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What is a Qualifying Event for Your Group Insurance Plan?

Guest post by: Corinne Mitchell

Article Overview: A qualifying event determines when an employee can make changes to their employee benefit elections outside of the annual open enrollment period. The IRS lists very specific events that constitute a qualifying event. Find out what they are here.

What is a Qualifying Event for Your Group Insurance Plan?

During the open enrollment period, (the month prior to your group plan renewal), employees that have previously declined coverage for themselves or dependents can enroll and coverage will become effective on the renewal date for the group.

It is only during the open enrollment period that employees can elect to join the group insurance plans. That is unless there is a qualifying event that results in a change in their status.

If there is a qualifying event, an employee can make a change to their employee benefit elections outside of the open enrollment period. So what is considered a qualifying event?

New Employee

The most common qualifying event occurs when a new employee is hired. Each carrier and plan has specific timeline guidelines for when a new employee becomes eligible for the group coverage. This is called the ‘waiting period’. The new application should be completed and submitted within the waiting period so that coverage will become effective at the end of the waiting period.

Other Qualifying Events

Other qualifying events are outlined by IRS Code, Section 125, and may include but not be limited to the following:

• Change in legal marital status due to marriage, divorce, annulment, legal separation or death of spouse
• Change in number of dependents due to birth, death, adoption, placement for adoption or award of legal guardianship
• Court Order to provide medical coverage, usually for a child
• Reduction or increase in hours of employment by the employee (switch between part-time to full-time)
• Change in employment status of the employee’s spouse or employee’s dependent: switching from part-time to full-time employment status or from full-time to part-time, termination or commencement of employment, a strike or lockout, commencement of or return from an unpaid leave of absence which results in employee/dependent becoming ineligible for coverage
• Loss of eligibility status for dependent: marriage of a dependent or dependent over eligible age, dependent satisfies or ceases to satisfy eligibility requirement, change in student status
• The employee either no longer works or no longer resides in the service area of their current health plan.
• Relocation of qualifying family members
• Addition or elimination of a benefit package option by the employer or carrier
• Loss of outside coverage through death, divorce, employee enrolled on spouse’s plan and lost coverage through termination of their spouse

If you experience a qualifying event, you will need to request a change to your benefits within 30 calendar days of the event and provide proper documentation. If you do not request the change within 30 calendar days, the next opportunity you will have to make changes to your benefits will be during the next open enrollment period.

Qualifying Event Changes

Some changes that you can make due to a qualifying event include:

• Enroll in or discontinue coverage
• Add or remove a spouse and/or dependents
• Switch health plans (if multiple plans are offered for your group)
• Enroll in or modify elections to medical/dependent flexible spending accounts

If you have any questions about whether or not you can make changes to your benefit elections, ask your employer or the insurance broker who manages your company’s group insurance plans.

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Article Tags: health insurance qualifying event, insurance qualifying event, medical insurance, qualifying event, qualifying event for health insurance
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