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Insurance inconsistencies

My door is always open to the people, and I strongly believe that the words written by Abraham Lincoln in June 1865 ring true today: “that government of the people, by the people, for the people shall not perish from the earth.”In the spirit of Abraham Lincoln’s words, I received a call from a gentleman in Security complaining about a company that required all of its employees to purchase the health care plan. Mr. Smith, retired from the Army, was receiving Tri-Care insurance coverage for himself and his family. He didn’t need the secondary insurance coverage, nor could he or his family afford it. The company’s insurance was costing him an additional $800 a month.I spend many hours with Colorado’s insurance commissioner, Marcy Morrison, talking about this issue. Is it right or fair to require employees to purchase a secondary insurance plan if the employee can prove they already carry credible insurance coverage? The Colorado Division of Insurance investigated Mr. Smith’s case and found that the employer – not the insurance company – was requiring all employees to buy the coverage.According to the Colorado Division of Insurance, the employer receives “fringe benefits” money from the federal government in compliance with the Federal Service Contracts Act. The money is used to cover the cost of health insurance for employees working on federal contracts. There is a small amount left after the health premium allocation and that amount can either help pay for the employees’ dependent coverage (if they choose) or it goes into the employees 401(K).The Colorado Insurance Commission and Colorado Statutes have jurisdiction over health carriers and employers with 50 or fewer eligible employees. The Commission released Bulletin No. B-4-26 to recap Colorado’s insurance law, and it states the following:”Existing law requires small employers’ carriers applying minimum participation requirements with respect to an employer to exclude employees or dependents who have credible group or individual coverage.“Credible coverage is defined as …

  • Medicare or Medicaid
  • An employee welfare benefit plan, group health insurance or health benefit plan
  • An individual health benefit plan
  • A state health benefits risk pool, including Cover Colorado
  • Coverage under TriCare for members and former members of the military and their dependents
  • By a tribe of the Indian Health Service
  • The Federal Employee Health Benefits Plan
  • Through the Peace Corps
“Carriers shall not require small group employers to require employees or dependents with in-force health credible group coverage of individual coverage as set out above to participate in the employer’s health benefit plan. Carriers may not require employers nor employees to pay premiums for coverage under the small group plan if the employee or dependent has and continues existing credible group coverage or individual coverage.”It is clear that the state of Colorado DOES NOT allow employers to require employees to purchase their health care plan if the employee already has coverage. Unfortunately, Mr. Smith’s company has more than 50 employees and must comply with federal insurance policies and not Colorado insurance policies.Since I began working on this issue for Mr. Smith, many other retired Army, Air Force and Navy personnel and reservists have complained that they are required to purchase the employer health care plan as a condition of employment. Mr. Smith and others could use the $800 a month or $9,600 a year for other expenses.This is another example of state policy that conflicts with federal policy. Do you believe that the state policy is more equitable than the federal policy?After all the sacrifices these men, women and their families have endured for our freedoms and liberties, isn’t it time that even the large companies follow Colorado’s lead and treat our military with respect and honor?If you have any questions or concerns about this issue or any other issue, call me at 719-238-5600, e-mail me at or visit my Web site at

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