July 19, 2010
Page 2

to all grandchildren up to age 26, or (2) cease to offer coverage to grandchildren. As with the
previous example, plan sponsors are likely to choose the second option.

In determining whether to apply Treas. Reg. §54.9815-2714T(b) to stepchildren
(in addition to an employee’s or member’s children by birth, adoption or placement for
adoption), the Agencies may want to weigh the current scope of stepchild eligibility under group
health plans against the potential gains and losses of stepchild eligibility. Typically, group health
plans offer coverage to stepchildren up to a specified age who reside with an employee or
member but do not offer coverage to stepchildren who do not reside with an employee or
member, Under Treas. Reg. §54.9815-2714T(b), a plan sponsor will need to decide whether to:
(1) offer coverage to all stepchildren up to age 26; or (2) cease to offer coverage to stepchildren.
I expect that some plan sponsors will choose the first option and some will choose the second
option.

I appreciate the opportunity to provide these comments and hope that they are
helpful.

Very Truly Yours,

Chimda. KR Mundah

Linda R. Mendel


Page I of 2

AERC uct AO
BRANCH, ONS AEG ((4 JUL 1 9 2010

As of: July 19, 2010
PUBLIC Status: Postes

Posted: July 19, 2010
SUBMISSION Comments Duet August 11, 2010

Submission Type: Web

Docket: IRS-2010-0011
Group Health Plans and Health Insurance Issuers Providing Dependent Coverage of Children to
Age 26 under the Patient Protection and Affordable Care Act

Comment On: IRS-2010-0011-0001
Group Health Plans and Health Insurance Issuers Providing DependentCoverage of Children to
Age 26, etc,

Document: IRS-2010-0011-0008
Comment on FR Doc # 2010-11393

Submitter Information

Name: Linda R. Mendel
Address:

52 East Gay Street
Columbus, OH, 43215
Email: Irmendel@vorys.com
Phone: 614-464-8218
Organization: Vorys

General Comment

Treas. Reg. §54.9815-2714T(b) provides that “{w]ith respect to a child who has not attained age
26, a plan or issuer may not define dependent for purposes of eligibility for dependent coverage
of children other than in terms of a relationship between a child and the participant.” My
suggestion is that the Agencies limit this rufe to dependent children who are the children of an
employee or member by birth, adoption or placement for adoption.

Some group health plans currently offer coverage to dependent children with a broad range of
relationships to employees or members. For example, a group health plan might offer coverage
to children up to a specified age who reside with an employee or member in a parent-child
relationship and who are wholly dependent on the employee or member for support. Under Treas.
Reg. §54.9815-2714T(b), a plan sponsor's options are to: (1) offer coverage to children up to
age 26 who have a parent-child relationship with the employee or member; or (2) cease to offer
coverage to children on the basis of having a parent-child relationship with the employee or
member. Because the first option would result in a significant expansion of eligibility to
individuals who are not part of an employee’s or member's household, plan sponsors are likely to
choose the second option.

A similar issue arises with respect to coverage of grandchildren. Under Treas. Reg. §54.9815-
2714T(c), a group health plan is not required to cover an employee’s or member's grandchildren.

https://fdms.erulemaking.net/fdms-web-agency/component/submitterInfoCoverPage?Call=..._ 7/19/2010


Page 2 of 2

However, it would appear that if a group health plan chooses to offer coverage to grandchildren,
it must do so without regard to financial dependency, residency or age younger than 26. If a
group health plan currently offers coverage to grandchildren up to a specified age who reside with
an employee or member and who are wholly dependent on the employee or member for support,
the plan sponsor’s options appear to be to: (1) offer coverage to all grandchildren up to age 26,
or (2) cease to offer coverage to grandchildren. As with the previous example, plan sponsors are
likely to choose the second option.

In determining whether to apply Treas. Reg. §54.9815-2714T(b) to stepchildren (in addition to
an employee’s or member's children by birth, adoption or placement for adoption), the Agencies
may want to weigh the current scope of stepchild eligibility under group health plans against the
potential gains and losses of stepchild eligibility. Typically, group health plans offer coverage to
stepchildren up to a specified age who reside with an employee or member but do not offer
coverage to stepchildren who do not reside with an employee or member. Under Treas. Reg.
§54.9815-2714T(b), a plan sponsor will need to decide whether to: (1) offer coverage to all
stepchildren up to age 26; or (2) cease to offer coverage to stepchildren. I expect that some plan
sponsors will choose the first option and some will choose the second option.

I appreciate the opportunity to provide these comments and hope that they are helpful.

Attachments

IRS-2010-0011-0008.1: Comment on FR Doc # 2010-11393

https://fdms.erulemaking.net/fdms-web-agency/component/submitterInfoCoverPage?Call=..._ 7/19/2010


52 East Gay St.

‘ 4 PO Box 1008
R Ss Columbus, Ohio 43216-1008

Vorys, Sater, Seymour and Pease LLP 614.464.6400 | www.vorys.com

Legal Counsel Founded 1909

Linda R. Mendel
Direct Diat (614) 464-6218
Direct Pax (614) 719-4889
Eraait Irmendel@vorys.com

July 19, 2010

Via Federal eRulemaking Portal

Internal Revenue Service
http://www. regulations.gov

Re: Interim Final Rules Relating to Dependent Coverage of Children to Age 26
under the Patient Protection and Affordable Care Act (REG-1 14494-10)

Dear Sir/Madam:

Treas. Reg. §54.9815-2714T(b) provides that “[w]ith respect to a child who has
not attained age 26, a plan or issuer may not define dependent for purposes of eligibility for
dependent coverage of children other than in terms of a relationship between a child and the
participant.” My suggestion is that the Agencies limit this rule to dependent children who are the
children of an employee or member by birth, adoption or placement for adoption.

Some group health plans currently offer coverage to dependent children with a
broad range of relationships to employees or members. For example, a group health plan might
offer coverage to children up to a specified age who reside with an employee or member in a
parent-child relationship and who are wholly dependent on the employee or member for support.
Under Treas. Reg. §54.9815-2714T(b), a plan sponsor’s options are to: (1) offer coverage to
children up to age 26 who have a parent-child relationship with the employee or member; or
(2) cease to offer coverage to children on the basis of having a parent-child relationship with the
employee or member. Because the first option would result in a significant expansion of
eligibility to individuals who are not part of an employee’s or member’s household, plan
sponsors are likely to choose the second option.

A similar issue arises with respect to coverage of grandchildren. Under Treas.
Reg. §54.9815-2714T(c), a group health plan is not required to cover an employee’s or
member’s grandchildren. However, it would appear that if a group health plan chooses to offer
coverage to grandchildren, it must do so without regard to financial dependency, residency or
age younger than 26. Ifa group health plan currently offers coverage to grandchildren up to a
specified age who reside with an employee or member and who are wholly dependent on the
employee or member for support, the plan sponsor’s options appear to be to: (1) offer coverage

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