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Understood. I still don't fully understand the facts here with how the loss of eligibility occurred per my note above, but I think I get enough of it to weigh in. I always advise that an ineligible individual has to be removed from the plan whenever notice is provided, even if notice is provided late. I do not advise that an employee has to continue paying the employee-share of the premium for an ineligible individual once removed from the plan. I view that as an ultra-purist reading of those §125 irrevocable election rules--and perhaps a violation of applicable state wage withholding law. So I would recommend moving this to the employee-only payment tier once the ineligible dependent is removed. Note that if I understand the scenario correctly, this isn't a HIPAA special enrollment timing window issue--that applied to the dependent's initial enrollment based on adoption or placement for adoption. This is a Section 125 cafeteria plan question you're raising on the employee's failure to timely make permitted election change event request based on a loss of dependent eligibility change in status even (presumably set at a 30-day window in the plan terms).

Do one VCP to cover both.

Or said differently, the Code wouldn't prohibit it if the plan document permits it.