For college students and parents-new law re: health coverage

A new law (P.L. 110-381), named "Michelle's Law," requires group health plans offering dependent coverage to allow college students who become seriously ill to leave school without losing coverage under their parents' plan. This law is effective for plan years beginning on or after October 9, 2009 (for calendar year plans, the provision takes effect on January, 1, 2010.)

Michelle's Law amends ERISA, the Public Health Service Act, and the Internal Revenue Code to ensure that dependent students who take a "medically necessary leave of absence" do not lose health insurance coverage for up to 12 months after they take the leave of absence. Fully-insured plans as well as self-funded plans are impacted.

A "medically necessary leave of absence" means a leave of absence from a postsecondary educational institution that commences while such child is suffering from a serious illness or injury, is medically necessary, and causes such child to lose student status for purposes of coverage under the terms of the plan.

A group health plan or a health insurance issuer that provides health insurance coverage in connection with a group health plan, may not terminate coverage of a dependent child under such coverage due to a "medically necessary leave of absence" before the date that is the earlier of: A) the date that is one year after the first day of the "medically necessary leave of absence"; or, B) the date on which such coverage would otherwise terminate under the terms of the plan or health insurance coverage.

Certification by Physician – The requirement to extend coverage during "medically necessary leaves of absence" applies only if the plan receives a written certification by a treating physician of the dependent child which states that the child is suffering from a serious illness or injury and that the leave of absence is medically necessary.

Notice Requirement – Group health plans must include with any plan notice regarding a requirement for certification of student status a description of the terms for continued coverage during a "medically necessary leave of absence."