A Review of Medical Child Support: Background, Policy, and Issues

Publication Date: November 2003

Publisher: Library of Congress. Congressional Research Service

Author(s):

Research Area: Health

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Abstract:

Medical child support is the legal provision of payment of medical, dental, prescription, and other health care expenses of dependent children. It can include provisions to cover health insurance costs as well as cash payments for unreimbursed medical expenses. According to 2001 Child Support Enforcement (CSE) data, 93% of medical child support is provided in the form of health insurance coverage. The requirement for medical child support is apart of all child support orders (administered by CSE agencies), and it only pertains to the parent's dependent children. Activities undertaken by CSE agencies to establish and enforce medical child support are eligible for federal reimbursement at the CSE matching rate of 66%.

The medical child support process requires that a state CSE agency notify the employer of a noncustodial parent who owes child support, that the parent is obligated to provide health care coverage for his or her dependent children. CSE agencies notify employers of a medical child support order via a standardized federal form called the National Medical Support Notice. The plan administrator must then determine whether family health care coverage is available for which the dependent children may be eligible. If eligible, the plan administrator is required to enroll the dependent child in an appropriate plan, and notify the noncustodial parent's employer of the premium amount to be withheld from the employee's paycheck.

Although establishment of a medical support order is a prerequisite to enforcing the order, inclusion of a health insurance order does not necessarily mean that health insurance coverage is actually provided. According to CSE program data, in 2001, only 49% of child support orders included health insurance coverage, and the health insurance order was complied with in only 18% of the cases. Most policymakers agree that health care coverage for dependent children must be available, accessible, affordable, and stable. Since 1977 and sporadically through 1998, Congress has passed legislation to help states effectively establish and enforce medical child support. The National Medical Support Notice, mandated by 1998 law and promulgated in March 2001, was viewed as a means to significantly improve enforcement of medical child support -- to date only about half the states are using the Notice. The 1998 law also called for an advisory body to design a medical child support incentive which would become part of the CSE performance-based incentive payment system -- a recommendation was made to Congress in 2001 to indefinitely delay development of a medical child support incentive mainly because it was argued that the appropriate data was not yet available upon which to base such an incentive.

Improving the establishment and enforcement of medical child support has been hampered to some extent by factors such as high health care costs, a decline in employer-provided health insurance coverage, an increase in the share of health insurance costs borne by employees, and the large number of uninsured children. This report provides a legislative history of medical support provisions in the CSE program, describes current policy with respect to medical child support, examines available data, and discusses some of the issues related to medical child support. This report will not be updated.