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Dependent Coverage


The extension of Dependent Coverage is one of the provisions in the Patient Protection and Affordable Health Care Act (PPACA) and the Health Care and Education Reconciliation Act (HCERA) now effective. This provision affects AlaskaCare employee and retiree members differently.

AlaskaCare Employee Health Plan

AlaskaCare Employee Health Plan member dependents up to age 26 are now eligible for enrollment. The PPACA required the addition of older dependent children after the first plan renewal occurring more than six months after the effective date of the new law (September 23, 2010). For the AlaskaCare Employee Health Plan, this was the plan year beginning July 1, 2011. The State of Alaska has decided not to implement this provision earlier than required by law, because the associated costs in State funds have not been appropriated by the Alaska State Legislature in the current State fiscal year (SFY 11).

This provision only applies to dependents up to age 26 who are not covered by their own employer group plan. Dependents who have access to their own employer group plan must enroll in that plan rather than their parent’s plan.

Before the new provision was in place, employees had the option to continue coverage for their dependents by selecting COBRA continuation benefits. Employees must notify the Division within 60 days of the date their child no longer meets the eligibility criteria and elect COBRA coverage within 60 days of the date they are notified of their right to do so. COBRA premiums must be paid retroactive to the date coverage ended.

AlaskaCare Retiree Health Plan

Based on the most recent federal regulations issued in June 2010, the AlaskaCare Retiree Health Plan is not subject to the provision in the PPACA requiring some health plans to add coverage for older dependent children up to age 26.

Retirees have the option to continue coverage for their dependents by selecting COBRA continuation benefits. Retirees must notify the Division within 60 days of the date their child no longer meets the eligibility criteria and elect COBRA coverage within 60 days of the date they are notified of their right to do so. COBRA premiums must be paid retroactive to the date coverage ended. If your child is incapacitated, he/she may qualify to continue health benefits under the retiree plan.

The Division of Retirement and Benefits and the Department of Law continue to analyze new regulations as they are published. Should the law or your plan benefits change, we will notify you, as an AlaskaCare retiree member, in ample time prior to any renewal or enrollment deadlines.

Summary of Provisions in the Extension of Dependent Coverage

Effective for plan years beginning on or after September 23, 2010 (prior to January 1, 2010 only applies to dependents not eligible for other coverage).

Group health plans (self and fully insured) that provide dependent coverage of children must continue to make such coverage available for an adult child until the child turns age 26. This does not include dental/ vision if offered separately.

  • Coverage provided to adult children who, as of the end of the tax year have not turned age 27, will not result in imputed income to the employee.
  • This requirement applies to grandfathered plans. However, for plan years beginning before January 1, 2014, this rule applies to grandfathered plans that are group health plans only if the adult child is not eligible to enroll in any other eligible employer sponsored health plan.    

This requirement applies to the AlaskaCare Employee Health Plan only. It does not apply to the AlaskaCare Retiree Health Plan.

Reference:

Legal Citation: PPACA § 1001 [PDF] (Amendments to PHSA). For exclusion of retiree plan, see preamble to Interim Final Rules issued 6/14/10 (26 CFR 54.9815-1251, 29 CFR 2590.715-1251, 45 CFR 147.140)

See also the U.S. Department of Labor.