Human Resources & Workforce Diversity
Child Loses Dependent Status
When your child marries, becomes independent, or reaches adulthood, your insurances will no longer cover him or her. To maintain coverage, you or your child must take action.
For state group health, vision, dental and Epic Major Medical, Dental and AD&D insurance, your child loses eligibility to be covered as your dependent when the child marries, becomes eligible for insurance through his/her employer at a cost that is less than the additional cost to you to provide coverage or attains age 27, whichever occurs first (totally disabled dependents may remain eligible indefinitely). To continue the adult child’s coverage, you or your dependent must take action.
Under State Group Life Insurance and Individual and Family life Insurance coverage, your child loses eligibility to be covered as your dependent when the child marries, becomes independent or reaches age 25, whichever occurs first.
Health insurance coverage for your dependent children will end on the date your coverage ends, or on the earliest of the following dates:
- The end of the month in which the child:
- Becomes eligible for coverage as an employee for whom the premium cost is less than the additional premium cost to you to provide coverage for your child.
- Turns age 27.
- Marries
A child does not need to be dependent upon you for care or support or be a full-time student in order to be eligible as a dependent under State Group Health Insurance. However, if the child does not qualify as a tax dependent under IRC § 152, UWS must include in your gross income the fair market value of the health insurance benefits provided to the adult child. This will likely increase both your taxable income and your tax liability. This is known as “imputed income.”
See ETF’s “Benefit Eligibility for Adult Children Up To Age 27” FAQ for detailed information about dependent eligibility and taxation. To calculate the additional taxes that you may owe as a result of this imputed income, please see the UW Service Center’s Imputed Income website. Be aware that the additional taxes owed due to imputed income average $150-$250 per month if you have one non-tax dependent and $350-$450 per month if you have two or more non-tax dependents on your health insurance.
See IRS Publication 501 or consult a tax advisor to help you determine if your adult child is considered a tax dependent.
Coverage for a grandchild ends at the end of the month in which your child (parent of grandchild) ceases to be an eligible dependent or becomes age 18, whichever occurs first. The grandchild is then eligible for continuation coverage. This does not impact your child’s eligibility for coverage.
If you divorce, coverage for your spouse and stepchildren under your plan terminates at the end of the month in which the divorce is entered.
If your child is disabled when coverage would otherwise end, you may be able to keep him or her insured under your plan. Consult your staff benefits office.
Continuation of Coverage: Dependent children who lose eligibility under your health insurance can continue in the group plan as single subscribers for up to 36 months through COBRA provisions by paying the full premium.
Once you inform your employer of the dependent's loss of eligibility, your employer is required to provide your child with a notice of his or her eligibility to continue coverage. Your child can continue coverage by filing an application with the Department of Employee Trust Funds within 60 days of receipt of that notice. If, at the end of 36 months, your child wishes to convert the coverage to an individual policy, he or she should contact the plan provider.
If coverage is continued, they can change health plans during the It’s Your Choice period or if they live or move out of the service area.
If you choose to voluntarily terminate coverage for an eligible adult dependent child, he/she will not be eligible to continue coverage.
What to do. . .
Plan providers annually monitor the dependent status of children age 19 or over. If you receive an inquiry about your child's dependent status, be sure to respond promptly. Failure to do so will result in termination of the child's coverage at the end of the current calendar year.
Loss of dependent status can occur for many different reasons, and your employer may not know when this happens. Therefore, you are required to notify your staff benefits office within 60 days of the event or the loss of coverage, whichever is later. If you fail to do so, your child may lose eligibility for COBRA continuation coverage and you could be responsible for reimbursing the University or the provider for premiums or claims paid in error.
Once you inform your employer of the loss of dependent status, your employer is required to provide your child with a notice of his or her eligibility to continue coverage. Your child can obtain the coverage by filing an application with the Department of Employee Trust Funds within 60 days of receipt of that notice.
If, at the end of 36 months, your child wishes to convert the coverage to an individual policy, he or she should contact the plan provider.
Epic Excess Major Medical, Dental and AD&D Insurance
You should know. . .
Coverage for your dependent child will end on the date that your coverage ends or on the earliest of the following dates:
- The end of the month in which the child:
- Becomes eligible for health insurance coverage as an employee for whom the health insurance premium cost is less than the additional premium cost to you to provide health insurance coverage for your child.
- Turns age 27.
- Marries.
Your eligible child may continue group coverage through COBRA provisions for 36 months by submitting a continuation application directly to EPIC Life Insurance Company and paying premiums.
What to do. . .
Notify your staff benefits office when your child's dependent status ends. Your staff benefits office can provide an application for continuation coverage. When your child is no longer eligible for coverage, you should review your coverage level to determine if you need to submit an application to change to single or two-person coverage.
Anthem Dental Blue and VSP Vision Insurance
You should know. . .
Coverage for your dependent child will end on the date that your coverage ends or on the earliest of the following dates:
- The end of the month in which the child:
- Becomes eligible for dental insurance as an employee for whom the premium cost is less than the additional premium cost to you to provide coverage for your child.
- Turns age 27.
- Marries.
If your child has lost eligibility for coverage as your dependent, he or she may continue group coverage through COBRA provisions for 36 months by applying to continue coverage and paying premiums.
What to do. . .
Notify your staff benefits office when your child's dependent status ends. Your staff benefits office can provide an application for continuation coverage. When you child is no longer eligible for coverage, you should review your coverage level to determine if you need to submit an application to reduce your coverage level.
Other Dental Insurance. Many employee's who are represented by a Union have access to dental insurance through their Union. Contact you Union for more information.
Employee Reimbursement Account (ERA)
You should know . . .
You may contribute to the ERA Program to help pay for non-covered medical expenses and/or dependent care expenses for your child or for certain other individuals if they are eligible dependents under the IRS definition of dependent found in IRC §152. Relatives or other persons may be considered your dependents for one or both purposes if they live in your household and are dependent on you for over half of their support. When the individual loses dependent status, you may be eligible to decrease your ERA contributions.
Medical Expense Account: Your child loses dependent status for purposes of medical expense reimbursements when he or she no longer:
• Has a specified family-type relationship to you;
• Lives in your household for more than half of the taxable year;
•Is 18 years old or older (23 years, if a full-time student) at the end of the taxable year; and
• Has provided more than one-half of their own support during the taxable year (or received less than one-half of their support from you during the taxable year if a full-time student age 19 through 23 at the end of the taxable year).
Dependent Care Account: Dependent care expenses generally cease when the child turns age 13 or when your spouse or another relative is provides the care.
See UWSA’s ERA page for detailed eligibility information.
What to do. . .
- If you want to change your contribution elections under the ERA program, contact Fringe Benefits Management (FBMC) at 608-829-0435 to see whether the loss of dependent status qualifies as a status change. If it does, you must file a Change of Status form with FBMC within 30 days after the event.
Individual and Family Life Insurance
You should know. . .
Life insurance on your child through the Individual and Family Life Insurance plan terminates at the end of the month in which the child marries or loses eligibility due to financial independence, but no later than the end of the month in which the child turns age 25 (or when your own coverage terminates, if earlier). The child can convert coverage to an individual policy with the insurance company by filing a timely conversion application and paying premiums. Evidence of insurability is not required.
What to do. . .
Conversion policies are usually more expensive than group life insurance plans or term life insurance that is available on the open market. If the child will need insurance coverage when the Individual and Family Life Insurance coverage ends, take time to investigate other insurance alternatives.
However, if your child is not insurable, conversion to an individual policy may be a good option. An application must be filed with the insurance company within 31 days after the end of regular coverage.
You should know. . .
Your child's insurance through the State Group Life Insurance plan terminates at the end of the month in which he or she marries, the end of the calendar year in which the child ceases to be dependent on you for at least 50% of support, or turns age 19 (age 25 if a full-time student), or when your coverage terminates, whichever is earliest.
The child can convert coverage to an individual policy with Minnesota Life by filing a timely application and paying premiums. Evidence of insurability is not required.
What to do. . .
Conversion policies are usually more expensive than group life insurance plans or term life insurance that is available on the open market. If the child will need insurance coverage when the State Group Life Insurance coverage ends, take time to investigate other insurance alternatives.
However, if your child is not insurable, conversion to an individual policy may be a good option. A conversion application, ET-2306, is available from your staff benefits office. It must be filed with Minnesota Life within 30days after the end of regular coverage.
If you have no other child and no spouse to insure, cancel your Spouse and Dependent coverage by filing a cancellation form with your staff benefits office.
Accidental Death and Dismemberment Insurance
You should know. . .
Accidental Death and Dismemberment coverage for your dependent child ends at age 20 (age 25 if a full-time student) or when your coverage ends, if sooner. Conversion to an individual policy is not available to the child. A family conversion policy is available to you when your coverage ends.
You should know. . .
When your family changes, you should review your beneficiary designations to be sure that they are still appropriate.
Saving for College
You should know. . .
It's never too early to put aside some savings for your child's education. Tax-favored savings plans ("529" plans) are available from EdVest and other states' providers.
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This document was last revised on December 8, 2009
