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National Medical Support Notice

Updated December 2006

Wisconsin child support agencies use the National Medical Support Notice form to notify employers to withhold health insurance premiums. Employers will receive this form for new employees who are court ordered to carry health insurance for their children.

In some situations employers may receive the form for current employees with new court orders for family health insurance coverage. The form is federally required, and was designed by a federal workgroup that included representatives of major employers, payroll associations, and insurance administrators.

Information for the Employer

Instructions to Employer
Employer Responsibilities
Limitations on Withholding
Priority of Withholding
Duration of Withholding
Possible Sanctions
Notice of Termination of Employment
Employee Liability for Contribution to Plan
Q & A
Contact for Additional Questions
More Information
Printable Instructions (Requires Adobe Acrobat Reader)

Instructions to Employer

The National Medical Support Notice serves as notice that the employee identified in the Notice is obligated by a court or administrative child support order to provide health care coverage for the child(ren) identified in the Notice. The National Medical Support Notice replaces any Medical Support Notice that the Issuing Agency has previously sent you with respect to the employee and the child(ren) listed in the Notice.

The document consists of Part A - Notice to Withhold for Health Care Coverage (2 pages) for the employer to withhold any employee contributions required by the group health plan(s) in which the child(ren) is/are enrolled; and Part B - Medical Support Notice to the Plan Administrator (2 pages), which must be forwarded to the administrator of each group health plan identified by the employer to enroll the eligible child(ren).

Employer Responsibilities

If the individual named in the Notice is not your employee, or if the family health care coverage is not available, please complete item 1, 2, or 3 of the Employer Response as appropriate, and return it to the Issuing Agency. No further action is necessary.

If family health care coverage is available for which the child(ren) identified in the Notice may be eligible, you are required to:

Transfer, not later than 20 business days after the date of the Notice, a copy of Part B-Medical Support Notice to the Plan Administrator to the administrator of each appropriate group health plan for which the child(ren) may be eligible, and

Upon notification from the plan administrator(s) that the child(ren) is/are enrolled, either:

1) Withhold from the employee's income any employee contributions required under each group health plan, in accordance with the applicable law of the employee's principal place of employment and transfer employee contributions to the appropriate plan(s), or

2) Complete item 4 of the Employer Response to notify the Issuing Agency that enrollment cannot be completed because of prioritization or limitations on withholding.

If the plan administrator notifies you that the employee is subject to a waiting period that expires more than 90 days from the date of its receipt of Part B of the Notice, or whose duration is determined by a measure other than the passage of time (for example, the completion of a certain number of hours worked), notify the issuing agency of the enrollment timeframe, and notify the plan administrator when the employee is eligible to enroll in the plan and that the Notice requires the enrollment of the child(ren) named in the Notice in the plan.

[If you know that the withholding is more than the what is allowed under the limits, and therefore Item 4 applies, you do not need to forward Part B to the Plan Administer. You may check item 4 and send the forms to the Issuing Agency.]

Limitations on Withholding

The total amount withheld for both cash and medical support of the employee's aggregate disposable weekly earnings cannot exceed the withholding limitations stated on the employee’s Income Withholding Notice/Order. The employer may not withhold more under the National Medical Support Notice than the lesser of:

The amounts allowed by the Federal Consumer Credit Protection Act (15 U.S.C., section 1673(b));

The amounts allowed by the State of the employee's principal place of employment; or

The amounts allowed for health insurance premiums by the child support order, as indicated here: Reasonable cost, which is interpreted to mean that the employee’s share of the monthly family coverage premium does not exceed 5% of the employee's gross monthly income or the amount specified by the court.

The Federal limit applies to the aggregate disposable weekly earnings (ADWE). ADWE is the net income left after making mandatory deductions such as State, Federal, local taxes, Social Security taxes, and Medicare taxes.

[The CCPA limits (50 - 65%) for each employee is listed on the Order/Notice to Withhold Income for Child Support (federal form OMB: 0970-0514) under the section labeled "Remittance Information."]

More information on withholding limits

Priority of Withholding

If withholding is required for employee contributions to one or more plans under the Notice and for a support obligation under a separate notice and available funds are insufficient for withholding for both cash and medical support contributions, the employer must withhold amounts for purposes of cash support and medical support contributions in accordance with the Priority for Withholding:

Current child and spousal support
Health care premiums or current cash medical support,
Arrearages
Other child support obligations

Example for calculating medical support according to CCPA limits and Priorities

[The amounts for withholding of each of the above categories are under the section labeled "Order Information" on the Order/Notice to Withhold Income for Child Support (OMB: 0970-0154) form you receive for your employee.]

Duration of Withholding

The child(ren) shall be treated as dependents under the terms of the plan. Coverage of a child as a dependent will end when similarly situated dependents are no longer eligible for coverage under the terms of the plan. However, the continuation coverage provisions of ERISA may entitle the child(ren) to continuation coverage under the plan. The employer must continue to withhold employee contributions and may not disenroll (or eliminate coverage for) the child(ren) unless:

The employer is provided satisfactory written evidence that:

The court or administrative child support order referred to above is no longer in effect, or

The child(ren) is or will be enrolled in comparable coverage (not including Medicaid or BadgerCare) which will take effect no later than the effective date of disenrollment from the plan; or

The employer eliminates family health coverage for all of its employees.

Possible Sanctions

An employer may be subject to sanctions or penalties imposed under State law and/or ERISA for discharging an employee from employment, refusing to employ, or taking disciplinary action against any employee because of medical child support withholding, or for failing to withhold income, or transmit such withheld amounts to the applicable plan(s) as the Notice directs.

Notice of Termination of Employment

In any case in which the employee's employment terminates, the employer must promptly notify the Issuing Agency listed in the Notice of such termination. This requirement may be satisfied by sending to the Issuing Agency a copy of any notice the employer is required to provide under the continuation coverage provisions of ERISA or the Health Insurance Portability and Accountability Act.

Employee Liability for Contribution to Plan

The employee is liable for any employee contributions that are required under the plan(s) for enrollment of the child(ren) and is subject to appropriate enforcement. The employee may contest the withholding under the Notice based on a mistake of fact (such as the identity of the obligor). Should an employee contest the withholding under the Notice, the employer must proceed to comply with the employer responsibilities in the Notice until notified by the Issuing Agency to discontinue withholding. To contest the withholding under the Notice, the employee should contact the Issuing Agency at the address and telephone number listed in the Notice. With respect to plans subject to ERISA, it is the view of the Department of Labor that Federal Courts have jurisdiction if the employee challenges a determination that the Notice constitutes a Qualified Medical Child Support Order.

Q & A

Do I have to complete a form for every employee who pays child support?
No. You must complete the National Medical Support Notice only if you receive a National Medical Support Notice for a particular employee. You will be sent these notices for new employees with an order for medical support and for current employees with new or modified medical support orders. You should not complete the National Medical Support Notice for current employees with income withholding (including withholding for health care premiums) unless you receive a new notice for the particular employee.

I received a National Medical Support Notice for an employee who I know receives child support. Why would an employee who receives child support be ordered to provide health insurance for his/her child?
The court may order either parent to provide health insurance for his/her child.

Do I have to complete a form for every employee who pays child support?
No. You must complete the National Medical Support Notice only if you receive a National Medical Support Notice for a particular employee. These new notices will be issued for new employees and for current employees with new or modified child support orders. You should not complete the National Medical Support Notice for current employees with income withholding (including withholding for health care premiums) unless you receive a new notice for the particular employee.

What pages of the National Medical Support Notice must I return to the agency?
We suggest that you make a copy of PART A of the National Medical Support Notice (2 pages), keep the original for your files and return the copy (2 pages) to the Issuing Agency with the response page completed.

What are the withholding limits for health insurance?
The withholding limits for health insurance premiums and the withholding limits for other support categories are different. The withholding limit for the actual medical insurance premium is 5% of the employee’s gross income (or the amount ordered by the court as stated on the Order/Notice to Withhold Income for Child Support, federal form OMB: 0970-0514).

The total amount withheld (the medical insurance premium plus the amount withheld for financial support) is limited under the Consumer Credit Protection Act (CCPA). The CCPA limits are based on the employee’s disposable income--the income that remains after federal, state, and local withholding taxes, Social Security taxes and Medicaid taxes are deducted. Deductions for Individual Retirement Accounts (IRAs), medical expense accounts, etc. do not reduce disposable income.

The CCPA limits range from 50 – 65% of the employee’s disposable income. The CCPA limit for an individual employee is listed on that employee’s Order/Notice to Withhold for Child Support under the section labeled "Remittance Information". CCPA limitations are:

50% of disposable income if an employee has a second family
55% of disposable income if an employee has a second family and has arrearages that are 12 or more weeks overdue
60% of disposable income if an employee has no second family
65% of disposable income if an employee has no second family and has arrearages that are 12 or more weeks overdue

What are the “priorities for withholding?”
The priorities are set for cases in which the ordered amount for current support and medical support along with past-due support exceed the CCPA limits. The specific amount for each category is listed on the employee’s Order/Notice to Withhold Income for Child Support under “Order Information.” If the total amount of support to be withheld exceeds the CCPA limits and the employee is ordered to pay health care premiums, you should follow the set priorities to determine the withholdings. The hierarchy of priorities is:

Current child and spousal support
Health insurance premiums or current cash medical support
Arrearages
Other child support obligations

Example:

Income Withholding Order/Notice (per weekly pay period) totals $250:

$150 for current child support
$25 for health care premium
$75 for past-due child support

Gross income for weekly pay period is $500

Disposable income is $420

Employee’s CCPA limit is 55% of disposable income: 55% x $420 = $231

Withhold:

$150 for current child support
$25 for health care premium
$56 for past-due child support

What should I do if the employee’s income varies due to commissions and available work, and during some pay periods, the withholding would exceed the limits and priorities?
When an employee’s income fluctuates, you may use an average monthly income to determine whether health insurance is available at a reasonable cost. If using an average income and the health care premiums are above the limits and priorities, the employee’s income is not sufficient for the deduction of health insurance premiums. You should complete item number 4 on the Employer Response form and send the form to the Issuing Agency. Employers are not expected to enroll/disenroll the children on a month-to-month basis due to the employee’s fluctuating income.

What happens with temporary layoffs and seasonal employees?
If health insurance remains available to employees who are on temporary layoff or who are seasonal workers, and the employee has wages available for the withholding of the premium, and the withholding complies with all the other terms of the National Medical Support Notice (e.g., the withholding limits), you should continue withholding the health insurance premium.

If insurance is not available or if there is no income from which to withhold premiums, you should notify the Issuing Agency (listed in upper-left corner of the National Medical Support Notice). This notification may be a copy of any notice you are required to provide under the continuation coverage provisions of ERISA or the Health Insurance Portability and Accountability Act.

Who is responsible for notifying the employee about the withholding for health insurance premiums?
The plan administrator is required to notify the employee.

What do I need to do if the insurance provider changes or family insurance is not available?
If there is a change in the insurance provider, you should forward Part B to the new Plan Administrator and notify the Issuing Agency (listed in upper-left corner of the National Medical Support Notice).

If the insurance is no longer available to all your employees in the same classification, you should notify the Issuing Agency listed on the National Medical Support Notice.

What do I need to do if the employee quits or is laid off for a long term?
You should notify the Issuing Agency (listed in upper-left corner of the National Medical Support Notice). This notification may be a copy of any notice you are required to provide under the continuation of coverage provisions of Employee Retirement Income Security Act of 1974 (ERISA) or the Health Insurance Portability and Accountability Act.

How can I find out if he/she is the parent's primary employer?
The National Medical Support Notice will not be automatically sent to you if you are listed as a secondary employer. If you are unsure based on information given by the employee, you may ask the Issuing Agency (listed in upper-left corner of the National Medical Support Notice).

May I charge actual costs (up to $3) for this withholding?
No, the statute does not permit charging a fee for sending an insurance premium payment to the appropriate provider.

However, fees are permitted if you are required to send the insurance premium payments to the Wisconsin Support Collections Trust Fund. These cases are unusual.

I offer employees a choice of health insurance from different providers. If my employee has joint custody that allows him/her to make medical decisions for the child, can I enroll the child in the plan the employee chooses, or do I enroll the child in the plan the other parent chooses?
If your employee is enrolled in a family plan or a plan with coverage for dependents, you may enroll the children in the same plan.

The Notice instructs me to enroll the child in and withhold premiums for basic health coverage and in a separate plan for dental coverage. The withholding limit will only allow me to enroll the child in one of these coverages, not both. What should I do?
You should send the options to the Issuing Agency listed on the National Medical Support Notice, with an explanation of the impact of the withholding limits.

What if family coverage is eliminated for some of my employee classifications, and the employee with the medical insurance order is in one of the classifications that no longer are eligible for family coverage?
If the employee classification of your employee with the medical insurance order is no longer eligible for family coverage, you should treat that employee as you do others in the same classification. You should also notify the Issuing Agency (listed in upper-left corner of the National Medical Support Notice) that the employee is no longer eligible for family coverage.

State law §767.513(4)(c) states that "After the child has coverage under the employer's health benefit plan, and as long as the parent is eligible for family coverage under the employer's health benefit plan, continue to provide coverage for the child unless the employer receives satisfactory written evidence that the court order is no longer in effect or that the child has coverage of health care expenses under another health insurance policy or health benefit plan that provides comparable coverage of health care expenses."

What is satisfactory written evidence?
Satisfactory written evidence means you are notified in one of three ways.

You receive, for the employee, a new Order/Notice to Withhold Income for Child Support with the Health Insurance Box not filled in. By not checking this box the child support agency is indicating that the employee is not court ordered to provide health insurance coverage for his/her dependent children.
You receive a letter from the child support agency stating that the identified employee's medical support order has been officially ended and/or the employee is no longer obligated to provided health insurance coverage through his/her employer.
A parent provides written documentation from an insurance carrier that the child has comparable health insurance coverage, and that coverage is currently in effect. You or plan administrator must notify the Issuing Agency (listed in upper-left corner of the National Medical Support Notice) prior to ending coverage for the child.

I am a self-insured employer. My company is subject to Employee Retirement Income Security Act (ERISA), and requires a Qualified Medical Support Court Order (QMSCO) before a dependent is added to an employee's health plan. Can I still require a Qualified Medical Support Court Order or must I accept the National Medical Support Notice?
The Notice meets the requirements for a Qualified Medical Support Court Order (QMSCO). The plan administrator of a group health plan must treat the Notice as a Qualified Medical Support Court Order under section 609(a) of Title I of the Employee Retirement Income Security Act (ERISA).

If you determine that a specific Notice does not constitute a Qualified Medical Support Court Order (QMSCO) (perhaps there is some missing required information for that particular notice), you must complete Response 5 of Part B - Plan Administrator (2 pages) and send it to the Issuing Agency, and inform the non-custodial parent, custodial parent and children of the specific reasons for your determination.

The Department of Labor and the Department of Health and Social Services jointly developed the National Medical Support Notice and published the requirements in the Federal Register. The final federal regulation can be viewed at http://www.dol.gov/ebsa/regs/fedreg/final/2000032411.pdf.

The Department of Labor issued the National Medical Support Notice under section 466(a)(19) of the Social Security Act, section 609(a)(5)(C) of the Employee Retirement Income Security Act of 1974 (ERISA), and for State and local government and church plans, section 401(e) and (f) of the Child Support Performance and Incentive Act of 1998.