If your company is one of the many companies currently going through annual open enrollment period, then you have probably read the term “eligible life events” or “qualifying life events” a couple dozen times by now. It’s important to know and understand which life events qualify because many people only have one chance per year to elect their health benefits unless they have a qualifying life event, which gives them an opportunity to change their benefits elections.
Your life is always changing, which means that your health care needs are always changing as well. That’s why qualifying life events are so important. These will give you the chance to change your coverage and get the health care insurance protection that you and your family members need. This article is going to look at some of the different quality events and ways that you can change health insurance plans.
Why Do Qualifying Life Events Matter?
Most companies negotiate group health insurance costs once per year, and it’s more cost efficient for both the insurance company and the employer to keep a relatively steady number of people in the plan they elect at the beginning of the year.
Insurance companies agree to lock in rates for the year in exchange for keeping people from switching plans at will. However, it wouldn’t be fair for the insurance companies not to allow people to change plans when they have a major life event that changes their needs. So there is a built-in clause that allows people to change their health care coverage when they experience certain qualifying life events.
What are Qualifying Life Events?
As mentioned above, qualifying life events are major events in your life that qualify you to change your health care coverage outside of the open enrollment period. Major life events include:
- Marriage, civil union, divorce, annulment, legal separation.
- Birth, adoption, taking in a foster child, or becoming a legal guardian.
- Change in spouse’s work status.
- Death of spouse or dependent.
- Change in status of dependent’s eligibility (e.g. change of student status or becoming too old for coverage).
- Possibly more, depending on the plan.
These are common qualifying life events, so be sure to read the fine print in your benefits enrollment package. Also keep in mind that you usually only have 30 days from the date of the qualifying life event in which to make a change in your health insurance plan. Insurance companies or your Human Resources department may also require proof of the qualifying life event, so be ready to fax a copy of a birth or marriage certificate, death certificate, adoption papers, etc.
Specifics vary from plan to plan, so be sure to read your plan thoroughly before electing your benefits plan. You may also wish to get insurance rate quotes from another insurance source before automatically assuming your group plan offers the best rates. My wife and I discovered we could save a couple thousand dollars per year with a comparable individual health plan.
Open Enrollment & Special Enrollment Periods
While this article focuses on Qualifying Life Events, it’s important to bring up two related topics: Open Enrollment and Special Enrollment Periods.
Open enrollment usually occurs with your employer once per year. This is the period you have to review your employer-sponsored insurance, including healthcare, life insurance, disability insurance, and long-term care insurance.
Special Enrollment Periods apply to the Affordable Care Act. Special Enrollment Periods are often held around the same time as many company sponsored open enrollment periods. This makes it a good time to review your health insurance options to determine if you want to keep your plan with your employer or look for other health care options on the ACA Exchanges or with an insurance broker, or an online search tool such as eHealthInsurance.
You can also participate in a Special Enrollment Period if you have a qualifying life event, such as getting married, divorced, having a child, etc. This also includes if you lose your job. If you lose your job, you should consider COBRA insurance coverage, or look to the ACA Exchanges to compare options.
Alternative Healthcare Options Outside of Open Enrollment
The Exchanges that opened under the Affordable Care Act only take new customers during open enrollment, or when you have a qualifying life event. Many employer healthcare options are similar.
If you are outside the Open Enrollment period and don’t have a qualifying event, then consider a Christian health-sharing ministry such as MediShare, Liberty HealthShare, or a similar organization. Most of these organizations do not have an Open Enrollment or Qualifying Life Event mandate to join their organization.
These health-sharing ministries satisfy the health insurance mandate under the ACA. Note: they aren’t technically insurance, but function in a similar manner. I encourage you to read reviews of Medi-Share, Liberty HealthShare, and others for more information on how these programs work.
Maintain Health Insurance Coverage – It’s Important
Without health insurance, you could be responsible for a massive amount of hospital bills that could easily drain your bank account or leave you with inadequate health care. There are plenty of options, and it’s important that you find the best plan for you and the best price.
Health insurance is one of the most confusing and frustrating purchases that you’ll ever make. I know that is can be difficult trying to make the best decision, but that’s why I’m here to help. If you have any questions about any qualifying life events, please feel free to look at some of the other posts on my site or contact me.