Cases or children closed due to non-payment of a premium after premium coverage begins (due to payment of Initial Invoice) are subject to penalty rules dependent on the Level of Care (LOC) of the child(ren) on the date of closure. Child(ren) active in a Reduced Premium Group (LOC 2, CHIP73 or CHIP74) whose coverage is closed for non-payment of premium are not subject to a six-month penalty period. The family’s eligibility remains open and coverage for the child(ren) is reinstated upon receipt of payment at a later date, the children become eligible for non-premium coverage, or the case/child is closed for other reasons (examples: failure to cooperate, no longer age-eligible child in home). Child(ren) active in a Full Premium Group (LOC 3 or CHIP75) whose coverage is closed for non-payment of premium any time after coverage begins are subject to a six-month penalty for non-payment of the premium. The family’s eligibility closes and coverage for the child(ren) stops. MHD notifies FSD through the Information Technology Services Division (ITSD) when a case is ineligible due to non-payment of a premium and the case or child(ren) must be closed. Whenever a Full Premium Group family reapplies for MO HealthNet for Kids within six months of coverage closing, the MCII screen is to be viewed to determine when the case or child was previously closed for failure to pay the premium. FAMIS will reject the application if the Full Premium Group (LOC 3 or CHIP 75) participant re-applies during the penalty period. If an individual (whose coverage closed for failure to pay a premium) is eligible for benefits in the non-CHIP group, No-Cost Group (LOC 1 or CHIP0), the Reduced Premium Group (LOC 2, CHIP73 or CHIP74), or for another program, the penalty will not apply.