Should a company continue to pay medical insurance after layoffs?

Question: “I need help in revising our current policy on continuation of medical insurance during the following cases: temporary layoff, permanent layoff, workers’ comp. Currently, the employer pays 100% of employee insurance benefits. Any advice would be appreciated.” — Anonymous

See Comments below

Jocelyn November 3, 2008 at 9:42 am

COBRA, where they stay insured through the company and they are responsible to make timely payments to you for the cost of the coverage plus some companies choose to charge 2% extra for the paperwork and employee time to take care of that, we choose not to. But people are sometimes “bad” at paying and you need to be on top of that so you do not get stuck with the bill, keep a copy of the letters you send to the ex-employee as well just in case.

Mark October 31, 2008 at 5:32 pm

Only once did we have to lay someone off. No benefits were paid other than the mandatory state-equivalent of COBRA. (We are too small for COBRA, but Illinois has a similar law for smaller employers.) For worker’s comp, we continue to pay all benefits as if they were still working.

KNL October 31, 2008 at 2:01 pm

At our company, our policy states that if the employee is out on Workers Compensation, they retain the same benefits as if they were still employed with their regular position. (This can vary between part time and full time employees.) As far as layoffs are concerned, temporary layoffs retain their benefits for 60 days. Permanent layoffs retain benefits for 30 days. Beyond that, they are generally eligible for COBRA coverage.