Eligibility and Enrollment
Understanding eligibility requirements and enrollment periods is crucial for both employers administering plans and employees seeking coverage.
Eligibility Requirements
Employee Eligibility
| Requirement | Typical Standard |
|---|
| Employment status | Full-time employee |
| Hours per week | 30+ hours (ACA definition) |
| Probationary period | First 90 days (maximum under ACA) |
| Active at work | Working on effective date |
| Job classification | May vary by employee class |
ACA Full-Time Definition
| Category | Definition |
|---|
| Full-time employee | 30+ hours per week average |
| Full-time equivalent | Combined part-time hours |
| Measurement period | Look-back to determine status |
Classes of Employees
Employers may offer different benefits to different employee classes:
| Class | Example Benefits |
|---|
| Executives | Enhanced coverage, lower contributions |
| Salaried | Standard benefits |
| Hourly | May have different waiting periods |
| Part-time | May not be eligible |
| Union | Collectively bargained benefits |
Note: Classification must be based on bona fide employment criteria, not health status.
Enrollment Periods
Initial Enrollment
| Timing | Description |
|---|
| New hire | When first becoming eligible |
| Enrollment window | Typically 30-31 days from eligibility |
| Effective date | First of month after enrollment |
Open Enrollment
| Feature | Details |
|---|
| Frequency | Annual (typically fall) |
| Duration | 2-4 weeks |
| Changes allowed | Add, drop, or change coverage |
| Effective date | Usually January 1 |
Special Enrollment Period (SEP)
Under HIPAA and the ACA, certain life events trigger special enrollment rights:
| Qualifying Life Event | Enrollment Period |
|---|
| Loss of other coverage | 30 days from loss |
| Marriage | 30 days from event |
| Birth of child | 30 days from birth |
| Adoption | 30 days from placement |
| Death of dependent | 30 days from event |
| Divorce | 30 days from event |
| Gaining citizenship | 60 days |
HIPAA Special Enrollment Rights
HIPAA guarantees special enrollment for:
- Loss of eligibility for other coverage
- Termination of employer contributions for other coverage
- Marriage, birth, or adoption
- COBRA exhaustion
- Medicaid/CHIP loss or eligibility
Exam Tip: HIPAA special enrollment periods are 30 days for most events, but may be 60 days for Medicaid/CHIP-related events.
Dependent Coverage
Eligible Dependents
| Relationship | Eligibility |
|---|
| Spouse | Legal spouse (including same-sex) |
| Children | Biological, adopted, stepchildren |
| Age limit | Up to age 26 (ACA requirement) |
| Disabled children | May continue beyond 26 if disabled |
Child Coverage Under ACA
| Requirement | Details |
|---|
| Maximum age | 26 years old |
| Marital status | Can be married |
| Student status | Not required |
| Financial dependency | Not required |
| Residency | Not required |
| Other coverage available | Not a factor |
Domestic Partner Coverage
| Factor | Details |
|---|
| Not required by ACA | Employer discretion |
| Tax implications | May be taxable income |
| Common in | Large employers, public sector |
| Documentation | Affidavit or registration |
Late Enrollment
Consequences of Late Enrollment
| Situation | Effect |
|---|
| Missed initial enrollment | Must wait for open enrollment |
| No qualifying event | Not eligible for SEP |
| Pre-existing conditions | Not excluded under ACA plans |
Avoiding Late Enrollment Issues
| Best Practice | Description |
|---|
| Timely notification | Inform new hires of deadlines |
| Reminder notices | Send enrollment reminders |
| Document elections | Get written enrollment decisions |
| Waiver forms | Have employees sign if declining |
Evidence of Insurability
When Required
| Situation | Evidence Needed |
|---|
| Initial enrollment | Generally not required |
| Late enrollment | May be required for amounts above guaranteed issue |
| Increasing coverage | May be required |
| Voluntary benefits | Often required |
Guaranteed Issue Amount
| Definition | Description |
|---|
| Amount | Coverage issued without evidence |
| Limitation | Above this requires underwriting |
| Example | First $50,000 guaranteed; above requires EOI |
Portability and Continuation
COBRA Continuation
When employment ends, COBRA provides temporary continuation:
| Feature | Standard |
|---|
| Qualifying events | Termination, hour reduction, divorce, death |
| Duration | 18 or 36 months depending on event |
| Premium | Up to 102% of full cost |
| Coverage | Same as active employees |
Conversion Rights
| Feature | Details |
|---|
| Right | Convert group to individual coverage |
| Timing | Within 31 days of losing group coverage |
| Underwriting | Not required |
| Premium | Individual rates (may be higher) |
| Coverage | May differ from group plan |
Effective Dates
Typical Effective Date Rules
| Situation | Effective Date |
|---|
| New hire | First of month following waiting period |
| Open enrollment | January 1 (or plan year start) |
| Qualifying event | Date of event or first of following month |
| Newborn | Date of birth (retroactive) |
Retroactive Coverage
| Event | Retroactive Requirement |
|---|
| Newborn | 30 days to enroll; effective from birth |
| Adopted child | 30 days to enroll; effective from placement |
| Marriage | 30 days to enroll; effective from marriage |