6

Suppose, for the sake of discussion, that I work at ACME, Corp, a USA company. As part of my compensation, ACME makes me a member of their group health insurance through Aetna, a USA health insurance company (or any other company).

Suppose further that I am diagnosed with hypothetical cancer. This hypothetical cancer requires very expensive treatment ( > $100,000 over the course of a year ), but I am able to continue working while receiving treatment.

I would like to know how this affects ACME. Is this going to be a cost to ACME somehow? Will their premiums rise because I am a member requiring expensive treatment? Will Aetna try to have me removed from the plan somehow so they don't have to pay?

Also, suppose that ACME goes out of business and I need a new job. Will my cancer affect a future employer who hires me? Should I keep my cancer a secret from potential employers for money reasons?

5

Many big companies self insure. They pay the insurance company to manage the claims, and to have access to their network of doctors, hospitals, specialists, and pharmacies; but cover the costs on a shared basis with the employees. Medium sized companies use one of the standard group policies. Small companies either have expensive policies because they are a small group, or they have to join with other small companies through an association to create a larger group.

The bigger the group the less impact each individual person has on the group cost. The insurance companies reprice their policies each year based on the expected demographics of the groups, the negotiated rates with the network of providers, the required level of coverage, and the actual usage of the group from the previo year.. If the insurance company does a poor job of estimating the performance of the group, it hits their profits; which will cause them to raise their rates the next year which can impact the number of companies that use them.

Some provisions of the new health care laws in the US govern portability of insurance regarding preexisting conditions, minimum coverage levels, and the elimination of many lifetime cap. Prior to these changes the switching of employers while very sick could have a devastating impact on the finances of the family. The lifetime cap could make it hard to cover the person if they had very expensive illnesses.

If the illness doesn't impact your ability to work, there is no need to discuss it during the interview process. It won't need to be discussed except while coordinating care during the transition. There is one big issue though. If the old company uses Aetna, and the new company doesn't then you might have to switch doctors, or hospitals; or go out-of-network at a potentially even bigger cost to you.

4

Your employers insurance premiums will definitely go up if there are a lot of claims when it is time for them to renew their policy. It is also possible that if this happens the employer will pass along some of the additional cost to employees.

The insurance company will not try to have you removed, it doesn't work that way with group policies. They just jack up the price as mentioned previously.

If you take a new job your cancer will affect the future employer in the same way. As to whether you should keep it a secret, I don't think it is something you have to disclose unless it affects your ability to perform your job, even then it may be protected under the Americans with Disabilities Act. It is true that some employers could exhibit some bias because of this, especially a small company that is likely to have a small group that is more likely to see price hikes because of a single employee making expensive claims.

Bottom line: I wouldn't lie about it to a future employer, but I wouldn't volunteer that information either unless it is material to your job performance.

-2

I don't think so. There is a provision in ObamaCare called "community rating" that applies starting in 2014. Insurance companies must place individual and small group plans into a pool of people from the same geographical region. The same plan must cost the same for all small businesses from the same region. So having employees who have high costs will not significantly affect the company's cost; it will get factored into the cost for all people in the area; but the effect gets averaged out over all businesses and individuals who have plans.

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Not the answer you're looking for? Browse other questions tagged or ask your own question.