In Notice 2014-55, the Internal Revenue Service
(IRS) announced two new situations in which employees may change
their health plan elections midyear under their employer's
cafeteria plan. In the first, an employee's hours are reduced
below 30 per week (without a corresponding loss of eligibility for
the employer's group health plan). In the second, an employee
decides to enroll in coverage through a Marketplace Exchange
(Exchange). Both of these are optional changes in status; neither
is mandatory.
Reduction in Hours
If an employee who was expected to work on average at least 30
hours per week is then expected midyear to work on average less
than 30 hours per week, the employee may drop his or her
employer-provided group health plan coverage, even if the reduction
in hours does not result in the employee's loss of eligibility
under the group health plan. The change in election must correspond
to the employee's intended enrollment (and the intended
enrollment of
