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Employer Medical Support FAQs

What is the National Medical Support Notice (NMSN)?
- The National Medical Support Notice (NMSN) is a two-part notice sent to employers from a local child support agency. Its purpose is to ensure that children receive health care coverage when it's available and required as part of a child support order.
  Employers and health plan administrators are required to complete and comply with the National Medical Support Notice (NMSN) and the accompanying DCSS-0054, Health Insurance Information form sent to the employer. (California Family Code Sections, 3751.5, 3763, 3764, 3766, 3767, 3768, 3769, 3771, and 3773.)
What does the National Medical Support Notice (NMSN) ask employers to do?
- - Confirm that the employee is eligible for group health insurance benefits.
  - Forward instructions to enroll to the designated plan administrator within 20 business days.
  - After the plan administrator has completed enrollment, the Health Insurance Information form must be completed and returned to the issuing local child support agency. In addition, ID cards, booklets, and summary plan descriptions should be forwarded to the issuing local child support agency.
  - Any interruption of health insurance benefits must be reported to the issuing local child support agency as soon as possible.
Will the NMSN always come from a California enforcing agency?
- No. The law allows other states to serve employers outside their state. All states are required to use the NMSN to enforce health care coverage. Your company may receive the NMSN from another state.
When is the NMSN sent to employers?
- Once an employer is matched to a noncustodial parent's case in which the parent is ordered to provide health care coverage for his/her child(ren) and no coverage is being provided, federal and California state law require that the NMSN be sent to the employer within two business days of receipt of the new employer information when the information is received from the National Directory of New Hires (NDNH), or, within 15 calendar days if the information is from any other source.
When must health care coverage withholding start?
- The Notice to Withhold for Health Care Coverage (Part A) requires withholding for the cost of health care as soon health insurance enrollment information is available to the employer. The withholding deductions for both child support and health insurance premiums may not exceed 50-65 percent of the employee’s net disposable income.
  The plan administrator must return Part B to the issuing local child support agency within 40 business days of the date of the NMSN. Enrollment must move forward irrespective of any open enrollment restrictions.
What if health insurance coverage is available, but the deduction of premiums and the child support exceed the employee's 50 percent net disposable earnings?
- Complete NMSN Employer Response (Part A), number 4 and return it to the issuing local child support agency within 20 business days. Please specify the cost amounts for health insurance benefits.
When will health care coverage withholding stop?
- The withholding order for health care coverage remains in effect until the employer is notified by the issuing local child support agency or receives a court order regarding any changes. However, even if the withholding order for health care coverage is dismissed, the employee may still elect to continue coverage.
What if the employee terminates?
- The employer must notify the issuing local child support agency promptly when the employee leaves, providing the termination date and the employee's last known home address. If known, the employer may also provide the new employer's name and address, as well as any other provider of a health benefit plan. California law states that withholding is a continuing obligation. The notice and withholding order remain in effect and are binding upon the employer until further notice from the court or the issuing local child support agency. Therefore, the employer is required to keep a record of the Order/Notice to Withhold Income and the National Medical Support Notice and to enforce the notices if the employee returns to work.
  The employer is also required to report the employee as a new hire if the employee returns to work.
If withholding limitations preclude the employer from withholding sufficient funds to cover both cash and medical support, which takes precedence? If the employee doesn't earn enough to pay both, what should the employer do?
- An NMSN issued by the local child support agency will provide detailed instructions on how to prioritize between cash and medical support. In some cases the employer may receive a subsequent notice that the custodial parent has elected to receive health care coverage over cash support. Unless notified, cash support will always have priority over health care coverage premiums. Contact the issuing local child support agency for assistance on how to calculate the cash support withholding and health care coverage premium.
  If the employee's principal place of employment is not in California, you may view other state's withholding priority and limits at: www.acf.hhs.gov/programs/cse/newhire/employer/contacts/contacts.htm
  
  If the employee doesn't earn enough to cover the cash child support amount and health care coverage premium, the employer should complete NMSN Employer Response (Part A), number 4 and return it to the issuing local child support agency. In addition, the employer should notify the plan administrator to remove the dependents from coverage.
Are employers and plan administrators required to comply?
- Yes. Federal and state law require all employers and plan administrators who offer dependent coverage to make health care coverage available to children of employees who are eligible and qualify for such coverage pursuant to a medical child support order, (See 29 USC 1169(a)). The NMSN forms were developed for this purpose by the federal Departments of Health and Human Services and Labor in consultation with payroll professionals, as well as sponsors and administrators of group health plans.
What will happen if I don't comply and enroll?
- If medical coverage is available and your organization fails to enroll and send in coverage and materials, the court may find the employer in contempt and the resulting penalties can include a fine. In addition, any employer who willfully fails to comply with the NMSN is liable for the amount incurred in health care services that would otherwise have been covered.
Who completes Part A of the NMSN?
- The employer completes Part A indicating whether the employee is eligible for dependent health care coverage. If the employer determines the employee is eligible, the employer retains Part A and forwards Part B to the plan administrator.
Who completes Part B of the NMSN?
- The plan administrator completes Part B. Once the dependent(s) enrollment is complete, the plan administrator notifies the issuing local child support agency and the employer, so health care coverage premium deductions, if required, can begin. The plan administrator is the person or entity responsible for enrolling participants in a health care coverage plan.
How soon must both parts of the Notice be completed?
- Within 20 business days of the date of the NMSN:
  - The employer must complete Part A of the form and return it to the issuing local child support agency or forward Part B to the plan administrator.
- Within 40 business days of the date of the NMSN:
  - The plan administrator must complete and return Part B to the issuing local child support agency;AND
  - The employer must either begin withholding, or if the amount exceeds the limits, return Part A to the issuing local child support agency and notify the plan administrator to remove the dependents from health care coverage immediately. The plan administrator must also notify the custodial parent and issuing local child support agency of termination of health insurance coverage.
What if the employee has health care coverage available for themselves and dependents, but they are not enrolled and don't want to enroll. What is the employer's responsibility when they receive an NMSN?
- The NMSN requires that the children must be enrolled if coverage is available at reasonable cost and accessible to them.
  If the employee is not enrolled in a health benefit plan, or is not enrolled in a plan that offers dependent coverage, and if only one plan with dependent coverage is offered, that plan shall be selected. On the signature line of the enrollment forms, simply write, "Per court order--copy attached."
  
  The employer should send Part B to the plan administrator. The plan administrator must enroll the dependents and, if necessary to enroll the dependents, enroll the employee.
  
  Plan selection criteria when multiple plans are available and accessible:
  - Employee already enrolled:
    - If the employee is enrolled in a health benefit plan that offers dependent coverage, that plan shall be selected.
  - Employee not enrolled, multiple plans available and accessible to children:
    - If the employee is not enrolled in a health benefit plan or is not enrolled in a plan that offers dependent coverage; and
    - if more than one plan with dependent coverage is offered, then the plan administrator shall enroll the dependents (and if necessary, the employee) in the health benefit plan selected by the issuing local child support agency in consultation with the custodial parent, or in any default option if no response is received from the issuing agency.
  The plan administrator must provide the issuing local child support agency copies of applicable summary plan descriptions or other documents that describe available coverage, including the participant’s additional contribution necessary to obtain coverage under each option and whether there is a limited service area. If the issuing local child support agency does not respond within 20 business days of the date the plan administrator returns the response, the dependent shall be enrolled in the default plan if one exists. If the plan does not have a default option, the plan administrator will enroll the option selected by the issuing local child support agency.
Our company's insurer provides open enrollment for all health benefit plans once a year. What happens if the employee cannot enroll the children until the annual open enrollment?
- By law, the NMSN requires your company's insurer to enroll the children in health care coverage at any time. (See 42 USC 1396g-1(a) and the California Family Code §3751.5(b)(1).
  If the employee is not enrolled in a plan that is accessible by the dependent(s) and one is offered, the employee must change plans to enroll the dependent(s) if it is reasonable in cost.
When are payments for health care coverage due?
- The medical notice requires you apply withheld wages to the cost of health care coverage according to your company's usual policy.
What if the employee doesn't want to enroll the child for medical coverage?
- The National Medical Support Notice is a qualified medical child support order; therefore, the employee does not have a choice. If health care coverage is available, the employer is required to enroll the child or children as instructed in the notice. However, the employer must adhere to limitations imposed on withholding as mandated by withholding laws of the state where the employee is principally employed.
  In order to object, the employee must contact the issuing local child support agency as instructed in the notice he/she received.
  
  The employer must still comply with the NMSN regardless of whether an objection has been made.
What if the children are already covered by the employee under another outside plan or a current spouse?
- The employer has an obligation to comply with the National Medical Support Notice until a notice from the issuing local child support agency or a court order terminating the medical support order or withholding is received. The employee may wish to contact the issuing local child support agency listed on the documents received regarding the notice.
Why do I have to send in enrollment information, if our employee has existing health insurance for the children?
- Your employee is under court order to supply medical insurance coverage for the dependent(s) through employment. Enrolling the dependent(s) is only half the obligation. In order for the employer and employee to be in compliance, it is necessary for this information to be noted in the local child support agency file and the information to be forwarded to the custodial parent of the child(ren).
If the employee reports that the child is enrolled in the custodial parent's health care coverage plan, what should the employer do?
- The employer's responsibilities under the NMSN are not affected by the child's enrollment in the custodial parent's health care coverage plan. The employee may wish to contact the issuing local child support agency to determine if a possible change in the child support order is appropriate. However, the employer must continue with enrollment until the employer receives an order terminating the NMSN.
Why do I have to enroll if the employee says the children are already insured by the Custodial Party?
- If you have received the NMSN, it means that our office has not confirmed that the custodial party is providing medical insurance coverage. Or, it could mean that the custodial party is currently on Medi-Cal, or does not want to provide this coverage but is doing so out of necessity. If the employee objects to the enrollment of dependents, the employee must contact the issuing local child support agency as instructed in the notice. The employer must still comply with the NMSN regardless of whether an objection has been made.
What should I do if the children live out of state?
- Contact the issuing local child support agency to verify that the dependents live out of state. Depending on the insurance provider, there may be a "guest membership enrollment" available. This means that the insurance coverage may extend to another state and it is just a matter of changing the enrollment information. After verifying with our office the ZIP Code of the family, you may need to contact the insurance provider to arrange this coverage.
The employee and children are eligible for coverage; however, our coverage is limited to within the state and the child lives out of state. What do we need to do?
- If health care coverage is not "accessible" to the children, check number 2 of the NMSN Employer Response (Part A), complete the remainder of the form and return it to the issuing local child support agency.
  "Accessible" means:
  - a health plan does not have service area limitations; or
  - the health plan provides an option not subject to service area limitation; or
  - a health plan has service area limitations, but the child lives within 30 miles or 30 minutes--whichever is less--of a primary care provider under the plan.
  You may wish to check an Internet map site to assist with the mileage/time accessibility determination.
What must the employer do once notice is received from the plan administrator that the children are enrolled?
- The employer will determine whether the combined cost of cash support and health care coverage is within the limits of withholding. Limits are determined by state law where the employee is principally employed (click link to view individual state withholding limits: http://www.acf.hhs.gov/programs/cse/newhire/employer/contacts/contacts.htm).
  If the amount is within the legal limits, the employer will begin withholding the contribution from the employee’s wages. If the combined amount exceeds the limit, the employer will check number 4 of the NMSN Employer Response (Part A), return Part A to the issuing local child support agency, and notify the plan administrator to immediately remove the children from the health care plan.
  
  The plan administrator must also notify the custodial parent immediately that health care coverage will not be provided.
What if the child is covered under Medi-Cal?
- Medi-Cal is not considered a substitute for private health care coverage. The employer must still comply with the medical withholding order.
What if the employer receives more than one health care coverage notice for the same employee?
- Determining the best way to handle multiple orders can sometimes be complicated. If you have specific questions about the medical withholding notice and/or regular income withholding, you may contact the issuing local child support agency.
Can the employer fire the employee so the employer doesn't have to enroll the employee in health care coverage?
- No. California law states that an employer, who discriminates, retaliates, or takes disciplinary action against an employee because of the medical support notice or income withholding is committing an unlawful employment practice for which the employee may bring a civil action. Under Family Code §3769, an employer may be fined for refusing to hire a person or for discharging or taking disciplinary action against an employee.
  An employer who willfully fails to comply with a valid health insurance coverage assignment order may also be liable for the amount incurred in health care services that would otherwise have been covered under the insurance policy under Family Code §3768(a). The court can find the employer in contempt of court for willfully failing to comply with the health insurance coverage assignment order under Family Code §3768(b) and Code of Civil Procedure §1218.
Our company is quite small and does not offer group health care coverage. Do we have to purchase group health care coverage for the NMSN?
- No. Your employee would be required to provide health care coverage for a dependent if it were available at a reasonable cost and accessible to the children. If your company does not offer this coverage to any of its employees, you are not obligated to provide it for this purpose.
  Within 20 business days of the date of the NMSN, the employer should check number 1 of the NMSN Employer Response (Part A) and return it by mail to the issuing local child support agency shown on the NMSN.
If a union provides health care coverage, what should the employer do?
- The employer should consider the union the plan administrator and forward Part B of the NMSN to the union, unless the employer checks numbers 1, 2, or 3 in Part A of the NMSN Employer Response.
My employee terminated and I must issue a COBRA* letter to the custodial parent. Would I send it to the enforcing agency if I do not have an address for the obligee?
- Yes, the issuing local child support agency will forward the letter to the to the obligee's last known address. You may view each state's information regarding income and health care coverage withholding at: http://www.acf.hhs.gov/programs/cse/newhire/employer/contacts/contacts.htm
  *Consolidated Omnibus Budget Reconciliation Act (COBRA)

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