Section 125 Mid-Year Changes

[Guest Angi]

Hello. If a benefits-eligible employee initially waives enrollment in the medical plan because they would pay a higher premium as a part-time employee, must we allow them to make a mid-year election when they move to full-time status, qualifying for the lower premium? I'm stuck on whether or not this would be an eligible event since the employee initially waived coverage, they are not currently enrolled. I understand that if an employee is currently enrolled and a lower cost option becomes available, we would be required to allow the change.

If the change is allowed, does this event (PT to FT) open up special enrollment rights for all (pre-tax) benefits offered, even if the other premiums didn't change?

Thanks!

[gtech1997]

I believe this change would be considered a qualifying event because of the significant cost change of the benefits associated with the move to FT. In my organization's SPD which was put ogether by our outside legal counsel it has "Significant Cost Change" listed in our chart of qualifying events and for a significant cost decrease it states that employees may elect coverage even if they had not participated before.

[SLuskin]

I agree.