Second Opinions

SECOND OPINIONS: Agencies Issue New HIPAA Excepted Benefits Proposed Rules

January 8, 2014 (PLANSPONSOR.com) - On Christmas Eve, the Departments of Labor (DOL) and Health and Human Services (HHS), and the Internal Revenue Service (IRS) (the Agencies) issued proposed rulemaking expanding the list of benefits that are “excepted benefits” under the HIPAA portability rules and Patient Protection and Affordable Care Act (ACA) insurance market reforms.  78 Fed. Reg. 77632 (Dec. 24, 2013).

By PS | January 08, 2014
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The Agencies say plans may rely on these proposed rules until final rulemaking, at least through 2014, except where otherwise noted.  Comments are due February 24, 2014.

Below we summarize the existing list of HIPAA excepted benefits and describe the new benefits added to this list. We also highlight the requirements from which these benefits are excepted.

What are the Existing HIPAA Excepted Benefits?

The HIPAA portability rules, which were in place prior to the ACA, included a list of “excepted benefits.”  ERISA §733; PHSA §9832; Code §9832.  This list of excepted benefits includes an “Overall Exception” and then specific categories of exceptions. 

·                     The “Overall Exception” includes accident insurance, disability insurance, liability and liability supplement insurance, workers’ compensation, automobile medical payment insurance, credit-only insurance, and on-site medical clinics. 

The other current exceptions include:

·                     Limited scope dental and vision coverage either offered under a separate insurance policy or where there is a separate election and contribution required;

·                     Benefits for long-term care or nursing home care;

·                     Coverage only for specified disease or illness, such as a cancer-only policy;

·                     Hospital indemnity or other fixed indemnity insurance offered under a separate policy;

·                     Medicare supplemental health insurance; and

·                     Similar supplemental coverage under a group health plan that is offered under a separate policy and where the value falls below a specified amount.

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