Employer Sponsored Health Care Coverage Overview

Legal Authorities:

See CS Quest The National Medical Support Notice (NMSN or MED5/MED5C).

Overview

When completing or reviewing a child support order you must determine the type of necessary medical support and you will need a way to enforce it.  You can review the contents and how to complete the medical section of an order in the CS Quest article How to Complete the Medical Section of an Order. The first type of health care coverage addressed in that article is “Employer Sponsored Health Coverage.”

Employer sponsored health care coverage is very common and the primary method for enforcing this type of medical support order is using the National Medical Support Notice (NMSN or MED5/MED5C).  This is a federally required document used to provide a standardized means of communication between State child support agencies, employers, and administrators of group health plans regarding the medical support obligations of noncustodial parents (NCPs) and custodians (CPs).

For more detailed information on the NMSN (MED5/MED5C), how it is used, where it is sent, and required employer compliance, check out the CS Quest article The National Medical Support Notice (NMSN or MED5/MED5C).

Employer Responsibility FAQs

Can an employer or plan administrator refuse a NMSN?

If the NMSN (MED5/MED5C) has the following, the employer may not refuse the NMSN (MED5/MED5C):

• Employee’s name
• Child’s name
• Custodian’s name/address (or CSS’s name/address in cases of family violence)
• Description of the health care coverage type required by the court order

The plan administrator has 40 business days after the date of the NMSN (MED5/MED5C) to indicate whether health care coverage is available to the child. Additionally, the custodial person (CP) or CSS must be provided with a description of health care coverage available under the plan and any forms or documents necessary to implement coverage (including insurance cards).

When must a plan begin to provide health care coverage to the child(ren) pursuant to a NMSN (MED5/MED5C)?

Following a determination that an order is qualified, the child(ren), if not already enrolled, must be enrolled as of the earliest possible date following such determination. For example, if an health care coverage plan only adds new participants or beneficiaries as of the first day of each month, such plan would be required to provide coverage to the alternate recipient as of the first day of the first month following the determination that the order is qualified. State laws require that when a child is enrolled in a plan pursuant to a court or administrative order, that enrollment be made without regard to open season restrictions. The existence of the court order is a qualifying event.

If a plan provides that dependents of participants must be enrolled in the same health care coverage and option as the participant, must an “alternate recipient” be enrolled in the same coverage and options in which the participant is enrolled?

Yes. The health care coverage for a child must be equal to or greater than the plan in which the parent or CP is enrolled.

What does the employer do if the cost of the health care coverage exceeds the reasonable cost or withholding limitations?

If the court order specifies a reasonable cost limit for the cost of the health care coverage and the cost of the premium for the children exceeds that limitation, the employer sends a response indicating they are not able to enroll the child due to the cost of the health care coverage. This amount is specifically listed in the NMSN (MED5/MED5C).

If the court order does not specify a reasonable cost limit, the employer must review the Consumer Credit Protection Act (CCPA) limits to determine the maximum amount that can be withheld for child support. If the cost of the health care coverage and the current child support exceeds the CCPA limits, the employer is to place a priority on the current child support and not enroll the child. The employer responds to the NMSN (MED5/MED5C) indicating they could not enroll the child due to the cost of the coverage. However, the parent/custodian may voluntarily consent to the withholding of an amount otherwise more than applicable withholding limitations.

What if the NCP or CP is not yet eligible to enroll because he (or she) has not completed an employer’s waiting period for enrolling in health care coverage (i.e., still on probation)?

The employer cannot refuse a NMSN (MED5/MED5C) because the employee is on probation. They must respond to CSS with the information of:

1. The employee is subject to a waiting period
2. The length of the waiting period
3. The date when the employee will be eligible for coverage and/or what type of trigger is necessary for the employee to become eligible for coverage (e.g., number of hours worked, completion of a training program)
4. At the completion of probation period, the employer must enroll the employee/children in the coverage. While the OKESC does mark these cases for follow-up, district office staff will still have the responsibility in an audit to ensure the information has been obtained and entered in OSIS.
5. When the employee is on probation or has some other waiting period for being eligible for health care coverage the following applies:
   1. For short waiting periods (90 days or less remaining at the time of the plan administrator’s receipt of Part B), the plan administrator qualifies the Notice, and waits until the expiration of the necessary time to enroll the child and notify the employer of the need, if any, to withhold from the employee’s wages to provide such coverage.
   2. For long waiting periods (greater than 90 days remaining at the time of the plan administrator’s receipt of Part B, or the period is measured by other means, such as hours worked), the plan administrator should inform the employer of the waiting period, and wait for notification from the employer of the employee’s satisfaction of the waiting period.
   3. The waiting or probation period does not allow an employer to ignore the fact the NMSN (MED5/MED5C) is a qualifying event. The employer may not require the employee or the children to wait until there is an open season for enrollment to comply with the NMSN (MED5/MED5C).

How does HIPAA affect the NMSN (MED5/MED5C)?

The Health Insurance Portability and Accountability Act (HIPAA) restrictions have no impact on the employer’s obligation to enroll minor child(ren) of the employee and to report the information requested on the NMSN (MED5/MED5C) and the survey. This information is not protected health information as defined in 45 CFR § 164.501. Additionally, a covered entity may disclose protected health information to the extent that disclosure is required by law or to an agency performing a government regulatory program.

How does an employer comply with a NMSN (MED5/MED5C) whenever an employee does seasonal work?

If the employee earns enough wages to cover the health care coverage for the duration of the seasonal work, the coverage should be added per the NMSN (MED5/MED5C). If the employee consistently does not earn enough wages to be eligible, CSS staff may need to review the case for modifying (Modding) the order to establish permanent cash medical (CM) support.