Past due medical/dental deductions

[izee98]

I tried asking this question in another sub-forum on this site but got no response. Hope you guys can give me advice..

Surprisingly I've just been informed that the hospital I work for somehow forgot to deduct my medical and dental benefits off my paycheck since my initial hire date (4yrs ago). For the past month I've been preparing to go BK-Ch7. I havent talked to my BK lawyer yet but was wondering if I can include these past-due medical/dental deductions (roughly $2300) to my BK.

Izee

[newbie2]

I don't believe I've seen this question before (or issue) so perhaps that is why you are not getting a response. Hopefully someone who has had this type of thing happen can chime in. I would also talk to HR at your hospital to see how this is handled during a bankruptcy just in case it isn't able to be discharged. (Perhaps monthly payments post bk?)

[izee98]

I don't believe I've seen this question before (or issue) so perhaps that is why you are not getting a response. Hopefully someone who has had this type of thing happen can chime in. I would also talk to HR at your hospital to see how this is handled during a bankruptcy just in case it isn't able to be discharged. (Perhaps monthly payments post bk?)

Thanks for the resp. They are willing to work with me in payments but I dont think I can incur any more debt..hence the BK....but if I cant include it I guess I have no choice but to accept it. I'll call HR and see what they say. Thanks again.

[kornellred]

You are trying to tell the forum that you have been unaware of the mistake for 4 years? Come on......

[frogger]

You are trying to tell the forum that you have been unaware of the mistake for 4 years? Come on......

I agree....... 4 years of not paying medical/dental is not something that you would just "not notice". That could be HUGE dollars.

[izee98]

Well I treated this job as a 2nd job...carelessly! With running a business and owning/managing my properties all I cared about was that it made it to my bank acct bi-weekly. The first few months working here I remember glancing at my check stub and it never dawned on me that they werent deducting it. And when they discontiniued printing check stubs and began doing them electronically, I never bothered viewing them online. Yes, error on my part, but Im just looking for an answer on the forum and not a virtual slap on the hand. Can I get any help here.

[StartinOver]

It's so easy to carelessly not review check stubs from employers, but as you've discovered, not a very good idea. This mistake went "in your favor" (cashflow-wise, anyway) for 4 years. I think since you had the benefit in your name that these deductions were supposed to be in payment of, and I assume you are continuing a work relationship with this job, that even if it can be discharged in bankruptcy, that might not lead to a smooth experience going forward. (I'm not addressing the legal question of whether it's dischargeable because I don't know... but I know that it sometimes makes for sticky work relations if a genuine mistake went unnoticed and someone appears to "get away" with something as a result.

It may seem semantic, but you incurred this debt when you and they first missed the deduction being left out. It's not a matter of incurring this debt now. Are you working with an attorney on your BK? Even if you plan to file pro se, this would seem to be a mixture of employment law and bankruptcy law and I'd be inclined to want an attorney's advice if it was my situation. You might want to have a few free consultations to determine if you're up to negotiating this alone.

[Pandora]

how is it in a 4 year span that your ins. company did not deny coverage/payment to drs/pharmacies to you for lack of payment?

Other issue I see is that you may be hit with tax consequences; you need to find out if your benefits were supposed to be pre-tax or post; different employers do it differently. Hubby's last job they did post tax, which made it eligible to deduct on tax returns once 7.5% was met for medical - job previous to that - it was pre-tax and not deductible. You may end up owing $ to the taxman, so ensure you know how it was to be paid out.

[StartinOver]

Pandora, regarding your first question, the insurance was contracted for by the employer, so the policy was in effect because the employer was paying the premium on their plan. The employer failed to deduct from the payroll, but these are two separate transactions. As long as the premium is paid, the coverage works.

[disconapper]

Pandora, regarding your first question, the insurance was contracted for by the employer, so the policy was in effect because the employer was paying the premium on their plan. The employer failed to deduct from the payroll, but these are two separate transactions. As long as the premium is paid, the coverage works.

This situation is very unfortunate and ridiculous. I would go directly to HR. I have never heard of a company forgetting to deduct premiums for 1 pay period, let alone 4 solid years. Their bookkeeping errors must be off the charts. I had the exact opposite happen to me, I wasn't enrolled for insurance and they deducted the premiums out of my first pay. Of course I received the money back. Wow, this mistake is huge, I hope it works out in your favor. Maybe since HR has obviously made quite a huge erroneous error they can meet you in the middle? Unlikely but worth a shot.

[brokeinal]

Do you still have this job? Do you want to keep it?

Your options depend on the answers to those questions. If you don't want to keep the job, I think you could possibly include it in your BK -- it will piss them off though, and that's why I say you should only consider this option if you aren't keeping that job -- you're pretty much sticking it to them and I'm sure they can find some reason to let you go. Your other option, if after speaking with them about possibly meeting halfway or just paying the last year's premium, etc would be to get an employment lawyer and fight them on it. But if you want to keep that job, your option is really not to make waves and to get this taken care of. Even if it was their mistake, they've now caught it and need to remedy it and they're going to argue that you should have known as well and are just as much at fault as they are for not noticing.

And to be fair, I really can see how you could easily overlook those deductions...$2300 over the course of 4 years is only ~$47.92/mo. If you're being paid bi-monthly, that's only ~$23.96/paycheck. That's not a lot. We would definitely know something was up as our medical deductions (health, dental, vision) come to a total of $900/mo...so your $2300 total wouldn't even have covered us for 3 months.

But before I started freaking out, I would meet with HR and see if they're willing to work with you in some capacity.