Health Insurance Portability

[Federal Register Volume 64, Number 205 (Monday, October 25, 1999)]

[Rules and Regulations]

[Pages 57520-57521]

From the Federal Register Online via the Government Publishing Office [www.gpo.gov]

[FR Doc No: 99-27646]

[[Page 57519]]

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Part II

Department of the Treasury

_______________________________________________________________________

Internal Revenue Service

26 CFR Part 54

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Department of Labor

_______________________________________________________________________

Pension and Welfare Benefits Administration

29 CFR Part 2590

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Department of Health and Human Services

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Health Care Financing Administration

45 CFR Subtitle A, Parts 144 and 146

Health Insurance Portability; Final Rule

Federal Register / Vol. 64, No. 205 / Monday, October 25, 1999 /

Rules and Regulations

[[Page 57520]]

DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Part 54

DEPARTMENT OF LABOR

Pension and Welfare Benefits Administration

29 CFR Part 2590

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Health Care Financing Administration

45 CFR Subtitle A, Parts 144 and 146

Health Insurance Portability

AGENCY: Office of Tax Policy and Internal Revenue Service, Treasury;

Pension and Welfare Benefits Administration, Labor; and Health Care

Financing Administration, HHS (the Departments).

ACTION: Solicitation of comments on interim rule.

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SUMMARY: In response to interim regulations published on April 8, 1997,

the Departments have received comments from the public on a number of

issues arising under the portability, access, and renewability

provisions of the Health Insurance Portability and Accountability Act

of 1996 (HIPAA). The Departments are interested in receiving further

comments reflecting the experience that interested parties have had

with the interim regulations.

DATES: The Departments have requested that comments be submitted on or

before January 25, 2000.

ADDRESSES: For convenience, written comments should be submitted with a

signed original and 3 copies to the Health Care Financing

Administration (HCFA) at the address specified below. HCFA will provide

copies to each of the Departments for their consideration. All comments

will be available for public inspection in their entirety. Comments

should be sent to: Health Care Financing Administration, Department of

Health and Human Services, Attention: HCFA-2056-NC, P.O. Box 9013,

Baltimore, MD 21244-9013.

If you prefer, you may deliver a signed original and 3 copies of

your written comments to one of the following addresses:

Room 443-G, Hubert H. Humphrey Building, 200 Independence Avenue, SW.,

Washington, DC.

or

Room C5-16-03, 7500 Security Boulevard, Baltimore, Maryland.

Comments may also be submitted electronically to the following e-

mail address: HIPAAC[email protected]. E-mail comments must include the

full name and address of the sender, and must be submitted to the

referenced address in order to be considered. All comments must be

incorporated into the text of the e-mail message itself in case of any

difficulty in accessing attachments. Electronically submitted comments

will be available for public inspection at the Independence Avenue

address, below. Because of staffing and resource limitations, comments

by facsimile (FAX) transmission cannot be accepted. In commenting,

please refer to file code HCFA-2056-NC. Comments received timely will

be available for public inspection as they are received, generally

beginning approximately 3 weeks after publication of this document, in

Room 309-G of the Department of Health and Human Service's offices at

200 Independence Avenue, SW., Washington, DC, on Monday through Friday

of each week from 8:30 a.m. to 5 p.m. (phone: (202) 690-7890).

Upon receipt from HCFA, the Department of Labor will make all

comments available for public inspection and copying in their entirety.

All comments received by the Department of Labor will be available for

public inspection and copying at the Public Disclosure Room, Pension

and Welfare Benefits Administration, U.S. Department of Labor, Room N-

5638, 200 Constitution Avenue, NW, Washington, DC 20210, on Monday

through Friday of each week from 8:30 a.m. to 4:30 p.m.

FOR FURTHER INFORMATION CONTACT: Amy Turner, Department of Labor,

Pension and Welfare Benefits Administration, Health Care Task Force, at

(202) 219-7006 (not a toll-free number); Russ Weinheimer, Internal

Revenue Service, at (202) 622-4695 (not a toll-free number); or

Danielle Noll, Health Care Financing Administration, at 410-786-1565

(not a toll-free number).

SUPPLEMENTARY INFORMATION:

Customer Service Information

To assist consumers and the regulated community, the Departments

have issued questions and answers concerning HIPAA. Individuals

interested in obtaining a copy of the Department of Labor's publication

``Recent Changes in Health Care Law'' may call a toll free number, 800-

998-7542, or access the publication on-line at www.dol.gov/dol/pwba,

the Department of Labor's website. Questions and answers pertaining to

HIPAA are also available on-line at www.hcfa.gov/hipaa/hipaahm.htm

(HCFA's website). The IRS publication ``Deciding Whether to Elect COBRA

Health Care Continuation Coverage After the Enactment of HIPAA'' is

available on the IRS's website at http://www.irs.ustreas.gov/prod/news/

index.html. Copies of the interim rules under HIPAA, as well as notices

and press releases related to HIPAA and other recently enacted health

care laws, are also available at the above referenced websites.

Background

The Health Insurance Portability and Accountability Act of 1996

(HIPAA) was enacted on August 21, 1996 (Public Law 104-191). HIPAA

amended the Internal Revenue Code of 1986 (Code), the Employee

Retirement Income Security Act of 1974 (ERISA), and the Public Health

Service Act (PHS Act) to provide for, among other things, improved

portability and continuity of health coverage including group health

plan coverage provided in connection with employment and other coverage

in the group and the individual insurance markets. Health coverage is

regulated in part by the Federal government, through the Code, ERISA,

the PHS Act and other Federal provisions, and in part by the States.

The portability, access, and renewability provisions of HIPAA are

set forth in Subtitle K of the Code, Part 7 of Subtitle B of Title I of

ERISA, and Title XXVII of the PHS Act (referred to below as the HIPAA

portability provisions). The HIPAA portability provisions are designed

to improve the availability and portability of health coverage by

limiting exclusions for preexisting conditions and providing credit for

prior coverage, guaranteeing availability of health coverage for small

employers, prohibiting discrimination against employees and dependents

based on health status, and guaranteeing renewability of health

coverage for employers and individuals. The HIPAA portability

provisions also include rules that guarantee access to individual

coverage for people who lose their group coverage. These provisions

also set forth requirements imposed on health insurance issuers.

Pursuant to sections 101(g)(4), 102(c)(4), and 401(c)(4) of HIPAA, the

Departments issued interim regulations made available on April 1, 1997

(published in the Federal Register on April 8,1997) (62 FR 16894) to

carry out these provisions, and are in the process of updating those

regulations.

[[Page 57521]]

Comments

In response to the interim regulations issued in April of 1997,

comments have been received from the public on a number of issues

arising under the HIPAA portability provisions. Further comments on the

HIPAA portability provisions are welcome, including comments

concerning, for example, certificates of creditable coverage,

limitations on preexisting condition exclusion periods, special

enrollment, excepted benefits, guaranteed availability and renewability

of coverage, and individual market requirements. The Departments are

interested in comments reflecting the experience of group health plans,

health insurance issuers, States, individuals, and other interested

parties in complying with or enforcing HIPAA's statutory and regulatory

requirements, or in obtaining the protections provided by these

provisions. With respect to HIPAA's nondiscrimination provisions, the

Departments expect to publish comprehensive regulations shortly and

comments will be solicited separately in connection with that

rulemaking. In order to quantify the costs and benefits associated with

the major provisions of HIPAA and the interim rule, the Departments are

interested in comments, studies, surveys, or reports on these costs and

benefits and why and how they arise. For benefits, areas of interest

include the impact HIPAA has had on: ``job lock,'' in which the risk of

losing health care coverage discourages workers from changing jobs;

health coverage--whether it has been expanded and whether lapses in

health coverage have become less frequent and shorter in duration; and

access to health coverage, particularly in light of HIPAA's

nondiscrimination and guaranteed issue provisions. In terms of costs,

areas of interest include the impact HIPAA has had on administrative

costs, claims costs, and group and individual premiums. In addition,

comments are sought regarding other changes to group health plans

resulting from HIPAA, as well as the experience with State

implementation of alternative mechanisms in the individual health

insurance market.

In addition, a recent General Accounting Office (GAO) report

contained a recommendation that the model certificate of creditable

health plan coverage should more explicitly inform consumers of their

rights under HIPAA.1 The GAO recommended that, at a minimum,

the model certificate should inform consumers about appropriate

contacts for additional information about HIPAA, and highlight key

provisions and restrictions, including: (1) The limits on preexisting

condition exclusion periods and the guaranteed renewability of all

health coverage; (2) the reduction or elimination of preexisting

condition exclusion periods for employees changing jobs; (3) the

prohibition against excluding an individual from an employer health

plan on the basis of one or more health factors; and (4) the guarantee

of access to insurance products for certain individuals losing group

health coverage and the restrictions placed on that guarantee. In light

of the GAO's recommendation, the Departments are interested in comments

on how best to improve the model certificate of creditable coverage

under HIPAA.

\1\ Private Health Insurance: Progress and Challenges in

Implementing 1996 Federal Standards (HEHS-99-100, May 1999).

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Signed at Washington, DC this 5th day of August 1999.

J. Mark Iwry,

Benefits Tax Counsel, Department of the Treasury.

Signed at Washington, DC this 5th day of August 1999.

Nancy J. Marks,

Acting Associate Chief Counsel, Employee Benefits and Exempt

Organizations, Internal Revenue Service, Department of the Treasury.

Signed at Washington, DC this 19th day of July 1999.

Richard M. McGahey,

Assistant Secretary, Pension and Welfare Benefits Administration,

Department of Labor.

Signed at Washington, DC this 15th day of September 1999.

Michael M. Hash,

Deputy Administrator, Health Care Financing Administration, Department

of Health and Human Services.

[FR Doc. 99-27646 Filed 10-22-99; 8:45 am]

BILLING CODE 4830-01-P; 4510-29-P; 4120-01-P