Open Enrollment

[Hefe]

These may be easy questions but I'm a p&c guy.

Is open enrollment for a small group based on when the plan started or is it a certain month for each carrier?

Can I leave the small group plan for an individual plan at any time or do I need to wait for open enrollment? What about removing a dependent? I know it needs to be open enrollment or a qualifying event to make additions but what about leaving the plan?

 

[arnguy]

It depends on the carrier.

 

[kheyknee]

There are carrier rules, and IRS rules. Most employees pay for group health coverage using pretax elections, which means they must comply with IRS rules: no changes in pre tax elections outside of the open enrollment unless the change is consistent with a qualifying life event. Finding a better deal is not a qualifying event.

 

[stuy119]

There are carrier rules, and IRS rules. Most employees pay for group health coverage using pretax elections, which means they must comply with IRS rules: no changes in pre tax elections outside of the open enrollment unless the change is consistent with a qualifying life event. Finding a better deal is not a qualifying event.

Check the wording on the plan docs; some plans allow for changes at the discretion of the admin/owner. I remember that the Aflac 125 plans were that way when I first started in the business.

 

[ABC]

There are carrier rules, and IRS rules. Most employees pay for group health coverage using pretax elections, which means they must comply with IRS rules: no changes in pre tax elections outside of the open enrollment unless the change is consistent with a qualifying life event. Finding a better deal is not a qualifying event.

I have only seen this employer rule on large case over 50 lives. Most small groups can drop coverage at anytime.

 

[Silvio Dante]

There are carrier rules, and IRS rules. Most employees pay for group health coverage using pretax elections, which means they must comply with IRS rules: no changes in pre tax elections outside of the open enrollment unless the change is consistent with a qualifying life event. Finding a better deal is not a qualifying event.

This is correct. The employer and how they set up the plan doc usually calls the shot. The plan document can be amended to change the open enrollment for the entire group, but an individual would need to have a qualifying "change of status" : Marriage, divorce, birth or death of a child, death of spouse, spouse losing employent, etc.

 

[junkman]

And many employers do not administer correctly so you may be able to assert that individual coverage is a qualifying event.

I was trying to get an 80 life county. I know that the current agent is an ***. Regardless, the Co Executive doesn't want to change or move into compliance. He lets employees drop coverage whenever they want.

There is no reporting other than 5500s and that only applies to larger groups so frequently, anything goes.

 

[leevena]

These may be easy questions but I'm a p&c guy.

Is open enrollment for a small group based on when the plan started or is it a certain month for each carrier?

It appears that you are in CA and this is probably a CA situs group. As other said, check your plan documents for the actual OE period. More than likely it coincides with your anniversary date, but it could be different.

Can I leave the small group plan for an individual plan at any time or do I need to wait for open enrollment? What about removing a dependent? I know it needs to be open enrollment or a qualifying event to make additions but what about leaving the plan?

An employee or dependent may drop their group medical coverage anytime they wish. The carrier and employer do not have any input into this decision. This is true whether you participate in a Section 125 plan or not. If you happen to participate in a 125 plan just realize that your pre-tax contribution will continue even though you have disenrolled from the health plan.

 

[Hefe]

Thanks everyone. I am pretty sure its not a section 125 plan. My "qualifying event" is that my wife's new company offers a plan that's close to what I have but her company pays for quite a bit of the cost. I'll see if they let me out for that.

 

[junkman]

Obtaining other group coverage is a qualifying event under a 125 plan. You will get credit for any previous coverage against pre-ex. Deductibles and out-of-pocket start over under the new plan.
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I have only seen this employer rule on large case over 50 lives. Most small groups can drop coverage at anytime.

Strange, every group I've seen has a 125 in place and anything over 5 at least has dental as an option. Here, dental premiums ~ cost of the preventive benefits.