family status change, adding dependents

[Guest nb]

A question has come up regarding adding dependents following a family status change. Scenario is this, an employee is enrolled as employee only but has children that are not currently enrolled in the group plan. That employee has a family status change, gets married, and makes a mid year change from single to family coverage. Can he add dependents, the children not covered previously, and new dependents at the same time or will the children he had not previously covered have to wait for the next open enrollment period?

[SLuskin]

Yes, the employee can add both the newly acquired dependents and the ones he had before but didn't have on the plan.

[Guest nb]

SLuskin,

How is the eligibility established for those dependents that had been eligible in the past but not enrolled?

In reviewing 701-6, the "requirements of the legislation would indicate that only those affected by the event (a)(3) dependent that looses coverage or (B)(5) dependent from marriage, birth ....

I can't find any support for the position that "all" dependents can be enrolled.

[KIP KRAUS]

I agree with nb. If these dependent children were previuosly eligible but not previuosly covered our plan would not allow them to become participants just becuase of a marriage, but would allow them to become covered at open enrollment. Just because a participant changes to family coverage do to a qualifying event does not mean he/she can automatically add other dependents.

[Guest scm]

My understanding is that HIPAA changed the eligibility rules and now requires that plans allow employees to add other dependents who were not previously enrolled as a result of a BIRTH ONLY (and not other QEs such as marriage). You may want to refer to the HIPAA regs for clarification.

[JJD]

HIPAA didn't change the 125 family status rules but did impose new requirements with respect to group health plans.

With respect to new family members, I think you'll find the following required by HIPAA:

--upon the birth or adoption of a child, a participant may add himself or herself and his or her spouse to group health plan coverage together with the newly born or adopted child (but not existing, uncovered dependent children);

--upon a new marriage, a participant may add himself or herself to coverage together with the new spouse and the spouse's dependent children, whether adopted by or step-children to the participant (but not existing, uncovered dependent children of the participant).

A cafeteria plan is not *required* to allow participants to make changes to their 125 elections to conform to their exercise of HIPAA, ghp rights. In other words, you could have a situation where the employer's ghp makes the above special enrollment rights available (as required) but the employer's cafeteria plan does not. However, the 125 regs. do provide that cafeteria plans *may* allow participants to change their elections so that the elections conform with an exercise of HIPAA rights.

[This message has been edited by JJD (edited 10-09-1999).]

[Guest LisaL]

I have another question regarding a change in family status: A husband and wife both work for the same company. The wife has 2 step-children (who live with the couple) and covers them on the health insurance (which is a pre-tax deduction plan). The husband has Employee Only coverage. If the wife quits her job at the company can the husband add all the family members (wife and step-children) onto his insurance mid-year? Also, the wife has elected contributory life insurance for herself, her husband, and her step-children. The husband has not elected any contributory life insurance. Again, if she quits, can the husband mid-year elect the contributory life insurance for himself, his wife, and her step-children?

[KIP KRAUS]

LisaL:

While it seems odd that a married couple with eligible dependent children have family coverage for one spouse that covers the children and the other spouse carries single coverage, if the spouse covering the eligible dependents quits working, I would allow the other spouse to pick up the dependents provided they are his eligible dependents under your medical plan. In my opinion, this would be a qualified change in family status.

With regard to the contributory life and dependent life insurance, you need to check the group life policy provisions related to late enrollments. Typically, group life policies require evidence of insurability for those employees who do not enroll within 31 days of first becoming eligible to do so. The employee will typically be required to submit this medical evidence to the insurer for approval to enroll. Most group life policies I have seen will allow a person to enroll for contributory coverage at any time, provided the insurer accepts him/her for such coverage based on the medical evidence submitted.

[Guest Yvonne Baldonado]

An employee had a baby but did not notify the benefits dept until the end of Nov. The employee wants to elect child, spouse and supp life insurance in addition to the medical plan. Do we have to process the life insurance request?

[Lisa Hand]

When was the baby born?