What is a qualifying event?

• A. An event that makes a qualified beneficiary eligible for COBRA coverage. For a current employee, a qualifying event is one that would otherwise disqualify the employee from the employer's group health plan, such as resignation or layoff. If the employee's dependents are covered through the employer's group health plan, the employee's death or divorce is a qualifying event as well
• B. An event that increases premiums
• C. An event that terminates COBRA for everyone
• D. An event that triggers a plan audit

Answer: (A)

A qualifying event is an event that would cause loss of the employer’s group health plan coverage, so the affected person becomes eligible to elect COBRA continuation coverage. This includes situations where an employee is terminated or has hours reduced, or resigns, and similarly for dependents when events like the employee’s death or a divorce would result in losing coverage. The idea is to identify events that would end coverage under the plan, thereby triggering the right to continue that coverage under COBRA for a limited period.

The other scenarios don’t fit because they don’t create an individual right to continue coverage: a mere increase in premiums isn’t itself a COBRA trigger, a plan-wide termination of COBRA would end coverage for everyone rather than create an eligible beneficiary, and a plan audit is unrelated to a beneficiary’s right to elect COBRA.