Reduction in Force and Health Coverage
Employees who lose their jobs as a result of a reduction in force (RIF) will continue to have coverage under the State Health Plan for up to 12 months, as long as the employee has 12 or more months of service and the employee was covered by the Plan at the time of separation from service - or completed a contract term of employment of 10 or 11 months as an employee of a local school administrative unit. Employees are not eligible for RIF health coverage if the employee is provided health coverage on a non-contributory basis by a subsequent employer.
New Billing Process
Effective September 1, 2011, State Health Plan members will be required to pay a premium for the 80/20 Standard plan subscriber only coverage.
Members, who are receiving the reduction in force (RIF) health benefit continuation coverage and who are enrolled in the 80/20 Standard plan or have covered dependents, will be billed directly by Blue Cross and Blue Shield of North Carolina for their portion of the premium. Members will have the option with BCBSNC to have payments automatically drafted through the EasyPayBlueSM program.
If the RIF'd member's premium is not received within 30 days after the premium due date, claims for the member and any enrolled dependents will be placed on hold or will be denied during the period for which the premium has not been paid. If the member is enrolled in the 80/20 Standard plan and the premium is not received within 60 days, the member will be moved to the 70/30 Basic plan. If the member has dependent coverage and the premium is not received within 60 days, coverage for their dependents will be terminated as of the last day of the month through which premiums have been paid.
How Will the Split Bill Work?
Under the split bill arrangement, agencies will no longer have to collect premiums on a monthly basis from former employees. Split billing will begin in August for September premiums. Split bill will operate essentially the same as COBRA subsidy.
In order to accommodate the split bill capability, new RIF subgroups have been created. Click here for a listing of your old RIF subgroup number and your new RIF subgroup number. Bills for the RIF subgroup will be generated on a date as close as possible to your active group bill, but early enough to allow RIF members 20 days to pay. Please make sure to record the new RIF subgroup number on your remittance to ensure that payment is properly applied to your RIF members. If you write only one check, please remember to include the RIF group coupon and record on the remittance stub the dollar amount that should be applied to the RIF subgroup.
Members whose initial 12 months of coverage will expire after August 31, 2011, and who are currently enrolled on existing RIF groups will be moved to the new RIF subgroup. Employing units will be billed the $410.94 per month and the member will be billed directly by BCBSNC for any dependent premium or if they are enrolled in the 80/20 Standard plan. Former employees on the 70/30 Basic plan with employee only coverage will not receive a bill.
Employees may continue coverage for their eligible dependents during this 12-month period. Employees who elect not to continue coverage under RIF immediately following separation from employment may not obtain RIF coverage at a later date.
HBRs should follow the appropriate RIF process below for their agency:
- eBenefitsNow agencies – HBRs should term RIF employees using the reason code "Terminate Employment" button. This sends the left employment (LEM) reason code to BCBSNC. The HBRs should explain the RIF benefits in their employees' exit interviews and provide the employees with the Application for Reduction in Force Health Coverage Benefit form. Employees who wish to elect RIF coverage should complete the application and submit it to their former HBR for approval. The HBR should, in turn, forward the approved form with the HBR's signature to BCBSNC for enrollment on the employer-sponsored RIF group. The RIF enrollment will not appear in eBN.
- Please note: HBRs must term the RIF employees in eBN prior to returning the completed Application for Reduction in Force Health Coverage Benefit form to BCBSNC.
- BEACON agencies – HBRs should provide the RIF employee with the Application for Reduction in Force Health Coverage Benefit form to complete, copy and keep for their records. The HBR does not need to send the application to BCBSNC. The employee and any dependents will remain on the employing unit's billing statement while receiving the 12 months of RIF benefits. For more detailed information, please refer to the process that has been provided by Best Shared Services.
- Paper agencies – HBRs should provide RIF employees with the Application for Reduction in Force Health Coverage Benefit form when they are terminated. The HBR should send the completed application to BCBSNC. BCBSNC will enroll the member, and if applicable, any covered dependents on the RIF subgroup.
After 12 months, the former employee and their eligible dependent(s) may continue health coverage on a fully contributory basis. Former employees who choose to continue their coverage after the initial 12-month period will be direct-billed by BCBSNC.
Employees who do not have the required months of service to qualify for RIF benefits may continue health coverage for themselves and their qualified dependents under COBRA at full cost.
For more information on RIF and health coverage, review the RIF Frequently Asked Questions.
