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COBRA insurance billing question
Old 09-23-2016, 11:18 AM   #1
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COBRA insurance billing question

Hi,

My coworkers and I may be about to lose our employer provided health insurance (due to a work stoppage). We have been learning about our options (Cobra, ACA, insurance broker), but one question that has come up is about the nitty gritty details of billing. If one elects Cobra care, but the paperwork hasn't been completed yet, how do you deal with paying for a major medical event? Or if you haven't decided to elect it yet, but are within the time period to do so when a medical event happens, how do you inform the health care provider? In the case of an ER visit, or surgery (previously scheduled or not), does one have to pay out of pocket and deal with paperwork later? Or can the billing go to the previous insurance, to be worked out when Cobra paperwork is all done and signed?

If anyone has personal experience with this, that would be very helpful to me and my colleagues. Thanks!
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Old 09-23-2016, 02:23 PM   #2
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Here's what my employer told us relating to COBRA: the coverage is retroactive to the first day we're not employed, but the paperwork can take several weeks to complete. If we have a minor expense just pay it ourselves and apply for reimbursement. For major expenses call the insurance company and ask for special dispensation.

You could, I suppose, let the provider bill your previous insurer and when it gets rejected have them refile. Some may not be happy about doing that.
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Old 09-23-2016, 02:36 PM   #3
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If one elects Cobra care, but the paperwork hasn't been completed yet, how do you deal with paying for a major medical event?

COBRA guarantees that, if you enroll in a timely manner and pay the premium, your coverage will be retroactive to when your employee coverage ended (no gap), even if you have a claim during that period. Contact your COBRA administrator for all of the details.
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Old 09-25-2016, 11:08 AM   #4
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COBRA guarantees that, if you enroll in a timely manner and pay the premium, your coverage will be retroactive to when your employee coverage ended (no gap), even if you have a claim during that period. Contact your COBRA administrator for all of the details.
Thanks. Do you have first hand experience with COBRA yourself? None of my colleagues have, as far as I know, and people are worried about paperwork snafus etc. I have one coworker in particular who is scheduled for major surgery right after our possible work stoppage begins, and he is really concerned about being out of pocket for many many thousands. Even if it's for a limited time it could be a major cashflow problem. In addition, if we are forced to pay at non-negotiated rates and then are reimbursed later, it might be a fight with Blue Cross.
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Old 09-25-2016, 11:10 AM   #5
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Originally Posted by mickeyd View Post
COBRA guarantees that, if you enroll in a timely manner and pay the premium, your coverage will be retroactive to when your employee coverage ended (no gap), even if you have a claim during that period. Contact your COBRA administrator for all of the details.
And yes, I will contact the COBRA administrator. Thanks for the tip.
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Old 09-25-2016, 11:52 AM   #6
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It took about 45 days for the Cobra to be in place with the receipt of insurance cards, but it was retroactive. We had no large medical expenses, but it still felt weird not having all the ducks in a row right away. Find out who the cobra administrator is. Our admin was an entirely separate company.
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Old 09-25-2016, 01:38 PM   #7
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Thanks. Do you have first hand experience with COBRA yourself?
At one time I administered COBRA programs for a large number of Fortune 500 companies. I'm sure that the law has since changed that in favor the employee, but the onus is always on the employer to advise the ex-employee of his rights. It's all covered by the ERISA legislation. Also try Google.
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Old 09-25-2016, 02:41 PM   #8
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At one time I administered COBRA programs for a large number of Fortune 500 companies. I'm sure that the law has since changed that in favor the employee, but the onus is always on the employer to advise the ex-employee of his rights. It's all covered by the ERISA legislation. Also try Google.
Thank you. I have spent plenty of time using Google, DOL website, IBX (our insurance co) third party COBRA admin companies, and understand my rights and the COBRA timeline of required notices. Why I am asking these questions is because I haven't found information or discussion (other than on this forum) about how to coordinate coverage and in-network rates when the insurance company will not even aware yet whether we are covered by them (during the elction period). Also our employer is not going to be at their most helpful when we are on strike, honestly.
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Old 09-27-2016, 05:28 AM   #9
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Your question is a very practical one. From my experience as an HR person and with the law, I am not aware of a solution that would allow you to have the advantages of the insurance (insured rates for procedures, not having to pay claims) when the insurance is not in place administratively. I think you want to defer elective procedures until Cobra is in place. I think the other thing to consider is to be in contact with the business manager at your health care provider, as they are in position to provide some leniency as to payment timing. Also better to know they will be filing with insurance on a deferred basis.

Good luck!

M
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Old 09-27-2016, 06:18 PM   #10
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Originally Posted by Montecfo View Post
Your question is a very practical one. From my experience as an HR person and with the law, I am not aware of a solution that would allow you to have the advantages of the insurance (insured rates for procedures, not having to pay claims) when the insurance is not in place administratively. I think you want to defer elective procedures until Cobra is in place. I think the other thing to consider is to be in contact with the business manager at your health care provider, as they are in position to provide some leniency as to payment timing. Also better to know they will be filing with insurance on a deferred basis.

Good luck!

M
I am in the process of signing up for COBRA and at the moment just got my Vision card but not Medical and Dental.

I was told the same things. I would be out of pocket for any medical work done before everything was settled. I would have a new member number. I would not get negotiated pricing. They said that when I filed the claim after things were set up, the doctor would have to adjust the charges to the negotiated rates, but it would be up to me to nag them to pay me the refund.

I have not had to make any claims. This is just what I have been told recently.
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Old 09-27-2016, 06:47 PM   #11
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When I retired I advised my Co. that I wanted to continue health insurance under COBRA. They sent me the form, I signed it and it was transparent. The insurance billed me and all was fine.

No problems.
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Old 09-28-2016, 07:06 AM   #12
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I ran this same Q past an actuarial discussion board (including those in the Health insurance business) when that happened to me. I had a sprint triathlon while in the "dead zone" between my last day of work and the time I'd have all my COBRA coverage documentation. They said that you could tell the healthcare providers that you didn't have your COBRA paperwork yet but were going to sign up immediately when you got it. I don't know how that would have worked; I still had nightmares of being carted off to the ER if I wiped out on my bike. Luckily, I didn't.

Is there any way your coworker who's got surgery scheduled could postpone it till the coverage was documented?
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Old 09-28-2016, 08:30 PM   #13
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I ran this same Q past an actuarial discussion board (including those in the Health insurance business) when that happened to me. I had a sprint triathlon while in the "dead zone" between my last day of work and the time I'd have all my COBRA coverage documentation.

Is there any way your coworker who's got surgery scheduled could postpone it till the coverage was documented?
Well, I know he is pretty worried about getting this benign tumor out as it could really cause a problem with his career if it grows. I strongly advocated he schedule the surgery, then if we are on strike and in the "dead zone", either postpone it or at least contact the billing manager to explain the situation. I believe he is planning to sign up for Cobra as soon as the paperwork arrives. I personally will wait most of the the election period and see if we are back at work bedore the deadline.
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