The Health Insurance Portability and Accountability Act of 1996 (HIPAA) was signed
into law on August 21, 1996. This law includes protections for working Americans
and their families who have preexisting medical conditions or who might suffer discrimination
in health coverage based on a factor that relates to an individual's health. HIPAA's
provisions amend Title I of the Employee Retirement Income Security Act of 1974 (ERISA)
as well as the Internal Revenue Code and the Public Health Service Act and place
requirements on employer-sponsored group health plans, insurance companies and health
maintenance organizations (HMOs). HIPAA includes changes that:
- limit exclusions for preexisting conditions;
- prohibit discrimination against employees and dependents based on their health
status;
- guarantee renewability and availability of health coverage to certain employers
and individuals; and
- protect many workers who lose health coverage by providing better access to individual
health insurance coverage.
The following information provides general guidance on frequently asked questions
about HIPAA.
PREEXISTING CONDITION EXCLUSIONS
Under HIPAA, a group health plan or a health insurance issuer offering group health
insurance coverage may impose a preexisting condition exclusion with respect to a
participant or beneficiary only if the following requirements are satisfied:
- a preexisting condition exclusion must relate to a condition for which medical
advice, diagnosis, care or treatment was recommended or received during the 6-month
period prior to an individual's enrollment date;
- a preexisting condition exclusion may not last for more than 12 months (18 months
for late enrollees) after an individual's enrollment date; and
- this 12- (or 18-) month period must be reduced by the number of days the individual's
prior creditable coverage, excluding coverage before any break in coverage of 63
days or more.
How will the new law help people who currently have health coverage and who want
to change jobs? Currently some employer health plans do not cover preexisting
medical conditions. HIPAA limits the time period of these restrictions so that most
plans must cover an individual's preexisting condition after 12 months. Under HIPAA,
an employer's plan will be required to give a new employee credit for the length
of time the individual had continuous health coverage that will reduce the 12-month
exclusion period.
If, at the time an individual changes jobs, she/he already has had 12 months of continuous
health coverage (without a break in coverage of 63 days or more), she/he will not
have to start over with a new 12-month exclusion for any preexisting conditions.
What is a "preexisting condition"? A "preexisting condition"
is a condition present before the enrollment date in any new health plan. Under HIPAA,
the only preexisting conditions that may be excluded under a preexisting condition
exclusion are those for which medical advice, diagnosis, care or treatment was recommended
or received within the 6-month period ending on the enrollment date.
If an individual had a medical condition in the past, but has not received any medical
advise, diagnosis, care or treatment within the 6 months prior to her/his enrollment
date in the plan, the old condition is not a "preexisting condition" for
which an exclusion can be applied.
Are there "preexisting conditions" that cannot be excluded from coverage?
Yes. Preexisting condition exclusions cannot be applied to pregnancy, regardless
of whether the woman had previous coverage. In addition, a preexisting condition
exclusion cannot be applied to a newborn, adopted child under age 18 or a child under
18 placed for adoption as long as the child became covered under the health plan
within 30 days of birth, adoption or placement for adoption, and provided the child
does not incur a subsequent 63-day or longer break in coverage.
Can states modify HIPAA's portability requirements? Yes, in certain circumstances.
States may impose stricter obligations on health insurance issuers. Therefore, you
should check with your State Insurance Commissioner's Office to find out the rules
in your state.
How do individuals know if they are subject to any preexisting condition exclusion
period? A plan must tell an employee if it has a preexisting condition exclusion
period (and can only exclude coverage for a preexisting condition after the employee
has been notified). The plan must also notify an individual of her/his right to show
prior creditable coverage to reduce the preexisting condition exclusion period.
If the plan does apply a preexisting condition exclusion period, the plan must make
a determination regarding an employee's creditable coverage and the length of any
preexisting condition exclusion period. An individual must be notified of this determination
if, after considering all evidence of creditable coverage, the plan will still impose
a preexisting condition exclusion period with respect to any preexisting condition.
If an employer has a waiting period for enrollment in a plan, how does this relate
to the preexisting condition exclusion period? HIPAA does not prohibit a plan
or issuer from establishing a waiting period. However, if a plan has a waiting period
and a preexisting condition exclusion period, the preexisting condition exclusion
period begins when the waiting period begins.
For group health plans, a waiting period is the period that must pass before an employee
or a dependent is eligible to enroll under the terms of a group health plan. However,
if the employee or dependent is a late enrollee or a special enrollee, any period
before such late or special enrollment is not a waiting period.
If an individual seeks and obtains coverage by purchasing an individual insurance
policy, the period between the date the individual files a substantially complete
application for coverage and the first day of coverage is a waiting period.
CREDITING PERIOD HEALTH COVERAGE FOR PURPOSES OF REDUCING A PREEXISTING CONDITION
EXCLUSION PERIOD
A preexisting condition exclusion period is not permitted to extend for more than
12 months (or 18 months for late enrollees) after an individual's enrollment date
in the plan. The period of any preexisting condition exclusion that would apply under
a group health plan is generally reduced by the number of days of creditable coverage.
What is "creditable coverage"? Most health coverage is creditable
coverage, such as coverage under a group health plan (including COBRA continuation
coverage), HMO, individual health insurance policy, Medicaid or Medicare. Creditable
coverage does not include coverage consisting solely of "excepted benefits,"
such as coverage solely for dental or vision benefits.
Days in a waiting period during which an individual has no other coverage are not
creditable coverage under the plan, nor are these days taken into account when determining
a significant break in coverage (a break of 63 days or more).
How does "crediting" for prior coverage work under HIPAA? Most plans
will use the "standard method" of crediting coverage. Under the standard
method, an individual will receive credit for previous coverage that occurred without
a break in coverage of 63 days or more. Any coverage occurring prior to a break in
coverage of 63 days or more will not be credited against a preexisting condition
exclusion period.
To illustrate, suppose an individual had coverage for 2 years followed by a break
in coverage of 70 days and then resumed coverage for 8 months. That individual would
only receive credit for 8 months of coverage; no credit would be given for the 2
years of coverage prior to the break in coverage of 70 days.
Is there another way that a group health plan or issuer can "credit"
coverage under HIPAA? Yes, a plan or issuer may elect the "alternative method"
for crediting coverage for all employees. Under the alternative method of counting
creditable coverage, the plan or issuer determines the amount of an individual's
creditable coverage for any of the five specified categories of benefits. Those categories
are mental health, substance abuse treatment, prescription drugs, dental care and
vision care. The standard method (described above) is used to determine an individual's
creditable coverage for benefits that are not within any of the five categories that
a plan or issuer may use. (The plan or issuer may use some of all of these categories.)
When using the alternative method, the plan or issuer looks to see if an individual
has coverage within a category of benefits (regardless of the specific level of benefits
provided within that category). For example, if an individual has 12 months of creditable
coverage, but coverage for only 6 of those months provided benefits for dental care,
a preexisting condition exclusion period may be imposed with respect to that individual's
dental care benefits for up to 6 months (irrespective of the level of dental care
benefits).
If an employer's plan requests information from an individual's plan regarding any
of the five categories of benefits under the alternative method, the former plan
must provide the information regarding coverage under the categories of benefits.
One way to provide this information is to use the Model for Categories of Benefits
included at the end of this chapter.
Can an individual receive credit for previous COBRA continuation coverage?
Yes. Under HIPAA any period of time that an individual receives COBRA continuation
coverage is counted as previous health coverage as long as the coverage occurred
without a break in coverage of 63 days or more.
For example, if an individual was covered continuously for 5 months by a previous
health plan and then received 7 months of COBRA continuation coverage, the individual
would be entitled to receive credit for 12 months of coverage by the new group health
plan.
CERTIFICATION OF CREDITABLE COVERAGE
Group health plans and health insurance issuers are required to furnish a certificate
of coverage to an individual to provide documentation of the individual's prior creditable
coverage. A certificate of creditable coverage:
- must be provided automatically by the plan or issuer when an individual either
loses coverage under the plan or becomes entitled to elect COBRA continuation coverage
and when an individual's COBRA continuation coverage ceases;
- must also be provided, if requested, before the individual loses coverage or
within 24 months of losing coverage; and
- may be provided through the use of the model certificate included at the end
of this chapter.
How will newly hired employees prove that they had prior health coverage that
should be credited? Under HIPAA, providing information about an employee's prior
health coverage is the responsibility of an employee's former group health plan and/or
insurance company providing such coverage. HIPAA sets specific disclosure and certification
requirements for group health plans, insurance companies and HMOs.
A certificate stating when an individual was covered under the plan must be provided
automatically when an individual loses coverage under the plan or otherwise becomes
entitled to elect COBRA continuation coverage as well as when COBRA continuation
coverage ceases. An individual may also request a certificate, free of charge, until
24 months after the time coverage ended.
What if an individual has trouble getting a certificate from a former employer's
plan? Under HIPAA, group health plans and insurers are required to provide documentation
that certifies the creditable coverage earned. Group health plans and insurers that
fail or refuse to provide certificates are subject to penalties.
Can plans contract with an issuer to provide the certificates for their employees?
Yes. To avoid duplication of certificates, a plan may contract with the issuer
to provide the certificate. Furthermore, if any entity (including a third-party administrator)
provides a certificate to an individual, no other party is required to provide the
certificate.
When must group health plans and issuers provide the certificates? Plans and
issuers must furnish the certificate automatically to:
- an individual who is entitled to elect COBRA continuation coverage, at a time
no later than when a notice is required to be provided for a qualifying event under
COBRA;
- an individual who loses coverage under a group health plan and who is not entitled
to elect COBRA continuation coverage, within a reasonable time after coverage ceases;
and
- an individual who has elected COBRA continuation coverage, either within a reasonable
time after the plan learns that COBRA continuation coverage ceased or, if applicable,
within a reasonable time after the individual's grace period for the payment of COBRA
premium ends.
Is there a model certificate that group health plans and issuers can use?
Yes. See the attached model certificate at the end of this chapter.
Can an old plan simply call a new plan to relay information about creditable coverage?
Yes, if the individual, the new plan and the old plan all agree, the information
may be transferred by telephone. An individual may always request a written certificate
for her/his records in addition to a telephonic transmission of information between
plans.
What if the plan or issuer cannot identify employees' dependents or their coverage
information? A plan or issuer must make reasonable efforts to collect the necessary
information for dependents and include it on the certificate. However, an automatic
certificate for a dependent is not required to be issued until the plan or issuer
knows (or, making reasonable efforts, should know) of the dependent's loss of coverage.
Through June 30, 1998, a plan or issuer may satisfy its obligation to provide a written
certificate regarding the coverage of a dependent by providing the name of the participant
covered by the plan and specifying the type of coverage provided (such as family
coverage or employee-plus-spouse coverage). If requested, however, the plan must
make reasonable efforts to obtain and provide the name of the dependent.
What is the minimum period of time that should be covered by the certificate?
It depends on whether the certificate is issued automatically or upon requestÛ
- for a certificate that is issued automatically, the certificate should reflect
the most recent period of continuous coverage.
- for a certificate that is issued upon request, the certificate should reflect
each period of continuous coverage ending within 24 months prior to the date of request.
At no time must the certificate reflect more than 18 months of creditable coverage
that is not interrupted by a break in coverage of 63 days or more.
When do group health plans and issuers start providing certificates of creditable
coverage? Group health plans and issuers are not required to provide certificates
before June 1, 1997. Generally, the certification requirements apply to periods of
coverage that occur after June 30, 1996, and certificates must be provided when coverage
ceases under the plan.
In general, by June 1, 1997, plans or issuers must send certificates (or notices
as discussed in the next question) to individuals who lost coverage or became eligible
for COBRA between October 1, 1996 and May 31, 1997.
After June 1, 1997, plans or issuers must provide certificates to individuals as
they lose coverage or begin COBRA in the manner set forth in the interim regulations.
Are there interim rules to assist in compliance with the certification requirement?
Yes. There is a transitional model notice. For certification events occurring on
ar after October 1, 1996, but before June 1, 1997, a plan or issuer can satisfy its
certification obligation by providing, no later than June 1, 1997, a written notice
informing individuals of their rights to certification. The transitional model notice
is provided at the end of this chapter.
NONDISCRIMINATION REQUIREMENTS
Individuals may not be excluded from coverage under the terms of the plan, or charged
more for benefits offered by a plan or issuer, based on specified factors related
to health status.
Group health plans and issuers may not establish rules for eligibility (including
continued eligibility) of any individual to enroll under the terms of the plan based
on "health status-related factors." These factors are health status, medical
condition (physical or mental), claims experience, receipt of health care, medical
history, genetic information, evidence of insurability or disability. For example,
an individual cannot be excluded or dropped from coverage under your health plan
just because of a particular illness.
Plans may establish limits or restrictions on benefits or coverage for similarly
situated individuals. In addition, plans may change covered services or benefits
if they give participants notice of such "material reductions" within 60
days after the change is adopted. Also, plans may not require an individual to pay
a premium or contribution greater than that for a similarly situated individual based
on a health status-related factor.
Plans or group health insurance issuers may not establish rules for eligibility to
enroll under the terms of the plan that discriminate based on one or more "health
status-related factors." For example, an employer cannot make a group health
plan available only to employees who pass a physical examination.
SPECIAL ENROLLMENT
Group health plans and health insurance issuers are required to permit certain employees
and dependents special enrollment rights. These rights are provided both to employees
who were eligible but declined enrollment in the plan when first offered because
they were covered under another plan and to individuals upon the marriage, birth,
adoption or placement for adoption of a new dependent. These special enrollment rights
permit these individuals to enroll without having to wait until the plan's next regular
enrollment period.
What are a plan's obligations with respect to special enrollment? A group
health plan is required to provide for special enrollment periods during which certain
individuals are allowed to enroll in the plan (without having to wait until the plan's
next regular enrollment season).
A special enrollment occurs if an individual with other health insurance coverage
loses that coverage or if a person becomes a dependent through marriage, birth, adoption
or placement for adoption. A special enrollee is not treated as a late enrollee.
Therefore, the maximum preexisting condition exclusion period that may be applied
to a special enrollee is 12 months, and the 12 months are reduced by the special
enrollee's creditable coverage. (And, remember, a newborn, adopted child or child
placed for adoption cannot be subject to a preexisting condition exclusion period
if the child is enrolled within 30 days of birth, adoption or placement for adoption.)
A plan must provide a description of the plan's special enrollment rights under HIPAA
to anyone who declines coverage. See the model description at the end of this chapter.
COBRA, TERMINATION OF GROUP PLANS AND EMPLOYERS COVERED
Does HIPAA extend COBRA continuation coverage? Generally no. However, HIPAA
makes two changes to the length of the COBRA continuation coverage period.
Effective January 1, 1997, qualified beneficiaries who are determined to be disabled
under the Social Security Act within the first 60 days of COBRA continuation coverage
will be able to purchase an additional 11 months of coverage beyond the usual 18-month
coverage period. This is a change from the old law which required that a qualified
beneficiary be determined to be disabled at the time of the qualifying event to receive
29 months of COBRA continuation coverage. This extension of coverage is also available
to nondisabled family members who are entitled to COBRA continuation coverage.
COBRA rules are also modified and clarified to ensure that children who are born
or adopted during the continuation coverage period are treated as "qualified
beneficiaries." A model notice that should have been sent to COBRA beneficiaries
by November 1, 1996, discussing these changes appears at the end of this chapter.
Note that changes should be made to general notice and election forms to reflect
these changes in COBRA. See the sample notice in Chapter 34 on COBRA.
I am an employer who provides group health insurance coverage through an issuer.
Is this policy renewable? Can it be terminated? At your option (as the plan sponsor),
the issuer offering your group health insurance coverage must renew or continue in
force your current coverage.
However, the group health insurance coverage may not be renewed or may be discontinued
because of nonpayment of premiums, fraud, violation of participation or contribution
rules, the issuer ceasing to offer that particular coverage, or movement outside
the service area or association membership cessation.
I have a small business and I sponsor a group health plan. Does HIPAA apply to
me? The HIPAA health portability provisions apply to group health plans with
two or more participants who are current employees. However, your state may elect
to regulate smaller groups.
DISCLOSURE REQUIREMENTS
What new kinds of information do group health plans have to give to participants
and beneficiaries? HIPAA and other recent legislation made important changes
in ERISA's disclosure requirements for group health plans. The Department of Labor
issued interim disclosure rules in April 1997 to implement those changes. Under the
new interim disclosure rules, group health plans must improve their summary plan
descriptions (SPDs) and summaries of material modifications (SMMs) in four major
ways to make sure they:
- notify participants and beneficiaries of "material reductions in covered
services or benefits" (for example, reductions in benefits and increases in
deductibles and co-payments) generally within 60 days of adoption of the change.
This compares to current requirements under which plan changes can be disclosed as
late as 210 days after the end of the plan year in which a change was adopted.
- disclose to participants and beneficiaries information about the role of issuers
(e.g., insurance companies and HMOs) with respect to their group health plan. In
particular, the name and address of the issuer, whether and to what extent benefits
under the plan are guaranteed under a contract or policy of insurance issued by the
issuer and the nature of any administrative services (e.g., payment of claims) provided
by the issuer.
- tell participants and beneficiaries which Department of Labor office they can
contact for assistance or information on their rights under ERISA and HIPAA.
- tell participants and beneficiaries that federal law generally prohibits the
plan and health insurance issuers from limiting hospital stays for childbirth to
less than 48 hours for normal deliveries and 96 hours for cesarean sections.
What is the definition of a "material reduction in covered services or benefits"
that is subject to the new 60-day notice requirement? Under the interim disclosure
rules, a "material reduction in covered services or benefits" means any
modification to a group health plan or change in the information required to be included
in the summary plan description that, independently or in conjunction with other
contemporaneous modifications or changes, would be considered by the average plan
participant to be an important reduction in covered services or benefits under the
group health plan.
The interim rules cite examples of "reductions in covered services or benefits"
as generally including any plan modification or change that:
- eliminates benefits payable under the plan;
- reduces benefits payable under the plan, including a reduction that occurs as
a result of a change in formulas, methodologies or schedules that serve as the basis
for making benefit determinations;
- increases deductibles, co-payments or other amount to be paid by a participant
or beneficiary;
- reduces the service area covered by a health maintenance organization; or
- establishes new conditions or requirements (e.g., preauthorization requirements)
to obtain services or benefits under the plan.
Can employers use e-mail systems to communicate these new disclosures to employees,
and if so, do employees have a right to get a paper copy of the information from
their plan? Yes. The interim disclosure rules provide a "safe harbor"
for using electronic media (e.g., e-mail) to furnish group health plan SPDs, summaries
of "material reductions in covered services or benefits" and other SMMs
(summaries of plan modifications and SPD changes). To use the "safe harbor,"
among other requirements, employees must be able to effectively access at their worksite
documents furnished in electronic form. Participants also continue to have a right
to receive the disclosures in paper form on request and free of charge.
Although the interim rule is not the exclusive means by which electronic media can
be used to lawfully communicate plan information, the HIPAA "safe harbor"
is limited to group health plans. The Department of Labor is considering extending
the rule to other types of plans.
IMPLEMENTATION TIMETABLE
When did the changes in HIPAA begin affecting health plans? Most of HIPAA's requirements
did not take effect until after June 30, 1997. Group health plans had to comply with
all nondiscrimination, preexisting condition and crediting of prior health coverage
requirements at the beginning of the first plan year starting after June 30, 1997.
For example, if an employer's plan started a new plan year on January 1, HIPAA's provisions
applied beginning on January 1, 1998.
There was a special rule for group health plans maintained pursuant to collective
bargaining agreements, ratified before August 21, 1996, that delayed the effective
date of HIPAA. HIPAA's provisions applied to these plans of the first day of the plan
year beginning on or after either the date on which the last collective bargaining
agreement ended or July 1, 1997, whichever came later.
HIPAA Rules Announced on Portability of Health Coverage; Model Notice Issued for Employers
Final rules have been issued under the 1996 law on health insurance
portability that gives workers greater access to group health plan
coverage. The rules were drafted by the U.S. Departments of Labor,
Health and Human Services and Treasury.
What the rules do. The regulations essentially adopt the interim
final rules issued by the three agencies in 1997, but include several
significant modifications. The rules already contained limits on
preexisting exclusions that group health plans and insurance issuers
can impose and allowed workers to receive credit for prior health
coverage from virtually all sources (group health, individual insurance
or public health plans) to reduce a future preexisting condition
exclusion. Individuals also automatically receive certificates
demonstrating prior health coverage. The final rules require an
educational statement to be included in the certificate of coverage,
explaining individuals' rights to health coverage portability, and
include model language that employers can use.
Model HIPAA Certificate Published Along with Proposed New Rules
The IRS and EBSA also released a HIPAA Model Certificate of Group
Health Plan Coverage. We have reproduced a copy of this Model
Certificate below. You can read about the above and more at: http://www.dol.gov/ebsa/.
Who enforces HIPAA? The Secretary of Labor enforces the health care portability
requirements on group health plans under ERISA, including self-insured arrangements.
In addition, participants and beneficiaries can file suit to enforce their rights
under ERISA, as amended by HIPAA. The Secretary of the Treasury enforces the health
care portability requirements on group health plans, including self-insured arrangements.
A taxpayer that fails to comply may be subject to an excise tax. States also have
enforcement responsibility for group and individual requirements imposed on health
insurance issuers, including sanctions available under state law.
SOURCES
1 This chapter and the model notices following this chapter are adapted from Questions
& Answers: Recent Changes in Health Care Law, U.S. Department of Labor, Pension
and Welfare Benefits Administration, April, 1997. For more information on HIPAA you
may contact the Pension and Welfare Benefits Administration at 1.800.998.7542.
These sample forms are provided as a general guideline for your review only
and with the understanding that neither the publisher nor the writers are providing
legal advice or other professional service. The law changes regularly and varies
from state to state, and you should not rely on or use these or any form without
consultation with a competent attorney in your state.
MODEL FOR CATEGORIES OF BENEFITS (Alternative Method)
Information On Categories of Benefits
1. Date of original certificate:_______________
2. Name of group health plan providing the coverage:_______________
3. Name of participant:_______________
4. Identification number of participant:_______________
5. Name of individual(s) to whom this information applies:_______________
6. The following information applies to the coverage in the certificate that was
provided to the individual(s) identified above:
- a. MENTAL HEALTH:_______________
b. SUBSTANCE ABUSE TREATMENT:_______________
c. PRESCRIPTION DRUGS:_______________
d. DENTAL CARE:_______________
e. VISION CARE:_______________
For each category above, enter "N/A" if the individual had no coverage
within the category or either (i) enter both the date that the individual's coverage
within the category began and the date that the individual's coverage within the
category ended (or indicate if continuing), or (ii) enter "same" on the
line if the beginning and ending dates for coverage within the category are the same
as the beginning and ending dates for the coverage in the certificate.
TRANSITIONAL MODEL NOTICE
Important Notice of Your Right to
Documentation of Health Coverage
Recent changes in Federal law may affect your health coverage if you are enrolled
or become eligible to enroll in health coverage that excludes coverage for preexisting
medical conditions.
The Heath Insurance Portability and Accountability Act of 1996 (HIPAA) limits the
circumstances under which coverage may be excluded for medical conditions present
before you enroll. Under the law, a preexisting condition exclusion generally may
not be imposed for more than 12 months (18 months for a late enrollee). The 12-month
(or 18-month) exclusion period is reduced by your prior health coverage. You are
entitled to a certificate that will show evidence of your prior health coverage.
If you buy health insurance other than through an employer group health plan, a certificate
of prior coverage may help you obtain coverage without a preexisting condition exclusion.
Contact your state insurance department for further information.
For employer group health plans, these changes generally take effect at the beginning
of the first plan year starting after June 30, 1997. For example, if your employer's
plan year begins on January 1, 1998, the plan is not required to give you credit
for your prior coverage until January 1, 1998.
You have the right to receive a certificate of prior health coverage since July 1,
1996. You may need to provide other documentation for earlier periods of health care
coverage. Check with your new plan administrator to see if your new plan excludes
coverage for preexisting conditions and if you need to provide a certificate or other
documentation of your previous coverage.
To get a certificate, complete the attached form and return it to:
[Insert Name of Entity]:
[Insert Address]:
For additional information contact: [Insert Telephone Number]
The certificate must be provided to you promptly. Keep a copy of this completed form.
You may also request certificates for any of your dependents (including your spouse)
who were enrolled under your health coverage.
Request for Certificate of Health Coverage
Name of Participant:
Date:
Address:
Telephone Number:
Name and relationship of any dependents for whom certificates are requested (and
their address if different from above):
CERTIFICATE OF GROUP HEALTH PLAN COVERAGE
- Date of this certificate: ______________
- Name of group health plan: ______________________________
- Name of participant: ______________________________
- Identification number of participant: ______________
- Name of individuals to whom this certificate applies: ______________________________
- Name, address, and telephone number of plan administrator or issuer responsible for providing this certificate:
____________________________________________
____________________________________________
____________________________________________
- For further information, call: ______________
- If the individual(s)
identified in line 5 has (have) at least 18 months of creditable
coverage (disregarding periods of coverage before a 63-day break),
check here and skip lines 9 and 10: ___
- Date waiting period or affiliation period
(if any) began: ______________
- Date coverage began: ______________
- Date coverage ended (or if coverage has not
ended, enter "continuing"): ______________
[Note: separate certificates will be furnished if information is not identical for the participant and each beneficiary.]
Statement of HIPAA Portability Rights
IMPORTANT - KEEP THIS CERTIFICATE. This certificate is evidence
of your coverage under this plan. Under a federal law known as HIPAA,
you may need evidence of your coverage to reduce a preexisting
condition exclusion period under another plan, to help you get special
enrollment in another plan, or to get certain types of individual
health coverage even if you have health problems.
Preexisting condition exclusions. Some group health plans restrict
coverage for medical conditions present before an individual's
enrollment. These restrictions are known as "preexisting condition
exclusions." A preexisting condition exclusion can apply only to
conditions for which medical advice, diagnosis, care, or treatment was
recommended or received within the 6 months before your "enrollment
date." Your enrollment date is your first day of coverage under the
plan, or, if there is a waiting period, the first day of your waiting
period (typically, your first day of work). In addition, a preexisting
condition exclusion cannot last for more than 12 months after your
enrollment date (18 months if you are a late enrollee). Finally, a
preexisting condition exclusion cannot apply to pregnancy and cannot
apply to a child who is enrolled in health coverage within 30 days
after birth, adoption, or placement for adoption.
If a plan imposes a preexisting condition exclusion, the length of the
exclusion must be reduced by the amount of your prior creditable
coverage. Most health coverage is creditable coverage, including group
health plan coverage, COBRA continuation coverage, coverage under an
individual health policy, Medicare, Medicaid, State Children's Health
Insurance Program (SCHIP), and coverage through high-risk pools and the
Peace Corps. Not all forms of creditable coverage are required to
provide certificates like this one. If you do not receive a certificate
for past coverage, talk to your new plan administrator.
You can add up any creditable coverage you have, including the coverage
shown on this certificate. However, if at any time you went for 63 days
or more without any coverage (called a break in coverage) a plan may
not have to count the coverage you had before the break.
- Therefore, once your
coverage ends, you should try to obtain alternative coverage as soon as
possible to avoid a 63-day break. You may use this certificate as
evidence of your creditable coverage to reduce the length of any
preexisting condition exclusion if you enroll in another plan.
Right to get special enrollment in another plan. Under HIPAA,
if you lose your group health plan coverage, you may be able to get
into another group health plan for which you are eligible (such as a
spouse's plan), even if the plan generally does not accept late
enrollees, if you request enrollment within 30 days. (Additional
special enrollment rights are triggered by marriage, birth, adoption,
and placement for adoption.)
- Therefore,
once your coverage ends, if you are eligible for coverage in another
plan (such as a spouse's plan), you should request special enrollment
as soon as possible.
Prohibition against discrimination based on a health factor.
Under HIPAA, a group health plan may not keep you (or your dependents)
out of the plan based on anything related to your health. Also, a group
health plan may not charge you (or your dependents) more for coverage,
based on health, than the amount charged a similarly situated
individual.
Right to individual health coverage. Under HIPAA, if you are an
"eligible individual," you have a right to buy certain individual
health policies (or in some states, to buy coverage through a high-risk
pool) without a preexisting condition exclusion. To be an eligible
individual, you must meet the following requirements:
- You have had coverage for at least 18 months without a break in coverage of 63 days or more;
- Your most recent coverage was under a group health plan (which can be shown by this certificate);
- Your group coverage was not terminated because of fraud or nonpayment of premiums;
- You
are not eligible for COBRA continuation coverage or you have exhausted
your COBRA benefits (or continuation coverage under a similar state
provision); and
- You are not eligible for another group health plan, Medicare, or Medicaid, and do not have any other health insurance coverage.
The right to buy individual coverage is the same whether you are laid off, fired, or quit your job.
- Therefore, if
you are interested in obtaining individual coverage and you meet the
other criteria to be an eligible individual, you should apply for this
coverage as soon as possible to avoid losing your eligible individual
status due to a 63-day break.
State flexibility. This certificate describes minimum HIPAA
protections under federal law. States may require insurers and HMOs to
provide additional protections to individuals in that state.
For more information. If you have questions about your HIPAA rights,
you may contact your state insurance department or the U.S. Department
of Labor, Employee Benefits Security Administration (EBSA) toll-free at
1-866-444-3272 (for free HIPAA publications ask for publications
concerning changes in health care laws). You may also contact the CMS
publication hotline at 1-800-633-4227 (ask for "Protecting Your Health
Insurance Coverage"). These publications and other useful information
are also available on the Internet at:
http://www.dol.gov/ebsa, the DOL's interactive web pages - Health Elaws, or
http://www.cms.hhs.gov/hipaa1.
MODEL DESCRIPTION OF SPECIAL ENROLLMENT RIGHTS
If you are declining enrollment for yourself or your dependents (including your spouse)
because of other health insurance coverage, you may in the future be able to enroll
yourself or your dependents in this plan, provided that you request enrollment within
30 days after your other coverage ends. In addition, if you have a new dependent
as a result of marriage, birth, adoption or placement for adoption, you may be able
to enroll yourself and your dependents, provided that you request enrollment within
30 days after the marriage, birth, adoption or placement for adoption.
SAMPLE NOTICE TO COBRA BENEFICIARIES (To be sent by November 1, 1996)
The Health Insurance Portability and Accountability Act of 1996 made important changes
in COBRA continuation coverage rules that will take effect on January 1, 1997. A
comparison of the current rules and the rules that will become effective on January
1, 1997, is provided below. Please review these changes carefully Û they may
have an effect on your continuation coverage.
Extension of Coverage for Disabled Beneficiaries
A qualified beneficiary may be eligible for an extension of up to 11 months of COBRA
continuation coverage due to disability, if the Plan Administrator receives notification
of the Social Security Administration's determination of disability, in writing,
within 60 days of the date the determination is made and within the initial 18 months
of COBRA continuation coverage.
Currently, only COBRA beneficiaries determined by the Social Security Administration
to have been totally disabled on the date of the qualifying event (i.e., the employee's
termination of employment, or reduction in hours) making that individual eligible
to elect COBRA coverage were eligible to extend continuation coverage for an additional
11 months, to a maximum of 29 months of COBRA continuation coverage.
Effective on January 1, 1997, an extension of up to 11 months of continuation
coverage will be available to a qualified beneficiary who is totally disabled during
the first 60 days after COBRA continuation coverage begins. Note: the new rule applies
to those whose COBRA coverage began in 1996 who are still covered on January 1, 1997,
as well as those who become eligible for COBRA in 1997.
Coverage for Newborns & Children Placed for Adoption
Newborn infants and children placed for adoption can be enrolled for COBRA continuation
coverage in accordance with the terms of the [name of plan] group health plan. A
child is considered to be placed for adoption when the adoptive parent assumes and
retains the legal obligation for the support of the child, in accordance with an
order to that effect issued by a proper court or other agency which has the authority
to issue such order.
Under the
current rules, a newborn infant or a child placed for adoption could
be enrolled for COBRA continuation coverage; however, the infant or adopted child
would not have independent rights as a COBRA beneficiary.
Effective on January 1, 1997, a newborn infant or child placed for adoption
with the covered employee will be entitled to receive COBRA continuation coverage
as a qualified beneficiary. To enroll a newborn or a child placed with you for adoption,
you must notify the Plan Administrator within (plan's time limit for enrolling newly
eligible dependent, e.g. 30 days) of your newborn's date or birth or (repeat the
plan's time limit) of the date a child is placed with you for adoption. Note: if
you added a dependent child during your first 18 months of COBRA continuation coverage
and you are covered under COBRA on January 1, 1997, that child will become a qualified
beneficiary on January 1, 1997.