The Illinois Religious Freedom Protection and Civil Union Act was signed into law on Jan. 31, 2011 and is
effective June 1, 2011.
- This new law ensures that civil unions and marriage are treated identically under Illinois law.
- For purposes of insurance laws, policies, eligibility, and benefits governed by Illinois law, a spouse in
a civil union and a spouse in a marriage are also to be treated identically. - With respect to employee benefits, the law applies to medical, dental, vision and life.
Insurance Guidelines
Since this is not an insurance law, insurance companies may have different procedures. Here are some general guidelines:
- Coverage will be offered to a civil union spouse and dependents upon the qualifying life event of the member entering into a civil union on or after June 1, 2011.
- If the member does not elect to change their coverage within 31 days of entering into a civil union, the next opportunity will be upon the employer group’s open enrollment period.
- Spouses of civil unions will be eligible for coverage if the existing group policy already covers spouses in marriage. Likewise, if the health plan provides coverage for children, then the children of civil unions must also be provided coverage.
- Illinois residency is not an explicit requirement for an Illinois civil union. Illinois will offer “reciprocity” and recognize as a civil union any same-sex marriage, civil union, domestic partnership or substantially similar legal relationship, other than common law, entered into in other states.
• Existing members who have previously entered into a civil union as legalized by another state are able to add their civil union spouse and dependents during a 30-day special enrollment period beginning
on June 1, 2011. - Self-funded health insurance programs, except for schools, municipalities and church plans, will have the option to provide coverage to a civil union spouse and dependents upon their renewal as of June 1, 2011 and thereafter.
Taxes
Please consult a tax advisor for information regarding any tax questions. Here is a general overview:
- Any coverage offered to the civil union spouse and or dependent will be taxable for both Illinois and Federal income tax purposes unless these individuals meet the definition as either a qualifying child or qualifying relative.
- Federal law does not recognize same-sex marriages, domestic partnerships or civil unions. As a result, employers must “impute income” for any employer-sponsored health coverage provided to a civil union partner who is not the employee’s tax dependent. Currently, the state of Illinois follows the federal tax code, so employers should impute income for federal and state purposes.
- The employer, and not the insurance company, is responsible for providing notice of possible tax implications to those covered employees with coverage for their civil union families.
COBRA and Other Continuation Coverage
Because federal law does not recognize parties to a civil union, they are not entitled to continuation election rights under COBRA (the Consolidated Omnibus Reconciliation Act of 1985). If the election right is that of the former party to a civil union or dependent (such as a divorce, dissolution of civil union or death of the employee), the Illinois State Spousal or Dependent Continuation options are available.
Additional Background
The law’s intent is to provide procedures for the certification and registration of a civil union in Illinois. Any person who enters into a civil union in Illinois consents to the jurisdiction of the courts of Illinois for the purpose of any action related to a civil union. Also defined are prohibited civil unions and the process for dissolution as dictated by the Illinois Marriage and Dissolution of Marriage Act. Essentially, civil unions will be treated the same as traditional marriages.
Under the Act, a person is a “party to a civil union” if they establish a civil union under a licensing process established by the Illinois Director of Public Health. This process includes obtaining a license from the county clerk’s office, paying appropriate fees, having the ceremony performed within 60 days of the date of the license, and returning the certified license to the clerk’s office. Illinois residency is not an explicit requirement, and Illinois will recognize civil unions or substantially similar unions entered into in other states with similar laws.
A civil union couple will have the same rights and protections afforded to a married couple, such as, the right to make medical decisions about a partner and the right to own property as a couple (tenants by the entirety). The law states that couples in a civil union have all of the same “obligations, responsibilities, protections, and benefits afforded or recognized by the law of Illinois to spouses.” This includes medical insurance coverage through the civil union partner’s policy.
Although similar, a civil union is not the exact same as a marriage and has some significant limitations.As an example, civil unions are not recognized by the federal government or by all states. The Defense of Marriage Act(DOMA) enacted by Congress in 1996 “prohibits same-sex couples from receiving federal marriage rights and benefits, such as the right to file joint federal tax returns.”
Although the law provides religious organizations the freedom to choose not to officiate or solemnize a civil union based on their religious practices, as an employer, religious organizations are required to extend benefits as mandated by law. Therefore, if the religious organization is fully insured or offers fully insured products (such as HMO), the law will also apply to them.
Sources: Aetna, BCBSIL, Humana, Seyfarth Shaw, Larry Grudzien – Attorney at Law, and ILDOI
The Illinois Department of Insurance (IDOI) has issued an insurance FAQ on May 26, 2011.
http://www.insurance.illinois.gov/newsrls/2011/05/CivilUnionsFinal05-25-11.pdf