What Are Examples of a Qualifying Event?

A qualifying event represents a significant life change that impacts an individual’s health insurance coverage, allowing adjustments outside of standard enrollment periods. These events are specifically defined by various federal regulations, ensuring that people do not face a sudden loss of access to health coverage due to major personal transitions.

Qualifying Events for COBRA Continuation

The Consolidated Omnibus Budget Reconciliation Act, commonly known as COBRA, provides a temporary extension of employer-sponsored health coverage after certain events cause a loss of group health benefits. This federal law applies to group health plans offered by employers with 20 or more employees. COBRA allows eligible individuals to continue their health insurance, often at their own expense, for a limited time following a qualifying event.

For employees, two primary events trigger COBRA eligibility. These include the voluntary or involuntary termination of employment for any reason other than gross misconduct. A reduction in the number of an employee’s work hours that results in the loss of eligibility for health coverage also constitutes a qualifying event.

Several other qualifying events specifically apply to spouses and dependent children of a covered employee, allowing them to elect COBRA continuation coverage if these events cause them to lose group health benefits. The termination of the employee’s employment or a reduction in their hours extends COBRA rights to their covered family members.

The death of the covered employee is a qualifying event for their spouse and dependent children, allowing them to continue coverage. Divorce or legal separation from the covered employee also triggers COBRA eligibility for the former spouse and dependent children. When a covered employee becomes entitled to Medicare, their spouse and dependent children may also become eligible for COBRA if this event leads to a loss of their existing group health coverage. A dependent child losing their dependent status under the plan rules, such as aging out at age 26, is another event that qualifies them for COBRA continuation.

Qualifying Events for Special Enrollment

Special Enrollment Periods (SEPs) allow individuals to enroll in or change health insurance coverage outside of the annual open enrollment period. This is typically done through the Health Insurance Marketplace established by the Affordable Care Act (ACA) or employer-sponsored plans. These periods are triggered by specific life changes that affect an individual’s health coverage needs or eligibility.

A common qualifying event for a Special Enrollment Period is losing existing health coverage. This includes losing job-based coverage, which can happen if employment ends or if hours are reduced. Other instances of losing coverage that trigger an SEP include COBRA benefits ending, turning 26 and no longer being covered by a parent’s plan, or losing eligibility for government programs like Medicaid or the Children’s Health Insurance Program (CHIP).

Changes in household status also frequently qualify individuals for a Special Enrollment Period. Getting married allows individuals to enroll in new coverage or add a spouse to an existing plan. The birth of a child, adoption, or placement for adoption are also qualifying events, enabling families to add the new member to their health plan, with coverage often backdated to the date of the event. Divorce or legal separation that results in a loss of health insurance coverage for one or both parties qualifies for an SEP. The death of a covered family member also allows for a Special Enrollment Period.

Changes in residence can trigger a Special Enrollment Period if the move results in new health plan options becoming available. This includes moving to a new county or state, or moving to an area where different health insurance plans are offered. Other qualifying events include release from incarceration, gaining U.S. citizenship or lawful presence, or certain changes in income that affect eligibility for financial assistance or subsidies.

What to Do After a Qualifying Event

After experiencing a qualifying event, prompt action is necessary to ensure continuity of health coverage. A crucial initial step involves timely notification to the relevant entities, whether it is an employer for COBRA or employer-sponsored plans, or the Health Insurance Marketplace for individual coverage. For COBRA, employers are generally required to notify the plan administrator within 30 days of events like termination or reduced hours, and the administrator then has 14 days to send an election notice to eligible individuals. For other events such as divorce or a child aging out, the individual or beneficiary has 60 days to notify the plan.

Adhering to strict deadlines for notification and enrollment is imperative to avoid gaps in coverage. For COBRA, eligible individuals have at least 60 days from the date they receive the election notice to decide whether to elect continuation coverage. For Special Enrollment Periods through the Marketplace, individuals usually have 60 days from the date of the qualifying event to select a new plan. Missing these deadlines can result in losing the opportunity to enroll in coverage outside of the regular open enrollment period.

Specific documentation is often required to verify the occurrence of a qualifying event and confirm eligibility for new or continued coverage. For instance, a marriage certificate may be needed for a marriage, a birth certificate for the birth of a child, or a divorce decree for a divorce or legal separation. Proof of job loss or reduction in hours, such as a termination letter, might be requested for COBRA or SEP eligibility.

Guidance on where to find specific forms and detailed instructions is readily available. For COBRA, an individual’s employer or their human resources department, or a third-party COBRA administrator, can provide the necessary election forms and guidance. For Marketplace plans, HealthCare.gov serves as a central resource for information, applications, and plan selection.

The general steps for enrolling after a qualifying event involve submitting an application, selecting a plan from the available options, and making the initial premium payment. For COBRA, the initial premium payment is due within 45 days after electing coverage, with subsequent payments having a 30-day grace period. For Marketplace plans, coverage can start the first day of the month after the qualifying event, or even retroactively to the date of the event in some cases like birth or adoption, provided enrollment is completed within the specified timeframe.