(a) In this chapter, “dependent” with respect to an individual eligible to participate in the group benefits program means the individual’s:
(1) spouse;
(2) unmarried child younger than 26 years of age;
(3) child of any age who the board of trustees determines lives with or has the child’s care provided by the individual on a regular basis if the child is mentally or physically incapacitated to the extent that the child is dependent on the individual for care or support, as determined by the board of trustees;
(4) child of any age who is unmarried, for purposes of health benefit coverage under this chapter, on expiration of the child’s continuation coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985 (Pub. L. No. 99-272) and its subsequent amendments; and
(5) ward, as that term is defined by Chapter 1002, Estates Code, who is 26 years of age or younger.
(b) In this section, “child” includes:
(1) a natural child, adopted child, stepchild, foster child, or child in the possession of a participant who is designated as managing conservator of the child under an irrevocable or unrevoked affidavit of relinquishment under Chapter 161, Family Code; or
(2) a child who is related by blood or marriage and was claimed as a dependent on the federal income tax return of an individual who is eligible to participate in the group benefits program under § 1551.101 or 1551.102 for the calendar year preceding the plan year in which the child is first enrolled as a dependent under Subchapter D, and for each subsequent year in which the child is enrolled as a dependent.

(c) The requirement in Subsection (b)(2) that a child must be claimed as a dependent on a federal income tax return in the calendar year preceding the child’s enrollment does not apply if:
(1) the child is born in the year in which the child is first enrolled; or
(2) the participant can demonstrate good cause for not claiming the child as a dependent in the preceding calendar year.