Drop family members from insurance outside of enrollment period?
January 28, 2014 4:02 PM   Subscribe

I have done something very stupid: I thought I had dropped my spouse from my insurance plan during open enrollment, but never double-checked and apparently I did not. Now my HR is telling me I can't remove him until next calendar year, so I have to pay the $3200 difference for the next year. This is in the U.S., as if you can't tell from the effed-upedness of these situations stemming from employer-based healthcare.

I definitely should have double-checked that the "disenrollment" went through, as I was using our terrible online HR system, but I didn't. Is there really no way to remove a family member from a plan? I can understand not allowing new enrollments, but... I can't just drop him? I'm trying to figure out if I should try to make a little bit of a fuss about this, or if it's based on hard-and-fast federal rules. Googling turns up statements like "your employer usually" and "your employer may", which makes me think there is some employer decision-making on this. At this point we're at a standoff, where I say I remember doing it online, and my HR office says there's no record, so we're just doing the he-said, she-said dance over and over.
posted by anonymous to Work & Money (10 answers total) 1 user marked this as a favorite
Do any of the qualifying life events listed here apply?
posted by tylerkaraszewski at 4:12 PM on January 28, 2014 [1 favorite]

Did you mean to drop him because he has other coverage? Gaining other coverage is a "benefit event" and should allow you to drop him.

If not, and you are going to be stuck with $3200 anyway, can he purchase the cheapest individual plan possible and would that be less than $3200? Then you can drop him based on the benefit event - check with your employer first of course!
posted by peep at 4:12 PM on January 28, 2014 [4 favorites]

You need to check the qualifying life events stuff. Might be something small in there that would qualify.
posted by Big_B at 4:22 PM on January 28, 2014

The only way you can add or drop someone outside of the enrollment period is in the case of a qualifying life event that tyler linked above. I don't think they can even make an exception even if they wanted to give you the benefit of the doubt. This is a standardized thing.
posted by bleep at 4:23 PM on January 28, 2014 [1 favorite]

I came in to say what bleep said: outside of the enrollment period, you can make updates only for IRS-qualifying changes. This is how it has worked at every US employer I've had. My understanding of the vague language you are coming across is that it's not up to your employer's discretion or federal requirements, so much as driven by your employer's standing agreement with the insurance company. Presumably, this is so the insurance company can anticipate costs/usage and make decisions based on the coverage guaranteed at the end of enrollment.

In other words, it's not your company/HR's call whether to make an exception for you: their hands are tied. And it's not likely the insurance company can or will make an exception either, as there's no benefit or reason for them to do so.

Any chance you received and email notification or transaction confirmation number when you dis-enrolled?
posted by juliplease at 4:46 PM on January 28, 2014

IAAHRRep, IANYHRRep. If you wanted to drop your spouse from your insurance due to a qualifying event, you must request the change within 31 days of the event. If it's been more than 31 days since your spouse got on other insurance coverage, or any of the other qualifying events in tylerkaraszewski 's link, then you're screwed.

And unfortunately, the burden of evidence falls on you to show that you dropped your spouse during open enrollment.
posted by donajo at 4:58 PM on January 28, 2014 [1 favorite]

Depending on where you live, it might be cheaper to do a quick, no-fault, amicable divorce; drop the coverage; and then head back to the courthouse to get married again. You might want to check with a lawyer to make sure this wouldn't consitute some sort of fraud, and look carefully to make sure it won't somehow cause your own health insurance to be cancelled. IANAL.

Alternatively, in some states it's possible to marry your current spouse again without getting divorced first. It's possible that this might fit the "qualifying life event" category, depending on how exactly it's phrased. At any rate, your spouse might find this option more romantic or acceptable than divorcing for insurance reasons.

In the past I had heard it was possible to marry your current spouse as often as you wished in New Mexico. It's possible that this has changed with the various changes in marrige licence laws that have been happening -- but that's been happening in many states, you might be able to find a state that can give you a freshly dated marrige certificate. Perhaps a vacation?
posted by yohko at 6:15 PM on January 28, 2014 [1 favorite]

In some cases, SOMEONE in HR can do something about this. Two years ago through a total oversight, I clicked the wrong button on a web form during an open enrollment period in the fall. The following February, the doctor's office said "yeah, you don't have insurance". I'm all "what the eff" and contacted HR and realized what I'd done. That person said it was impossible to fix, but two managers up the line, it was changed within two days. It's worth appealing a round or two.
posted by ersatzkat at 6:28 PM on January 28, 2014 [2 favorites]

If you wanted to drop your spouse from your insurance due to a qualifying event, you must request the change within 31 days of the event.
This is actually not the law - the cafeteria plan regulations do not specify 31 days for election changes. What the irrevocability provision says is that the election change must be made "on account of" the status change. Many plans use 31 days (which is the time for requesting enrollment for a HIPAA special enrollment event) but there is no law providing that the timeframe cannot be 45 days or probably even 60 days. Informally, the IRS has said that over 60 days as an election window would likely violate the "on account of" provision. So, if this were a status change or qualifying life event (or cost/coverage change), you would have to check your plan's terms to find out how long you have to change your election.

However, as to open enrollment, the cafeteria plan rules are indeed clear that a participant cannot make changes after the period of coverage (here, likely 1/1/2014) has begun.

HOWEVER, ersatzkat's experience is real - many employers (including mine) send a reminder for employees to check their first pay stub of the plan year to make sure the elections went through properly. The IRS has also indicated - informally - that certain mistaken elections might be able to be corrected, basically based on facts and circusmtances, but only where there is clear and convincing evidence that an actual error (not a human "I forgot") has occurred (this would be more for a technical glitch and not likely to fly for "I thought I did but didn't"). The other type of mistake that may be able to be corrected would be based on "impossibility," where example the IRS has used was where an employee elected a dependent care spending account but didn't have any kids, so it would be impossible to benefit from the election.

So, it could be worth pleading your "mistake" case to the HR/benefits folks, especially if you believe IT issues were the problem, but this kind of problem is not one that the statutory appeals process (under ERISA, but now applicable to non-ERISA plans because of PPACA) contemplates, so you don't have a formal appeal right in this situation.

This answer assumes that your benefits are offered through a cafeteria plan and that your spouse is a spouse under the IRS definition.
posted by Pax at 4:46 AM on January 29, 2014

How big is the company you work for? Is your plan self-insured? Some of these things can create some leeway for your HR people to make changes. Smaller companies can get penalized by the insurance company for making out of policy changes (up to and including refusing to underwrite the next year) whereas larger companies (usually) or self-insured companies can get away with more.

The reason you can't drop people mid-year for no reason is the same as the reason you can't add people mid-year for no reason. You don't want people getting added to insurance only because they got sick and you don't want people dropping insurance just because they aren't sick anymore. You want as many healthy people as possible paying in.

The important thing to remember if you do appeal higher up in HR is that someone is going to have to do extra work because of you. This means you need to be gracious in your request, I'm not super willing to do extra work for people who are giant assholes and will actively fight against making an exception for them. This also means that you need to take responsibility for the mistake, blame yourself, not HR and not the tool. Again we are much more willing to help people like this who made an honest effort and an honest mistake. Lastly, if you do get granted an exception DO NOT go around telling other people about how you got an exception and tell them how all they have to do is tell HR and they'll make any changes in the world. Again, be gracious, feel free to tell them that HR really helped you but I don't need that person who forgot to remove his kid three years ago coming to me because he heard that the rules don't actually matter and can't we just change it like we did for anonymous???

Unless you can use one of the qualifying life events. That is the easiest thing to do.
posted by magnetsphere at 7:19 AM on January 29, 2014

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