When does coverage terminate for an employee?

Coverage for an employee typically terminates when the employee ceases to be eligible for the benefits, which aligns with the correct answer. Eligibility for health insurance is often tied to specific criteria established by the employer or the insurance plan, such as changes in employment status, full-time versus part-time employment, or reaching a certain age.

If an employee no longer meets these eligibility criteria—due to reasons like moving to a part-time position, leaving the organization, or failing to meet specific health plan requirements—coverage will end. This termination is usually in accordance with the terms set by the employer and the health insurance policy, reflecting the employee's eligibility status rather than personal desire or employer whims.

Other scenarios mentioned, such as an employer's decision to terminate employment or the employee opting out of coverage, may lead to termination of benefits but are not direct measures of the employee's eligibility according to standard health insurance policies. The lack of a raise does not impact eligibility directly, since health insurance coverage typically does not depend on salary increases. Thus, the cessation of eligibility remains the most accurate reason for coverage termination in this context.