HIPAA Law Employees worry about keeping their health plan when changing jobs. By understanding their rights under the HIPAA Law, you can ease the fears and misconceptions employees may have when changing group health coverage. Among the most common concerns are the questions of whether or not a pre-existing condition will be covered when they switch to a new plan and how pregnancy will be covered. The Kassenbaum-Kennedy Act, also known as the Health Insurance Portability and Accountability Act of 1996, or HIPAA, is a federal law. HIPAA offers little protection if someone is switching from a group plan to an individual plan, and less if they have no insurance at all. HIPAA does, however, offer protection from losing coverage employees already have when they move from one group plan to another group plan. HIPAA says that group health plans cannot deny an application for group coverage based solely on the applicant's health status. This allows workers changing jobs better access to health coverage, limits exclusions for pre-existing conditions, and for certain employees guarantees renewable health coverage. Additionally, HIPAA states that an employee may not be denied coverage due to mental illness, genetic information, disability, or past claims history. However, employers are not required by any state or federal law to offer, or pay for, health insurance for employees. Under HIPAA rules, group health plans cannot consider pregnancy a pre-existing condition or exclude coverage for prenatal care or delivery. There are no federal laws requiring that group health plans provide maternity coverage, although some states, such as Washington, do mandate maternity coverage. Therefore this HIPAA provision applies only to health plans offering maternity coverage. HIPAA rules regarding pregnancy do not negate the employer's waiting period. In other words, an employee may still be subject to the standard eligibility period for all new employees before benefits begin. A worthy note: the employer's waiting period does not count as a lapse of coverage for the employee, and thus he is not penalized under HIPAA. HIPAA imposes limits on the time which some health plans can exclude coverage for pre-existing conditions. As an example, if an employee has had "creditable" health insurance for 12 months, with no lapse in coverage greater than 63 days, the new group health plan cannot invoke the pre-existing condition exclusion. The new plan must cover all medical conditions when the employee becomes eligible for benefits. Alternatively, if an employee did not have creditable coverage he may be subject to the pre-existing condition clause and the plan can refuse to pay for any existing medical problems. Under federal law, 12 months is the maximum limitation that can be applied to any pre-existing condition on a group health plan. In the state of Washington, the maximum limitation is set at 9 months. Employees can receive "credit for time served" - that is the amount of time they were enrolled in the previous health plan. The "credit" or time spent on the other plan can be deducted from the exclusion period on their new plan. For example, if an employee had 12 or more months of continuous coverage on his old plan, switches to a new group plan, he will not be subject to the pre-existing condition rule. If he had coverage for only eight months prior to switching to the new plan he would be subject to only a four-month exclusion period. Whenever an employee leaves your health plan, it is important that they get a "certificate of creditable coverage" (also known as a HIPAA certificate)* from your group's insurance carrier. When a new employee applies for coverage, the employer or insurance carrier may ask for evidence of prior coverage. Including that information on the applicant's enrollment form may reduce the time that it takes to process claims. Original Article http://www.insure.com/health/hipaa.html *Information regarding "certificate of creditable coverage may be found at: http://www.hcfa.gov/medicaid/hipaa/content/modcert3.asp
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