BA146 CREW DEVIATES FROM CLRED ALT IN CLB AFTER FAILING TO RESET ALTIMETER IN ZID AIRSPACE.

Narrative

I WAS PERFORMING IOE ON A NEWLY TRANSITIONED CAPT. ENRTE FROM CVG TO DTW; WE ENCOUNTERED TURB AT OUR FILED CRUISE ALT OF FL220 AND REQUESTED FL190. UPON LEVELING AT FL190; WE WERE ASKED OUR ALT BY ZID. ABOUT THE SAME TIME; I NOTICED A KING AIR AHEAD AND BELOW APPROX FL180; SAME DIRECTION OF FLT. BECAUSE OF CTR'S ALT INQUIRY; I SAW IMMEDIATELY THAT WE HAD FAILED TO SET ALTIMETERS TO 29.92. THEY WERE STILL SET AT 30.36. WE RESPONDED THAT WE WERE CORRECTING. IT WAS GOOD VFR AND THE ACFT WAS IN SIGHT. NO EVASIVE ACTION WAS NECESSARY. FOR WHATEVER REASON I MISSED THIS SIMPLE; RECURRING; NORMAL PROC IS BEYOND ME. WE WERE DISCUSSING VARIOUS PROCS DURING THE CLB AS USUAL AFTER 10000 FT AND ALSO DISCUSSING A POSSIBLE CHANGE IN CRUISE ALT AND WHETHER OR NOT ENG INTAKE ICE WOULD BE REQUIRED. SUPPLEMENTAL INFO FROM ACN 422168: IOE. TRAINING INSTRUCTOR (R SEAT); CHIEF PLT IN JUMP SEAT; AND MYSELF (AN IOE CAPT) IN L SEAT. THE TRAINING INSTRUCTOR WAS FLYING ACFT. WE INITIALLY CLBED TO FL210. THE IOE TRAINING INSTRUCTOR DID NOT CHANGE ALTIMETER TO 29.92 PASSING FL180. I WAS BUSY FINISHING CHKLIST; PUTTING AWAY APCH CHARTS; AND GETTING OUT OTHER APCH CHARTS. I DID NOT NOTICE THAT WE DID NOT SET IN 29.92 PASSING FL180. WE LEVELED OFF AT OUR ASSIGNED ALT FOR SEVERAL MINS BEFORE ZID SAID OUR ALT WAS OFF MORE THAN 300 FT FROM ASSIGNED.