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Archived News Release--Caution:
information may be out of date.
For more information call: 202-219-8921
Millions of Americans will have important new health
benefit protections when they change jobs or lose health coverage under interim
regulations announced today by the U. S. Departments of Labor, Health and Human
Services and the Treasury.
The regulations provide guidance to help employees and
their families understand these new rights and to assist employers, plans and
insurance companies in complying with the Health Insurance Portability and
Accountability Act of 1996 (HIPAA). The law was signed by President Clinton on
Aug. 21, 1996.
The interim rules are effective for all plans with respect
to the certification requirements of HIPAA beginning June 1, 1997; however, the
other HIPAA provisions are generally effective for plan years beginning after
June 30, 1997.
"Health coverage is important to the physical and financial
well-being of millions of Americans," said Acting Labor Secretary Cynthia A.
Metzler. "The Administration has worked tirelessly to ensure that workers and
their families have greater access to health care. These regulations are the
first step in providing greater access and portability of health coverage."
The Labor Department also is making available today through
its publication hotline (1-800-998-7542) a handy reference booklet for
employees and employers. The booklet, titled "Questions and Answers: Recent
Changes in Health Care Law," gives an overview of the new law and answers the
most commonly asked questions.
The regulations are designed to provide greater access,
portability and renewability of health coverage. Among other things, the
regulations:
- limit exclusions for preexisting medical conditions;
- give employees and their families credit for prior health coverage
with their new group health plan or issuer;
- provide new enrollment rights for individuals who lose coverage or
have a new dependent;
- prohibit discrimination against employees and dependents in
enrollment and premiums due to health status; and
- guarantee availability of health insurance for small employers and
renewability of health insurance coverage in both the small and large group
markets.
Also today, the Labor Department issued interim guidance
for private sector group health plans to comply with HIPAA's requirements on
disclosure of information to employees. Those rules require that group health
plans:
- notify covered workers within 60 days of any material reduction in
covered services or benefits under their plan;
- give workers information in the plan brochure if an insurance
company is used by the plan, including an explanation of whether their benefits
are guaranteed under an insurance contract or policy; and
- list in the plan brochure the office within the Labor Department
where individuals can get help or information about their rights under federal
law or HIPAA.
The Labor Department's regulation also requires group
health plans to tell covered workers that under federal law hospital stays for
childbirth usually cannot be less than 48 hours for normal deliveries and 96
hours for cesarean sections. Finally, the rules provide guidance on the use of
electronic communication systems, such as e-mail, to furnish information to
workers.
Public comments are requested on both interim rules to
assist in developing the final rules. Comments or requests for a hearing should
be submitted in writing to the Office of Regulations and Interpretations,
Pension and Welfare Benefits Administrations, U. S. Department of Labor, Room
N-5669, 200 Constitution Ave., N.W., Washington, D. C. 20210, Attention:
"Interim Portability and Renewability Rules" or "Interim Disclosure Rules," as
appropriate.
U.S. Department of Labor
April 1, 1997
- The Health Insurance Portability and Accountability Act (HIPAA),
signed into law by President Clinton on August 21, 1996, offers new protections
for an estimated 25 million American workers.
- HIPAA amended the Employee Retirement Income Security Act (ERISA),
the Public Health Service Act, and the Internal Revenue Code to provide
improved portability and continuity of health insurance coverage.
- The new law:
- -- limits exclusions for preexisting medical conditions; -- provides
credit for prior health coverage and a process for providing certificates
concerning prior coverage to a new group health plan or issuer;
-- provides new rights that allow individuals to
enroll for health coverage when they lose other health coverage or add a new
dependent;
-- prohibits discrimination in enrollment and in
premiums charged to employees and their dependents based on health
status-related factors;
-- guarantees availability of health insurance coverage
for small employers and renewability of health insurance coverage in both the
small and large group markets; and,
-- preserves the states' role in regulating health
insurance, including the states' authority to provide greater protections.
- Interim rules published today by the Departments of Labor, Health and
Human Services, and the Treasury provide guidance to both employees and
employers with respect to these HIPAA provisions in the following areas:
Preexisting Condition Exclusions
-- 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.
-- may not last for more than 12 months (18 months for late
enrollees) after an individual's enrollment date.
-- must be reduced by the number of days of the
individual's prior creditable coverage that occurred without a break in
coverage of 63 days or more.
Creditable Coverage
-- includes prior coverage under another group health plan,
an individual health insurance policy, COBRA, Medicaid, Medicare, or a public
health plan.
Certificates of Creditable Coverage
-- must be provided automatically by the plan when an
individual loses coverage under the plan or exhausts COBRA continuation
coverage.
-- must be provided, if requested, before losing coverage
or within 24 months of losing coverage.
-- may be provided through the use of a model certificate
which is contained in the preamble to the regulations.
Special Enrollment Rights
-- are provided for individuals who lose their coverage in
certain situations.
-- are provided for individuals who become a new dependent
through marriage, birth, adoption or placement for adoption.
Discrimination Prohibitions
-- ensure that individuals are not excluded from coverage,
or charged more for benefits offered by a plan or issuer, based on health
status-related factors.
- The Department of Labor simultaneously issued interim rules today
regarding new disclosure requirements under ERISA for group health plans. Under
these new rules, plans are now required to:
-- furnish a summary of a "material reduction in covered
services or benefits" to covered workers within 60 days after the change has
been adopted by the plan.
-- provide information to workers if an insurance company
is used by the plan -- including an explanation of whether their benefits are
guaranteed under an insurance contract or policy.
-- list in their plan brochure the office of the Labor
Department where individuals can get assistance or information about their
rights under federal law in general or HIPAA in particular.
- The disclosure rules also provide guidance on the use of electronic
media (e.g., E-mail) to furnish covered workers with required group health plan
disclosures.
- The interim rules are effective for all plans with respect to the
certification requirements of HIPAA beginning June 1, 1997. However, the other
HIPAA provisions are generally effective for plan years beginning after June
30, 1997.
- The three Departments sought to minimize the burden on employers and
insurers in implementing the new rules. For example, a model certificate of
coverage and a model notice relating to the categories of benefits provided
under a plan were included with the preamble to the regulations.
- In addition, a handy reference guide, titled "Questions and Answers:
Recent Changes in Health Care Law," was published by the Labor Department in
December 1996 to help employees and employers understand their rights and
obligations under HIPAA.
- Today the Labor Department released an addendum to the booklet that
contains additional questions and answers covered by the new regulations. The
Department expects to publish a revised booklet that incorporates this addendum
and other changes in the near future.
- The booklet and addendum give an overview of the new law and provide
answers to the most commonly asked questions. Since last fall, the Pension and
Welfare Benefits Administration (PWBA) has received thousands of calls from
plan participants and plan administrators asking about the effect of the new
law.
- The booklet and addendum are available on the Department's Website at
http://www.dol.gov/dol/pwba and through the Department's Publication
Hotline, telephone number 1-800-998-7542.
- Individuals needing additional assistance or clarification should
call the PWBA technical assistance staff at 202-219-8776.
Archived News Release--Caution:
information may be out of date.
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