In 2024, Gov. Pritzker signed HB 5258, which expands dependent coverage status to a parent or stepparent in certain circumstances for fully insured plans issued in Illinois. The effective date of this bill is January 1, 2026, so it is an important reminder for employers who sponsor health plans in Illinois.
The bill expands the definition of dependent to include the parent or stepparent of the insured only if the parent or stepparent meets the definition of a qualifying relative under IRS guidelines outlined in 26 USC 152: Dependent defined and resides in the policy’s service area. Interestingly, the bill does not include the parent or stepparent of the insured’s spouse as an eligible dependent.
The bill only applies to policies written in Illinois, so employers with policies issued outside of Illinois do not have to comply, even if the policy covers Illinois residents. Self-insured plans are also exempt from the legislation.
Employers who sponsor fully insured health plans in Illinois should work closely with their insurance carrier to make the appropriate policy changes as needed.