Posted: 5/16/2009 6:47:37 PM EDT
|
I am a contractor to the company that I work for. I am an employee of a contracting company that has pimped me out to another company. As an employee of the contracting company I have benefits, one of which is health insurance. It is pretty damn good health insurance too by the way.
Recently, the company that I have been pimped out to made the decision that for the next 5 weeks all contractors are limited to 32 hours per week. I don't have much info on the reasoning, but I assume that this is some sort of cost cutting measure to improve profit reports for Q2. At this time, the expectation is that after the expiration date for the 32 hour work weeks passes, all contractors will be going back to 40 hour work weeks. That is what we have been told by the company I am contracted to and my employer. That said, I am concerned about the future. As it stands I can make my bills and still have enough left over to save a decent amount of money each month if I am cut to a 32 hour work week permanently. However, I am worried about my health insurance. If I am cut to a 32 hour work week then I would become a part time employee and my employer could cut our health insurance. I have not heard that they will do this, but it is a distinct possibility in my mind and I am trying to plan ahead. My problem is that I have back problems and I am supposed to have another surgery at the end of the year. If I lose my health insurance then I'm going to be in trouble. The surgery is going to cost in the neighborhood of $40K and I don't have that kind of cash. The other problem is that jobs in my field aren't real abundant at the moment, and even if I did switch jobs a new insurer would probably categorize my back problems as a pre-existing condition. Besides, most health insurance takes a few months to kick in after you switch jobs anyways. My question is this: If I am converted from a full time employee to a part time employee, and lose my health insurance in the process, then will I be eligible to keep my insurance under KOBRA or am I going to be SOL? I am very seriously considering moving my surgery up to try and avert any difficulties in regards to my insurance. As it stands I have a job that I like and it has a lot of fringe benefits that I am in no hurry to give up. My manager from the company that I have been pimped out to has told me that I have made myself very valuable to his organization and that if he has to make cuts then I will be last man standing. He wants to convert me to an employee, but he can't due to a hiring freeze. I am in no hurry to leave my current situation and want to try and ride it out here as long as humanly possible. But I don't want to wait too long to have my surgery and then lose my insurance and wind up being the guy who let it ride a little too long. |
|
By law you have to have access to COBRA. As long as you make the payments you will be good to go.
The problem is that you will be paying out the nose. I paid over $500 a month for mine. I dont have any real health problems so I have switched over to high deductable low payment policy. No prescription coverage but I am protected if I have a catastrophic illness or injury. $2500 deductable, 2 mill cap for $107 a month. I would keep your COBRA but it will be expensive. As long as you pay they have to honor their part. |
|
Each employer determines what is part time, what is full time and what qualifies for benefits. From the description you have provided I would suggest finding out how many hours a week you can go down to and still get your benefits. Also if a temporary reduction in hours qualify for a reduction in benefits or not. If you do lose your benefit,s you are eligible for COB RA benefits. Obama's stimulus package does have a clause that if a person loses their job through no fault of their own (like a layoff) the govenernment will pay 65% of their COBRA premium. Don't know if a reduction in hours would qualify or not.
Best suggestion is to ask your HR department for information on your questions. |
|
the stimulus bill included a 65% subsidy for cobra payments, which should make it easier to handle. I've heard that there have been some problems in implementing that though and I don't know if people are getting the subsidy yet. Also, COBRA has a time limit. I can't remember what it is. I think 18 months.
If you're in need of a surgery you're unlikely to be approved for insurance that you purchase on your own. If you run out cobra and apply for individual and are denied you would end up going to the texas high risk pool: http://www.txhealthpool.com/ |
|
Quoted:
By law you have to have access to COBRA. As long as you make the payments you will be good to go. The problem is that you will be paying out the nose. I paid over $500 a month for mine. I dont have any real health problems so I have switched over to high deductable low payment policy. No prescription coverage but I am protected if I have a catastrophic illness or injury. $2500 deductable, 2 mill cap for $107 a month. I would keep your COBRA but it will be expensive. As long as you pay they have to honor their part. Yeah, I knew it wasn't going to be cheap, but it shouldn't be a problem. As it stands I think I'm paying $160/month for my insurance (it might be $160/pay period though, I would have to dig up my documents...we have an online pay stub which I never use and I'll have to get my password reset to the website where I can go and view it). According to my budget, I would still have $1,100 left over every month after bills and personal allowance if I am forced into a 32 hour work week. I didn't know that Obama had added a subsidy for COBRA in the porkulous program. I'll look into the details of that. I've never taken money from the government before so I'll have to do some soul searching on this one. Under the circumstances I may have to bite the bullet and swallow some pride on this one though. If my hours get cut then I'll want to save as much as I can in order to help prepare myself in case I lose my job. Right now I have enough saved to maintain my current budget (minus monthly savings of course) for three months. |
