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OPINION OF TRUSTEES
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In Re
Complainant: Employee
Respondent: Employer
ROD Case No: 81-362 – January 30, 1984
Board of Trustees: Harrison Combs, Chairman; John J. O’Connell, Trustee; Paul R. Dean, Trustee.
Pursuant to Article IX of the United Mine Workers of America 1950 Benefit Plan and Trust, and under the authority of an exemption granted by the United States Department of Labor, the Trustees have reviewed the facts and circumstances of this dispute concerning the conversion of benefits coverage for a laid-off Employee under the terms of the Employer’s Benefit Plan hereby render their opinion on the matter.
Background Facts
The Complainant was employed by the Respondent for a thirteen month period, prior to being laid off on August 20, 1982. During his period of employment, the Complainant worked in excess of 2,000 hours for the Respondent, qualifying him for continued health benefit coverage through August 31, 1983, which he received.
At the expiration of his period of eligibility, the Complainant exercised his option to convert his insurance coverage and mailed a check in the requested amount of $268.19 to the insurance carrier at the designated address in August 1983.
Shortly thereafter, the Complainant’s wife incurred bills for services related to pregnancy. She was advised by the insurance carrier that their converted policy did not provide the same level of coverage as previously provided under the Employer’s Benefit Plan and, specifically, that services related to pregnancy were not covered.
Dispute
Is the coverage provided under the individual conversion privilege required to be similar to that under the Employer’s Benefit Plan? Does the Pregnancy Discrimination Act of 1979 require the company to cover these medical bills?
Positions of the Parties
Position of the Complainant: Coverage provided under the conversion privilege should be similar to that provided under the Employer’s Benefit Plan. Statutory requirements under the Pregnancy Discrimination Act of 1979 should require coverage of these incurred expenses.
Position of the Respondent: The converted health insurance coverage does not include pregnancy benefits and is consistent with standard conversion policy coverage available to residents of the state of Virginia where continuation of pregnancy benefits are not required.
Pertinent Plan Provision
The Employer Benefit Plans provide:
Article III D.(3)(b)When health benefits coverage terminates, a Beneficiary may, upon application, convert, without medical examination, to a policy issued by the insurance carrier within 31 days after the date-coverage terminates. The type of policy, coverage and premiums therefore are subject to the terms and conditions set forth by the insurance carrier.
Discussion
Article III D. (3)(b) of the Employer’s Benefit Plan provides that a Beneficiary y convert to a policy issued by the insurance company if application is made thin the specified time limits. The Complainant was provided with and exercised his conversion option within that time period.
The Complainant claims, however, that the policy issued by the insurance carrier was inconsistent with that provided under the Employer’s Benefit Plan. While this was in fact the case, Article III D. (3)(b) of the Employer’s Benefit Plan clearly specifies that the type of policy, coverage and premiums offered by the insurance carrier at the time of conversion are subject to the terms and conditions set forth by the insurance carrier. There is no requirement that coverage be the same as that provided under the Employer’s Benefit Plan. Therefore the obligations of the Respondent, as a former Employer, were met by virtue of its making available a plan for conversion.
As to the question raised by the Complainant concerning the applicability of the Pregnancy Discrimination Act of 1979, the Trustees regret that they may not comment on whether the insurance carrier’s policy is in violation of the Pregnancy Discrimination Act. The authority granted to them by the Department of Labor to resolve disputes extends only to the resolution of disputes arising of the administration of Employer Benefit Plans. The Respondent in the case has fully complied with its obligations under the Employer’s Benefit Plan.
The remaining dispute concerns a statutory question between an insurance carrier and its policyholder which the Trustees may not address.
Opinion of the Trustees
Respondent has complied with its contractual obligations and is not responsible for the payment of charges incurred after the expiration of the Complainant’s eligibility under the Employer’s Benefit Plan.