Can an employer cancel your health insurance while you are out on a disability?

Written by DanielleBosely MS, NCSP | Fact checked by Psychology Dictionary staff 

Having to take even short term leave from work due to a disability is stressful to say the least. The last thing any employee wants to have to worry about during a time like this is whether or not they will lose their benefits while they’re away from work. Good news! The law is on the employee’s side with this one and in many ways. Employers cannot terminate health insurance coverage for any employee while they are on disability leave.

First, the Family and Medical Leave Act protects employees from losing coverage while off of work as long as they have a legitimate medical reason to be on leave that is backed by a physician’s word. ELABORATE. Sometimes, employees worry that if they’re away for an extended period of time, their employer may become restless and tire of the financial cost of keeping them on as a covered employee. Even if they do, there’s nothing they can do about it in this regard. Whether you were injured on or off the job, recently had a baby or have to take time off to tend to serious matters—health-related or otherwise—with other family members, employers must allow you to maintain your health insurance coverage during these times if a doctor says the time away from work is warranted.

The FMLA isn’t the only thing working in your favor here either. The Affordable Care Act was put into action in 2012 and it forbids employers from dropping covered employees from insurance plans just because they’ve developed a disability. While there is extensive legal coverage to make sure you hold on to your insurance benefits while on leave, you have to hold up your end of the bargain, too. Anyone on short- or long-term disability must return to work once they are capable of such and attain a doctor’s clearance noting so.

Now then, individuals who do not qualify for leave under the FMLA do not have the same protection. Those employers are not always required to even extend disability leave as an option to workers. Furthermore, they aren’t required at all to offer leave to employees who want to tend to other family members in need. If you are covered under the FMLA and your employer tries to terminate your employment or discontinue your health insurance benefits, you may be entitled to sue based on disability discrimination and should consult an attorney in that field if contemplating such.

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