Extension of Dependent Health Insurance Coverage – Public Act 095-0958

Typically, group health insurance plans and HMOs cover dependent children until they reach age 18 or 19 years of age. Such plans often grant extensions to cover dependent children up to 21 or 22 years of age if they are full-time students. These rules left about 300,000 Illinoisans between the ages of 19-25 uninsured. However, the state of Illinois recently amended The Illinois Insurance Code and The Health Maintenance Organization Act to give parents the right to keep dependent accident and health insurance for their unmarried children until they reach age 26 on the same terms and at the same cost. The required extension of dependent coverage is not conditioned on college enrollment. Laws relating to medical coverage for state, county and municipal employees were similarly amended.

The age for dependent care eligibility is extended from 26 to 30 for military veterans. A veteran of the active or reserve components of any branch of the U.S. Armed forces who is 30 years of age or younger, may receive continued dependent coverage if he or she is an Illinois Resident and has received a release or discharge other than a dishonorable discharge. The Illinois Department of Veterans’ Affairs is required to approve a form evidencing the dependent’s service and date of discharge to be presented by eligible dependents to their insurers.

The changes affect new group and individual policies of accident and health insurance, and managed care plans or those that are renewed or amended after June 1, 2009. Upon amendment, delivery, issuance, or renewal of a policy after June 1, 2009, the insurer is required to establish an initial enrollment period. The initial enrollment period must last no less than 90 days. During the initial enrollment period an insured parent may make a written election for coverage of an unmarried dependent covered by the new law. After the initial enrollment period, enrollment of a dependent will be allowed under terms established by terms of the plan or policy.

Dependent coverage may be elected during the annual open enrollment date or the annual renewal date of a policy or plan if the dependent had at least 90 days of prior continuous creditable coverage and has not been without creditable coverage for more than 63 days. Creditable coverage is defined under the Illinois Health Insurance Portability and Accountability Act and includes group and individual health plans, Medicare and Medicaid, military medical benefits, State health benefits risk pools, medical care programs of the Indian Health Service or of a tribal organization, and plans for government employees.

The new law requires insurers to provide customers notice of these changes upon application or enrollment, on coverage certification documents and in a semi-annual notice to policyholders.

The original version of the amendments provided only for a 12-month extension of coverage for dependent college students taking a medical leave of absence or reducing their course load to part-time status because of a catastrophic illness or injury. Governor Blagojevich, in one of his last acts as Governor of Illinois, used his amendatory veto to add the other coverage extensions and both houses accepted his changes.