Starting January 1, 2026, as required by HB5258, fully insured accident and health plans that are issued, amended, delivered, or renewed in Illinois and make dependent coverage available must treat certain parents and stepparents as dependents who can be covered under the plan.
Fully insured plans subject to Illinois law will be required to extend coverage to a parent or stepparent who meets the definition of a “qualifying relative,” as defined by 26 U.S. Code § 152(d), and who lives or resides within the policy’s service area. To be a qualifying relative a parent or stepparent must:
- Have gross income less than the IRS exemption amount for that year;
- Receive over half their support from the primary insured; and
- Not be a qualifying child of the primary insured individual or any other individual.
Employers with insurance policies subject to this new Illinois requirement may need to coordinate with their insurance carrier to determine what is necessary to comply with this new requirement. Carriers may be developing their own processes and requirements for enrolling a parent/stepparent who meets the required definition. Employers would be well served to check with their insurance carrier to determine what their role is if coverage for a parent/stepparent is requested.
Key Takeaways
Employers who offer fully insured accident and health plans subject to Illinois state law should be aware that accident and health plan policies effective January 1, 2026, or later will require the coverage of certain parents/stepparents. Employers should be ready to facilitate requests for enrollment from employees and may need to confirm with their carrier what information is needed. Self-funded plans do not have to comply with state insurance mandates and are unaffected by this change.
The information provided is a summary of laws and regulations relating to employee benefit plan compliance. This information should not be construed as legal advice. In all cases, employers should consult with their own legal counsel.
