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Health Benefits for Domestic Partners
The SHBP Domestic Partner Benefit
On July 10, 2004 , The Domestic Partnership Act went into effect. This law provides for the extension of State Health Benefits Program (SHBP) benefits to same-sex domestic partners of State employees. This benefit will only apply to State employees enrolled in SHBP.
The Member and Spouse level of coverage will be used for an employee and domestic partner. The premium rate for Member and Spouse and Member and Domestic Partner will be the same. If the employee also has children enrolled for coverage, the Family level coverage will include the domestic partner at the same cost as if a spouse were covered.
The employee will be able to add a domestic partner's children to SHBP, under the same conditions that an employee can now add stepchildren to coverage. The children of the domestic partner must be unmarried, under the age of 23, live with the employee, and receive financial support from the employee. In order to add a domestic partner's children, employees will be required to complete an Affidavit of Dependency.
Enrollment of Domestic Partner
To add a domestic partner to SHBP coverage, the employee must provide a Certificate of Domestic Partnership issued by a New Jersey local registrar. A list of New Jersey local registrars is available on the web site (http://www.state.nj.us/health/vital/regbycnty.shtml).
Employees will have 60 days from the issue date of the Certificate of Domestic Partnership in which to add a new dependent to their SHBP coverage. A copy of the Certificate of Domestic Partnership must be submitted along with the revised New Jersey State Health Benefits Program Application. The New Jersey State Health Benefits Program Application can be obtained from the web site http://www.state.nj.us/treasury/pensions/epbam/exhibits/pdf/ha0800.pdf. Please note that the form will print on standard letter sized paper.
If the application is received by the Office of Human Resources within the 60 day time frame, the effective date of coverage will be retroactive to the date of the certificate, but no earlier than August 7, 2004 . If the application is not received within the 60 day time frame provided, employees must wait for the next regular open enrollment to add the dependent.
Taxability of the Domestic Partner Benefit
The value of the employer health benefits provided to a domestic partner is normally subject to federal income taxes, Social Security, and Medicare taxes as imputed income. This means that the biweekly payroll tax calculation will be based on your gross biweekly pay plus the dollar value of the employer provided health insurance, (i.e., imputed income). To see the calculated Monthly Imputed Income go to http://www.state.nj.us/treasury/pensions/civil-unions.htm . The College's biweekly rate of calculated imputed income will equal one-half of the State's monthly calculation. Please note, the value of the Domestic Partner benefit is not taxable under New Jersey law.
If the domestic partner meets the IRS definition of a dependent for tax purposes, the benefit will not be subject to federal taxes. In order to effect this exemption, you must file a tax certification with the Office of Human Resources. The tax certification is available at http://www.state.nj.us/treasury/pensions/fh-0703.pdf . The certificate must be updated annually.
Cost of Coverage for Domestic Partners
The cost for Member and Spouse and Member and Domestic Partner will be the same. As of July 1, 2007, the employee cost was changed to a standard contribution of 1.5% of the annual base salary.
Cobra upon Termination
The federal COBRA law sets minimum standards which an employer can exceed. The SHBP considers a domestic partner as an eligible dependent for coverage and will include them in its COBRA program.
Further Information
Further information on Domestic Partnership benefits can be found under Hot Topics, Letters to Employers, Domestic Partnership Act: Health Benefits Implications, State Biweekly Employer Group at http://www.state.nj.us/treasury/pensions /.
Also see Fact Sheet #71, which can be found at the aforementioned website.
You may also call the Office of Human Resources at extension 3306.
