|
|
|
|
|
|
 |
On
This Page |
 |
|
|
|
|
This checklist is a useful self-compliance tool for group health plans, plan
sponsors, plan administrators, health insurance issuers, and other parties to
determine whether a group health plan is in compliance with the provisions of
Part 7 of Subtitle B of Title I (Part 7) of the Employee Retirement Income
Security Act of 1974 (ERISA). The Part 7 provisions were added to ERISA by four
separate laws: the Health Insurance Portability and Accountability Act of 1996 (HIPAA);
the Mental Health Parity Act of 1996 (MHPA); the Newborns’ and Mothers’
Health Protection Act of 1996 (Newborns’ Act); and the Women’s Health and
Cancer Rights Act of 1998 (WHCRA). ERISA is administered by the Employee Benefits Security Administration
(EBSA).
|
|
All of the foregoing laws amended Part 7 of ERISA by adding new requirements
for group health plans. With respect to most of these requirements,
corresponding provisions are contained in Chapter 100 of Subtitle K of the
Internal Revenue Code (Code) and Part A of Title XXVII of the Public Health
Service Act (PHS Act).
|
|
Arrangements Subject to Part 7 of ERISA: In general, Part 7 of ERISA applies
to group health plans and health insurance issuers in the group market.
|
-
A group health plan means an employee welfare benefit plan to the extent
that the plan provides medical care (including items and services paid for as
medical care) to employees (including partners in a partnership) or their
dependents (defined under the terms of the plan) directly or through
insurance, reimbursement, or otherwise.
-
A health insurance issuer or issuer means an insurance company, insurance
service, or insurance organization (including a health maintenance
organization (HMO)) that is required to be licensed to engage in the business
of insurance in a State and that is subject to State law that regulates
insurance.
-
Group market generally means the market for health insurance coverage
offered in connection with a group health plan.
-
Even though issuers in the group market are subject to Part 7, the
Department of Labor cannot enforce against them. However, participants may bring
a cause of action against an issuer for violations of Part 7.
-
States can enforce against issuers for violations of these new health care
laws. Therefore, questions concerning issuers or suspected violations by issuers
should be referred to the applicable State insurance department.
|
|
Arrangements Not Subject to Part 7 of ERISA: Certain arrangements that are
group health plans are not subject to Part 7. These arrangements are listed
below.
|
-
Very Small Group Health Plans are generally not subject to Part 7 (except
very small group health plans are subject to section 711 of ERISA, the Newborns’
Act provisions). A very small group health plan is a group health plan that has
fewer than two participants who are current employees on the first day of the
plan year.
-
Group health plans are not subject to
Part 7 of ERISA in their provision of “excepted
benefits.” There are several types of “excepted benefits.”
-
Certain benefits are always treated as “excepted benefits” because they
are not considered health coverage, such as accident-only or disability income
insurance and workers’ compensation insurance.
-
Other benefits are treated as “excepted benefits” if they are offered
separately or are not an integral part of the plan, including limited-scope
dental or vision benefits or long-term care benefits.
-
Moreover, other benefits are treated as “excepted benefits” if they are
offered separately and not coordinated with benefits under another group health
plan, including coverage for a specific disease, and hospital indemnity or other
fixed indemnity insurance.
-
Finally, other benefits are treated as “excepted benefits” if they are
offered separately and supplemental to Medicare, Armed Forces health care
coverage, or group health plan coverage.
-
Church Plans are not subject to Part 7 because they are not subject to
Title I of ERISA. (However, they are generally subject to parallel provisions in
the Code. Questions concerning these plans should be referred to the Internal
Revenue Service (IRS).)
-
Governmental Plans are not subject to Part 7 because they are not subject
to Title I of ERISA. (However, nonfederal governmental plans may be subject to
parallel provisions in the PHS Act. Questions concerning these plans should be
referred to the Department of Health and Human Services (HHS).)
|
|
Preemption: Part 7 of ERISA contains new preemption and applicability rules
for group health plans and health insurance issuers.
|
-
Group Health Plans. In general, section 514 of ERISA continues to apply
with respect to group health plans.
-
Group Health Insurance Issuers.
|
-
With respect to the requirements of section 701 of ERISA, state laws
regarding issuers cannot “differ” from the requirements of ERISA section
701, except as listed below:
-
State law may shorten the 6-month “look-back” period prior to the
enrollment date to determine what is a preexisting condition;
-
State law may shorten the 12-month (18-month for late enrollees) maximum
preexisting condition exclusion period;
-
State law may lengthen the 63-day significant-break-in-coverage period;
-
State law may lengthen the 30-day special enrollment period for newborns,
adopted children, and children placed for adoption to enroll in the plan without
a preexisting condition exclusion period;
-
State law may expand the prohibitions on conditions and individuals to whom
a preexisting condition exclusion period may not be applied beyond the
exceptions for newborns, adopted children, and children placed for adoption
enrolled within 30 days of birth, adoption and placement for adoption, and
pregnancy;
-
State law may require additional special enrollment periods; and
-
State law may reduce the maximum HMO affiliation period to less than 2
months (3 months for late enrollees).
-
With respect to all other HIPAA provisions and the MHPA provisions, state
laws relating to health insurance issuers continue to apply, except to the
extent that the state law “prevents the application of a requirement of”
these HIPAA and MHPA provisions.
-
With respect to the WHCRA provisions, state law protections may apply to
certain health insurance coverage if the state law was in effect on October 21,
1998 (the date of enactment of WHCRA) and the state law requires at least the
coverage of reconstructive breast surgery that is required by WHCRA.
|
-
Special Applicability Rule. The Newborns’ Act contains a special
applicability rule. This applicability rule is explained in Part III, Section A of this
checklist.
|
|
|
|
|
|
|
|
If you answer “No” to any of the questions below, the group health plan
is in violation of the HIPAA provisions in Part 7 of ERISA.
|
|
|
|
If the plan imposes a preexisting condition exclusion period, the plan must
comply with this section. Check for hidden preexisting condition exclusion
provisions. A hidden preexisting condition exclusion is not designated as a
preexisting condition exclusion, but restricts benefits based on when a
condition arose in relation to the effective date of coverage.
|
|
If the plan imposes a hidden preexisting condition exclusion, the plan
may violate many or all of the provisions discussed in this section. For
example, if the plan excludes coverage for cosmetic surgery unless it is
required by reason of an accidental injury occurring after the effective date
of coverage, there could be multiple violations of this section A.
|
|
If the plan does not impose a preexisting condition
exclusion period, including a hidden preexisting condition exclusion period,
check “N/A” and skip to Section B.
|
|
|
|
|
|
Question 1 - Six-month look-back period - Does the plan comply with the six-month look-back period requirement?
A preexisting condition exclusion may apply only to conditions for which
medical advice, diagnosis, care, or treatment was recommended or received during
the 6-month period ending on an individual’s “enrollment date.” See ERISA
section 701(a)(1); 29 CFR 2590.701-3(a)(1)(i).
Note: An individual’s enrollment date is the earlier of - (1) the first
day of coverage; or (2) the first day of any waiting period for coverage.
(Waiting period means the period that must pass before an employee or dependent
is eligible to enroll under the terms of the plan. If an employee or dependent
enrolls as a late enrollee or special enrollee, any period before such
enrollment date is not a waiting period.) Therefore, if the plan has a waiting
period, the six-month look-back period ends on the first day of the waiting
period, not the first day of coverage.
|
|
|
|
|
|
Question 2 - 12/18-month look-forward period - Does the plan comply with HIPAA’s 12-month (or 18-month) look-forward
period requirement?
The maximum preexisting condition exclusion period is 12 months (18 months
for late enrollees), measured from an individual’s enrollment date. See ERISA
section 701(a)(2); 29 CFR 2590.701-3(a)(1)(ii).
Note: If the plan has a waiting period, the 12-month (or 18-month)
look-forward period must begin on the first day of the waiting period, not the
first day of coverage.
|
|
|
|
|
|
Question 3 - Offsetting the length of preexisting condition exclusions by
creditable coverage - Does the plan offset the length of its preexisting condition exclusion by an
individual’s creditable coverage?
The length of the plan’s preexisting condition exclusion must be offset
by an individual’s creditable coverage. However, days of coverage prior to a
“significant break in coverage” are not required to be taken into account.
Under federal law, a significant break in coverage is a period of 63 days or
more without any health coverage. See ERISA section 701(a)(3); 29 CFR
2590.701-3(a)(1)(iii) [using ERISA section 701(c) rules for crediting previous
coverage].
|
|
|
|
|
|
Question 4 - Preexisting condition exclusion on genetic information
- Does the plan comply with HIPAA by not imposing a preexisting condition
exclusion with respect to genetic information?
Genetic information alone cannot be treated as a preexisting condition in
the absence of a diagnosis of a condition related to such information. See ERISA
section 701(a)(1); 29 CFR 2590.701-3(a)(1)(i) [using ERISA section 701(b)(1)
definition of a preexisting condition exclusion].
|
|
|
|
|
|
Question 5 - Preexisting condition exclusion on newborns
- Does the plan comply with HIPAA by not imposing an impermissible
preexisting condition exclusion on newborns?
The plan generally may not impose a preexisting condition exclusion on a
child who enrolls in creditable coverage within 30 days of birth. See ERISA
section 701(d)(1); 29 CFR 2590.701-3(b)(1).
|
|
|
|
|
|
Question 6 - Preexisting condition exclusion on children adopted or placed
for adoption - Does the plan comply with HIPAA by not imposing an impermissible
preexisting condition exclusion on adopted children or children placed for
adoption?
The plan generally may not impose a preexisting condition exclusion on a
child who enrolls in creditable coverage within 30 days of adoption or placement
for adoption. See ERISA section 701(d)(2); 29 CFR 2590.701-3(b)(2).
|
|
|
|
|
|
Question 7 - Preexisting condition exclusion on pregnancy
- Does the plan comply with HIPAA by not imposing a preexisting condition
exclusion on pregnancy?
The plan may not impose a preexisting condition exclusion relating to
pregnancy. See ERISA section 701(d)(3); 29 CFR 2590.701-3(b)(4).
|
|
|
|
|
|
Question 8 - Adequate general notices of preexisting condition exclusions
- Does the plan provide adequate general notices of preexisting condition
exclusions?
A group health plan (or issuer) may not impose a preexisting condition
exclusion with respect to a participant or dependent before notifying the
participant, in writing, of-
-
The existence and terms of any preexisting condition exclusion under
the plan; and
-
The rights of individuals to demonstrate creditable coverage (and any
applicable waiting periods), including (1) a description of the right of the
individual to request a certificate from a prior plan or issuer, if
necessary, and (2) a statement that the current plan (or issuer) will assist
in obtaining a certificate from any prior plan or issuer, if necessary. See
29 CFR 2590.701-3(c).
Guidelines for the general notice of preexisting condition exclusion are
available in EBSA’s publication, Compliance Assistance Guide: Recent Changes
in Health Care Law, which is located in the Compliance Assistance section of
the Agency’s Web site at www.dol.gov/pwba.
|
|
|
|
|
|
Question 9 - Adequate individual notices of preexisting condition exclusions
- Does the plan provide adequate individual notices of preexisting condition
exclusions?
A group health plan (or issuer) seeking to impose a preexisting condition
exclusion with respect to an individual must, within a reasonable time following
receipt of creditable coverage information, make a determination about the
individual’s period of creditable coverage.
If the individual does not have enough creditable coverage to completely
offset the preexisting condition exclusion period, the plan must then provide,
in writing, to the individual:
-
Its determination of the length of any preexisting condition exclusion
that applies to the individual, including the source and substance of any
information on which the plan or issuer relied; and
-
A written explanation of any appeal procedures established by the plan
or issuer.
The plan must also allow the individual a reasonable opportunity to submit
additional evidence of creditable coverage. See 29 CFR 2590.701-5(d)(2).
Guidelines for the individual notice of preexisting condition exclusion are
available in EBSA’s publication, Compliance Assistance Guide: Recent Changes
in Health Care Law, which is located in the Compliance Assistance section of the
Agency’s Web site at www.dol.gov/pwba.
|
|
|
|
|
|
|
|
A group health plan (or a group health insurance issuer, on the plan’s
behalf) must issue complete certificates of creditable coverage (free of
charge) automatically to individuals whose coverage under the plan ends, and
(free of charge) to individuals upon request. A model certificate that may be
used to satisfy this notice requirement is available in EBSA’s publication,
Compliance Assistance Guide: Recent Changes in Health Care Law, which is
located in the Compliance Assistance section of the Agency’s Web site at
www.dol.gov/pwba.
|
|
Check to see that the plan issues complete certificates of creditable
coverage within the required time frames.
|
|
Special Accountability Rule for Insured Plans:
-
Under a special accountability rule in ERISA section 701(e)(1)(C) and 29
CFR 2590.701-5(a)(1)(iii), a health insurance issuer, rather than the plan, may
be responsible for providing certificates of creditable coverage by virtue of an
agreement between the two that makes the issuer responsible. In this case, the
plan cannot be held accountable for a violation of Part 7. (**Note: An agreement
with a third-party administrator (TPA) that is not insuring benefits will not
transfer responsibility from the plan.)
-
Despite this special accountability rule under Part 7, other
responsibilities, such as a plan administrator’s duty to monitor compliance
with a contract, remain unaffected.
|
|
Accordingly, this section of the checklist is organized differently to take
into account this special accountability rule.
|
|
|
|
Question 10 - Automatic certificates of creditable coverage upon loss of
coverage - Does the plan provide complete certificates of creditable coverage to
individuals automatically upon loss of coverage?
Plans are required to provide each participant and dependent covered under
the plan a certificate, free of charge, when coverage ceases.
If the plan is insured and there is an agreement with the issuer that the
issuer is responsible for providing the certificates, check “N/A” and go to
Question 11.
To be complete, under 29 CFR 2590.701-5(a)(3)(ii), each certificate must
include:
-
Date issued;
-
Name of plan;
-
The individual’s name and identification information (**Note:
Dependent information can be included on the same certificate with the
participant information or on a separate certificate. The plan is required
to have used reasonable efforts to get dependent information. See 29 CFR
2590.701-5(a)(5)(i));
-
Plan administrator (or issuer) name, address, and telephone number;
-
Telephone number for further information (if different); and
-
Individual’s creditable coverage information:
-
Either - (1) that the individual has at least 18 months of creditable
coverage; or (2) the date any waiting period (or affiliation period) began
and the date creditable coverage began.
-
Also, either - (1) the date creditable coverage ended; or (2) that
creditable coverage is continuing.
-
Automatic certificates of creditable coverage should reflect the last
period of continuous coverage.
|
|
|
|
|
|
Question 11 - Automatic certificate upon loss of coverage - Issuer
Responsibility - If there is an agreement between the plan and the issuer stating that the
issuer is responsible for providing certificates of creditable coverage, does
the issuer provide complete certificates?
Even if the plan is not responsible for issuing certificates of creditable
coverage, the plan should monitor issuer compliance with the certification
provisions.
If the plan is self-insured, or if there is no such agreement between the
plan and the issuer, check “N/A” and skip to Question 12.
|
|
|
|
|
|
Question 12 - Certificates of creditable coverage upon request
- Does the plan provide complete certificates of creditable coverage upon
request?
If the plan is insured and the issuer is responsible for issuing
certificates pursuant to an agreement, check “N/A” and go to Question 13.
Certificates of creditable coverage must also be provided free of charge
upon request to individuals while covered under the plan and for up to 24 months
after coverage ends. See ERISA section 701(e)(1)(A); 29 CFR
2590.701-5(a)(2)(iii).
Requested certificates of creditable coverage should reflect periods of
continuous coverage that an individual had in the 24 months prior to the date of
the request (up to 18 months of creditable coverage). See 29 CFR
2590.701-5(a)(3)(iii).
The plan should also have a procedure for individuals to request and
receive certificates of creditable coverage. See 29 CFR 2590.701-5(a)(4)(ii).
|
|
|
|
|
|
Question 13 - Certificates upon request - Issuer Responsibility
- If the plan is insured and there is an agreement between the plan and the
issuer stating that the issuer is responsible for providing certificates of
creditable coverage, does the issuer provide complete certificates?
Even if the plan is not responsible for issuing certificates of creditable
coverage, the plan should monitor issuer compliance with the certification
provisions.
If the plan is self-insured, or if there is no such agreement between the
plan and the issuer, check “N/A” and skip to Question 14.
|
|
|
|
|
|
Question 14 - Certificates within required time frames - If the plan issues certificates of creditable coverage, are they issued
within the required time frames?
If the plan is insured and the issuer is responsible for issuing
certificates pursuant to an agreement, check “N/A” and go to Question 15.
Under 29 CFR 2590.701-5(a)(2)(ii), plans and issuers must furnish an
automatic certificate of creditable coverage:
-
To an individual who is entitled to elect COBRA, at a time no later
than when a notice is required to be provided for a qualifying event under
COBRA (usually not more than 44 days);
-
To an individual who loses coverage under the plan and who is not
entitled to elect COBRA, within a reasonable time after coverage ceases; and
-
To an individual who ceases COBRA, within a reasonable time after the
plan learns that COBRA has ceased.
Plans and issuers must also generally provide a certificate of creditable
coverage upon request, at the earliest time that a plan or issuer, acting in a
reasonable and prompt fashion, can provide the certificate of creditable
coverage. See 29 CFR 2590.701-5(a)(2)(iii).
|
|
|
|
|
|
Question 15 - Certificates within required time frames - Issuer
Responsibility - If the plan is insured and there is an agreement with the issuer stating that
the issuer is responsible for providing certificates of creditable coverage, are
those certificates being provided timely?
Even if the plan is not responsible for issuing certificates of creditable
coverage, the plan should monitor issuer compliance with the certification
provisions.
If the plan is self-insured, or if there is no such agreement between the
plan and the issuer, check “N/A” and skip to Section C.
|
|
|
|
|
|
|
|
Group health plans must allow individuals (who are otherwise eligible) to
enroll upon certain specified events, if enrollment is requested within 30
days of the event. The plan must provide for special enrollment, as follows:
|
|
|
|
Question 16 - Special enrollment upon loss of other coverage - Does the
plan provide special enrollment upon loss of other coverage? (The plan must
comply with all of the following.)
Plans must permit loss-of-coverage special enrollment upon: (1) loss of
eligibility for group health plan coverage or health insurance coverage; and (2)
termination of employer contributions toward coverage. See ERISA section
701(f)(1); 29 CFR 2590.701-6(a).
Plans must permit eligible employees and dependents to special enroll
because of a loss of eligibility (other than loss due to failure to pay premiums
or termination of coverage for cause -- such as for fraud).
-
Examples of reasons for loss of eligibility include: legal separation,
divorce, death, termination of employment - voluntary or involuntary (with
or without electing COBRA), exhaustion of COBRA, reduction in hours, “aging
out” under other parent’s coverage, or moving out of an HMO’s service
area.
Plans must permit eligible employees and dependents to special enroll due
to termination of employer contributions towards the other coverage whether or
not they also lost the other coverage as a result.
Coverage must become effective no later than the first day of the first
month following a completed request for enrollment. See 29 CFR 2590.701-6(a)(7).
|
|
|
|
|
|
Question 17 - Dependent special enrollment - Does the plan provide special enrollment rights to individuals upon marriage,
birth, adoption, and placement for adoption? (The plan must comply with all of
the following.)
Plans must permit employees, spouses, and new dependents to enroll upon
marriage, birth, adoption, and placement for adoption. See ERISA section
701(f)(2); 29 CFR 2590.701-6(b).
In the case of marriage, coverage must become effective not later than the
first day of the month following a completed request for enrollment. See 29 CFR
2590.701-6(b)(8)(i).
In the case of birth, adoption, or placement for adoption, coverage must
become effective as of the date of the birth, adoption, or placement for
adoption. See 29 CFR 2590.701-6(b)(8)(ii) and (iii).
|
|
|
|
|
|
Question 18 - Notice of special enrollment rights - Does the plan provide notices of special enrollment rights?
On or before the time an employee is offered the opportunity to enroll in
the plan, the plan must provide the employee with a description of the plan’s
special enrollment rules.
A model description of special enrollment rights is available at 29 CFR
2590.701-6(c) and in EBSA’s publication, Compliance Assistance Guide: Recent
Changes in Health Care Law, which is located in the Compliance Assistance
section of the Agency’s Web site at www.dol.gov/pwba.
|
|
|
|
|
|
|
|
Overview. HIPAA prohibits group health plans and health insurance issuers
from discriminating against individuals in eligibility and continued
eligibility for benefits and in individual premium or contribution rates based
on health factors. These health factors include: health status, medical
condition (including both physical and mental illnesses), claims experience,
receipt of health care, medical history, genetic information, evidence of
insurability (including conditions arising out of acts of domestic violence
and participation in activities such as motorcycling, snowmobiling,
all-terrain vehicle riding, horseback riding, skiing, and other similar
activities), and disability. See ERISA section 702; 29 CFR 2590.702.
|
|
Similarly Situated Individuals. It is important to recognize that the
nondiscrimination rules prohibit discrimination within a group of similarly
situated individuals. Under 29 CFR 2590.702(d), plans may treat distinct
groups of similarly situated individuals differently, if the distinctions
between or among the groups are not based on a health factor. If
distinguishing among groups of participants, plans and issuers must base
distinctions on bona fide employment-based classifications consistent with the
employer’s usual business practice. Whether an employment-based
classification is bona fide is based on relevant facts and circumstances, such
as whether the employer uses the classification for purposes independent of
qualification for health coverage. Bona fide employment-based classifications
might include: full-time versus part-time employee status; different
geographic location; membership in a collective bargaining unit; date of hire
or length of service; or differing occupations. In addition, plans may treat
participants and beneficiaries as two separate groups of similarly situated
individuals. Plans may also distinguish among beneficiaries. Distinctions
among groups of beneficiaries may be based on bona fide employment-based
classifications of the participant through whom the beneficiary is receiving
coverage, relationship to the participant (such as spouse or dependent),
marital status, age or student status of dependent children, or any other
factor that is not a health factor.
|
|
Benign Discrimination. The nondiscrimination rules do not prohibit a plan
from establishing more favorable rules for eligibility or premium rates for
individuals with an adverse health factor, such as a disability. See 29 CFR
2590.702(g).
|
|
Check to see that the plan complies with HIPAA’s nondiscrimination
provisions as follows:
|
|
|
|
Question 19 - Nondiscrimination in rules for eligibility -
Does the plan allow individuals eligibility and continued eligibility under
the plan regardless of any adverse health factor?
Examples of plan provisions that violate ERISA section 702(a) because they
discriminate in eligibility based on a health factor include -
-
Plan provisions that require “evidence of insurability,” such as
passing a physical exam, providing a certification of good health, or
demonstrating good health through answers to a health care questionnaire in
order to enroll. (This is a violation, even if the plan provision is imposed
only at late enrollment.)
Also, note that it may be permissible for plans to require individuals to
complete physical exams or health care questionnaires for purposes other than
for determining eligibility to enroll in the plan, such as for determining an
appropriate blended, aggregate group rate for providing coverage to the plan as
a whole.
|
|
|
|
|
|
Question 20 - Benefit restrictions - Does the plan uniformly provide benefits to participants and beneficiaries?
A plan is not required to provide any benefits, but benefits provided must
be uniformly available and any benefit restrictions must be applied uniformly to
all similarly situated individuals and cannot be directed at any individual
participants or beneficiaries based on a health factor. If benefit exclusions or
limitations are applied only to certain individuals based on a health factor,
this would violate ERISA section 702(a) and 29 CFR 2590.702(b)(2).
Examples of plan provisions that would be permissible under ERISA section
702(a) include:
-
A lifetime or annual limit on all benefits,
-
A lifetime or annual limit on the treatment of a particular condition,
-
Limits or exclusions for certain types of treatments or drugs,
-
Limitations based on medical necessity or experimental treatment, and
-
Cost-sharing
if the limit applies uniformly to all similarly situated individuals and is
not directed at individual participants or beneficiaries based on a health
factor.
A plan amendment applicable to all similarly situated individuals and made
effective no earlier than the first day of the next plan year is not considered
directed at individual participants and beneficiaries. See 29 CFR
2590.702(b)(2)(i)(C).
|
|
|
|
|
|
Question 21 - Source-of-injury restrictions - If the plan imposes a source-of-injury restriction, does it comply with the
HIPAA nondiscrimination provisions?
Plans may exclude benefits for the treatment of certain injuries based on
the source of that injury, except that plans may not exclude benefits otherwise
provided for treatment of an injury if the injury results from an act of
domestic violence or a medical condition. See 29 CFR 2590.702(b)(2)(iii). An
example of a permissible source-of-injury exclusion would include -
-
A plan provision that provides benefits for head injuries generally,
but excludes benefits for head injuries sustained while participating in
bungee jumping, as long as the injuries do not result from a medical
condition or domestic violence.
An impermissible source-of-injury exclusion would include -
-
A plan provision that generally provides benefits for medical/surgical
benefits, including hospital stays that are medically necessary, but
excludes benefits for self-inflicted injuries or attempted suicide. This is
impermissible because the plan provision excludes benefits for treatment of
injuries that may result from a medical condition (depression).
If the plan does not impose a source-of-injury restriction, check “N/A”
and skip to Question 22.
|
|
|
|
|
|
Question 22 - Nondiscrimination in premiums or contributions
- Does the plan comply with HIPAA’s nondiscrimination rules regarding
individual premium or contribution rates?
Under ERISA section 702(b) and 29 CFR 2590.702(c), plans may not require an
individual to pay a premium or contribution that is greater than a premium or
contribution for a similarly situated individual enrolled in the plan on the
basis of any health factor. For example, it would be impermissible for a plan to
require certain full-time employees to pay a higher premium than other full-time
employees based on their prior claims experience.
Nonetheless, the nondiscrimination rules do not prohibit a plan from
providing a reward based on adherence to a bona fide wellness program. See ERISA
section 702(b)(2)(B); 29 CFR 2590.702(c)(3). Proposed rules describing bona fide
wellness programs were published on January 8, 2001 at 66 FR 1421. Essentially,
these proposed rules permit rewards that are not contingent on an individual
meeting a standard related to a health factor. In addition, these proposed rules
permit rewards that are contingent on an individual meeting a standard related
to a health factor if:
-
The reward does not exceed a specified percentage of the total
employee-only premium. (Comments were invited as to whether a 10%, 15%, or
20% limitation might be appropriate.)
-
The program is reasonably designed to promote good health or prevent
disease. (For this purpose, a program must allow individuals an opportunity
to qualify for the reward at least once each year.)
-
The reward is available to all similarly situated individuals. In
particular, the program must allow a reasonable alternative standard for
individuals for whom it is unreasonably difficult due to a medical condition
to satisfy the original program standard or for whom it is medically
inadvisable to attempt to satisfy the original program standard during that
time period.
-
The plan must also disclose the availability of a reasonable
alternative standard in all plan materials describing the terms of the
program.
|
|
|
|
|
|
Question 23 - List billing - Is there compliance with the list billing provisions?
Under 29 CFR 2590.702(c)(2)(ii), plans and issuers may not charge or quote
an employer a different premium for an individual in a group of similarly
situated individuals based on a health factor. This practice is commonly
referred to as list billing. If an issuer is list billing an employer and the
plan is passing the separate and different rates on to the individual participants and
beneficiaries, both the plan and the issuer are violating the prohibition
against discrimination in premium rates. This does not prevent plans and issuers
from taking the health factors of each individual into account in establishing a
blended/aggregate rate for providing coverage to the plan.
|
|
|
|
|
|
Question 24 - Nonconfinement clauses - Is the plan free of any nonconfinement clauses?
Typically, a nonconfinement clause will deny or delay eligibility for some
or all benefits if an individual is confined to a hospital or other health care
institution. Sometimes nonconfinement clauses also deny or delay eligibility if
an individual cannot perform ordinary life activities. Often a nonconfinement
clause is imposed only with respect to dependents, but they may also be imposed
with respect to employees. 29 CFR 2590.702(e)(1) explains that these
nonconfinement clauses violate ERISA sections 702(a) (if the clause delays or
denies eligibility) and 702(b) (if the clause raises individual premiums).
|
|
|
|
|
|
Question 25 - Actively-at-work clauses - Is the plan free of any impermissible actively-at-work clauses?
Typically, actively-at-work provisions delay eligibility for benefits based
on an individual being absent from work. 29 CFR 2590.702(e)(2) explains that
actively-at-work provisions generally violate ERISA sections 702(a) (if the
clause delays or denies eligibility) and 702(b) (if the clause raises individual
premiums or contributions), unless absence from work due to a health factor is
treated, for purposes of the plan, as if the individual is at work. Nonetheless,
an exception provides that a plan may establish a rule for eligibility that
requires an individual to begin work for the employer sponsoring the plan before
eligibility commences. Further, plans may establish rules for eligibility or set
any individual’s premium or contribution rate in accordance with the rules
relating to similarly situated individuals in 29 CFR 2590.702(d). For example, a
plan that treats full-time and part-time employees differently for other
employment-based purposes, such as eligibility for other employee benefits, may
distinguish in rules for eligibility under the plan between full-time and
part-time employees.
|
|
|
|
|
|
|
|
If the plan provides benefits through an HMO and imposes an HMO affiliation
period in lieu of a preexisting condition exclusion period, answer Question
26. If the plan does not provide benefits through an HMO, or if there is no
HMO affiliation period, check “N/A” and go to Section F.
|
|
|
|
|
|
|
Question 26 - HMO affiliation period provisions - Does the plan comply with the limits on HMO affiliation periods?
An affiliation period is a period of time that must expire before health
insurance coverage provided by an HMO becomes effective and during which the HMO
is not required to provide benefits.
A group health plan offering coverage through an HMO may impose an
affiliation period only if:
|
-
No preexisting condition exclusion is imposed;
-
No premium is charged to a participant or beneficiary for the
affiliation period;
-
The affiliation period is applied uniformly without regard to any
health factor;
-
The affiliation period does not exceed 2 months (or 3 months for late
enrollees);
-
The affiliation period begins on an individual’s “enrollment date;”
and
-
The affiliation period runs concurrently with any waiting period.
|
|
See ERISA section 701(g); 29 CFR 2590.701-7.
|
|
|
|
|
|
|
|
If the plan is a multiple employer welfare arrangement (MEWA) or a
multiemployer plan, it is required to provide guaranteed renewability of
coverage in accordance with ERISA section 703. If the plan is a MEWA or
multiemployer plan, it must comply with Question 27. If the plan is not a MEWA
or multiemployer plan, check “N/A” and go to Part II of this checklist.
|
|
|
|
|
|
Question 27 - Multiemployer plan and MEWA guaranteed renewability - If the plan is a multiemployer plan, or a
MEWA, does the plan provide
guaranteed renewability?
Group health plans that are multiemployer plans or MEWAs may not deny an
employer continued access to the same or different coverage, other than:
- For nonpayment of contributions;
- For fraud or other intentional misrepresentation by the employer;
- For noncompliance with material plan provisions;
- Because the plan is ceasing to offer coverage in a geographic area;
- In the case of a plan that offers benefits through a network plan,
there is no longer any individual enrolled through the employer who lives,
resides or works in the service area of the network plan and the plan
applies this paragraph uniformly without regard to the claims experience of
employers or any health-related factor in relation to such individuals or
dependents; or
- For failure to meet the terms of an applicable collective bargaining
agreement, to renew a collective bargaining or other agreement requiring or
authorizing contributions to the plan, or to employ employees covered by
such agreement. See ERISA section 703.
Note: The PHS Act contains different guaranteed renewability requirements
for issuers. For more information, see PHS Act section 2712.
|
|
|
|
|
|
|
|
|
|
If you answer “No” to any of the questions below, the group health plan
is in violation of the MHPA provisions in Part 7 of ERISA.
|
|
If the plan provides both mental health and medical/surgical benefits, the
plan may be subject to MHPA. If this is the case, answer Questions 28-32.
|
|
If the plan does not provide mental health benefits, check “N/A” here
and skip to Part III of this checklist. Also, the plan may be exempt from MHPA
under the small employer (50 employees or fewer) exception or the increased
cost exception. (To be eligible for the increased cost exception, the plan
must have filed with EBSA and notified participants and beneficiaries.) If the
plan is exempt, check
“N/A” here and skip to Part III of this checklist.
|
|
|
|
|
|
Question 28 - Lifetime dollar limit - Does the plan comply with MHPA’s rules for lifetime dollar limits on mental
health benefits (excluding constructive dollar limits)?
A plan may not impose a lifetime dollar limit on mental health benefits
that is lower than the lifetime dollar limit imposed on medical/surgical
benefits. See ERISA section 712; 29 CFR 2590.712. (Only limits on what the plan
is willing to pay are taken into account. A plan may impose annual dollar
out-of-pocket limits on participants and beneficiaries without implicating MHPA.)
Note: Limits on out-of-network mental health benefits may be lower than
limits on medical/surgical benefits if limits on in-network mental health
benefits are unlimited, or in parity with medical/surgical limits. See 29 CFR
2590.712(b)(4), Example 3. But, limits on inpatient and outpatient mental health
benefits must separately be in parity with limits on medical/surgical benefits.
See 29 CFR 2590.712(b)(4), Example 2.
|
|
|
|
|
|
Question 29 - Constructive lifetime dollar limit - If the plan imposes a “constructive lifetime dollar limit” on mental
health benefits (see explanation and examples below), is the limit greater than
or equal to that imposed on medical/surgical benefits?
A lifetime visit limit that is coupled with a maximum dollar amount payable
by the plan per visit is, in effect, a lifetime dollar limit. This is referred
to as a constructive lifetime dollar limit.
For example, a 100-visit lifetime limit on mental health benefits that is
payable to a maximum of $40 per visit is a constructive lifetime dollar limit of
$4,000 on mental health benefits. If this limit is less than the limit for
medical/surgical benefits (or if there is no limit for medical/surgical
benefits), the plan is not in compliance with MHPA.
Again, remember only limits on what the plan is willing to pay are taken
into account.
|
|
|
|
|
|
Question 30 - Annual dollar limit - Does the plan comply with MHPA’s rules for annual dollar limits on mental
health benefits (excluding constructive dollar limits)?
A plan may not impose an annual dollar limit on mental health benefits that
is lower than the annual dollar limit imposed on medical/surgical benefits. See
ERISA section 712; 29 CFR 2590.712.
Note: Limits on out-of-network mental health benefits may be lower than
limits on medical/surgical benefits if limits on in-network mental health
benefits are unlimited, or in parity with medical/surgical limits. See 29 CFR
2590.712(b)(4), Example 3. But, limits on inpatient and outpatient mental health
benefits must separately be in parity with limits on medical/surgical benefits.
See 29 CFR 2590.712(b)(4), Example 2.
Remember only limits on what the plan is willing to pay are taken into
account. A plan may impose annual dollar out-of-pocket limits on participants
and beneficiaries without implicating MHPA.
|
|
|
|
|
|
Question 31 - Constructive annual dollar limit - If the plan imposes a “constructive annual dollar limit” on mental health
benefits, is the limit greater than or equal to that imposed on medical/surgical
benefits?
An annual visit limit that is coupled with a maximum dollar amount payable
by the plan per visit is, in effect, an annual dollar limit. This is referred to
as a constructive annual dollar limit.
Again, remember only limits on what the plan is willing to pay are taken
into account.
|
|
|
|
|
|
Question 32 - Substance abuse dollars counting against mental health dollar
limit - Does the plan exclude substance abuse or chemical dependency benefits from
its definition of “mental health benefits?”
If the plan does not impose any explicit or constructive annual or lifetime
dollar limits on mental health benefits, check “N/A” and skip to Part III of
this
checklist.
If the plan imposes any explicit or constructive annual or lifetime dollar
limit on mental health benefits, the plan must not count benefits for substance
abuse or chemical dependency against the mental health dollar limit. Instead,
benefits for substance abuse and chemical dependency can be counted against a
medical/surgical cap, or a separate substance abuse or chemical dependency cap.
See 29 CFR 2590.712(b)(4), Example 4 [using ERISA section 712(e)(4) definition
of mental health benefits].
|
|
|
|
|
|
|
|
|
|
If you answer “No” to any of the questions below, the group health plan
is in violation of the Newborns’ Act provisions in Part 7 of ERISA.
|
|
|
|
The substantive provisions of the Newborns’ Act apply only to certain
plans, as follows:
|
|
If the plan does not provide benefits for hospital stays in connection with
childbirth, check “N/A” and go to Part IV of this checklist. (Note: Under
the Pregnancy Discrimination Act, most plans are required to cover maternity
benefits.)
|
|
|
|
Special applicability rule for insured coverage that provides benefits for
hospital stays in connection with childbirth: If the plan provides benefits
for hospital stays in connection with childbirth and is insured, whether the
plan is subject to the Newborns’ Act depends on state law. Based on a
preliminary review of state laws as of July 1, 2002, if the coverage is in
Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut,
Delaware, the District of Columbia, Florida, Georgia, Hawaii, Idaho, Illinois,
Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts,
Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New
Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota,
Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South
Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia,
or Wyoming, it appears that state law applies in lieu of the federal Newborns’
Act. If this is the case, check “N/A” and skip to Section B.
|
|
|
|
If the plan provides benefits for hospital stays in connection with
childbirth, the plan is insured, and the coverage is in Wisconsin, Puerto
Rico, the Virgin Islands, American Samoa, Wake Island, or the Northern Mariana
Islands, it appears that the federal Newborns’ Act applies to the plan. If
this is the case, answer Questions 33-36.
|
|
Self-insured coverage that provides benefits for hospital stays in
connection with childbirth: If the plan provides benefits for hospital stays
in connection with childbirth and is self-insured, the federal Newborns' Act
applies. Answer Questions 33-36.
|
|
|
|
Question 33 - General 48/96-hour stay rule - Does the plan comply with the general 48/96-hour rule?
Plans generally may not restrict benefits for a hospital length of stay in
connection with childbirth to less than 48 hours in the case of a vaginal
delivery (see ERISA section 711(a)(1)(A)(i)), or less than 96 hours in the case
of a cesarean section (see ERISA section 711(a)(1)(A)(ii)).
Therefore, a plan cannot deny a mother or her newborn benefits within a
48/96-hour stay based on medical necessity. (A plan may require a mother to
notify the plan of a pregnancy to obtain more favorable cost-sharing for the
hospital stay. This second type of plan provision is permissible under the
Newborns’ Act if the cost-sharing is consistent throughout the 48/96-hour
stay.)
An attending provider may, however, decide, in consultation with the
mother, to discharge the mother or newborn earlier.
|
|
|
|
|
|
Question 34 - Provider must not be required to obtain authorization from plan
- Does the plan defer to the provider for a decision on hospital length of stay
within the first 48/96-hour period?
Plans may not require that a provider (such as a doctor) obtain
authorization from the plan to prescribe a 48/96-hour stay. See ERISA section
711(a)(1)(B); 29 CFR 2590.711(a)(4).
|
|
|
|
|
|
Question 35 - Incentives/penalties to mothers or providers - Does the plan comply with the Newborns’ Act by avoiding impermissible
incentives or penalties with respect to mothers or attending providers?
Penalties to attending providers to discourage 48/96-hour stays violate
ERISA section 711(b)(3) and 29 CFR 2590.711(b)(3)(i).
Incentives to attending providers to encourage early discharges violate
ERISA section 711(b)(4) and 29 CFR 2590.711(b)(3)(ii).
Penalties imposed on mothers to discourage 48/96-hour stays violate ERISA
section 711(b)(1) and 29 CFR 2590.711(b)(1)(i)(A).
Incentives to mothers to encourage early discharges violate ERISA section
711(b)(2) and 29 CFR 2590.711(b)(1)(i)(B).
Benefits and cost-sharing may not be less favorable for the latter portion
of any 48/96-hour hospital stay. In this case less favorable benefits would
violate ERISA section 711(b)(5) and 29 CFR 2590.711(b)(2) and less favorable cost-sharing would violate
ERISA section 711(c)(3) and 29 CFR 2590.711(c)(3).
|
|
|
|
|
|
|
|
Group health plans that provide benefits for hospital stays in connection
with childbirth are required to make certain disclosures, as follows:
|
|
|
|
Question 36 - Disclosure with respect to hospital lengths of stay in
connection with childbirth - Does the plan comply with the notice provisions relating to hospital stays in
connection with childbirth?
Group health plans that provide benefits for hospital stays in connection
with childbirth are required to make certain disclosures. See the Summary Plan
Description (SPD) content regulations at 29 CFR 2520.102-3(u).
Model language for the Newborns’ Act disclosure requirement is available
in EBSA’s publication, Compliance Assistance Guide: Recent Changes in Health
Care Law, which is located in the Compliance Assistance section of the Agency’s
Web site at www.dol.gov/pwba.
|
|
|
|
|
|
|
|
|
|
If you answer “No” to any of the questions below, the group health plan
is in violation of the WHCRA provisions in Part 7 of ERISA.
|
|
WHCRA applies only to plans that offer benefits with respect to a
mastectomy. If the plan does not offer these benefits, check “N/A” and you
are finished with this checklist.
|
|
|
|
If the plan does offer benefits with respect to a mastectomy, answer
Questions
37-40.
|
|
|
|
Question 37 - Four required coverages under WHCRA - Does the plan provide the four coverages required by
WHCRA?
In the case of a participant or beneficiary who is receiving benefits in
connection with a mastectomy, the plan shall provide coverage for the following
benefits for individuals who elect them:
-
All stages of reconstruction of the breast on which the mastectomy has
been performed;
-
Surgery and reconstruction of the other breast to produce a symmetrical
appearance;
-
Prostheses; and
-
Treatment of physical complications of mastectomy, including
lymphedemas;
in a manner determined in consultation with the attending provider and the
patient. See ERISA section 713(a).
These required coverages can be subject to annual deductibles and
coinsurance provisions if consistent with those established for other benefits
under the plan or coverage.
|
|
|
|
|
|
Question 38 - Annual notice - Does the plan provide annual notices as required by
WHCRA?
Plans must provide notices describing the benefits required under WHCRA
upon enrollment in the plan and annually thereafter. See ERISA section 713(a).
The annual notice must include:
-
Information on the availability of benefits under the plan for the
treatment of mastectomy-related services, including benefits for
reconstructive surgery, surgery to achieve symmetry between the breasts,
prostheses, and physical complications resulting from mastectomy (including
lymphedemas); and
-
Information (telephone number, Web address, etc.) on how to obtain a
detailed description of the mastectomy-related benefits available under the
plan.
Model language for WHCRA’s annual notice requirement is available in EBSA’s
publication, Compliance Assistance Guide: Recent Changes in Health Care Law,
which is located in the Compliance Assistance section of the Agency’s Web site
at www.dol.gov/pwba.
|
|
|
|
|
|
Question 39 - Enrollment notice - Does the plan provide enrollment notices as required by
WHCRA?
Plans must provide notices describing the benefits required under WHCRA
upon enrollment in the plan and annually thereafter. See ERISA section 713(a).
The enrollment notice must describe the benefits that WHCRA requires the
group health plan to cover. Additionally, the enrollment notice must describe
any deductibles and coinsurance limitations applicable to such coverage. (Under
WHCRA, coverage of the required benefits may be subject only to deductibles and
coinsurance limitations consistent with those established for other benefits
under the plan or coverage.)
Model language for WHCRA’s enrollment notice requirement is available in
EBSA’s publication, Compliance Assistance Guide: Recent Changes in Health Care
Law, which is located in the Compliance Assistance section of the Agency’s Web
site at www.dol.gov/pwba.
|
|
|
|
|
|
Question 40 - Incentive provisions - Does the plan
comply with WHCRA by not providing impermissible incentives or penalties
with respect to patients or attending providers?
A plan may not deny a patient eligibility to enroll or
renew coverage solely to avoid WHCRA’s requirements under ERISA section
713(c)(1).
In addition, under ERISA section 713(c)(2), a plan may
not penalize or offer incentives to an attending provider to induce the
provider to furnish care in a manner inconsistent with WHCRA.
|
|
|
