Avoid birthday rule

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PostPosted: Wed Aug 04, 2010 8:59 pm   Post subject: Avoid birthday rule  

Hi, first time poster, I moved to the US a little while ago so the insurance business in this country is still a bit daunting to me.



My wife and I both work, we both have our individual insurance. I have a union position so mine is through the union. We have a 6 month old daughter. My wife's birthday is before mine, which means the union will not allow me to have my daughter on my insurance as primary, she has to be on my wife's. We do not want that; my wife's insurance is much more expensive than mine. We dropped my daughter from my wife's insurance, but the union denies primary coverage and makes us put my daughter back again.



My question is if there is anyway to get around this, or is it just plain my terrible luck to be born later in the year? I find it such strange rule and completely random. Why can't I choose where I insure my own daughter?



Thanks for any help and suggestions.



JB


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Jurtje
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PostPosted: Thu Aug 05, 2010 6:52 am   Post subject:   

I guess only a court order supersedes the birthday rule. Doesn't your wife have a cheaper insurance option?

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PostPosted: Fri Aug 06, 2010 10:17 am   Post subject:   

Quote:
the union will not allow me to have my daughter on my insurance as primary, she has to be on my wife's. We do not want that; my wife's insurance is much more expensive than mine. We dropped my daughter from my wife's insurance, but the union denies primary coverage and makes us put my daughter back again.




It may be that the union is wrong when it says your wife must cover your daughter as a dependent, and you may wish to inquire with your state's Dept of Insurance. If there is no cost to your wife for her employer-provided coverage without dependents but there is a cost to cover dependents, she can choose to be covered alone. I know of no requirement in any state for a person to cover their dependents under a group or individual policy, even if there is no cost for the dependent coverage. And if there is a charge for dependent coverage, then a decision to cover one's dependents is entirely voluntary as far as I know.



If your wife were to drop her employer's coverage entirely, and the three of you would be insured under your coverage alone, then your union's plan would have no choice but to cover your daughter as the primary insurer. Your wife cannot be forced to accept the insurance provided by her employer, even if it comes at no cost (known as a noncontributory plan, which prevents her employer from NOT covering her deliberately because you have insurance available through your employer) -- she is still free to voluntarily decline to be covered by her employer's plan. The same as you cannot be forced to accept your employer's plan for yourself or cover your dependents under your employer's plan.



An alternative is for you to drop your employer's coverage and the three of you to be covered under your wife's plan.



Quote:
Why can't I choose where I insure my own daughter?




Your state most likely has no law requiring each parent to cover their spouse or children as dependents. But if you both do, then the state has a law or regulation that prevents you from choosing which insurer to make primary for yourself or your dependents. It's not a matter of which is more or less expensive, or which provides better benefits. It is simply a concept known as "coordination of benefits".



COB provisions determine whose coverage is primary when a person is covered by more than one policy. As employees, your primary coverage is your employer's policy, and your wife's employer's coverage is her primary plan. But your daughter is a dependent under both policies, and to establish a uniform method of determining which policy should be primary for a dependent, the state has chosen the "birthday rule" instead of the "gender rule" that makes the father's plan primary.



This is as much for your protection as it is for the insurer's protection. It protects you by establishing a primary insurer so that neither insurer can avoid paying a claim by saying it's the other insurer's responsibility. To avoid being discriminatory, it is not based on cost or level of benefits. It protects the insurers by preventing you from simply using the plan that has the higher level of benefits alone. Similarly, the birthday rule recognizes that some women's coverage may be better than their husband's coverage, so it establishes a "gender-neutral" way of determining which policy is primary.



It also assures that your daughter's medical bills CAN be covered 100% even if both insurers would only cover a percentage of the total bill by themselves. The primary insurer pays the bill first, and the unpaid portion can be sent to the secondary insurer for payment. If the secondary insurer would have covered more than the amount of the unpaid bill as its share of the total bill if it was the primary insurer, it will cover the full amount of the unpaid bill. You cannot "profit" at the expense of the insurers, for example, by paying the bill and seeking 80% reimbursement from each insurer (thereby receiving back 160% of the bill).



Quote:
only a court order supersedes the birthday rule




No, Steven, the court is powerless to make one parent's coverage primary if it contradicts state law. The only thing a court may order is that both parents cover the child under any insurance available to the parent. And this is only done in the case of a divorce/legal separation, to prevent one parent from being "stuck" with the cost of covering the children.


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PostPosted: Sat Aug 07, 2010 2:08 pm   Post subject:   

Thanks for both answers. Indeed as you state Max Herr, we are both insured for "free". But my wife has to pay for dependents and I do not. It was no problem to drop my daughter from my wife's insurance, but the union refuses to take her as primary, so now we have to put her back on my wife's insurance.



I argued to the union that if my daughter does not have other insurance, the union is tha primary one, but they wouldn't have it and continued to deny payment to the pediatrician.



After this episode I do not dare to drop both my daughter and my wife from my wife's insurance. I am sure the union will say the same thing, it is quite unbelievable.



If I drop my insurance we would be off even more expensive because one dependent is cheaper than the family plan on my wife's insurance.



Still, as a foreigner from Europe it is difficult to understand that one cannot choose the best insurance for himself. I have no interest in fooling the insurance into paying me twice. Heck, I just want them to pay the doctors directly.



I live in NYC by the way.



Thanks for your time.



JB


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PostPosted: Sat Aug 07, 2010 5:04 pm   Post subject:   

JB . . .



File a complaint with the NY Superintendent of Insurance. I could be wrong, but I doubt NY's Insurance Code permits this conduct by your union's insurer.



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PostPosted: Fri Aug 13, 2010 3:11 pm   Post subject: Seems shady  

I guess I don't understand the reasoning behind this either. It seems the union is doing whatever it can to avoid the costs.


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PostPosted: Fri Aug 13, 2010 4:44 pm   Post subject:   

Remember, the unions have been the primary impetus behind Obamacare -- the unions trotted out their members at all of the well-scripted healthcare town hall sham meetings in the summer of 2009. Get a "single-payer" system in place, and we can keep our union dues where they are and make more money on the backs of our members. (Just reported this week: as of 2010, more than 50% of all union members in America are public employees, federal, state, and local, and public employees' pay and benefits are now, on average, nearly double those for similar private sector jobs.)



[ Mark my words. If we ever get to a single-payer system to the exclusion of all insurance companies, as Medicare once was before Medicare Advantage (which Obama desperately wants to end), the law will be written in such a way that employers will be forced to pay upwards of 80%-90% of the cost. If you think 9%-12% unemployment is bad, imagine what life in America will be like when unemployment reaches 50% because employers don't want to be forced to pay the ever-rising cost of Obamacare that will easily outstrip the premiums they are paying to their commercial insurers and HMOs today. ]



It would not be unheard of for a union to try to make its members do something that is contrary to state law. Most union members blindly follow the instructions of their leaders, and never check facts for themselves.



It's almost as bad as those persons who allow Rush Limbaugh to condescendingly refer to them as "dittoheads" -- you don't have to think about anything for yourself, just take Rush's word for it. Well, he makes mistakes, too, and you can't believe everything that spews out of his mouth either, especially when he puts his brand of "spin" on it.



Get the facts for yourself. If you think you're being abused by an insurance company (or a union who provides your insurance), contact your state's Department of Insurance and file a complaint. If what's happening is wrong, it will be corrected, if what's happening is lawful, you'll find that out, too. Then you'll know the answer for your specific situation.



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PostPosted: Sat Aug 14, 2010 9:36 am   Post subject:   

I'd truly agree with you on this this one- it's true that the union members follow their leaders like anything.



I really don't think any employer would find it easy to bear this 80%-90% cost. 50% unemployment will affect crime rates and lead to bankruptcy.


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PostPosted: Fri Nov 19, 2010 2:14 am   Post subject:   

Jurtje,



I'm going through the exact same thing (minus being in a union) and I'd like to know if the problem was resolved.


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PostPosted: Fri Nov 19, 2010 3:13 am   Post subject:   

N . . .



You are unlikely to hear from Jurtje. What are the specifics of your situation? You are not going through "the exact same thing", but perhaps something similar. Each situation is unique. With more information, we may have better answers.



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PostPosted: Fri Nov 19, 2010 4:16 am   Post subject:   

MaxxHerr,



Okay, maybe not the exact same thing, but extremely similar Smile Like the OP, I have insurance through my employer and they require my wife to accept the insurance offered by her employer due to it being a sponsored plan. This is okay as her individual employee rates are really low. The issue is with the requirement by my employer to have my wife's insurance cover our son due to her birthday occurring earlier in the year than mine (her employee + child/children rate is much higher than mine). My employer will, however, cover our son as secondary if we choose to have him on mine at all. If my birthday fell earlier in the year than my wife's, my employer would have no issue covering our son and not requiring her insurance to do so. In doing some research, it seems to me that the birthday rule was used more for when the dependent was covered under two plans, so I wouldn't see how it would apply in my situation since I just want him on mine and not hers. It almost seems as if they are twisting the true reasoning behind the 'BR' to benefit themselves.



How is it fair/legal to offer uncontested primary insurance for one employee's child but not to another's just because of where the two employees' birthdays fall in relation to those of their wives'?



Thanks for the offer to help, Max!


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PostPosted: Fri Nov 19, 2010 6:00 pm   Post subject:   

Quote:
How is it fair/legal to offer uncontested primary insurance for one employee's child but not to another's just because of where the two employees' birthdays fall in relation to those of their wives'?




The birthday rule (as opposed to the gender rule "father's plan is primary") is established by state law. Most states now use the birthday rule as it is "politically correct" (and many mothers have better health plans than some fathers). It only governs the situation with children covered by more than one plan, since employees are primary under their employer's plan and secondary under their spouse's plan. ("The employee plan pays before the dependent plan pays"). Children are only dependents under either plan, so the "employee" rule cannot work. It is intended to prevent persons whose children are covered by more than one plan from deliberately using only the plan that provides better benefits.



Having said that, it is DOUBTFUL that there is anything in your state's law that requires a person to cover their minor children as dependents under a spouse's employer-sponsored plan if there is a cost to do so. And I don't believe that an insurance company has the freedom to require that dependents be covered under either an employee's/spouse's plan. I have never seen it happen here in California.



(It may be that group contracts in your state can legally require that a person's eligible working spouse enroll in their own employer's plan in order to be covered as a dependent under their plan -- specifically for the purpose of sticking the employer's plan with that person's claims on a primary basis. This is probably not in violation of state law.)



When it comes to covering children, I suppose your state could have a different provision in its Insurance Code, but I would certainly think it does not. (But Obamacare may eventually have more to say about this in the future.)



I would recommend filing a complaint with your state's Dept of Insurance, requesting information as to whether it is permissible to be forced to insure minor children as dependents under two different employer-sponsored plans when there is a cost to do so under either or both plans. That should solve the matter for you.


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PostPosted: Fri Nov 19, 2010 7:00 pm   Post subject:   

Thanks again for the info.



Your comments about the birthday rule definitely leads me to believe that my employer's insurance company is using the BR out of it's intended usage, possibly in order to help them deny primary coverage to dependents (purely speculation on my part:) )



One question, though...you stated:



"as to whether it is permissible to be forced to insure minor children as dependents under two different employer-sponsored plans"



I just wanted to be clear that my employer's insurance company isn't necessarily requiring that our child be covered under BOTH insurance policies, but rather that the child must be placed under the plan of the parent whose birthday occurs first in the year. If the spouse has the earlier birthday, than the child must go on their plan, but they are also permitted to be placed onto the employee's plan, but only as secondary.



I'm guessing you understood that from my previous post, but I just wanted to be sure Smile Your one comment that I quoted just made me want to double check.



I'm in Indiana btw, and I definitely plan on calling the IDOI and speaking with them as it's costing us an additional $1000+ a year and I'm sure it's costing some other employees here much more.


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PostPosted: Sat Nov 20, 2010 12:07 am   Post subject:   

Quote:
but rather that the child must be placed under the plan of the parent whose birthday occurs first in the year. If the spouse has the earlier birthday, then the child must go on their plan, but they are also permitted to be placed onto the employee's plan, but only as secondary.




That, as far as I know, is a blatant misapplication of the birthday rule. The birthday rule is used only to COORDINATE BENEFIT PAYMENTS when a child is covered by more than one plan. I don't know of any state's laws that would use it in the manner you have indicated. Here's what the IN Insurance Code has to say:



Quote:
IC 27-13-33

Chapter 33. Coordination of Benefits



IC 27-13-33-1

Coordination of benefits provision; purpose

Sec. 1. Health maintenance organizations may adopt a coordination of benefits provision to:

(1) avoid overinsurance; and

(2) provide for the orderly payment of a claim when a person is covered by two (2) or more group health insurance or health care plans.

As added by P.L.26-1994, SEC.25.



IC 27-13-33-2

Provision consistent with 760 IAC 1-38.1

Sec. 2. If a health maintenance organization adopts a coordination of benefits provision, the provision must be consistent with the coordination of benefits provisions of 760 IAC 1-38.1 as it may be amended or replaced from time to time.

As added by P.L.26-1994, SEC.25.
(emphasis added)



The rest of the "rules" are contained in the IN Administrative Code. I've excepted the 10 pages that deal with coordination of benefits, and there is absolutely nothing there to support what you are being asked to do by your employer's health plan. (Send me an email or PM with your email address and I will send it to you.)



It would appear to me that your insurance company is engaging in a form of UNFAIR BUSINESS PRACTICE (limiting its risk of loss by improperly denying enrollment), which is also prohibited by the Insurance Code. That's what you would complain to the DOI about. If found to be true, the insurance company could be in BIG trouble with the state.



Click the PM or email link below and send me your email address!!


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PostPosted: Sat Nov 20, 2010 2:16 am   Post subject:   

Max,



I briefly spoke with my insurance rep within our HR department today. I'm supposed to get back with her on Monday concerning whether or not this requirement is enforced by our employer or our insurance provider. I did this because, according to the IN DOI, if it's a requirement laid out by my employer there is apparently nothing that the DOI can do. They actually recommended that I call and speak with the Department of Labor if this is the case.



So, I called the IDOL. They forwarded me to the federal DOL since apparently this would be a federally mandated/regulated issue. In speaking with the federal DOL, not much was accomplished. The woman didn't seem to know much about insurance (she had very little knowledge of COB for starters). She did say, however, that the employer can conjure up and enforce rules such as this, but I honestly don't know how much weight I can place on her answer (just judging from our brief conversation).



Another thing was brought up recently. Someone had mentioned that under the new Obamacare regulations insurers could not deny coverage to a dependent under the age of 27 (I'm sure there are special requirements, etc.), so with that being the case, how could my employer deny coverage to my son if I chose to not place him on my spouse's plan?


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