Title: Addressing Employer’s Continued Responsibility for Health Insurance After Separation
Understanding Your Rights When Your Former Employer Fails to Cancel Your Health Coverage
Navigating health insurance after leaving a job can sometimes be complicated, especially when your former employer does not follow proper procedures to terminate your coverage. This situation can leave former employees in a tricky position, potentially affecting their ability to access healthcare and receive necessary billings. Here’s a real-world update on such an experience and how to handle it professionally.
The Situation
A former employee, who has been out of their previous job since 2020, discovered that despite no longer working for the company, their employer continued to carry them on their employer-sponsored health insurance plan. This oversight resulted in the employer ignoring multiple communications requesting official removal from the policy. While the individual has maintained continuous Medicaid coverage—rendering them secondary in terms of insurance—there was still concern regarding billing for healthcare services.
A few months ago, the person received official notice from the employer indicating that their insurance had been terminated about six months earlier—in fall 2024—and that they were eligible for COBRA coverage. However, the individual soon experienced issues. Healthcare providers sent notices indicating that payments had been recovered from the insurance, and some could not bill Medicaid due to the age of the bills. Fortunately, Medicaid couldn’t bill the individual directly, but this caused frustration among providers, especially community and private practices that rely on timely payments.
Legal and Professional Assistance
Seeking clarity, the individual contacted a nonprofit legal organization specializing in healthcare law. They confirmed that, generally, insurance coverage cannot be retroactively canceled unless there are exceptional circumstances, such as fraud, which did not apply here. Further, they revealed that the employer’s actions were non-compliant—specifically, they should have notified the employee promptly about COBRA rights upon separation. Instead, the employee was mistakenly led to believe they were eligible six months after the fact, making it impossible to apply for COBRA retroactively.
Thanks to expert legal guidance, the individual is working through the process of ensuring that healthcare providers are reimbursed appropriately. The legal team is also exploring potential compensation due to the employer’s failure to adhere to COBRA notification requirements, which may warrant legal action or compensation.
Key Takeaways for Employees
- Employers are legally required to notify former employees about COBRA benefits promptly upon separation.
- Retroactive cancellations of health insurance are limited by law and generally require exceptional circumstances.
- If you find yourself in a situation where your
