While you are on leave, you are still an employee--your employer has to keep paying for your benefits. But if you discontinue employment after leave without returning to work for some reasonable time, they are allowed to bill you for the benefits cost, since in that case, you effectively discontinued your employment when you first took leave (since your leave transitioned seamlessly to not being employed) and should have received benefits for that time. Moreover, if you had the benefits for those 8 months, you are not allowed to keep them without providing something in return to your employer (like continued employment)--otherwise, you need to return the value of the benefits to the employer. Based on what you write, it appears you do have to reimburse them for this; your best bet may to try to negotiate a more-afforable settlement and/or payment plan.