Medical Support for Federal Agencies
Federal Employee Enrollment
What is Medical Support?
Medical support is a form of child support often provided as health care insurance under a parent's policy. The child support order may provide for a specific dollar amount to be deducted for medical purposes as well. A court or state child support enforcement agency may require your employee to provide health insurance for his/her dependents.
Medical support can take several forms. The non-custodial or custodial parent may be ordered to provide coverage for the child(ren). The support order may require either parent to do one or more of the following:
- provide health insurance if available through the employer
- pay for private health insurance (health care coverage) premiums or reimbursement costs for all or a portion of the health insurance obtained through the employer
- pay additional amounts to cover a portion of ongoing medical bills or as reimbursement for uninsured medical costs
Current law requires every child support order entered by a state child support enforcement agency to include a provision for health care coverage. States are required to include provisions for health care coverage in their child support guidelines, and the child support enforcement program is required to pursue private health care coverage when such coverage is available through a noncustodial parent's employer at a reasonable cost.
What is the National Medical Support Notice?
To help obtain health care coverage for children, new laws were passed, creating the National Medical Support Notice (NMSN). The NMSN is a notice sent to employers from the state child support enforcement agency. Its purpose is to ensure that children receive health care coverage when it is available and required as part of a child support order. It is designed to simplify the work of employers and plan administrators by providing uniform documents requesting health care coverage.
States were required to begin using the NMSN in October 2001 although some states have had to delay implementation until enactment of required state enabling legislation. An appropriately completed NMSN is considered a "Qualified Medical Child Support Order," or QMCSO, and as such must be honored by all Federal agencies' group health plans.
Federal Employee Enrollment
Under the Federal Employees Health Benefits Program (FEHBP) regulations, a child support order that includes medical support constitutes a "change in family coverage," granting an employee an opportunity to change health plan coverage without waiting for the next open enrollment season.
Enrollment in a self-and-family plan under FEHBP covers an employee's unmarried dependent children under age 26, including the following:
- A legitimate child, an adopted child, or a recognized natural child;
- A stepchild or foster child who lives with the employee in a regular parent-child relationship; or
- An unmarried dependent child regardless of age who is incapable of self-support because of mental or physical disability that existed before age 26.
Federal legislation (Public Law 106-394) provides Federal agencies authority under the Federal Employees Health Benefits Children's Equity Act of 2000 to enroll an employee and his or her family in the FEHBP when a state court or administrative authority orders the employee to provide health insurance coverage for a child of the employee but the employee fails or refuses to provide the coverage. Federal agencies may also enforce a child support order providing for direct income assignment (i.e., an amount of money for medical purposes as specified in the order).
If the employee is not enrolled for any FEHBP coverage, the agency employing office must enroll the dependents and/or the employee in the standard option of the Blue Cross/Blue Shield Service Benefit Plan. If the employee has a self-only enrollment in a fee-for-service plan, the agency must change the enrollment to self-and-family in the same option of the same plan. Authorized enrollment changes may be processed retroactively, if necessary, to comply with the effective date of the court or administrative order. For more details, see the Federal Employees Health Benefits Program Handbook. The Federal agency employer will receive a National Medical Support Notice from the state child support enforcement agency and will be required to notify the plan administrator to enroll the dependents in an insurance plan. Upon enrollment, the Federal agency employer will withhold premiums from the employee's income. This order may be subsequent to, or in conjunction with, an order to withhold a monetary child support obligation.
When a Federal agency implements an income-withholding order, the health insurance premium is deducted before arriving at the Federal employee's disposable income for purposes of calculating the income withholding. Income withholding for monetary support cannot exceed the maximum amount under the Consumer Credit Protection Act (CCPA).
National Medical Support Notice
The National Medical Support Notice (NMSN) complies with section 609 (a)(3) and (4) of ERISA, which pertains to informational requirements and restrictions against requiring new types or forms of benefits. It also includes:
- applicable state law provisions for withholding employee contributions due under any group health plan in connection with coverage required to be provided;
- duration of the withholding requirement;
- applicability of limitations on such withholding under title III of the Consumer Credit Protection Act, or similar state law;
- prioritization required under state law between amounts to be withheld for purposes of cash support and amounts to be withheld for purposes of medical support, in cases where available funds are insufficient for full withholding for both purposes; and
- the name and telephone number of the appropriate unit or division to contact at the state agency regarding the NMSN.
Your employee may be ordered to pay his or her dependent's health insurance premium and a monetary amount in addition to ongoing child support. The health insurance premium, but not the additional monetary amount for medical, is deducted before arriving at disposable income. The monetary medical support, together with the ongoing child support, is subject to CCPA limits.
The NMSN is actually four documents and instructions:
- Part A - Notice to Withhold For Health Care Coverage, will be completed by the child support agency and sent to the federal agency employer with the rest of the packet.
"Employer Response" is just that, your opportunity to respond to the request if one of the following situations exists:
- Health care coverage is not provided for your employees
- The employee is not eligible for the health care coverage you provide; or
The employee has been terminated or has left employment.
Otherwise, follow the steps below to comply with the NMSN.
- Part B - Medical Support Notice To Plan Administrator, should be forwarded to the health care plan administrator.
- "Plan Administrator Response" is completed by the plan administrator according to the accompanying instructions and returned to the state child support enforcement agency.
Even if your employee is already enrolled in a self-and-family health plan, the dependent child named in the NMSN may still need to be added to the plan.
Step-By-Step: What To Do When You Receive a NMSN
Since Federal employees have a wide choice of health insurance plans, adding an employee's child to comply with a National Medical Support Notice (NMSN) should be straightforward. Below are the steps to follow upon receiving a NMSN:
- Step 1: Once you receive the NMSN, determine whether any of the categories on the Employer Response applies. Most Federal employees will have medical coverage.
- Step 2: If any of the categories on the Employer Response does apply, complete the Employer Response form and return it to the Issuing Agency within 20 business days. If none of the categories on the Employer Response applies to your agency or this employee, forward Part B to your plan administrator/personnel office.
- Step 3: The plan administrator will notify you when enrollment has been completed. You must then notify your payroll agency to make the appropriate deductions for employee contributions required under the health plan. Note that for Federal employees, deductions for health insurance premiums are mandatory deductions when calculating disposable income for child support.
- Step 4: If enrollment cannot be completed until after a waiting period or other contingency, you must notify the plan administrator when the employee is eligible for enrollment.
In order to be "qualified," a medical support order must clearly specify:
- the name and last known address of the participant and the name and address of each child covered by the order;
- a reasonable description of the coverage to be provided or the manner in which coverage will be determined; and
- the period for which the order applies.
The law requires that health care coverage be provided under a medical support order even if the child:
- was born out of wedlock;
- is not claimed as a dependent for tax purposes; or
- does not reside with the parent or in the insurer's service area.