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The Center for Consumer Information & Insurance Oversight

 

Self-Funded Non-Federal Governmental Plans

Procedures and Requirements for HIPAA Exemption Election

The following procedures and requirements apply with respect to a plan sponsor's election to exempt its group health plan from certain requirements of Title XXVII of the Public Health Service (PHS) Act:

An exemption for a self-funded nonfederal governmental plan is not automatic.  If the sponsor of a self-funded nonfederal governmental plan wishes to exempt its plan from one or more of the requirements of Title XXVII from which the plan sponsor is permitted to exempt its plan, it must notify the Centers for Medicare & Medicaid Services (CMS) to that effect in writing. (See Model Exemption Election Document. Use of model format is recommended, but not required.  However, the requested information must be provided to CMS.)

An election to opt out of one or more of the requirements of Title XXVII, from which the plan sponsor is permitted to exempt its plan, may be sent to CMS at the following address:

Centers for Medicare & Medicaid Services (CMS)

Center for Consumer Information and Insurance Oversight (CCIIO)

ATTN: HIPAA Opt-Out

200 Independence Avenue, SW

Room 733H-02

Washington, DC 20201

or via facsimile to 301-492-4462

  • An election applies for a single specified plan year, or, in the case of a plan provided pursuant to a collective bargaining agreement, for all plan years encompassed by the agreement.
  • A plan sponsor may renew an opt-out election for a subsequent plan year (or period of plan coverage) by notifying CMS in writing. (See Model Exemption Election Document. Use of model format is recommended but not required.  However, the requested information must be provided to CMS.) 
  • Under an opt-out election, the plan must provide for: (1) notice to enrollees, on an annual basis* and at the time of enrollment under the plan, of the fact and consequences of the election (See Model Notice to Enrollees. Use of model format is recommended but not required.)

*IMPORTANT: The annual notice to plan enrollees generally must be disseminated BEFORE the plan year begins for a plan's initial exemption election and, in the case of an exemption election renewal, for any Title XXVII requirement from which the plan is permitted to be exempted but from which the plan was not exempt during the immediately preceding plan year.

  • A copy of the enrollee notice should be attached to the initial exemption election letter that is submitted to CMS.