The average rate of employee divorces not reported to HR clocks in at 10-13%. When this happens, ex-spouses remain on employer-sponsored health insurance plans, with the average annual cost per spouse reaching $7,000, significantly impacting the employer’s bottom line. These unreported divorces can also lead to compliance risks and administrative burdens. If a divorce takes place, employers are required to offer COBRA continuation coverage to eligible individuals or risk legal complications.
That’s why organizations of all sizes count on Consova’s results-oriented working spouse verification audit to ensure only those truly eligible are covered by employer-sponsored health plans. Committing to an ongoing spouse re-verification strategy can reduce the administrative burden that transpires after overlooking the re-verification process for extended periods of time. By re-reviewing spouse populations on a regular basis (every 18-24 months), employers can ensure divorces unreported by employees don’t slip through the cracks.
Here are four steps to consider when launching an ongoing spouse re-verification program.
STEP 1: Define Clear Policy Guidelines
To prevent misunderstandings during the verification process, clearly communicate with employees what your organization’s policy is for spouse insurance coverage eligibility. Also align on timing intervals for regular re-verification, such as every 18-24 months, and what documentation will be required.
STEP 2: Proactively Communicate with Employees
In addition to communicating clearly about the policy, inform employees about the upcoming audits in advance to reduce potential pushback and confusion. Consova actually recommends conducting audits in the period immediately after open enrollment to maximize savings. This is because it ensures that only eligible spouses and dependents are included in the plan from the very start of the new benefit year. Also, given many employees use healthcare benefits more at the beginning of the year, it catches ineligible beneficiaries before those costs are incurred.
By partnering with a dependent verification company like Consova, you can receive counsel on the best employee communications approach to help protect the employee experience while simultaneously securing substantial savings.
STEP 3: Leverage Technology
Having user-friendly technology in place to support re-verification audits also helps support clear and transparent communication. Consova offers streamlined digital methods for document submission that makes the process easy for employees and thereby helps secure substantial savings for employers. Consova’s program also integrates well with other benefits platforms, includes automation features, and offers real time reporting and analytics insights. These insights often lead to more precise budgeting and forecasting as well as more enhanced benefits offerings.
STEP 4: Ensure Ongoing Compliance
Putting regular spouse re-verification audits in place helps employers stay compliant with regulatory requirements such as the Consolidated Appropriations Act (CAA) and the Employee Retirement Income Security Act (ERISA). The CAA, established in 2021, helps protect consumers against surprise medical billing.1 The ERISA established in 1974, protects employees and their beneficiaries from unfair practices and abuse by their employers regarding retirement and health plans.2 Through a commitment to re-verification, companies demonstrate their due diligence and fiduciary responsibility in managing benefits programs.
Consova specializes in spousal re-verification strategies and offers cutting-edge solutions designed to streamline the verification process and maximize savings. With clear counsel around policy guidelines, communication, technology support, and compliance issues, you can achieve peace of mind that you’re checking every box without sacrificing employee satisfaction.
Ready to upgrade your spousal re-verification process? Contact us to learn how our customized solutions can help you achieve significant financial savings.
Sources:
- Consolidated Appropriations Act, 2021 (CAA) | CMS. www.cms.gov. https://www.cms.gov/marketplace/about/oversight/other-insurance-protections/consolidated-appropriations-act-2021-caa.
- U.S. Department of Labor. Employee Retirement Income Security Act (ERISA) | U.S. Department of Labor. Dol.gov. https://www.dol.gov/general/topic/retirement/erisa.