What Employers Need To Know About the National Medical Support Notice!
As of October 1, 2001 states began using the National Medical Support Notice (NMSN). The NMSN is a standardized federal form that all state IV-D child support agencies must use. In many states implementation has been delayed due to the need for enabling state legislation. The form was developed with input from employer groups and health plan administrators. Of additional interest to employers, the NMSN complies with section 609 (a)(3) and (4) of ERISA, which pertains to informational requirements and restrictions against requiring new types or forms of benefits. It also includes:
- applicable state law provisions for withholding employee contributions due under any group health plan in connection with coverage required to be provided;
- duration of the withholding requirement;
- applicability of limitations on such withholding under title III of the Consumer Credit Protection Act, or similar state law;
- prioritization required under state law between amounts to be withheld for purposes of cash support and amounts to be withheld for purposes of medical support, in cases where available funds are insufficient for full withholding for both purposes; and
- the name and telephone number of the appropriate unit or division to contact at the state agency regarding the NMSN.
The NMSN is actually four documents and instructions:
- Part A- Notice to Withhold For Health Care Coverage, will be completed by the child support agency and sent to the employer with the rest of the packet.
- "Employer Response" is just that, your opportunity to respond to the request if one of the following situations exists:
- You do not provide health care coverage for your employees.
- The employee is not eligible for the health care coverage you provide.
- The employee has been terminated or has left this employment.
- The deduction for health care coverage cannot be made because of State or Federal withholding limits and the State's priority for withholding. These limitations will be included in the instructions that accompany the NMSN or that you have received from your State, as mentioned above.
Otherwise, follow the steps below to comply with the NMSN.
- Part B- Medical Support Notice To Plan Administrator. This document should be forwarded to your health care plan administrator for handling.
- "Plan Administrator Response" is completed by your Plan Administrator according to the accompanying instructions and returned to the child support agency.
What To Do When You Receive a NMSN
- Step 1: Once you receive the NMSN, determine whether any of the four categories on the Employer Response apply to you or this employee. You may only be able to determine whether one of the first three apply at this stage.
- Step 2: If so, complete the Employer Response form and return it to the Issuing Agency within 20 business days. If none of the four categories on the Employer Response apply to you or this employee, forward Part B to your plan administrator.
- Step 3: The plan administrator will notify you when enrollment has been completed. You must then notify your payroll to make the appropriate deductions for employee contribution required under the health plan. It is at this point that you may determine that the total deductions exceed the maximum allowed under the Consumer Credit Protection Act, and any applicable state law.
- Step 4: If, in fact, you determine that the amount of support coupled with the deduction for health care premiums exceeds the maximum deduction allowable, you must look to state law in the state where the employee is employed to determine the priority for payment. If the CCPA limits preclude payment of ongoing support and health care premiums and the priority scheme does not allow for the payment of the health care premium first, you must notify the issuing agency by completing No. 4 on the Employer Response form and send the form to the agency.
- Step 5: If enrollment can not be completed until after a waiting period or other contingency, you must notify the Plan Administrator when the employee is eligible for enrollment.