Dependent Coverage

Effective for health plan years beginning on or after September 23, 2010, the Affordable Care Act requires group health plans and health insurers that offer dependent coverage of children to make coverage available for young adults until age 26. The goal of this policy is to extend coverage to as many employed adults. Enrollees are eligible even if they don’t live with their parents, are no longer a dependent on parents’ tax return, or are no longer students. This law does not apply if the young adult is offered insurance through an employer.

Some important points:

  • Special open enrollment opportunity: for a plan/policy years beginning on or after September 23,2010, groups and carriers must give qualifying children an opportunity to enroll on the parents’ plan. The open enrollment period must continue for 30 days and employers must notify employee in writing no later than the first day of the plan’s/policy’s year that begin on of after Sep 23, 2010. See sample “Dependent Notification” at the bottom of this email.
  • No changes in benefits or premium: under agency regulations, no benefits coverage or premium amounts may differ from the existing plan/policy, regardless of the chid’s age. This rule is known as “uniformity requirement”.
  • Until 2014 “grandfathered plans” do not have to extend this coverage to adult children if the child is eligible for group coverage elsewhere.

For more information on this topic, please visit http://www.hhs.gov/ociio/regulations/dependent/ or www.healthcare.gov

Sample Dependent Coverage Notice

Individuals whose coverage ended, or who were denied coverage (or were not eligible for coverage), because the availability of dependent coverage of children ended before attainment of age 26 are eligible to enroll in [insert name of group health plan or health insurance coverage]. Individuals may request enrollment for such children for 30 days from the date of notice. Enrollment will be effective retroactively to [insert date that is the first day of the first plan year beginning on or after September 23, 2010]. For more information contact the [insert plan administrator or issuer] at [insert contact information].

If you have questions, please contact us to discuss these significant health care reform changes.

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