Skip to main content

View Diary: AOL CEO reverses benefits cut decision (101 comments)

Comment Preferences

  •  Like many large firms, they may self-insure (4+ / 0-)
    Recommended by:
    shoeless, mconvente, Mage11an, BachFan

    I.e., they are financially responsible for paying the claims and they receive the value of the premiums, and retain a third party insurance company (Blue Shield, Aetna, whoever) simply to administer the plan (collect premiums, process claims, etc.).

    "[W]e shall see the reign of witches pass over . . . and the people, recovering their true spirit, restore their government to its true principles." Jefferson

    by RenMin on Mon Feb 10, 2014 at 09:36:41 AM PST

    •  And even if (6+ / 0-)
      Recommended by:
      koosah, tobendaro, Columba, Tunk, shoeless, PhilW

      they self insure, they wouldn't be on the hook for that much. A large employee pool—more than 5,000—and reinsurance would cushion them. As is pretty much explained in the link I have in the story.

      "The NSA’s capability at any time could be turned around on the American people, and no American would have any privacy left, such is the capability to monitor everything. [...] There would be no place to hide."--Frank Church

      by Joan McCarter on Mon Feb 10, 2014 at 10:03:54 AM PST

      [ Parent ]

      •  Reinsurance might (1+ / 0-)
        Recommended by:
        mspicata

        but just a large pool doesn't necessarily mean they would have enough premium reserves from that plan year.

        It's rare, but there are indeed some years where there are a lot of high dollar claims such that the loss ratio would be over 100%.  That's the nature of the system.  With self-insurance, you're on the hook for that.  Perhaps you can mitigate with a re-insurance policy, but they need to have that in the first place.

        "Give me a lever long enough... and I shall move the world." - Archimedes

        by mconvente on Mon Feb 10, 2014 at 10:41:19 AM PST

        [ Parent ]

    •  Only Unless Things Have Changed (8+ / 0-)
      I.e., they are financially responsible for paying the claims and they receive the value of the premiums, and retain a third party insurance company (Blue Shield, Aetna, whoever) simply to administer the plan (collect premiums, process claims, etc.).
      I worked for AOL for 13 years and have several buddies that still do. While I was with them they never self-insured (they use United Healthcare). Checking with at least one of my pals who is still there, that still seems to be the case.

      Considering this is the same guy who condones mass layoffs by conference call, I am leaning more toward general douchebaggery on Armstrong's part.

      At least this time he got called on it.

    •  My company self-insures -- HR tries to cut costs (3+ / 0-)
      Recommended by:
      davehouck, mspicata, DMentalist

      My company self-insures -- and so our HR and benefits people are not on the side of the employees.  I found this out the hard way when we had a denied claim to dispute.  Claims are still processed (and approved or denied) by Anthem -- but when I went to our benefits office to try to get some help with a complaint, they were definitely on the side of Anthem and were much more unpleasant than the Anthem people we talked to about the dispute.

      •  Wonder if an HR screw-up might be the real reason (0+ / 0-)

            that a couple of employees ended up costing the company $2 million in healthcare expenses.

             I had an experience with my employer when I decided to change my hours.  I wasn't REDUCING my hours, just working different hours...but somehow HR got its wires crossed and got the idea that I was reducing my hours to part-time, and gleefully jumped on the opportunity to terminate my full-time insurance benefits without notice.  I didn't even realize that it had happened until a couple months later.  

             Fortunately I was able to work it out and have my benefits restored retroactively.  However, it is my understanding that in situations like that, where an employee who is legally entitled to benefits suffers a lapse in coverage due to an employer error, the employer is on the hook for ALL of the employee's medical expenses which would have otherwise been covered by insurance.  

              Considering AOL's recent decision to close-down the immensely popular Winamp and Shoutcast, before realizing, "Hey...if we can't figure out how to make money off this, at least we can SELL it to somebody else who can..." it's apparent that the company isn't very well-organized.  

             So it wouldn't surprise me at all if the reason that AOL's medical expenses for employees were $2 million higher than anticipated was simply because some clerk in the HR department screwed up the paperwork.

Subscribe or Donate to support Daily Kos.

  • Recommended (148)
  • Community (71)
  • Baltimore (67)
  • Bernie Sanders (49)
  • Civil Rights (38)
  • Freddie Gray (38)
  • Elections (27)
  • Hillary Clinton (27)
  • Culture (24)
  • Racism (23)
  • Education (20)
  • Labor (20)
  • Media (19)
  • Law (19)
  • Economy (19)
  • Rescued (18)
  • Science (16)
  • 2016 (15)
  • Politics (15)
  • Barack Obama (14)
  • Click here for the mobile view of the site