Texas General Lines — Life, Accident, Health and HMOHealth InsuranceMedium
A group health insurance plan specifies that new employees must complete a 90-day waiting period before they become eligible for coverage. This is an example of which type of provision?
- AConversion Privilege
- BEnrollment Period
- CContinuation of Coverage
- DEligibility Period
Show answer & explanationAnswer & explanation
Correct answer: D. Eligibility Period
The eligibility period, also known as the waiting period or probationary period, is the time an employee must work for an employer before becoming eligible to enroll in a group health insurance plan.
Why the other options are wrong
- A. A conversion privilege allows an employee to convert group coverage to an individual policy upon termination.
- B. The enrollment period is the specific window when eligible employees can sign up for coverage.
- C. Continuation of Coverage (like COBRA) allows temporary extension of group benefits after a qualifying event.
Eligibility Period (Group Health)
A waiting period imposed by a group health insurance plan during which a new employee is not yet eligible for coverage.
- Also known as a probationary period or waiting period
- Common in group insurance to manage adverse selection
- Must comply with ACA rules (generally max 90 days)
Memory trick: Eligibility is the 'Entry' 'Gate' for new employees.