Gay federal employees will be able to cover the children of their same-sex partners under the federal health insurance plan once a proposed rule published Friday by the U.S. Office of Personnel Management is enacted.

Under the proposed regulation, children will be eligible for coverage if a parent is in a domestic same-sex relationship with a federal employee who receives coverage through federal programs. These children would be eligible for coverage — both under the Federal Employees Health Benefits Program and the Federal Employees Dental & Vision Program — regardless of whether or not they’ve been legally adopted by the federal employee.

The same rule also brings federal health program rules into compliance with the Affordable Care Act, which stipulates insurers providing dependent coverage extend that coverage to the children of individuals they insure until the age of 26.

Emily Hecht-McGowan, the Family Equality Council’s public policy director, said the proposed rule is important because many LGBT families throughout the country live in states without legal protections.

“Most of the two million children raised by LGBT parents live in states where their parents cannot marry, cannot secure legal ties to their own kids and cannot get their children covered under a health insurance plan,” Hecht-McGowan said. “This rule change means that federal workers can now be assured that a high fever, broken arm or debilitating illness won’t jeopardize their child’s health or their family’s finances.”

Now that the rule has been proposed, OPM will take public comment on its implementation, which must be received by the agency within 60 days. The rule would be made final at some later time, but there’s no required or definitive timeline for publication of the final rule. Typically regulations become effective 30 days after they’re issued.

Right now, federal employees can obtain coverage for the children of their same-sex partners if he or she adopts their partner’s children. But adoption isn’t available to same-sex couples everywhere: only in 18 states and D.C. is second-parent adoption available statewide.

Brian Moulton, legal director for the Human Rights Campaign, said the proposed rule change is important because of this limited availability of second-parent adoption.

“In the absence of fair adoption laws, thousands of same-sex parents across the country remain legal strangers to the children they have raised from birth,” Moulton said. “By issuing this proposed rule, OPM will ensure that fewer children of federal workers will be denied health care coverage simply because their parents are a same-sex couple.”

According to the proposed rule, the change is being made because of a memorandum that President Obama issued on domestic partner benefits. On June 17, 2009, Obama extended limited partner benefits to gay federal employees and called on U.S. agencies to determine additional benefits could be extended. The results of that review were compiled by OPM and sent to the White House as recommendations. A subsequent memo from Obama on June 2, 2010 instructed agencies to implement them.

But since the time OPM made its recommendations, the agency determined that the definition of the term “stepchild” in U.S. code dealing with federal employees could be interpreted as a child of a same-sex partner of a federal employee.

“This regulatory action is necessary to implement fully the Presidential Memoranda cited above and is consistent with OPM’s policy determination that extension of coverage is appropriate,” the proposed rule says. “Accordingly, this proposed rule extends FEHB and FEDVIP coverage to children of same-sex domestic partners of enrolled employees and annuitants.”

The proposed rule isn’t expected to have a significant economic impact because it only adds additional groups to the list of groups eligible for coverage under the federal health care system.

As part of the proposed rule change, federal health program regulations would be amended so that if a federal employee doesn’t establish that insuring their partner’s child qualifies for favorable tax treatment under applicable tax laws, the employee can be taxed on the fair market value of the coverage. As part of the process for seeking comments, OPM is specifically seeking input on how the fair market value might be calculated for different plans, including, for example, a high deductible health plan with a health reimbursement arrangement.

The proposed rule change means the children of same-sex partners of federal employees would have access to benefits unavailable to the same-sex partners themselves. The Obama administration has said it cannot extend major benefits — health and pension benefits — to the same-sex partners of federal employees because of the Defense of Marriage Act. Legislation that would extend those benefits, called the Domestic Partnership Benefits & Obligations Act, was reported out of the Senate committee of jurisdiction in May, but hasn’t yet come to a floor vote.