From: Benefits
Question:
An employee has acquired health insurance coverage for her child under the Children’s Health Insurance Program (CHIP). Can this employee drop group coverage for the child due to the coverage through CHIP?
Answer:
Having her child become newly eligible for CHIP coverage is not a qualifying event which would allow the employee to drop coverage for the child. In general, part of the premise behind CHIP is that it does not replace existing private or public coverage. As such, CHIP generally coordinates coverage with another health plan and, like Medicaid, is always secondary to the other health plan in terms of expense payment. In order to drop group coverage for her child, the employee will need to wait until open enrollment or until she experiences another qualifying event allowed by the employer’s section 125 cafeteria plan.
