Health Insurance: Employee Rights to Coverage and Benefits

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Currently, there is no federal law mandating employers to provide employees with health insurance coverage, and many states do not require employers to provide it or any other health coverage.  Statistics from the United States Census Bureau on health insurance coverage in the workplace estimated that only sixty-one percent of workers received some form of health insurance coverage from their employers in 2006.  For full health insurance coverage, including dental and optical allowances, the numbers bottomed to less than twenty percent in 2006.  There are, however, some state laws and regulations in place mandating certain variations of health care coverage to certain employees.  Not all states, however, ascribe to this form of mandatory coverage.  At the federal level, the laws covering existing employees and their health care coverage generally only mandate fairness and equality among workers in order to prevent discrimination.  Once a worker is offered insurance coverage by their employers, generally through employment contracts or a company handbook, federal laws are in place to regulate the fair and equitable coverage of all individuals.

HIPAA Laws: The Health Insurance Portability and Accountability Act of 1997

HIPAA, a federal law enacted in July of 1997, aimed to make it simpler for employees to change jobs, while remaining covered by insurance.  In addition, the HIPAA laws looked to prevent healthcare fraud, discrimination, abuse, and other illegal acts by workers, employers, healthcare providers, and insurance carriers.  The HIPAA laws provided several specific avenues of protection for employees, which include:

  • Protections for workers from being denied coverage due to pre-existing medical conditions, especially when previously insured by other private or public coverage carriers
  • Increased preventative measures to protect workers from health care coverage discrimination due to past claims history, mental medical conditions, physical medical conditions, genetic information, disability, or domestic violence
  • Criminalization and active pursuit of anyone defrauding or abusing any health care benefits programs
  • Promotion of tax favorable insurance plans, including health reimbursement arrangements (HRAs), health savings account (HSAs), and flexible spending arrangements (FSAs)
  • Increased medical privacy protection for workers

Covering Former Employees

Federal law does provide workers some protection in the event they are laid off from their jobs, have their hours reduced to a level where they are no longer insured, and for workers fired for any reason besides “gross misconduct”.  These protections and more are grouped into a continuing healthcare coverage plan for former employees known as COBRA.

Page 2: COBRA Insurance Coverage


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