The Benefits "In" Word

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January 27, 2012

The Merriam Webster dictionary defines the word "eligible" as: qualified to participate or be chosen. The word "eligible" appears quite often in employee benefits communications. You will find it in your hire letter, throughout your benefits packet, in your health and retirement plan documents, and COBRA notices.

So, now that you know that you cannot have health insurance or a retirement plan without encountering this all-powerful word, here is a quick Q&A on "eligibility."

How is Eligibility Determined?

Dependent upon the plan, your eligibility will likely be based on whether you work full-time or part-time, are classified as a regular or temporary employee, and how many hours you work each week or year.

Who is Eligible to Enroll?

Typically, you and your dependents (children, stepchildren, grandchildren (under certain circumstances), and spouse. Some plans cover domestic partners also (ask your Human Resources department about coverage for same and opposite sex domestic partners).

When Are You Eligible to Enroll?

Some benefit plans require a waiting period of 30 to 90 days before you can enroll in the plans. For example, if you are hired on July 15 and your plan's enrollment eligibility period is the first of the month following 30 days of employment, you are eligible to enroll in the plan on September 1. July 15 through August 13 is 30 days and the first of the month following August 13 is September 1.

What Plans Are You Eligible to Enroll in?

Employers may offer the following health and welfare and retirement plan options, including:

  1. Medical insurance

  2. Dental insurance

  3. Vision insurance

  4. Health care and dependent care flexible spending accounts

  5. Life insurance

  6. Disability insurance

  7. Long-term care insurance

  8. Retirement (401k, 403b, 457b, pension)

  9. 529 (college savings) plan

Can Your Eligibility Status Change?

Yes. If your employment status changes (for example, hours reduced, termination, retirement), you can lose your eligibility to continue participation in your employer’s health insurance and retirement plans.

Can Your Dependent's Eligibility Status Change?

Yes. If you marry, legally separate, or divorce, your spouse may gain or lose eligibility for health insurance coverage and retirement plan eligibility status. When your dependent children reaches age 26.

Contact your benefits office if your dependents are no longer eligible to participate in a benefit plan because of age, employment status or marital status. You may be paying additional premiums for a dependent that is no longer eligible for benefits and may have to reimburse the plan for claims the dependent incurred while not eligible.

Also, contact your benefits office if you have a dependent that is eligible to enroll or re-enroll in your health plan (birth, adoption, change in student status, marriage). If you wait too long to inform your employer of these changes, you may miss out on the opportunity to immediately enroll or re-enroll new or existing dependents. This could mean that you have to wait up to 12 months to add him or her to your health plans.

For more information on life events and how they can affect you and your dependents' benefit plans eligibility status, check out the BenefitsAll life events checklists.

The word "eligibility" plays a starring role in employee benefits communication. Always know what benefits you are eligible for and how and when you can receive them. Ask your Human Resources representative your plan eligibility related questions or review your employee benefits packet. You do not have to enroll in your employer-provided benefits plans, but it is nice to know if and when you can get in.

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