https://fdms.erulemaking.net/...eb-agency/Download?operation=CoverPage&ObjectId=0900006480b2e56a&Comment=true[8/12/2010 11:27:41 AM]

PUBLIC SUBMISSION

As of: August 12, 2010

Received: August 11, 2010

Status: Pending_Post

Tracking No. 80b2e56a

Comments Due: August 11, 2010

Submission Type: Web

Docket: HHS-OS-2010-0012

Group Health Plans and Health Insurance Issuers Relating to Dependent Coverage of Children to Age

26, etc.

Comment On: HHS-OS-2010-0012-0001

Group Health Plans and Health Insurance Issuers Relating to Dependent Coverage of Children to Age

26, etc.

Document: HHS-OS-2010-0012-DRAFT-0027

Comment on FR Doc # 2010-11391

Submitter Information

Name: Kathleen King

Organization: Children's Defense Fund

General Comment

Dear Mr. Mayhew:

Please find attached the Children’s Defense Fund’s comments in response to the Interim Final Rules

for Group Health Plans and Health Insurance Issuers Relating to Dependent Coverage of Children to

Age 26 under the Patient Protection and Affordable Care Act as amended by the Reconciliation Act.

We appreciate your consideration of our comments and recommendations and would be happy to

meet with you to discuss them in further detail. 

Sincerely,

MaryLee Allen 

mallen@childrensdefense.org

202-662-3573

Kathleen King

kking@childrensdefense.org

202-662-3576

Attachments

HHS-OS-2010-0012-DRAFT-0027.1: Comment on FR Doc # 2010-11391
August 11, 2010 

Jim Mayhew 

Office of Consumer Information and Insurance Oversight 

Department of Health and Human Services 

P.O. Box 8016 

Baltimore, MD 21244-1850 

Attention: OCIIO-4150-IFC 

Dear Mr. Mayhew: 

The Children’s Defense Fund (CDF) is pleased to have the opportunity to comment on the Interim 

Final Rules for Group Health Plans and Health Insurance Issuers Relating to Dependent Coverage of 

Children to Age 26 under the Patient Protection and Affordable Care Act (the Affordable Care Act) as 

amended by the Reconciliation Act. The Act and the regulations clarify that plans and issuers that 

make available dependent coverage of children must make coverage available for children until age 26, 

with only one time-limited exception. They make clear that previous conditions attached to dependent 

coverage of adult children can no longer be applied to young adults or to minors covered by their 

parent’s plans. These are extremely valuable improvements in addressing the health care needs of 

young people. 

CDF’s Leave No Child Behind® mission is to ensure every child a Healthy Start, a Head Start, a Fair 

Start, a Safe Start and a Moral Start in life and successful passage to adulthood with the help of caring 

families and communities. CDF provides a strong, effective and independent voice for all the children 

of America who cannot vote, lobby or speak for themselves. We pay particular attention to the needs 

of poor and minority children and those with disabilities. CDF educates the nation about the needs of 

children and encourages preventive investments before they get sick, drop out of school, get into 

trouble or suffer family breakdown. 

CDF has worked for many years, in collaboration with others, to expand health coverage to children 

and youths that is comprehensive, accessible and affordable, recognizing how important health care is 

to children’s transition to and success in adulthood. Yet today, 10.2 million of the 29.5 million young 

adults in America – or 1 in 3 -- is uninsured leaving them particularly susceptible to poor health 

outcomes and high medical bills. The Affordable Care Act’s extension of dependent coverage to age 

26, coupled with the creation of the temporary “high risk pool”, the expansion of Medicaid that will 

take effect in 2014, and the option of the catastrophic plan go far in reducing the number of young 

adults without health insurance. The new statutory provisions and the interim final rule will help 

prevent health insurance companies from restricting coverage to these young adults. Given that only 

seven states currently extend dependent coverage to non-students to age 26 or older in both individual 

and group health plans, this is a significant move in the right direction. It will help young people who 

are not students and also assist young adult children after they graduate from college and before they 

find employment. 

25 E Street, NW, Washington, DC 20001 p (202) 628-8787 f (202) 662-3510 www.childrensdefense.org
Page two 

Request for Public Comment on Interim Final Rules for Group Health Plans and Health Insurance 

Issuers Relating to Dependent Coverage of Children to Age 26 

August 11, 2010 

The interim final rules build upon the Affordable Care Act’s provisions in very helpful ways. The 

broad definition of dependent will ensure health coverage for a large number of previously uninsured 

young adults through their parents’ health insurance plans and without penalty based on their 

residency, geographic status, student status, marital status or financial independence. The latter is 

especially important because it will no longer require that the young adult be a tax dependent and 

therefore documentation of tax status will be unnecessary. The law’s prohibition on varying 

dependent’s premiums with age is consistent with the law’s other provisions to limit discrimination in 

the health insurance market and is key to expanding coverage to the young adult population. We are 

also pleased that the regulations require that insurers provide prominent notice about the extended 

coverage, but recommend ways to strengthen this provision. 

Our comments and recommendations below are intended to further strengthen the likelihood that a 

broad group of young adults to age 26 will know about and be able to receive health coverage through 

their parent’s plans, that full accommodation is made for youths with pre-existing conditions, and that 

none of these young adults will experience gaps in coverage as they move to and from health coverage 

through their own employer. Our comments and recommendations build on those submitted to the 

Department of Labor on August 3, 2010, by the Young Invincibles and 14 other public health, 

grassroots, patient and consumer rights advocacy organizations. 

Include Step-Children, Adopted Children, and Children Being Raised by Guardians or Relatives 

in the Definition of Child 

CDF is pleased the regulations allow for an expansive definition of a dependent based solely on the 

relationship between a child and the participant and do not allow plans or issuers to discriminate 

against young adults based on their residential, marital, or student status, or financial dependence or 

independence. 

The Affordable Care Act is clear that children who are eligible for coverage as children under their 

parent’s plan will continue to be eligible as dependents to age 26. However, given the current 

flexibility the regulations afford states to define children, we are concerned that there are several 

groups of children who may not be included unless they are specifically mentioned in the regulations. 

In defining the relationship between a child and the participant, it is important that child includes 

stepchildren, adopted children, and children being raised by guardians or other relatives who have not 

been adopted but have been eligible for the guardian’s or caregiver’s health insurance plan as if they 

were their dependent children. While many insurance plans require that a child be a birth, step or 

adopted child to be eligible for a caregiver’s health insurance plan, it is important to ensure that the last 

group of children – those being raised by legal guardians or other relatives – does not fall through the 

cracks. We are especially concerned that this group of children not be confused with the grandchildren 

that are specifically excluded by the from the participant’s plan. Children being raised by legal 

guardians or by grandparents or other relatives in kinship care arrangements, most often without their 

parents present, receive full time care from the caregivers and should be distinguished from 

grandchildren being raised by their parents. If a young adult was eligible for his or her caregiver’s 

health insurance while a child, the young adult should continue to be eligible as a dependent to age 26 

provided that other eligibility requirements are met. 
Page three 

Request for Public Comment on Interim Final Rules for Group Health Plans and Health Insurance 

Issuers Relating to Dependent Coverage of Children to Age 26 

August 11, 2010 

Recommendation: Revised regulations or guidance should be issued that makes it clear that when 

determining who is a dependent child for purpose of the dependent coverage extension, child shall 

include birth children, stepchildren, and adopted children, and other children raised by a guardian or 

relative. This last group of children includes children being raised by a guardian or relative and 

eligible for coverage under their caregiver’s health plan as if they were their children. It is a different 

group than the grandchildren of the participants, whose parents (the dependent children of the 

participants) are raising them and under the new provision are excluded from coverage by the 

Affordable Care Act. 

Clarify the Time-Limited Exemption for Young Adults with 

Employer-Sponsored Insurance 

Congress, by passing the Affordable Care Act, made clear that it wanted to increase the number of 

young adults with health coverage. It therefore included only one exception in defining who the 

dependent children are who are eligible under their parent’s insurance plans, and even that is time 

limited. Prior to January 1, 2014, grandfathered health plans that are group health plans may exclude 

an adult child who has not attained age 26 from coverage if the adult child is eligible to enroll in an 

employer-sponsored health plan other than a group health plan of the parent. In 2014, children up to 

age 26 can decide to stay on their parent’s employer plan even if they have another offer of coverage 

through an employer. 

CDF is concerned that the interim final rules as drafted to not take steps needed to ensure that these 

young adults will only be denied coverage on their parent’s plans once they are actually receiving 

coverage through their own employer. It is important that the regulations make clear that young adults 

may stay on their parent’s plan or enroll in their parent’s plan until they receive full coverage from an 

employer, clearly define what is and is not considered an employer plan for purposes of this provision, 

and clarify that insurance companies cannot impose burdensome requirements for determining whether 

or not a young adult has coverage through his or her employer. All of these improvements will help 

ensure that the goal of health reform is honored and that additional young adults will be insured. 

Clarifying what constitutes employer-sponsored plans 

While there is an exception until 2014 to the Affordable Care Act’s requirement for dependent 

coverage to age 26 for youths in employer-sponsored plans, it is important that these plans provide 

coverage that is adequate and affordable. Regulations or guidance should clarify that young adults 

offered an inadequate employer sponsored plan should continue to have the option of enrolling in their 

parents’ policy. For example, a plan that only offers coverage for specific illnesses or for injuries from 

automobile accidents or similar situations should not trigger the exemption. 

In making these clarifications, the Department also should clarify how college-sponsored student 

health plans will be treated for purposes of dependent coverage under the new Act. These student 

health plans, like some of the plans noted above, may offer less generous benefits and lower annual 

and lifetime caps. Therefore it should be clarified that these student health plans should not be treated 

as employer sponsored insurance. Instead, a dependent adult child must be able to obtain coverage 

under both his student health plan and his parent’s health insurance plan. 
Page four 

Request for Public Comment on Interim Final Rules for Group Health Plans and Health Insurance 

Issuers Relating to Dependent Coverage of Children to Age 26 

August 11, 2010 

Recommendation: The regulations must make clear that, for purposes of the dependent coverage 

extension, the exempted benefit plans described in section 5000A(f)(3) of the Internal Revenue Code, 

as inserted by the Affordable Care Act, are not considered eligible employer sponsored insurance. The 

exclusions specified in section 5000A (f) (2) should also apply to the dependent coverage provisions. 

The regulations should also clarify that a young adult may join a parent’s grandfathered plan as a 

dependent regardless of whether that young adult has accessed to a student health plan through a 

college or university. 

Ensuring that young adults truly have employer-based health coverage 

For purposes of ensuring that young adults have affordable and adequate health coverage, it is not 

sufficient to say that they are “eligible” for such insurance from their employers without further 

clarification. The regulations should make clear that the young adults are actually receiving such 

health coverage before they can no longer participate in their parent’s plans. Grandfathered plans, for 

example, should not be able to drop dependents while they wait for coverage from an employer. 

Young people starting jobs often cannot enroll immediately in health plans. There may be a waiting 

period before a young adult may join the company’s insurance (which under the Affordable Care Act 

may not exceed 90 days), but the law and regulations as proposed only state that the adult dependents 

must be “eligible to enroll” in an employer sponsored plan. It should be clarified that a person waiting 

for insurance would not yet be eligible to enroll and could remain on his or her parent’s insurance 

while waiting. 

Similarly, there may be some young adults with pre-existing conditions who will face exclusionary 

periods under employer plans and who should be allowed to remain on their parent’s plan until they 

would be fully eligible for the care they need. A young adult facing a pre-existing condition exclusion 

could be eligible for employer sponsored insurance but lack the medical care he or she needs for a 

specific health or mental health condition. While many of these young adults might previously have 

had coverage which will help reduce the time a new insurer can exclude them for a pre-existing 

condition, they may still face a gap in adequate coverage. These youth may be particularly vulnerable 

and in need of intensive medical services, and they should not be prevented from receiving them. 

Recommendation: The regulations should be modified to state clearly that a grandfathered plan may 

only remove a dependent with employer-sponsored insurance when the dependent can receive full 

coverage under his or her employer sponsored plan. They should further state that a young adult who 

becomes eligible but is then subjected to a waiting period would not be considered eligible for 

employer coverage until the waiting period ends and the employer’s plan begins providing full 

coverage to the young adult. Similarly the regulations should make clear that young adults with preexisting conditions should not lose their parent’s insurance if an employer plan does not pay for the 

medical care that a young person needs because of pre-existing condition exclusions or the extremely 

limited nature of the employer plan. 

 

Protections against burdensome documentation requirements to demonstrate that employer 

coverage is not available for adult dependent children to age 26 
Page five 

Request for Public Comment on Interim Final Rules for Group Health Plans and Health Insurance 

Issuers Relating to Dependent Coverage of Children to Age 26 

August 11, 2010 

Now that insurance companies have little ability to restrict coverage to dependents to age 26, there is 

less opportunity for plans to impose onerous documentation requirements to prove eligibility for 

coverage as was sometimes done in the past. However, we still have concerns that, at least between 

now and January 2014, plans might focus all their attention on the young people who are working and 

make it extremely burdensome for them to demonstrate that they do not have access to health coverage 

under an employer plan. Guidelines are needed that suggest reasonable documentation requirements to 

use with dependents to age 26 to ensure that non-eligible dependents are not enrolled. 

Recommendation: The Departments should issue guidance for plans that outline reasonable 

documentation requirements to use with dependents who are eligible for coverage to age 26 to ensure 

that non-eligible dependents who have access to employer sponsored coverage are not enrolled in their 

parent’s plan. 

Strengthening Notice Requirements for Dependent Coverage 

The Interim Final Rules require that beneficiaries receive “prominent notice” about the new 

opportunity to enroll in health coverage based on the dependent coverage extension in the Affordable 

Care Act. However, the regulations do not adequately specify what constitutes prominent notice and 

should be strengthened to ensure notice is received by both the young adult dependent as well as the 

plan holder. 

As this important new extended dependent coverage for young adults has been unveiled, there has been 

a lot of confusion about who is eligible, when they are eligible and for what they are eligible, despite 

the good efforts by the White House and the Departments, as well as the good work of organizations 

like the Young Invincibles. Clear information about the dependent coverage extension is key to its 

successful implementation. This is particularly important given that group health plans and insurers 

only have to give the adult dependent children 30 days to enroll in their parents’ plans, although they 

may allow for a longer enrollment period. 

Without appropriate notice, the millions of young adults expected to benefit from this new coverage 

may not be reached. “Prominent notice” must be defined more specifically to ensure that the plan 

holders and dependents understand what is necessary for them to enroll in coverage prior to the 

enrollment period. Customary notice is not sufficient. The notice should include basic information 

about the benefit and the responsibilities of both the carrier and the beneficiaries. In describing the 

employer coverage exemption discussed earlier, it is important that the notice make clear that it only 

applies when the dependent is actually able to receive the coverage. Wherever possible, adult 

dependents as well as carriers should be notified of their ability to be covered under their parent’s plan. 

Language is important too as references to a young adult dependent’s ability to “remain on” a plan 

may be misinterpreted to mean that dependents that have not been on their parent’s plans as young 

adults may not be covered. 

Recommendation: The Departments in the regulations must provide further specificity about notice of 

the extended dependent coverage that addresses who must receive it, what it must include, and how it 

must be delivered: 
Page six 

Request for Public Comment on Interim Final Rules for Group Health Plans and Health Insurance 

Issuers Relating to Dependent Coverage of Children to Age 26 

August 11, 2010 

 Notice to the dependent as well as the insurance carrier. Currently the regulations 

only require that the notice go to the plan-holder. In addition, notice should at least be 

provided to adult dependent children currently enrolled in the plan, and where possible 

adult dependent children who may have been enrolled in the past or could be in the 

future. This is especially important since the eligible dependents may likely not be 

living with the plan holder and even be in a different city or state. Direct notice to the 

dependent also is helpful given that parents may have separate policies and a dependent 

adult child may be eligible for one but not the other. As referenced earlier, the notice 

provided to all must make clear that dependent children now are eligible for their 

parent’s plans to age 26 even if they have not been enrolled previously as adults in their 

parents plan. For example, some dependents that have been in college may be on the 

plan already, whereas those who have not may have been without health coverage. It 

should be clear that both groups may now be enrolled. 

 Nature of the notice. “Prominent” notice about the dependent coverage extension 

must be able to be distinguished from the myriad of communications insurance holders 

receive from their plans. It should be a customized notice that is a clear and 

conspicuous, stand alone document highlighting the availability of the new coverage 

option and how to enroll. It should also include resources to help dependent adult 

children learn more about their eligibility and rights under the parent’s plan. 

 Delivery of the notice. Notice to the dependent adult child must be by mail or 

electronic transmission. In-hand furnishing to the plan holder at his or her place of 

enrollment may be sufficient for the plan holder, but is certainly not an adequate way to 

get notice to the young adult about this new opportunity for him or her to continue 

coverage or resume coverage. In fact, given the importance of this new coverage, 

insurance plans should be encouraged to get from their plan holders the names and 

contact information of their adult dependents and to notify them on a one time basis 

about the new opportunity for coverage. 

Enforcement of the Obligation to Provide Health Coverage to 

Dependent Adult Children to Age 26 

Group health plans and insurers essentially hold the futures of these young adults as they decide how 

to implement the extended health coverage for dependent children to the age of 26. Comprehensive, 

affordable, and accessible coverage is key to their likelihood of success in both school and work. It is 

essential that there be mechanisms in place to ensure enforcement of the dependent coverage extension 

so that young adults can be successfully enrolled. It is critically important for both the states and 

federal government to have in place systems for monitoring and receiving complaints about barriers to 

implementation of the dependent coverage extension and for taking prompt action when there is a 

pattern of questionable practice. Insurance companies should also be encouraged to establish an 

ombudsman or other mechanism to answer queries about the coverage of dependent adult children. 

Such information should be readily accessible to young adults who are applying for coverage under 

their parent’s plans and to their parents. Given that enrollment is to begin for plan years that begin on 

or after September 23, 2010, it is essential that the additional guidance recommended above should be 
Page seven 

Request for Public Comment on Interim Final Rules for Group Health Plans and Health Insurance 

Issuers Relating to Dependent Coverage of Children to Age 26 

August 11, 2010 

provided immediately so as to prevent erroneous delays in establishing coverage of dependent adult 

children. 

Thank you for the opportunity to comment on and make recommendations about the Interim Final 

Rules for Group Health Plans and Health Insurance Issuers Relating to Dependent Coverage of 

Children to Age 26. It is important that these young adults, including those who are adopted children, 

step children, or children being raised by legal guardians or relatives, know about and are able to 

receive coverage through their parent’s or caregiver’s plan, that full accommodation is made for youths 

with pre-existing conditions, and that none of these young adults will experience gaps in coverage as 

they move to and from health coverage through their own employer. CDF is optimistic about the 

opportunity for millions of young adults to get health insurance who could not get coverage in the past. 

We appreciate your consideration of our comments and would be pleased to discuss them or our 

concerns or recommendations with you further. Thank you. 

Sincerely yours, 

 

MaryLee Allen 

Director, Child Welfare and Mental Health 

 mallen@childrensdefense.org; 202-662-3573 

 Kathleen King 

Policy Associate, Child Health 

 kking@childrensdefense.org; 202-662-3576