You may recognize the acronym “QMCSO”, but are you aware of what it represents and the written procedures and disclosure requirements? Our ERISA desk has received several questions from brokers on this topic for plan documents and SPDs. Here are the top seven questions we received with answers: (Answers are given as a high-level summary; to know the intricate details, review the DOL’s reference guide.)
- What is a QMCSO?
A QMCSO is a Qualified Medical Child Support Order. The Employee Retirement Income Security Act (ERISA) requires group health plans to extend health care coverage to the children of a parent/employee who is divorced, separated, or never married when ordered to do so by a state court or agency. If the order comes from a state child support enforcement agency, the order is listed as a National Medical Support Notice (NMSN) and is treated like a QMCSO. However, other procedural steps are to be applied which are not referenced in this blog.
True ACA provides coverage to dependents until the age of 26, but it does not require the dependent to be covered. The QMCSO requires an employee and their employer to enroll the child in the group health plan if the employee is already eligible (the most ideal case is for the employee to already be enrolled). If the plan administrator does not follow this, the DOL has the authority to enforce it.
Key Note: Under the ERISA, the child/dependent in this case is labeled as an “alternate recipient.”
- What size employer must follow the QMCSO?
Small and large groups, all employers that are private entities, and those that are non-profit are required to follow the QMCSO. Church plans and governmental plans are exempt.
- Are plan administrators required to accept the order?
The plan administrator is in the position to determine if the medical child support order is deemed as “qualified.” If they determine the order is qualified, the child is to be enrolled as a dependent. The process is to take a “reasonable amount of time,” and the plan administrator does not need to provide retroactive coverage.
- What are the criteria points to be qualified?
The QMCSO should include the following (if the details are lacking, the plan administrator may reject it):
- Name of the participant and last known address
- Name of the alternate recipient/child and last known address (the state official who issued the order may be used instead)
- Description of the coverage to be provided
- Period to which the order applies
The order cannot require a benefit to be offered if it is not already in place.
- Are the details to be listed in the plan document and the SPD?
Yes. These documents need to spell out the procedures for determining if the order is qualified, and the participant must be able to obtain a copy of the procedures free of charge. Here is a sample of a portion of the wording that would be included in the plan document:
“QMCSO determinations and notice. Within a reasonable period of time after receipt of an MCSO, the employer will review the MCSO and determine whether it meets the QMCSO requirements with respect to the provisions of the plan and applicable law. Upon making it, the employer will notify the participant and each child of their determination. If the name and address of a state official are substituted for the mailing address of the child, the notice will be sent to the state official. If the child has designated a representative for the receipt of the copies of such notices, the employer will also notify such representative of their determination.”
Typically, you see the QMCSO provisions listed in the eligibility section of the SPD.
- What are the disclosure requirements?
The ERISA’s QMCSO provisions require that the participant and each alternate recipient named in a medical child support order receive two notifications:
- Notification of the receipt of a medical child support order and of the plan’s procedures for determining whether an order is a QMCS
- Notification of the plan administrator’s determination as to whether the order is a QMCSO
Most do not electronically disclose this type of disclosure, and instead use first-class mail.
- Does Wrangle’s plan document and SPD contain the necessary material?
Yes, and if you have questions or need sample materials to review, feel free to ask Aubrey Box for assistance. She can be reached at email@example.com.