Can we sue an employer for the cost of medical fees incurred due to policy cancellation?

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Can we sue an employer for the cost of medical fees incurred due to policy cancellation?

My wife’s employer deducted the co-pay amount each paycheck for 2 months without paying the premium. This resulted in the policy being cancelled. To deal with that matter, we are filing with the NJ State Dept of Labor. However, we are now receiving several thousands of dollars in bills from the various medical providers whose bills have been denied by the insurance company for that period. Most of the medical visits were not of an “emergency” nature and would definitely not have occurred if we had known that we had no coverage.

Asked on September 24, 2011 under Employment Labor Law, New Jersey

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

You and your wife should consult with an attorney. If the employer deducted the premiums but failed to pay them to the insurer, then the employer would seem to be liable to you, under one or more of the following theories: breach of contract (violating the "agreement" under which your wife works), negligence (being unreasonably careless), fraud (if it misrepresented about coverage), even possibly an intentional tort (it if deliberately, not accidentally, failed to pay the money). If liable, the employer would likely be liable for *all* medical costs which you incurred which should have been covered by insurance during the time your coverage was canceled for nonpayment (it would not need to reimburse you what you would have paid out of pocket, such as through copayments or deductibles, however). It is worth speaking with an attorney to explore a lawsuit.


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