Who Is Eligible for Health Insurance Coverage?

by Gregory Gambone; Updated September 26, 2017

If your employer offers group health insurance coverage as an employee benefit, you should become familiar with the basic and most common factors that determine your eligibility to participate in the plan. Not every worker qualifies to enroll in the medical plan. Regulations that define an eligible employee may differ slightly from state to state, but most state insurance departments have similar legislation.

Minimum Hours Worked

Only those employees who work an average of at least the minimum number of hours each week may participate in a group health insurance plan. The definition of full time versus part time workers used by your employer’s human resources department has no bearing on your eligibility to enroll in the medical plan. Most states define an eligible employee as anyone who works an average of at least 20 hours to 30 hours each week. Anyone who puts in at least this many hours for the company must be permitted to enroll in the group health insurance coverage.

Actively Employed

Only actively employed individuals are eligible to participate in group health insurance plans. This regulation usually only pertains to the owners and officers of a corporation. Simply being an owner or officer does not qualify you to enroll in the plan. Silent partners of a corporation cannot participate in the company’s medical policy. Employees must actively work at and for the business in order to qualify for health insurance coverage.

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Waiting Periods

Employers are permitted to restrict access to group health insurance for a pre-defined period for all newly hired employees. This waiting period must be chosen at the time the health insurance plan is installed and applies to all newly hired workers without exception. Even if a newly hired employee meets other eligibility criteria set by the state insurance department, he cannot enroll until the waiting period has passed. Employers can choose any of several waiting periods ranging from 30 days to 180 days, with the most common duration being 90 days.

Independent Contractors

Many states allow employers to offer group health insurance benefits to independent contractors, provided they meet the same eligibility criteria as ordinary W2 workers. Employers who choose to make their group health insurance plan available to independent contractors must offer coverage to all contractors without restriction. Other regulations, including minimum participation and shared contribution percentages also still apply.

About the Author

Gregory Gambone is senior vice president of a small New Jersey insurance brokerage. His expertise is insurance and employee benefits. He has been writing since 1997. Gambone released his first book, "Financial Planning Basics," in 2007 and continues to work on his next industry publication. He earned a Bachelor of Science in psychology from Fairleigh Dickinson University.

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