One trend that is growing among companies and employers that provide group health insurance plans to employees are audits to determine dependents’ eligibility on policies. The purpose of the audits is to cut back on the number of dependents that are receiving coverage from parents’ health insurance plans that are not eligible for coverage.
Employees are receiving these audits in the mail and have 30 to 45 days to fill out the questionnaire and provide proof for dependents. According to a report by The New York Times, a company audit of 10,000 employees will find 200 to 500 dependents that do not meet requirements. Removing these dependents can save a company $420,000 to $1.05 million a year.
Allowing children to stay on parents’ health insurance policies used to be based on an honor system but as more companies are trying to cut back health care costs, these audits are becoming more popular.
Right now, most of the dependents that are no longer eligible for coverage are children over the age of 18 and are not enrolled in school. This will change in January from the new health insurance legislation, which will allow children under the age of 26 to stay on health insurance plans even though they are not in school.
It is important for employees to make sure that their children are eligible for coverage and read their policy before they are audited. Employees should also fill out the audit as quickly as possible, because if it is not returned, the company is likely to drop the dependents’ coverage.