A friend of mine was in a catastrophic accident (not at fault) and has been hospitalized for 3 weeks. The company he works for knows that he is injured and believes he MAY not be able to work again. The company has told his family that they will be terminating his insurance after April. Is this legal? This seems to be discriminatory to me, but I'm not sure of the law.
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The employer is obligated to follow the benefit rules of the plan. If your friend becomes ineligible under the rules of the plan, then they have to terminate his coverage. So the question is not whether, in general, a person's health insurance can be terminated while they are hospitalized. (It can.) The question is why specifically your friend's insurance is being terminated. Are they terminating his job? Are they stating that he's no longer eligible because he's not actively working the minimum number of required hours per week? These could be valid reasons for terminating a person's group health insurance benefits IF those are the eligibility requirements under the plan. If the injury was not work related and your friend has not been at work for 3 weeks/will not be returning any time soon, its possible that your friend's coverage could be canceled. He should speak with his human resources representative, if he's able to do so. (If he's unable to communicate, whomever is his legal representative should do so for him.) He or his legal representative could also check with his state's Department of Labor, if they feel that he is being wrongfully terminated. He should also find out whether he's protected under the Family Medical Leave Act (small employers are exempt from that law), and whether or not he will be eligible for COBRA continuation coverage. They could also contact an attorney to assist them.
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