I have an employee who is currently having her medical and dental premiums taken on a pre-tax basis. She had a baby in August. She now wants to drop coverage 3 months later. Is there a time frame of when the change of family status to make a change in premium only plans?

I'm a little confused by your question but will try to give you some ideas. Your title mentions an FSA participant but your question text refers to premium only. To me, an FSA means a flexible spending account and premium only means paying health premiums on a pretax basis through a 125 (cafeteria) plan. In either event, I think you first need to look at your plan document which should have a deadline for submitting status change requests. Typically this is 30 days. If the participant waits longer than 30 days to request a change, it's hard to argue that the change is "on account of" the change in status. Also, if you are in fact talking about a premium conversion plan, I don't see how dropping coverage after having a baby is consistent with the change. Is it possible that this participant has experienced some other change that is causing her to want to drop coverage (e.g., maybe her spouse got a job?)?