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Updated on May 19, 2023
A qualifying life event (QLE) is any potential circumstance that has been identified by the IRS to have a significant impact on one’s insurance needs, or on what health insurance plans one qualifies for, thus warranting a Special Enrollment Period.
Under the Health Insurance Portability and Accountability Act (HIPAA), any individual who has experienced a qualifying life event, as defined by Section 125 of the Internal Revenue Code, must be afforded an opportunity to update their health insurance plan, or to enroll in a new plan, outside of the standard annual open enrollment period.
For most companies that offer health insurance coverage as an employee perk, open enrollment is a 60-day period, typically from November to January. Though, this may vary from state to state. During the open enrollment period (or open enrollment), employees are encouraged to assess their average health spending, and forecast upcoming wellness needs, so they may enroll in an insurance plan that is likely to cover any personal medical costs for the upcoming year.
But if an unavoidable or unexpected circumstance significantly changes those insurance needs mid-year, policy holders are allowed to either adjust their insurance plan, or newly enroll, without having to wait for the next open enrollment period (OEP). In these cases, employers are required to offer a Special Enrollment Period (SEP) to the employee experiencing the qualified life event.
According to healthcare.gov, there are a number of circumstances that are considered to be “qualifying life events”, but the most common reasons are a change in residence, loss of current coverage for reasons other than failure to pay premiums, losing eligibility for Medicare, Medicaid, or CHIP (Children’s Health Insurance Program), or due to household changes such as marriage, birth, divorce, or the death of a covered family member.
“When my husband and I had our baby, it was a huge relief to learn that this qualifying life event would mean I could add our new arrival to our healthcare coverage right away.”
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