Selling Individual to Businesses

[somarco]

If you put any kind of 125 in then it looks and smells like group!!

So you believe that individual policies, in any flavor, cannot be offered under a 125 plan. Is that correct?

As for the other flap, about state vs fed, NHS is correct. States regulate insurance and are free to pass their own laws. COBRA is one example. Each state can pass COBRA qualifying legislation and are permitted to make their laws broader (but not more stringent) than federal law.

COBRA only affects groups of 20 or more employees, but most states have small group laws that extend COBRA rights to fewer than 20.

 

[jbage007]

So you believe that individual policies, in any flavor, cannot be offered under a 125 plan. Is that correct?

As for the other flap, about state vs fed, NHS is correct. States regulate insurance and are free to pass their own laws. COBRA is one example. Each state can pass COBRA qualifying legislation and are permitted to make their laws broader (but not more stringent) than federal law.

COBRA only affects groups of 20 or more employees, but most states have small group laws that extend COBRA rights to fewer than 20.

I am going to go out on a limb here and say that a properly installed 125 plan does not impact company sponsorship in any way. Not sure why all the confusion on this. If the company keeps a true arms-length distance and does nothing to encourage or discourage employees from using 125 dollars to fund individual coverage, then no-harm, no-foul. Key term: properly installed (and explained) 125 plan.


re: Cobra
Minor technicality: When a state "expands" continuation rights, it is NOT "extending COBRA" which is purely federal legislation.

Here's a "little" primer on Cobra from a friend's site: DLC COBRA consolidated omnibus budget reconciliation act

 

[somarco]

COBRA is a federal law, which in all cases supercedes state mandates.

Insurance is still regulated at the state level.

It appears some folks still don't comprehend what you can, and cannot do with regard to 125 plans. Why is this not surprising?

 

[susieQ]

So you believe that individual policies, in any flavor, cannot be offered under a 125 plan. Is that correct?quote]

Texas Department of Insurance -- COMMISSIONER'S BULLETIN #B-0028-06 Department of Labor totally disagrees with their bulletin but it doesn't matter in Texas and TDI doesn't care. Until somebody takes them court they are watching these kinds of situations. So if you have an employer/employee that gets unhappy and contacts the TDI -- IMHO you could have a problem with TDI.

It's been a long time since I've talked to them but Paul Zane Pilzer's benefit group does the individual premium being paid out of an HRA in other states.

Now I know some of you guys on here enjoy a good fight but risking my license is not something I'm willing to do.

 

[somarco]

So you are saying the Tx DOI really doesn't care about IRS section 125 (including the August 2007 regs)?

Interesting.

 

[susieQ]

Exactly.