Life moves quickly—and things can change at the drop of a hat, especially when it comes to managing employee benefits. Yet, it’s likely your employees aren’t thinking about their benefit plans when they pop the question or plan a pregnancy.
Typically, your employees are stuck with their benefits plan until the following years’ open enrollment period. However, employees who experience certain life events and milestones may qualify for a Special Enrollment Period. This is a period outside of the annual Open Enrollment Period that gives individuals a rare opportunity to enroll in a health plan or change from one plan to another.
However, many employees are unaware of this unique opportunity to change their benefit plan, mainly because the employee and their employer are unaware of what is considered a Qualifying Life Event.
While some Qualifying Life Events are more commonly known than others (like getting married or having a baby), others may slip under the radar, and employees may miss the special enrollment period.
So, what constitutes a Qualifying Life Event? And what is the responsibility of the employer when it comes to special enrollment? We will cover that and more below.
What is Considered a Qualifying Life Event?
There are many examples of Qualifying Life Events, but they generally fall into the following 4 different categories:
- A change in household size
- The loss of health coverage
- A change in circumstance
- A change in status
A Change in Household Size
Individuals may experience a change in their household size due to a qualifying life event which can include: getting married, having a baby, adopting a child, placing a child up for adoption or foster care. A death of a family member that causes an individual to lose their eligibility on their current healthcare plan is also considered a qualifying life event.
The Loss of Health Coverage
People may lose health coverage for several different reasons including but not limited to: losing their job, expiration of COBRA, turning 26 while on their parents’ health plan, getting divorced or losing Medicaid eligibility. All of these situations are considered a Qualifying Life Event, and make the employee eligible for Special Enrollment.
A Change of Circumstance
Employees are also eligible for Special Enrollment when they have a “change of circumstance.” This can mean several different things, but a change in circumstance can include moving outside of a plan’s coverage area, a change in income or a change in employee status (switching from a salaried to hourly or vice versa).
A Change in Status
The less commonly known Qualifying Life Events fall under the “change in status” category. A change in status can include an individual being released from prison or becoming a U.S. citizen.
You can find the complete list of Qualifying Life Events here.
Qualifying Life Event Timelines and the Responsibility of the Employer
How much time do employees have to take action? Under federal law, an employee must be given at least 30 days after the Qualifying Life Event to make any changes or updates to their benefits plan. Luckily, most carriers allow up to 60 days.
Still, employees often don’t realize their options and many aren’t even aware of Qualifying Life Events until one happens. This can delay their timeline to make any adjustments. A proactive HR department will clearly communicate with employees before it’s too late.
Abby Baumann is the Senior Marketing Coordinator at EPAY Systems, a leading SaaS provider of integrated human capital management software designed to help medium to large businesses manage and pay their hourly workers.