What Is a Qualifying Event for Health Insurance?

By hrlineup | 26.04.2020

Something has occurred in the life of someone working within the organisation. To course through this occurrence, a review on spend and finances takes centre stage. Quickly, the individual notices that it may be time to update their health insurance. Health Insurance typically has spend limits. Extenuating circumstances may require for these limits to be amended. This is not something that occurs automatically, when the patient feels that there is a need. Instead, changing the amount of health insurance that is needed requires a qualifying life event. With this, it becomes possible to benefit from a special enrolment period.

What is a qualifying life event?

This is the type of event that will have a big impact in a person’s life and change the way that they live. With this change, the normal insurance needs will need to be updated to adequately fit in with this new life experience. Some qualifying life changes include: –

  • A change in the household through marriage, separation or divorce, a child joining the family through pregnancy or adoption, or losing coverage following death of a family member.
  • Loss of health care coverage from losing eligibility for Medicaid or Medicare, through losing job-based coverage or even turning 26 and no longer being covered by parents.
  • Updating one’s residence such as moving to another state, working in another state or having to move students from one school to another.
  • Other qualifying charges may include a new U.S. Citizen becoming eligible for Marketplace coverage, becoming a federally recognised tribe or even being released from incarceration.

An employee who experiences a qualifying life event is able to update the health insurance coverage that they already have. To get this life changing event insurance, an evaluation is done on a case by case basis through an underwriter.

Key points to remember with qualifying life event health insurance

To make the most of a health insurance qualifying event, the existing plan would need to be changed within 30 to 60 days before or after that event. Since individual plans may vary, it becomes important to look through and discern the finer details of the plan. Should one not make the changes within the time allowed, the next window for enrolment may required close to a year to pass.

There are some instances where it may feel like a life qualifying event for an individual, but according to the definitions allowed, the event does not fit the mould. For example, an individual who gets pregnant may feel that they need their life is changing. However, it is only when they have given birth that it is possible to apply or a qualifying life event. Another common example is starting a new job. Rather than being an automatic qualifying event, it requires the buy in from the employer. This is because when the insurance is offered as group health insurance, what may be affected the most is contributions to a flexible spending account.

An IRS qualifying event has clear criteria on what qualifies and what does not as a life changing event. Maintaining applications for changes within the stipulated time period, will enable one to update their health insurance to better meet new life needs with ease.