The Health Insurance Plan

The first step in selecting a health insurance plan is determining your priorities and needs. The next step is comparing those priorities and needs with the coverage that a given health insurance plan offers. To make the selection process manageable, the next sections explain some of the major features that make up a health insurance plan.

If you’re employed and married or have a domestic partner, you may have some flexibility in choosing secondary coverage under a spouse’s or partner’s plan. For example, two adults who each have individual coverage may pay less in premiums than if both are covered under one policy with a family plan. If you and your spouse are each covered by a group plan, you may be able to get secondary (additional) coverage under the other’s plan, or you may decide to forego secondary coverage and stick with one plan per person. Or one spouse may drop his or her employer’s insurance altogether and obtain coverage under the other’s policy. (Be sure that neither plan has provisions that prohibit this choice.) Weigh the cost of each option against the coverage you get before making a decision. Some families include unmarried domestic partners. Check out your plan’s policies regarding coverage for domestic partners, but don’t be surprised if coverage isn’t available. The issue of health insurance for domestic partners has no national legislation, nor does any state have regulations covering its employees’ domestic partners.

To cover a person under your health insurance plan, that person must be considered a dependent. The definition of dependent is based on your plan’s legal requirements concerning financial support. (In an employer-sponsored plan, the employer may also have input into the definition of dependent.) Some plans consider a child a dependent only if the child meets all of the following very specific criteria:

- The child is your responsibility by birth or legal adoption, or the child is a stepchild or a foster child.

- The policyholder provides more than 50 percent of financial support and maintenance for this child.

- The policyholder can claim the child as an exemption on his or her federal income tax return.

A child is considered a dependent if a legal court order mandates that the policyholder must provide coverage for the child. Other individuals may be considered dependents if they satisfy IRS requirements.

health insurance plans’ regulations regarding coverage for children and/or other dependents may vary greatly, so check out the plans carefully. To make administration simple and consistent, some companies use some variation of the birthday rule, in which the primary coverage for eligible children is through the plan of the parent whose birthday falls in the earlier month of the year. For example, a parent born in May 1954 would assume coverage for the children, even though the spouse born in September 1950 is older.

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