adverse risk where only an employee that needs the coverage elects coverage.
When you don’t enroll an employee in coverage that’s 100% paid by the employer, you leave yourself open to some pretty substantial risk. If that employee files a claim with the insurance carrier, the carrier has the right to deny coverage if the enrollment was never submitted to them for that employee. If that happens, you as the employer could potentially be liable to pay that claim, which could be substantial in the case of a high-dollar medical procedure or a life insurance claim.
Best thing to do? Setup a system for yourself to remind you to enroll your new employees in any 100% employer paid coverage when they’re hired, either by adding it to your HR onboarding checklist or adding a monthly notification to your calendar to double check that you’ve completed that step for any new hires. It’s often easy to overlook, especially if the employee waived all other coverage, but it’s very important to remember what you need to do to avoid the consequences.
- Yes, they need to sign a waiver (and I know – it’s the worst)
Waiver forms can often be a pain to collect from employees, especially because employees don’t get something in return for filling it out (Submit an application? Get insurance. Submit a waiver? Get nothing. Where’s the fun in that?). Still, you as an employer need to have that waiver on file as proof that you offered coverage to your employee and they declined to take it. This protects you from potential fines or hardships down the road by giving you the evidence you need to show you did your due diligence by offering coverage to all of your eligible employees.
Our advice for getting those waivers signed and back in your hands? Don’t underestimate the power of free jolly ranchers as reward for good behavior.
- Audit your invoices
The greatest weapon you have against avoiding any common eligibility management pratfalls is the almighty monthly invoice audit. Invoices show you who your insurance carrier wants to be paid premium for. If your carrier wants money for an employee, that means they’re covered. If your carrier does not want money for an employee, that means they aren’t covered. Simple right? It really is! Review your carrier invoices every month to make sure any employees who need to be covered are (you may as well make sure they have the correct coverage while you’re at it), and that any employees who are terminated or otherwise shouldn’t be covered are not.
The best part? Carriers like getting paid, so they deliver those invoices right to you every month. How convenient and considerate is that?
Bonus Tip: Consider an online enrollment tool to make your life wonderfully, blissfully paperless.
Juggling paper is a pain. Tracking which employees are where in the enrollment process is a pain. Hunting employees down and reminding them to return the paper you don’t even really want back is a pain. Actually, managing eligibility at all is a pain. While we can’t entirely take the latter off of your hands, The Ashley Group can provide excellent solutions for the former. Just ask us! We love talking about it.