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Health Insurance Reform for Employers

The HIPAA health insurance reform requirements of Part A of title XXVII of the Public Health Service (PHS) Act apply to group health plans.  Title XXVII has been amended by the Newborns' and Mothers' Health Protection Act of 1996, the Mental Health Parity Act of 1996 (MHPA), the Women's Health and Cancer Rights Act of 1998 (WHCRA), the Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA), the Genetic Information Nondiscrimination Act of 2008 (GINA), Michelle's Law (2008) and the Children's Health Insurance Program Reauthorization Act of 2009 (CHIPRA).  Requirements of the MHPA and MHPAEA only apply to group health plans of large employers.

A large employer is an organization (or a non federal government employer) that has at least 51 employees.  (Certain HIPAA requirements only apply to large employers.)  A small employer is a company (or a non federal government employer) that has at least two but not more than 50 employees. Some states, however, may consider a business with only one employee a small employer.  An individual market policy is a non-employment based policy.

Contact your state department of insurance, if you sponsor a fully insured plan, to find out whether there are any additional requirements.

In general, non federal government group health plans are subject to the requirements mentioned above to the same extent as other employer group health plans. However, a non federal government employer that provides self-funded group health coverage to its employees may elect to exempt its plan from certain requirements of title XXVII of the Public Health Service (PHS) Act.

In addition to having to comply with certain requirements under HIPAA, employers sponsoring group health plans also enjoy certain protections under HIPAA. For example, a small group health insurance issuer generally is required to sell coverage to all small employers. Also, a group health insurance issuer generally is required to renew coverage to all employers.

The HIPAA certificate of creditable coverage indicates how long an individual had a group market, individual market or other health coverage.  Individuals should retain this document for their records.  This document or a copy of this document should not be sent to CMS.

As noted above, in 2008, Congress enacted three important laws that provided additional protection for consumers:  GINA, MHPAEA (see The Mental Health Parity Act Web page by going to the Health Insurance Reform for Consumers page and scrolling down the left hand column); and Michelle's Law.  In 2009 another important law, CHIPRA, was enacted.  These new laws will took effect in 2009 and are now posted for your review on the "Health Insurance Reform for Consumers" page.  To view the page, scroll down to the "Related Links Inside CMS" and click on the link.

For additional information, you may e-mail us at phig@cms.hhs.gov.

Note:  A nonfederal government employer that provides self-funded group health plan coverage to its employees (coverage that is not provided through an insurer) may elect to exempt its plan from most requirements of title XXVII of the Public Health Service (PHS) Act, with the exception of requirements pertaining to GINA and requirements pertaining to the certification and disclosure of an individual's creditable coverage under the plan.  For more information go to http://www.cms.gov/SelfFundedNonfedGovPlans/ in the left hand column scroll down and select "Procedures and Requirements".