When Can I Enroll or Make Changes?
Under a "cafeteria" plan, current IRS regulations require that the benefit elections you make remain in effect throughout the entire plan year. However, participants may be permitted to change their pretax elections during the year under certain circumstances :
In order to change your current elections, you, your spouse/qualified domestic partner or an eligible dependent must have experienced a qualified life status change.
30 days after qualified life status change to add an eligible member to your benefits
60 days after qualified life status change to take someone off of your benefits
Election changes resulting from a change in status must meet a "consistency" requirement — thus, any election change must be on account of and correspond with a change in status affecting eligibility for employer plan coverage. For example, for divorce, legal separation, death, or loss of a dependent, an employee may cancel coverage for the spouse or ex-dependent, but may not be allowed to make other changes.
Allowable changes in status under current IRS regulations include:
- Change in marital status, including marriage, divorce, legal separation, annulment, or death of spouse.
- Change in number of dependents, including birth, death, adoption, and placement for adoption. This extends to dependents who become newly eligible for plan coverage because of a plan amendment.
- Change in employment status of the employee, spouse, or dependent, including commencement or termination of employment, change in worksite, commencement or return from a leave of absence, gain or loss of benefit eligibility by a dependent.
- Change in residence of the employee, spouse, or dependent. This might include a child moving away to attend college and losing eligibility for a region-specific plan.
- Dependent meeting or ceasing to meet the plan's definition of "dependent," such as attainment of a specified age or ceasing to be a student.
Corresponding changes to payroll will not be made until appropriate elections are processed. To change your contribution to a flexible spending account during the year, you or an eligible dependent must have had a "change in status" as described above. In addition, the following status changes also qualify:
- Dependent care account only: change in dependent care provider’s rates (unless the dependent care provider is your or your spouse’s relative) or switching of provider.
- Dependent care account only: your dependent otherwise ceases to be eligible.
- Health care account only: entitlement to Medicare or Medicaid.
You must change your elections within 30 days after the life-status change takes place if it involves adding yourself or an eligible dependent to your benefits. For a life-status change that constitutes a COBRA qualifying event, (one in which you take a dependent off your coverage) you have 60 days to change your elections.
Any eligible employee hired during the plan year will have the opportunity to enroll in the Individual Choice program.
**If a new employee or an employee who is newly eligible for benefits fails to complete the enrollment process within 30 days, no credits are given, and no coverage is in effect.**
In the late fall of every year, eligible employees are given the opportunity to change certain of their renewable benefits elections during the Open Enrollment Period.