Medical Support for Employers
- What Is Medical Support?
- National Medical Support Notice (NMSN)
- What to Do When You Receive an NMSN - Step-By-Step
- Federal Employee Enrollment
Medical support is a form of child support that requires one or both parents to provide health care coverage under a parent's policy or cash medical support. The parent may be ordered to:
- Provide health insurance if available through an employer,
- Pay premiums for private health care coverage or reimburse a parent for all or a portion of the costs of health insurance obtained by that parent, or
- Pay additional amounts to cover a portion of ongoing medical bills or as reimbursement for uninsured medical costs.
If neither parent has health care coverage, the child support order may provide for a specific dollar amount to be deducted for medical purposes.
Current law requires that every child support order, enforced by a child support agency, 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 agency is required to pursue private health care coverage when such coverage is available through a noncustodial parent's employer at a reasonable cost. States determine what is a reasonable cost for medical insurance, and employers can find that information on the Medical Support Requirements matrix.
State laws require that health care coverage be provided under a medical support order even if the child:
- Was born to unmarried parents,
- Is not claimed as a dependent for tax purposes, or
- Does not reside with the parent or in the insurer's service area.
The NMSN is a notice sent to employers from the child support agency 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 to request health care coverage.
An appropriately completed NMSN is considered a "Qualified Medical Child Support Order" (QMCSO), and must be honored by all employers' group health plans. A QMCSO must clearly specify this information:
- 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.
- The period for which the order applies.
The NMSN complies with section 609 (a)(3) and (4) of the Employee Retirement Income Security Act about requirements and restrictions against requiring new types or forms of benefits. It includes:
- Applicable state law provisions for withholding employee contributions under any group health plan in connection with coverage required.
- Duration of the withholding requirement.
- Applicability of Consumer Credit Protection Act (CCPA) limits on these withholdings under title III or similar state law.
- How to prioritize under state law between amounts to withhold for cash support and for medical support, if there is not enough money to withhold for both.
- Who to contact at the child support agency for questions about the NMSN.
The NMSN form 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 employer with the rest of the packet.
- "Employer Response" is your opportunity to respond to the request if one of the following situations exists:
- You do not provide health care coverage for your employees.
- The employee is not eligible for the health care coverage you provide.
- The employee has been terminated or has left this employment.
- You cannot deduct for health care coverage because of state or federal withholding limits and the state's priority for withholding. These limitations will be included in the instructions that accompany the NMSN or that you have received from your state, as mentioned above.
- Part B - Medical Support Notice To Plan Administrator. This document should be forwarded to your health care plan administrator for handling.
- "Plan Administrator Response" is completed by your plan administrator and returned to the child support agency.
Many HMOs and other health insurance carriers have reciprocal agreements and provide coverage for each other's insureds when in their respective service areas. The employer's health insurance plan administrator may contact the insurance carrier about a service area residence issue to find out if reciprocal coverage is available.
- Step 1: Determine whether any of the four criteria on the Employer Response apply to you or this employee that prevent you from honoring the NMSN. You may only be able to determine the first three at this stage.
- Step 2: If any apply, complete the Employer Response form and return it to the issuing agency within 20 business days. If none of the four categories on the Employer Response apply to you or this employee, forward Part B to your plan administrator.
- Step 3: The plan administrator will notify you when enrollment is complete. You must then notify your payroll department to make the appropriate deductions from the employee’s income. At this point you can determine whether the total deductions exceed the maximum allowed under the CCPA, and any applicable state law.
- Step 4: If you determine that the amount of support plus the deduction for health care premiums exceeds the maximum deduction allowed, you must look to state law in the state where the employee is employed to determine the priority for payment. If the CCPA limits are too high for payment of ongoing support and health care premiums and the priority scheme does not allow for the payment of the health care premium first, you must complete No. 4 on the Employer Response form to notify the issuing agency that the employee’s children cannot be added.
- Step 5: If enrollment cannot be completed until after a waiting period or other requirement, you must notify the plan administrator when the employee is eligible for 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 the employee an opportunity to change health plan coverage without waiting for open enrollment season.
Enrollment in a self-and-family plan under FEHBP covers an employee's unmarried dependent children under age 26, including:
- 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 authority to federal agencies under the Federal Employees Health Benefits Children's Equity Act of 2000 to enroll an employee and family in the FEHBP when a state court or administrative authority orders the employee to provide health insurance coverage for a child but the employee fails or refuses to provide the coverage.
If the employee is not enrolled for any FEHBP coverage, the agency 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 FEHBP Handbook. The federal agency employer will receive an NMSN from the state child support 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.
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 CCPA.