Health Insurance for a Minor Child Due to Remarriage

It's not uncommon for children to be covered by more than one group health insurance plan, especially in the case of divorced parents who later remarry. Spouses who maintain "family" coverage under their employer's medical policy, then divorce and remarry someone with children, may create a situation where the children in the family are covered by two, or perhaps even three or four, different health insurance plans. These scenarios have the potential for significant confusion surrounding which of the parents' and step-parents' plans should be responsible for paying a child's medical bills, and in what order claims should be paid.

Coordination of Benefits

• To address the issue of multiple policies covering the same person, most states have adopted a set of guidelines to determine the order in which insurance companies should pay claims. These guidelines are not formal laws, but rather an accepted standard of practice used by the majority of states and insurance companies. The insurance policy designated as primary pays the child's medical bills first, and any remaining balance gets transferred to the secondary policy. If the secondary policy's benefits are insufficient to cover the entire remaining balance, any leftover costs get transferred to the next policy.

The Birthday Rule

• When spouses both maintain family coverage, the "birthday rule" is used to determine which parent's health insurance plan is primary. The policy covering the parent whose birthday arrives earlier in the year is always primary, regardless of the actual age of the parent.

Divorced Parents

• For children of divorced parents who both maintain family coverage, the plan covering the parent with residential custody is always primary. If both parents share equal residential custody, the birthday rule determines which parent's plan pays first. Any remaining balance gets paid by the other parent's insurance policy.

Step-Children

• Second marriages may result in children having coverage under a step-parent's policy in addition to their natural parent's plan. In those situations, the natural parent's plan is primary and the step-parent's plan is secondary. If that same child is also covered under the other natural parent's plan, any balance that might remain after the step-parent's policy pays gets shifted to the other natural parent's policy.