What is HIPAA?

The Health Insurance Portability and Accountability Act of 1996 (HIPAA) was signed into law on August 21, 1996. This law includes important new protections for millions of working Americans and their families who have preexisting medical conditions or 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 is NOT an insurance policy.

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.

*Click here to access a form that serves as the Certificate of Group Health Plan Coverage that is given to the employee upon termination from the plan.

HIPAA provides rights and protections for both group health plans and individual coverage. These rights and protections address:

• Portability - Whether you can get new health coverage if you want to change coverage
• Availability - Whether health coverage must be offered to you and your dependents
• Renewability - Whether you are able to renew health coverage

HIPAA might protect you if you:

• Have lost or are changing jobs
• Are recently married or divorced
• Are gaining new dependents through birth or adoption
• Are moving from one State to another
• Have a preexisting condition or other health factor that makes it difficult to get health coverage
• Have had health coverage and are now being denied coverage
• Want to renew your health coverage
• Are a small employer and want to buy health coverage for your employees
• Are an employer and want to renew health coverage for your employees

HIPAA does NOT:

• Require employers to offer health coverage
• Regulate the cost of health coverage
• Regulate the types of benefits that must be offered
• Provide protections when you wish to change from one form of individual coverage to another

Important HIPAA rights and protections for group health plans include:

• Limits on preexisting condition exclusions
• Prohibition of discrimination based on health factors
• Requirements for special enrollment opportunities for people who lose other group health coverage or gain new dependents, such as a spouse or a child
• Requirements for certificates of creditable coverage
• Guaranteed availability of group health plans for small employers
• Guaranteed renewal of all group health plans at the option of the employer

Important HIPAA rights and protections for individual coverage include the following:

• HIPAA-eligible individuals are guaranteed the right to purchase individual coverage
• Preexisting condition exclusions are not allowed for HIPAA-eligible individuals
• Certificates of creditable coverage are required
• Individual health insurance coverage is guaranteed to be renewed

HIPAA – Employer Responsibilities

The Health Insurance Portability and Accountability Act of 1996 (HIPAA) protects the health coverage of people who switch from one job to another or who leave their jobs without taking another job. Who is Covered

HIPAA applies to group health plans with two or more participants who are current employees. HIPAA affects self-insured group health plans as well as insurers and insured plans in the group health plan market. Basic Provisions/Requirements

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 provisions that:

• limit exclusions for preexisting conditions;
• prohibit discrimination against employees and dependents based on their health status; and
• guarantee renewability and availability of health coverage to certain employees and individuals.

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 of the individual's prior creditable coverage, excluding coverage before any break in coverage of 63 days or more.

*Click here to access a form that serves as the Certificate of Group Health Plan Coverage that is given to the employee upon termination from the plan.

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 administrator 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.

Group health plans and health insurance issuers are required to provide special enrollment periods. Pre-existing condition limitations will not apply to individuals during a special enrollment period as long as the request for coverage is made within 30 days of the event.

A special enrollment period can occur with the following events:

• individuals who had previously declined coverage because of group health coverage elsewhere and who now request coverage because other coverage terminated or
• an individual acquires a new dependent through the birth of a newborn or newly adopted child.

Individuals may not be denied eligibility or continued eligibility to enroll for benefits under the terms of the plan based on specified health factors. In addition, an individual may not be charged more for coverage than similarly situated individuals based on these specified health factors.

HIPAA and other recent laws made important changes in ERISA's disclosure requirements for group health plans. Under current Department of Labor interim disclosure rules, group health plans must improve their summary plan descriptions (SPDs) and summaries of material modifications (SMMs) (documents employers are required to provide to employees at certain key intervals) 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 or 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.

HIPAA Questions and Answers

Welcome to the Health Insurance Portability and Accountability Act of 1996 (HIPAA) Questions and Answers (Q&A) review. Below is a listing of pertinent questions that help provide guidance on several issues dealing with the HIPAA rights and obligations for employers.

*Click here to access more Frequently Asked Questions (FAQ’s) on HIPAA.

*Click here to access a form that serves as the Certificate of Group Health Plan Coverage that is given to the employee upon termination from the plan.

If, at the time you change jobs, you already have had 12 months of continuous health coverage (without a break in coverage of 63 days or more), you will not have to start over with a new 12-month exclusion for any preexisting conditions.

If you had a medical condition in the past, but have not received any medical advice, diagnosis, care or treatment within the 6 months prior to your enrollment date in the plan, your old condition is not a "preexisting condition" for which an exclusion can be applied.

• shorten the 6-month "look-back" period prior to the enrollment date to determine what is a preexisting condition;
• shorten the 12- and 18-month maximum preexisting condition exclusion periods;
• increase the 63-day significant break in coverage period;
• increase the 30-day period for newborns, adopted children and children placed for adoption to enroll in the plan so that no preexisting condition exclusion period may be applied thereafter;
• expand the prohibitions on conditions and people to whom a preexisting condition exclusion period may be applied beyond the "exceptions" described in federal law (the "exceptions" under federal law are for certain newborns, adopted children, children placed for adoption and pregnancy);
• require additional special enrollment periods; and
• reduce the maximum HMO affiliation period to less than 2 months (3 months for late enrollees).

• 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 premiums ends.

• 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 the 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. In addition, the resulting coverage must be effective no later than the first day of the first calendar month beginning after the date the completed request for enrollment is received.