Coverage during leave rarely fails on the policy. It fails on the premium nobody collected.
Keeping medical, dental and vision active while someone is out is required during FMLA leave and often promised beyond it. The hard part is the employee’s share of the premium when there is no paycheck to deduct it from. We set up how it is billed and collected, run it through our platform, and write the rules for a late payment before one happens.
Coverage can be dropped for a late premium only after a waiting period and a written notice.
Under the FMLA regulations, the duty to maintain coverage ends only if the employee’s payment is more than 30 days late, and only after a written notice mailed at least 15 days before coverage stops. Skipping either step turns a missed payment into a reinstatement problem.
The Notice Letter
It must state the date coverage will end and that payment by then prevents it. We draft the letter and set its dates from the billing record, so it is never sent early and never forgotten. A properly dated notice letter protects the employer’s right to end coverage.
Restoring Coverage on Return
An employee whose coverage lapsed for nonpayment still returns to the same benefits, without a new waiting period or proof of insurability. The insurance contract has to allow that, so we confirm it before any lapse. Confirming reinstatement terms protects returning employees.
Recovering the Employer Share
If an employee does not return, the employer may recover premiums it paid during unpaid FMLA leave, unless the reason is a continuing serious health condition or something else outside their control. Coming back for at least 30 calendar days counts as returning.
Leave that is not FMLA is governed by the plan document, and the insurer has to agree.
Personal leave, extended medical leave and leave after FMLA is exhausted all depend on what the plan says about eligibility for people who are not actively at work.
Plan and Policy Must Match
If HR continues coverage longer than the insurance or stop-loss contract allows, claims in that period may not be covered. We compare the handbook promise with the contract language before either is relied on. Matching handbook promises to contract terms keeps leave coverage insured. To size unused time off, try our free paid time off liability calculator.
When Leave Becomes COBRA
For an employee who does not return from FMLA leave, the COBRA qualifying event occurs on the last day of leave, and COBRA cannot be conditioned on repaying premiums. The notice timeline starts there, not at the first day of leave. Our free leave of absence benefits cost calculator turns this into dollars for your plan.
FSAs During Leave
An employee on unpaid leave can typically revoke, continue or prepay health FSA contributions, depending on how the plan is written. The cafeteria plan document should spell it out, so the answer is not improvised case by case. A clear cafeteria plan document keeps FSA handling on leave consistent.
What HR asks about coverage during leave.
Do we keep paying our share during unpaid leave?
During FMLA leave, yes, on the same terms as if the employee were working. For other leave, your plan document and policy decide, which is why both should say it plainly. Clear plan language keeps benefits continuation on leave consistent for every employee, whether or not FMLA applies.
Can we add an administrative fee?
Not during FMLA leave. Employees on FMLA leave cannot be charged more than their normal share, which differs from COBRA, where a fee on top of the premium is permitted. FMLA premium rules differ from COBRA in ways that matter.
What about life and disability coverage?
FMLA’s maintenance rule covers group health plans, including dental and vision. Life and disability follow your policy and the carrier contract, and should be addressed explicitly so nobody is uninsured at the worst moment. Explicit policies protect life and disability coverage during leave.
Also in Employee Communication
The rules in one place.
FMLA And Leave Rules For Employers
Eligibility, penalties, benefits during leave and disability, in one place.
Where the Rules Come From.
The laws and rules named on this page link to the statute or regulation they come from. This is general information, not legal or tax advice, and rules change, so check the current text.
COBRA Continuation Coverage (29 U.S.C. 1161)
Requires many group health plans to offer temporary continuation coverage after a qualifying event.
Family and Medical Leave Act (29 U.S.C. Chapter 28)
Job-protected leave and group health coverage continuation for eligible employees.
Cafeteria Plans (26 U.S.C. 125)
The tax code section that lets employees pay certain benefit premiums before tax.
Send us your renewal.
We’ll tell you whether it looks competitive, where we see opportunity, and the five questions we’d put to your carrier. No cost, and no obligation to move anything.
The renewal letter
Your current plan summary
Contribution split by tier
Enrolled counts by tier
Four documents — two more if your group is 50 or more. Nothing else; every extra one is a reason to postpone.
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