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Drop dependent mid yearfor medical plan


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7 replies to this topic

#1 alexa

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Posted 13 April 2012 - 07:01 PM

I have an ee whose adult dependent age 23 had gotten a new job on 3/22/2012. Yeah!
Employee now wants to drop adult child dependent on date of new job;i.e. 3/22.
Let's assume medical eligibility for dependent is later than date of hire e.g 4/1/2012

What type of documentation do we need for life event change?
Is the life event date : 1) date of new job or 2)date when adult dependent <age 26 get s enrolled in new employer's plan?
Thanks
Lexy

#2 matthew222

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Posted 17 April 2012 - 09:30 AM

Most employers can provide an enrollment confirmation for you to tidy things up on your end. The qualifying event is the date the person receives coverage, not necessarily date of hire. If the dependent was hired on 3/22 and the employer's probationary/waiting period is first of the month following 30 days, then the qualifying event date wouldn't be until 5/1.

#3 alexa

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Posted 17 April 2012 - 12:20 PM

Most employers can provide an enrollment confirmation for you to tidy things up on your end. The qualifying event is the date the person receives coverage, not necessarily date of hire. If the dependent was hired on 3/22 and the employer's probationary/waiting period is first of the month following 30 days, then the qualifying event date wouldn't be until 5/1.


That date was what I had thought as well ;i.e. date new coverage starts. I have requested proof of new coverage from her daughter's new employer

#4 FormsRstillmylife

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Posted 17 April 2012 - 01:03 PM

Would it not be a comfort if the 125 regulations addressed this type of family status change? There are clear rules for spouse obtaining a job status change, but nothing about a dependent having a job status change.

We just fielded a request to drop coverage because the parents are "mad" at the twenty something. Could not find that anywhere in the law. :shades:

#5 Chaz

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Posted 17 April 2012 - 03:00 PM

We just fielded a request to drop coverage because the parents are "mad" at the twenty something. Could not find that anywhere in the law. :shades:

That raises an interesting question that I actually asked one of the drafters of the age 26 regulations: That is, who has the "right" to enroll an under age 26 child? Is it the parent or is it the child him or herself? The regs don't say.

The drafter said she would get back to me but, alas, no response.

#6 alexa

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Posted 17 April 2012 - 06:45 PM

We just fielded a request to drop coverage because the parents are "mad" at the twenty something. Could not find that anywhere in the law. :shades:

That raises an interesting question that I actually asked one of the drafters of the age 26 regulations: That is, who has the "right" to enroll an under age 26 child? Is it the parent or is it the child him or herself? The regs don't say.

The drafter said she would get back to me but, alas, no response.



Iwould think the employee who is paying for the ptential extra cost if it's a group health plan covering the employee

#7 Maria66

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Posted 28 April 2012 - 05:39 AM

We just fielded a request to drop coverage because the parents are "mad" at the twenty something. Could not find that anywhere in the law. :shades:

That raises an interesting question that I actually asked one of the drafters of the age 26 regulations: That is, who has the "right" to enroll an under age 26 child? Is it the parent or is it the child him or herself? The regs don't say.

The drafter said she would get back to me but, alas, no response.



Iwould think the employee who is paying for the ptential extra cost if it's a group health plan covering the employee


Since most employers are not paying the extra cost of the coverage for dependents, it would be the parent/employee who makes the call, they are the ones who have to list the dependents on their health application. Until an adult child challenges or a lawsuit is field to clarify the law, the employer really does not determine this, they just offer it. As an employer or agent I would make sure to have the employee sign the termination/enrollment form to remove the dependent from the coverage, to cover yourself.

#8 GBurns

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Posted 28 April 2012 - 10:50 PM

While not saying that www.changeofstatus.com is authoritative, their decision tool includes (and has long done so) the scenario of change of status of a dependent caused by that dependent's employment status. Their Q&A was developed partially from examples given in the Prop. Regs etc and various rulings and comments by the IRS. I am not aware of their credibility or accuracy being contested over the years so I have to say that the Prop. Regs do address the issue.

Neither a spouse nor a dependent can participate in a section 125 plan, but they may derive benefits from a participant. A participant in a section 125 plan must be a person treated as an employee under the Regs.

I think that it follows that only participants can "enroll" beneficiaries for benefits under the plan and unless "enrolled" in the section 125 plan they cannot be "enrolled" in the Group Health Plan or other benefits provided through the section 125 plan. So a dependent cannot "enroll" themself.
George D. Burns
Cost Reduction Strategies
Burns and Associates, Inc
www.costreductionstrategies.com(under construction)
www.employeebenefitsstrategies.com(under construction)