Can you drop your employer sponsored health plan?

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Asked April 27, 2011

1 Answer


Yes. You can drop an employer sponsored health plan due to any qualifying event, such as marriage, or a change in your employment level and benefit package, among other things. In fact, you cannot be required to carry a health insurance plan at all, although the actual process of canceling for non-qualifying events may not take effect immediately.

What you have to keep in mind with employer sponsored health insurance is that your weekly payroll deductions are not applied to immediate coverage, but to future coverage. When you drop the insurance coverage, your request must be relayed to the health insurance provider and then logged into the payroll system of your employer. Because of this, dropping the coverage today may not take effect for as much as 30 days, and will never be effective immediately, even under a qualifying event. As a rule, expect one full pay period between the time you drop the insurance and the time when deductions are no longer taken from your pay.

If you are currently undergoing medical treatment, dropping your insurance company before a new insurer is secured could be a costly mistake. Before you drop the coverage, make sure that your replacement health plan is in place and has gone into effect. Some companies may require as much as a 30 day wait period before they will honor health insurance claims, so do not cancel your old coverage until you know the new one has taken effect.

Answered April 27, 2011 by Anonymous

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