What's New with Medical Support: An Employer's Guide
Meeting the Needs of Children
Parents are responsible for providing financial and medical support for their children. Employers help children get their financial support through income withholding from the employee’s (parents’) earnings.
When a support order requires an employee to also provide medical insurance, employers again help children by enrolling them in dependent medical insurance coverage which is available to the employee through the employer.
Who is considered an employer?
For purposes of the NMSN program, the term “employer” includes actual employers, and associations, organizations, trade unions, etc., through which a parent is an employee or otherwise associated with, and through which medical benefit coverage for dependents is available.
When is the NMSN sent to employers?
Employers will receive an NMSN when an employee is hired or a support order is established or modified that involves an employee who is ordered to provide medical insurance coverage for dependent children.
Are employers and health plan administrators required to comply?
Yes. Federal law requires all employers and health plan administrators to enroll the employee’s dependent children in health insurance, which is available to the employee through the employer at the employee’s expense as an NMSN enrollment order directs.
What is the National Support Notice?
The NMSN provides information about the employer’s and health plan administrator’s responsibilities and about enrollment in a specific case. The NMSN may be sent by the Idaho Child Support Agency, another state or other individual obligee.
The order also includes a two-part notice. Part A is filled out by the employer; Part B goes to the Health Plan Administrator. Instructions are included.
Upon receiving the NMSN, an employer determines whether the employee’s children are eligible for dependent health coverage. If an employee’s children are eligible, the employer retains Part A and forwards Part B to the company’s health plan administrator. If an employee’s children are ineligible, the employer completes and returns Part A to the child support agency, but discards Part B.
If an employee’s children are qualified, the health plan administrator enrolls the children and returns the completed form to the employer, child support agency and both parents. Health insurance information, insurance cards and forms must be provided to the custodial parent.
If the health plan administrator finds an employee’s children are not eligible, the administrator will complete Part B and return it to both the employer and child support agency.
Are there limits to how much an employee must spend for this health insurance?
Yes. Before you withhold any ordered insurance remium from the obligor’s income you will first need to determine if the cost to enroll the child or children is within the new definition of reasonable cost. Effective 7/1/08 the new definition limits the cost to enroll to five percent (5%) of the obligated parent’s/employees gross income. If there are multiple children included in the order the total cost to enroll all children of the order cannot exceed five-percent (5%) of the obligated parent’s gross income. If the obligated parent/employee must also be enrolled to qualify the child for enrollment, then the obligated parent/employee must be enrolled. The cost of the obligated parent/employee to be enrolled is not considered in the five percent (5%) limitation.
You must also determine if the amount of child support withheld and the amount of the insurance premium exceeds fifty-percent (50%) of disposable income. If fifty-percent (50%) of the disposable income is not sufficient to satisfy both child support and the medical insurance premiums, the employer will satisfy the child support amount first and complete Section 4 of Part A and return it to the child support agency.
If the employee’s disposable income covers both child support and insurance premiums, the employer will begin withholding the health insurance coverage from the employee’s earnings. Child support withholdings are submitted to the child support agency; the employer submits medical support withholdings to the health plan administrator.
Idaho Child Support has developed a calculator to determine if the cost to enroll the child exceeds five percent (5%) of gross income and if the maximum amount of withholding exceeds the fifty-percent (50%) of disposable earnings. You can access this calculator and the instructions from the Child Support Home Page or use these direct links to: Reasonable Cost Calculator and Reasonable Cost Calculator Instructions.
Priority of child support deductions
If 50 percent of disposable income is not sufficient to satisfy both child support and medical insurance premiums, the child support amount shall be satisfied first.
An additional cost for vision and dental insurance coverage exists. Does the medical support order require children be offered this coverage?
Yes. Health insurance includes dental and vision coverage. If these benefits are available through an employer, the employee’s children must be enrolled, regardless of whether the benefits are part of an existing policy or separate plan.
How soon must each part of the notice be completed?
The employer must complete Part A within 20 business days of the date of the NMSN, and either forward to the child support agency or the health plan administrator. The health plan administrator must complete Part B and return to the employer and child support agency within 40 business days of the NMSN.
What if an employee objects to enrolling children or withholding income to pay for coverage?
The employee can challenge a medical support order based on a mistake in fact by requesting an administrative review by the Department. In the meantime, the employer must continue withholding income unless notified otherwise by the child support agency or other obligee.
If an employee pays child and medical support and quits his job, does the employer have to notify anyone?
Yes. The employer must promptly notify the child support agency if the employee who owes child support or medical support quits their job. If you know the new employer’s name and address, forward this information to the child support agency. If an employee returns to work, the NMSN order remains in effect and must be enforced until ordered to stop enforcing the order by the State.
Beginning July 1, 2003, Idaho joins the rest of the nation by adopting the National Medical Support Notice (NMSN) program. Under this program, employers receive a standard National Medical Support Notice (Order) requiring the employer to enroll the employee’s dependent children in medical insurance coverage available through the employer at the employees expense. Each NMSN Enrollment Order provides employers with detailed information that will help the employer determine the rules that apply and how to respond.