Qualifying Event - Birth of a Child

[Guest shorty]

EE has wife and a 4 year old child. EE waives medical coverage for himself and deps at time of OE on Jan 1st. EE and spouse have a child 3 months later. Can the EE now enroll himself, wife, 4 year old child and newborn?

Insurance Carrier is telling us that only the EE, spouse and newborn are eliglble but the 4 year old cannot come on the plan.

I always thought the qualifying event made the EE and all deps eligible for coverage.

Seeking the truth.

[QDROphile]

The plan (possibly driven by the insurance policy) does not have to extend as far as the allows. The plan only has to provide for what the law requires, and the law does not require opportunity to cover the other child.

[oriecat]

This is what the DOL website says:

Group health plans are required to offer special enrollment to otherwise eligible employees, spouses, and any new dependents upon marriage, birth, adoption, or placement for adoption. Accordingly, an employee who is otherwise eligible, but not enrolled for coverage, can enroll (and can also enroll a spouse and any new dependents, if they are otherwise eligible under the plan) when any of these events occur.

It only talks about new dependents, not old dependents.

[JanetM]

Unless the wife lost insurance from another source that covered the 4 yr old, there is no way to get coverage before the next OE.

[LRDG]

If the employee was covered based on an election for employee only coverage, or if the EE coverage was due to a plan that automatically covers all employees, the special enrollment would only extend to the new dependent based on the birth of a child qualifying event, but not the spouse and 4yo for whom the employee previously declined coverage.

The same would be true if there was a loss of coverage as a qualifying event, that is to say, only those experiencing the loss of coverage would become entitled to special enrollment privilages for coverage previously declined.

Because the employee wasn't a covered EE at the time of birth, neither employee or the child meet special enrollment eligibility based on birth of the child as a qualifying event.

If EE was a covered employee the child can be added based on birth as a qualifying event. The spouse and the 4yo do not qualify for special enrollent based on birth as qualifying event.

Because the EE did not experience a loss of previous coverage, no one is eligible until the next open enrollment. At the next open enrollment if the employee elects coverage, all will be eligible as dependents of a covered employee.

[oriecat]

I don't think that is correct. This example is straight from the 54.9801-6 regulations:

Example 1. (i) Facts. An employer maintains a group health plan that

offers all employees employee-only coverage, employee-plus-spouse

coverage, or family coverage. Under the terms of the plan, any employee

may elect to enroll when first hired (with coverage beginning on the

date of hire) or during an annual open enrollment period held each

December (with coverage beginning the following January 1). Employee A

is hired on September 3. A is married to B, and they have no children.

On March 15 in the following year a child C is born to A and B. Before

that date, A and B have not been enrolled in the plan.

(ii) Conclusion. In this Example 1, the conditions for special

enrollment of an employee with a spouse and new dependent under

paragraph (b)(2)(vi) of this section are satisfied. If A satisfies the

conditions of paragraph (b)(3) of this section for requesting enrollment

timely, the plan will satisfy this paragraph (b) if it allows A to

enroll either with employee-only coverage, with employee-plus-spouse

coverage (for A and B), or with family coverage (for A, B, and C). The

plan must allow whatever coverage is chosen to begin on March 15, the

date of C's birth.

[LRDG]

It seems that the 4yo, based on the example in 54.9801-6, can not be denied coverage either.

If so, on what basis? Arguments I come up with for logical basis to deny coverage doen't stand up to scruitny. It would be absurd that 4yo's could be denied coverage because this example failed to eleborate family members far enough?

[oriecat]

Section (b)(2) of the reg describes the Individuals Eligible for Special Enrollment. It does not talk about prior dependents, only new dependents.

(vi) Current employee, spouse, and a new dependent. A current

employee, the employee's spouse, and the employee's dependent are

described in this paragraph (b)(2)(vi) if the dependent becomes a

dependent of the employee through marriage, birth, adoption, or

placement for adoption.

Here is the full regulation

[LRDG]

Thanks for the link. i agree that the regs and example exclude reference to existing dependents. Failing to do so is poor writting regardless of personal opinions on the issue.

I don't believe the drafters intended existing dependents to go uninsured, while their parents who previously declined coverage would be extended another opportunity to enroll, based on the birth of a child, who will also be covered, while existing dependents would be denied coverage. It defies logic.

[QDROphile]

And yet, it is true.

[oriecat]

That's our government for ya...

[LRDG]

Not that I'm at all surprised.

[QDROphile]

Depends on what end of the telescope you look thorough. If you accept the idea of annual elections, the requirement to cover the newborn is an exception with obvious motivation and implications (primarily mother and child, but throw in the father to assure that employee is covered). Why would the advent of a newborn raise an expectation that an employee would be able to change an earlier decision not to cover the siblings? That would have very different policy underpinnings.