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Insurance Underpayment Letters Are Likely False, Says Benefits Office

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Many University of Florida employees received letters this week claiming their insurance plans had been suspended without their knowledge.

Letters sent out to UF employees by People First and the Florida Department of Management Services stated their insurance coverage was suspended because of an underpayment. The amount of money owed varied by employee and the letter did not specify which insurance plan had been underpaid.

Lisa Hodges, an assistant director in the benefits office at UF, said that the insurance plan in question was the optional term life plan, but that many of the letters were false and were sent out because of a computer glitch.

The error occurred because November payrolls did not post correctly, she said. The letter is automatically generated by People First, the state of Florida’s human resource information system, and was sent out the first week of December.

Natalee Singleton, the director of communications for the Florida Department of Management Services, said there are 43,000 employees enrolled in optional life insurance plans throughout the state. Of those, 480 received underpayment letters in error.  One-hundred and forty-two of them went to employees at the University of Florida.

Hodges said that underpayment letters are sent every month to UF employees and that errors do happen from time to time, but a glitch like this is not normal.

“I can’t say that we’ve had a widespread problem,” she said.

Hodges said if an employee does receive one of these letters and suspects it to be false, they should call the human resources office at UF or People First directly to make sure their payments are up to date.

Some University of Central Florida employees also received letters stating their insurance has been suspended or canceled.

Zenaida Kotala, an assistant director in news and information for the benefits office at UCF, said that so far 15 employees have confirmed receiving false letters.

“We became aware of the problem late yesterday (Tuesday) and we’re reaching out to them,” she said.

Kotala advises UCF employees who suspect an error to not panic and said they should also call the UCF benefits office to rectify the problem.

Hodges said she presumes People First would still honor insurance claims because the letters sent out were false, but she has not received confirmation from the state that this is true.

UF has previously asked DMS to change the alarming language of the letters and clarify which insurance plan is under threat of being canceled to help mitigate the urgent response from policy holders.

Singleton said she does not know if DMS has plans to do so, however.

Human resources offices across the state that are associated with DMS and People First have received a notice detailing the problem, she said.

UF’s human resource office informed policy holders they will be sending out an email soon to alert them of the error.

According to Florida Statue 627.6043, which deals with the notification of cancellation, nonrenewals and changes in rates of insurance, UF nor DMS are under legal obligation to notify policy holders prior to canceling or suspending their insurance policies.
The statute states: Written notice of cancellation for nonpayment of premium shall not be required for health insurance policies under which premiums are payable monthly or more frequently and regularly collected by a licensed agent.

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