Recipients: All Non-Union / Non-Represented Employees
Subject: Update on Domestic Partner Benefits for Non-Union/Non-Represented Employees
This e-mail is being sent to non-union/non-represented employees at MSU to update you on what the recent Michigan Court of Appeals decision prohibiting public institutions from providing benefits based on domestic partner agreements means for you.
MSU intends to implement a pilot program effective July 1, 2007 for non-union/non-represented employees (including faculty, academic staff and executive management) that changes the eligibility criteria for enrollment in its health/dental plan(s). If implemented, this temporary program will be reviewed at least annually to determine if it will be continued for the next plan year. The pilot program is scheduled to end at the conclusion of the 2009-2010 plan year. Individuals are strongly encouraged not to forego health and/or dental coverage that may be available to them from other sources. The University reserves the right to suspend this pilot program and to determine how the below-listed eligibility criteria will be applied during the pilot program.
Under the pilot program a non-represented MSU employee who does not already enroll a spouse for health and/or dental benefits may enroll one (1) individual for health and/or dental coverage (“OEI” or “other eligible individual”), but only if ALL of the following eligibility criteria are met:
• The OEI currently resides in the same residence as the employee and has done so for the last 18 continuous months, other than as a tenant;
• The OEI is not a “dependent” of the employee as defined by the IRS; and
• The OEI is not eligible to inherit from the employee under the laws of intestate succession in the State of Michigan (see below).
Children who are qualified and claimed as IRS-defined dependents by an employee’s OEI are also eligible for health and dental benefits if they are members of the employee’s household or a full-time student and they are unmarried and under the age of 19 (up to age 23 if an IRS-defined dependent).
Eligibility to continue coverage for an OEI ceases at the end of the month in which the above criteria are not met. Employees must immediately notify MSU Human Resources Benefits of a change in eligibility status.
The following individuals do not fall within the eligibility criteria for this pilot program:
• Spouse
• Children and their descendents (i.e., children, grandchildren)
• Parents
• Parents’ descendents (i.e., siblings, nieces, nephews)
• Grandparents and their descendents (i.e., aunts, uncles, cousins)
• Renters, boarders, tenants, etc.
Tax Implications of covering an OEI under your benefits:
IRS regulations require the University to tax the fair market value of University-provided health and dental benefits for Other Eligible Individuals. The IRS defines fair market value of a fringe benefit as the amount that an individual would have to pay for the particular fringe benefit in an arm’s length transaction. This means what you would have to pay for an individual policy for your Other Eligible Individual in the open market. Contact MSU Benefits at 517-353-4434 for a chart that can help you determine the taxable amount.
If you already participated in the online open enrollment process and if this information impacts your preferences, please be assured that you can re-enter the online open enrollment and continue to update open enrollment selections through the end of open enrollment on May 7, 2007.
If you have questions about this e-mail or domestic partner benefits, please contact Patrick Cusick or Renee Rivard in the MSU Human Resources Benefits Office at 517-353-4434 or 1-800-353-4434.
Renee Rivard
Director of Benefits
MSU Human Resources