With the October 1st opening of the Health Insurance Marketplace, some employers have inquired about where they stand if an employee would like to leave their plan. In particular, those employers with a non-calendar year Section 125 plan have asked for guidance on whether entering the Exchange is considered a “qualified life event” for their employee(s). Typically, a mid-year change cannot be made unless a “qualified life event” occurs. The IRS issued relief which permits employers with POP plans to implement a special one-time enrollment period to accommodate for these changes. Should the Employer choose to allow this “special enrollment period” for certain plans, they must first verify with their insurance or stop-loss carrier that it is acceptable to them. If so, the following changes are permitted:
- Individuals may prospectively revoke or change elections once during the plan year without regard to whether there has been a change in status event, or
- Individuals who failed to make elections may make a prospective election for coverage during the plan year without regard to whether there has been a change in status event
Employers have until December 31, 2014 to amend their plans, but the amendment must be effective retroactively to the first day of the 2013 plan year.
If you would like more information, please click here to request our FAQ about the Health Insurance Marketplace.
Written by Ryan Kastner
