Health Insurance

Can an employee decline health coverage?

Employees can decline or accept health coverage in most cases. The only exception is if your company is contributing 100% towards your employees’ health plans and your carrier stipulates that you must have 100% enrollment on the plan.

What’s a valid waiver?

If your employee does decline health coverage, there are two ways that carriers categorize this, depending upon the reason for declining coverage. A valid waiver refers to a reason for declining coverage that does not affect how your carrier calculates participation in the plan. The most common valid waiver (or reason for declining coverage) is if the employee has existing coverage with their spouse’s employer. There are a few non-valid waivers that vary by carrier. One example in some cases is declining because they have parental coverage.

If someone has a non-valid waiver this will affect the participation calculation for your plan.

This article provides general information and shouldn’t be construed as legal, benefits, or HR advice. Benefits and insurance regulations may change over time and may vary by location and employer size. So, please consult a licensed broker or appropriately certified expert for advice specific to your business’s benefits options.