Author Topic: Corp to Corp or Employee -- Health Care?  (Read 2861 times)

Insanity

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Corp to Corp or Employee -- Health Care?
« on: July 23, 2013, 08:30:11 PM »
Alright, so I was laid off in July due to the company not able to find work. 

I am currently set up as contract to hire (which will eventually have a non-compete).  The job is kind of in an odd situation.  They can't guarantee the hire part (the client is looking to hire a certain number of contractors that are being brought in.  The contract is for 3 months.  In this case I am W-2 with the contract company.

I have a potential contract offer coming from another client (also non-compete).  This would be for 1099  or Corp to Corp.  That might be for a 6 month to a year contract.  (again, nothing official).   Today I met with someone else that might be interested in doing some contract work.  I also have a third contact that wants me to do (I originally turned it down due to believing I was going to be an employee and would have to sign a non-compete) some contract work (I would not sign a non-compete)

So - here's the concern.

Health Care and pre-existing conditions.  I can pretty much guarantee I would either not get coverage (yeah, I know that isn't supposed to be possible any more) or it would be insanely expensive.  Obviously going without insurance is not an option (family).  Disregarding potential for spouse to go to an employer and get insurance, anyone have any thoughts?

bUU

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Re: Corp to Corp or Employee -- Health Care?
« Reply #1 on: July 24, 2013, 05:06:00 AM »
Guaranteed Issue, including the limitation on insurers that prevent them from charging more for those with preexisting conditions, goes into effect January 1 - it is not yet in force. The three month contract would, of course, leave you a couple of months short of the protection of Guaranteed Issue. Perhaps that's enough to help you decide which job to take?
« Last Edit: July 24, 2013, 05:11:21 AM by bUU »

Freedom2016

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Re: Corp to Corp or Employee -- Health Care?
« Reply #2 on: July 24, 2013, 10:15:13 AM »
If the 3-month W-2 contract comes with a health care benefit, would you be able to keep it via COBRA after the contract ends, until the new law takes effect?
 

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Re: Corp to Corp or Employee -- Health Care?
« Reply #3 on: July 24, 2013, 10:26:07 AM »
If the 3-month W-2 contract comes with a health care benefit, would you be able to keep it via COBRA after the contract ends, until the new law takes effect?
I have a pre-existing condition and this is what I'm doing (left corporate job in May).

Your state's healthcare exchange should be open for enrollment in October. (Some states' exchanges have already published rates.) bUU is correct: you cannot be barred from getting health insurance due to pre-existing conditions starting Jan 2014.

Daleth

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Re: Corp to Corp or Employee -- Health Care?
« Reply #4 on: July 24, 2013, 10:45:00 AM »
Wait, do you have insurance now? Did you Cobra whatever insurance you had at your previous employer? If so, to my knowledge preexisting conditions wouldn't be an issue--someone please correct me if I'm wrong, but I think the preexisting conditions thing comes into play when you've let your insurance lapse and are seeking new insurance (or when you somehow never had insurance before).

Someone please smack me if I'm wrong.

But in any case, yeah, thanks to Obamacare this will be a total nonissue for everyone come January 1, 2014.

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Re: Corp to Corp or Employee -- Health Care?
« Reply #5 on: July 24, 2013, 10:57:12 AM »
Daleth - You are correct. Pre-existing conditions have generally not been a problem with employer-provided plans. You can keep coverage through COBRA for 18 months after separation (even with pre-existing conditions). (It's extremely expensive, but that's another issue....)

The challenge has always been individual policies for those of us with pre-existing conditions. (And that challenge existed even if you never had a lapse in coverage.) And you are right: after Jan 2014, it won't be a problem any more.

Insanity

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Re: Corp to Corp or Employee -- Health Care?
« Reply #6 on: July 24, 2013, 11:15:43 AM »
I am covered through August as part of a severance form a layoff.  After that it would be COBRA. 

My fear is the cost (even if the insurance company is required to cover me) of a plan.

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Re: Corp to Corp or Employee -- Health Care?
« Reply #7 on: July 24, 2013, 12:22:16 PM »
Yep, COBRA is very expensive: a little over 100% of the cost. You would need at least four months of coverage before Affordable Care Act is an option in January.

I have not been able to find out whether we will be required to exhaust COBRA (18 months) before going with an ACA Exchange plan or not. I'm anticipating the answer is "no," since paying over 100% of the cost (employer is paying nothing) would not appear to meet the "employer-provided" test.