3507 / When can benefit elections under a cafeteria plan be changed due to a change in an employee’s status?

(1)     events that change an employee’s legal marital status, including marriage, death of a spouse, divorce, legal separation, and annulment;

(2)     events that change an employee’s number of dependents such as birth, death, adoption, and placement for adoption;

(3)     events that change the employment status of an employee, an employee’s spouse, or an employee’s dependent, such as a termination or commencement of employment, a strike or lockout, a commencement of or return from an unpaid leave of absence, or a change in work site, if the employee, spouse, or dependent becomes or ceases to be eligible under the plan;

(4)     events that cause an employee’s dependent to satisfy or cease to satisfy eligibility requirements for coverage due to reaching a certain age, student status, or any other similar provision;

(5)     a change in the place of residence of the employee, spouse, or dependent; and

(6)     for purposes of adoption assistance provided through a cafeteria plan, the commencement or termination of an adoption proceeding.²

Consistency Rule

The consistency rule states that an election change is not properly made with respect to accident or health coverage or group term life insurance unless it is on account of or corresponds with a change in status that affects eligibility for coverage under an employer’s plan.