8456 Federal Register / Vol. 78, No. 25 / Wednesday, February 6, 2013 / Proposed Rules 

24 CFR Part 203 

Hawaiian natives, Home 

improvement, Indians—lands, Loan 

programs—housing and community 

development, Mortgage insurance, 

Reporting and recordkeeping 

requirements, Solar energy. 

Accordingly, for the reasons 

discussed in the preamble, HUD 

proposes to amend 24 CFR parts 200 

and 203 to read as follows: 

PART 200—INTRODUCTION TO FHA 

PROGRAMS 

■ 1. The authority citation for part 200 

continues to read as follows: 

Authority: 12 U.S.C. 1702–1715–z–21; 42 

U.S.C. 3535(d). 

■ 2. In § 200.145, add paragraph (c) to 

read as follows: 

§ 200.145 Property and mortgage 

assessment. 

* * * * * 

(c) For all new construction as well as 

structural repairs and/or renovations of 

existing properties, to the extent that an 

inspection is required to determine if 

construction quality of a one- to fourunit property is acceptable as security 

for an FHA-insured loan, the following 

requirements apply: 

(1)(i) In areas where local 

jurisdictions provide building code 

enforcement and the requisite 

documentation, the lender shall provide 

a copy of: 

(A) The building permit, or its 

equivalent, and a copy of the certificate 

of occupancy, or its equivalent; or 

(B) A satisfactory inspection notice for 

work completed, or its equivalent. 

(ii) The documentation provided 

under paragraph (c)(1)(i) of this section 

shall be considered satisfactory 

evidence of completion of the work. 

(2) In jurisdictions that do not provide 

building code enforcement and requisite 

documentation, three inspections are 

required for new construction. For 

existing construction, only one 

inspection and certification of work 

completed for repairs and renovations is 

required. For both new and existing 

construction, the lender shall, in order 

to ensure compliance with FHA 

requirements: 

(i) Select a Residential Combination 

Inspector (or its successor designation) 

certified by the International Code 

Council (or its successor organization) 

who is licensed or certified as a home 

inspector in accordance with the 

applicable State and local requirements 

governing the licensing or certification 

of those jurisdictions that license or 

certify such inspectors in the respective 

jurisdiction. The lender shall provide a 

certification from such inspector that 

the new construction and/or structural 

repair or renovation work is completed 

satisfactorily and in compliance with 

any applicable building code. 

(ii) In the absence of such Residential 

Combination Inspector, the lender shall 

obtain an inspection performed by a 

third party, who is a registered architect, 

a professional engineer, or a tradesman 

or contractor, and who has met the 

licensing and bonding requirements of 

the State in which the property is 

located. The lender shall provide a 

certification from such inspector that 

the inspector is licensed and bonded 

under applicable State law, and that the 

new construction and/or structural 

repair or renovation work is completed 

satisfactorily and in compliance with 

any applicable building code. 

■ 3. Remove the undesignated center 

heading ‘‘FHA Inspector Roster’’ and 

§§ 200.170–172. 

PART 203—SINGLE FAMILY 

MORTGAGE INSURANCE 

■ 4. The authority citation for part 203 

continues to read as follows: 

Authority: 12 U.S.C. 1709, 1710, 1715b, 

1715z–16, and 1715u; 42 U.S.C. 3535(d). 

§ 203.18 [Amended] 

■ 5. In § 203.18, remove paragraph (a)(3) 

and redesignate paragraph (a)(4) as 

paragraph (a)(3). 

■ 6. In § 203.50, revise paragraph (f)(1) 

to read as follows: 

§ 203.50 Eligibility of rehabilitation loans. 

* * * * * 

(f) * * * 

(1)(i) The limits prescribed in 

§ 203.18(a)(1) (in the case of a dwelling 

to be occupied as a principal residence, 

as defined in § 203.18(f)(1)); 

(ii) The limits prescribed in 

§ 203.18(a)(1) and (3) (in the case of a 

dwelling to be occupied as a secondary 

residence, as defined in § 203.18(f)(2)); 

(iii) 85 percent of the limits 

prescribed in § 203.18(c), or such higher 

limit, not to exceed the limits set forth 

in § 203.18(a)(1), as Commissioner may 

prescribe (in the case of an eligible 

nonoccupant mortgagor as defined in 

§ 203.18(f)(3)); 

(iv) The limits prescribed in 

§ 203.18a, based upon the sum of the 

estimated cost of rehabilitation and the 

Commissioner’s estimate of the value of 

the property before rehabilitation; or 

* * * * * 

§§ 203.200 through 203.209 [Removed] 

■ 7. Remove the undesignated center 

heading ‘‘Insured Ten-Year Protection 

Plans (Plan)’’ and §§ 203.200 through 

203.209. 

Dated: January 8, 2013. 

Carol J. Galante 

Assistant Secretary for Housing– Federal 

Housing Commissioner. 

[FR Doc. 2013–02668 Filed 2–5–13; 8:45 am] 

BILLING CODE 4210–67–P 

DEPARTMENT OF THE TREASURY 

Internal Revenue Service 

26 CFR Part 54 

[REG–120391] 

RIN 1545–BJ60 

DEPARTMENT OF LABOR 

Employee Benefits Security 

Administration 

29 CFR Part 2590 

RIN 1210–AB44 

DEPARTMENT OF HEALTH AND 

HUMAN SERVICES 

45 CFR Parts 147, 148, and 156 

[CMS–9968–P] 

RIN 0938–AR42 

Coverage of Certain Preventive 

Services Under the Affordable Care 

Act 

AGENCY: Internal Revenue Service, 

Department of the Treasury; Employee 

Benefits Security Administration, 

Department of Labor; Centers for 

Medicare & Medicaid Services, 

Department of Health and Human 

Services. 

ACTION: Proposed rules. 

SUMMARY: This document proposes 

amendments to rules regarding coverage 

for certain preventive services under 

section 2713 of the Public Health 

Service Act, as added by the Patient 

Protection and Affordable Care Act, as 

amended, and incorporated into the 

Employee Retirement Income Security 

Act of 1974 and the Internal Revenue 

Code. Section 2713 of the Public Health 

Service Act requires coverage without 

cost sharing of certain preventive health 

services, including certain contraceptive 

services, in non-exempt, nongrandfathered group health plans and 

health insurance coverage. The 

proposed rules would amend the 

authorization to exempt group health 

plans established or maintained by 

certain religious employers (and group 

health insurance coverage provided in 

connection with such plans) with 

respect to the requirement to cover 


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Federal Register / Vol. 78, No. 25 / Wednesday, February 6, 2013 / Proposed Rules 8457 

1 26 CFR 54.9815–2713T(b)(1); 29 CFR 2590.715– 

2713(b)(1); 45 CFR 147.130(b)(1). 

contraceptive services. The proposed 

rules would also establish 

accommodations for group health plans 

established or maintained by eligible 

organizations (and group health 

insurance coverage offered in 

connection with such plans), including 

student health insurance coverage 

arranged by eligible organizations that 

are religious institutions of higher 

education. This document also proposes 

related amendments to regulations 

concerning excepted benefits and 

Affordable Insurance Exchanges. 

DATES: Comments are due on or before 

April 8, 2013. 

ADDRESSES: In commenting, please refer 

to file code CMS–9968–P. Because of 

staff and resource limitations, the 

Departments cannot accept comments 

by facsimile (FAX) transmission. 

You may submit comments in one of 

four ways (please choose only one of the 

ways listed): 

1. Electronically. You may submit 

electronic comments to http:// 

www.regulations.gov. Follow the 

‘‘Submit a comment’’ instructions. 

2. By Regular Mail. You may mail 

written comments to the following 

address only: Centers for Medicare & 

Medicaid Services, Department of 

Health and Human Services, Attention: 

CMS–9968–P, P.O. Box 8013, Baltimore, 

MD 21244–1850. 

Please allow sufficient time for mailed 

comments to be received before the 

close of the comment period. 

3. By Express or Overnight Mail. You 

may send written comments to the 

following address only: 

Centers for Medicare & Medicaid 

Services, Department of Health and 

Human Services, Attention: CMS–9968– 

P, Mail Stop C4–26–05, 7500 Security 

Boulevard, Baltimore, MD 21244–1850. 

4. By Hand or Courier. You may 

deliver (by hand or courier) your written 

comments to the following addresses 

only: 

a. For delivery in Washington, DC— 

Centers for Medicare & Medicaid 

Services, Department of Health and 

Human Services, Room 445–G, Hubert 

H. Humphrey Building, 200 

Independence Avenue SW., 

Washington, DC 20201. 

Because access to the interior of the 

Hubert H. Humphrey Building is not 

readily available to persons without 

federal government identification, 

commenters are encouraged to leave 

their comments in the Centers for 

Medicare & Medicaid Services drop 

slots located in the main lobby of the 

building. A stamp-in clock is available 

for persons wishing to retain a proof of 

filing by stamping in and retaining an 

extra copy of the comments being filed. 

b. For delivery in Baltimore, MD— 

Centers for Medicare & Medicaid 

Services, Department of Health and 

Human Services, 7500 Security 

Boulevard, Baltimore, MD 21244–1850. 

If you intend to deliver your 

comments to the Baltimore address, call 

(410) 786–9994 in advance to schedule 

your arrival with one of our staff 

members. 

Do not mail comments to the 

addresses indicated as appropriate for 

hand or courier delivery because they 

may be delayed and received after the 

close of the comment period. 

For information on viewing public 

comments, see the beginning of the 

SUPPLEMENTARY INFORMATION section. 

FOR FURTHER INFORMATION CONTACT: 

Jacob Ackerman, Centers for Medicare & 

Medicaid Services (CMS), Department 

of Health and Human Services (HHS), at 

(410) 786–1565. Amy Turner or Beth 

Baum, Employee Benefits Security 

Administration (EBSA), Department of 

Labor, at (202) 693–8335. 

Karen Levin, Internal Revenue Service 

(IRS), Department of the Treasury, at 

(202) 927–9639. 

Customer Service Information: 

Individuals interested in obtaining 

information from the Department of 

Labor concerning employment-based 

health coverage laws may call the EBSA 

Toll-Free Hotline at 1–866–444–EBSA 

(3272) or visit the Department of Labor’s 

Web site (www.dol.gov/ebsa). In 

addition, information from HHS on 

private health insurance coverage can be 

found on CMS’s Web site 

(www.cciio.cms.gov), and information 

on health care reform can be found at 

www.HealthCare.gov. 

SUPPLEMENTARY INFORMATION:

Inspection of Public Comments: All 

comments received before the close of 

the comment period are available for 

viewing by the public, including any 

personally identifiable or confidential 

business information that is included in 

a comment. The Departments post all 

comments received before the close of 

the comment period on the following 

Web site as soon as possible after they 

have been received: 

www.regulations.gov. Follow the search 

instructions on that Web site to view 

public comments. 

Comments received timely will also 

be available for public inspection as 

they are received, generally beginning 

approximately three weeks after 

publication of a document, at the 

headquarters of the Centers for Medicare 

& Medicaid Services, 7500 Security 

Boulevard, Baltimore, Maryland 21244, 

Monday through Friday of each week 

from 8:30 a.m. to 4:00 p.m. To schedule 

an appointment to view public 

comments, call (800) 743–3951. 

I. Background 

The Patient Protection and Affordable 

Care Act (Pub. L. 111–148) was enacted 

on March 23, 2010, and amended by the 

Health Care and Education 

Reconciliation Act of 2010 (Pub. L. 111– 

152) on March 30, 2010. These statutes 

are referred to collectively as the 

Affordable Care Act. The Affordable 

Care Act reorganizes, amends, and adds 

to the provisions of part A of title XXVII 

of the Public Health Service Act (PHS 

Act) relating to group health plans and 

health insurance issuers in the group 

and individual markets. The Affordable 

Care Act adds section 715(a)(1) to the 

Employee Retirement Income Security 

Act of 1974 (ERISA) and section 

9815(a)(1) to the Internal Revenue Code 

(Code) to incorporate the provisions of 

part A of title XXVII of the PHS Act into 

ERISA and the Code, and to make them 

applicable to group health plans. The 

PHS Act sections incorporated by these 

references are sections 2701 through 

2728. 

Section 2713 of the PHS Act, as added 

by the Affordable Care Act and 

incorporated into ERISA and the Code, 

requires that non-grandfathered group 

health plans and health insurance 

issuers offering non-grandfathered 

group or individual health insurance 

coverage provide benefits for certain 

preventive health services without the 

imposition of cost sharing. These 

preventive health services include, with 

respect to women, preventive care and 

screenings as provided for in 

comprehensive guidelines supported by 

the Health Resources and Services 

Administration (HRSA). 

The Departments of Health and 

Human Services (HHS), Labor, and the 

Treasury (collectively, the Departments) 

published interim final rules with a 

request for comments implementing 

section 2713 of the PHS Act in the July 

19, 2010 Federal Register (75 FR 41726) 

(2010 interim final rules). Among other 

things, the 2010 interim final rules 

provide that a plan or issuer must 

provide coverage, without cost sharing, 

for certain newly recommended 

preventive health services starting with 

the first plan year (or, in the individual 

market, policy year) that begins on or 

after the date that is one year after the 

date on which the recommendation or 

guideline is issued.1

On August 1, 2011, HRSA adopted 

and released guidelines for women’s 

preventive services based on 


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2The HRSA Guidelines are available at: http:// 

www.hrsa.gov/womensguidelines. 

3This excludes services relating to a man’s 

reproductive capacity, such as vasectomies and 

condoms. 

4The 2011 amended interim final rules were 

issued and effective on August 1, 2011, and 

published on August 3, 2011. 

5The 2012 final rules were published on 

February 15, 2012 (77 FR 8725). 

6 Guidance on the Temporary Enforcement Safe 

Harbor for Certain Employers, Group Health Plans, 

and Group Health Insurance Issuers with Respect to 

the Requirement to Cover Contraceptive Services 

Without Cost Sharing Under Section 2713 of the 

Public Health Service Act, Section 715(a)(1) of the 

Employee Retirement Income Security Act, and 

Section 9815(a)(1) of the Internal Revenue Code, 

issued on February 10, 2012, and reissued on 

August 15, 2012. Available at: http://cciio.cms.gov/ 

resources/files/prev-services-guidance08152012.pdf. The guidance, as reissued on August 

15, 2012, clarifies, among other things, that group 

health plans that took some action before February 

10, 2012, to try, without success, to exclude or limit 

contraceptive coverage are not precluded from 

eligibility for the safe harbor. 

7See final rule on student health insurance 

coverage published by HHS on March 21, 2012 (77 

FR 16456 and 16457). 

8 In these proposed rules, any proposed 

accommodation specific to a religious institution of 

higher education is intended to accommodate the 

religious institution of higher education only with 

respect to its arrangement of student health 

insurance coverage. With respect to the 

establishment or maintenance of a group health 

plan by a religious institution of higher education, 

the religious institution of higher education is 

intended to be accommodated the same way as any 

other religious organization that has established or 

maintained a group health plan. 

recommendations of the independent 

Institute of Medicine, which had 

undertaken a review of the scientific 

and medical evidence on women’s 

preventive services (Women’s 

Preventive Services: Required Health 

Plan Coverage Guidelines, or HRSA 

Guidelines).2 As relevant here, the 

HRSA Guidelines include all Food and 

Drug Administration (FDA)-approved 

contraceptive methods, sterilization 

procedures, and patient education and 

counseling for all women with 

reproductive capacity, as prescribed by 

a health care provider (collectively, 

contraceptive services).3 Accordingly, 

under section 2713 of the PHS Act and 

the 2010 interim final rules, nongrandfathered group health plans and 

health insurance issuers offering nongrandfathered group or individual 

health insurance coverage are required 

to provide coverage without cost sharing 

of women’s preventive health services, 

including contraceptive services, 

consistent with the HRSA Guidelines in 

plan years (or, in the individual market, 

policy years) beginning on or after 

August 1, 2012, except as discussed 

later in this section. 

Contemporaneous with the issuance 

of the HRSA Guidelines, the 

Departments amended the 2010 interim 

final rules (76 FR 46621) (2011 amended 

interim final rules). The amendment 

provided HRSA with the authority to 

exempt group health plans established 

or maintained by religious employers 

(and group health insurance coverage 

provided in connection with such 

plans) from the requirement to cover 

contraceptive services pursuant to the 

HRSA Guidelines.4 The 2011 amended 

interim final rules specified that, for 

purposes of this exemption, a religious 

employer is one that: (1) Has the 

inculcation of religious values as its 

purpose; (2) primarily employs persons 

who share its religious tenets; (3) 

primarily serves persons who share its 

religious tenets; and (4) is a nonprofit 

organization described in section 

6033(a)(1) and (a)(3)(A)(i) or (iii) of the 

Code. Section 6033(a)(3)(A)(i) and (iii) 

of the Code refers to churches, their 

integrated auxiliaries, and conventions 

or associations of churches, as well as 

to the exclusively religious activities of 

any religious order. HRSA exercised this 

authority in the HRSA Guidelines such 

that group health plans established or 

maintained by these religious employers 

(and group health insurance coverage 

provided in connection with such 

plans) are exempt from the requirement 

to cover contraceptive services. 

On February 10, 2012, the 

Departments issued final rules that 

adopted the definition of religious 

employer in the 2011 amended interim 

final rules for purposes of the 

exemption from the requirement to 

cover contraceptive services (2012 final 

rules).5 Contemporaneous with the 

issuance of the 2012 final rules, HHS, 

with the agreement of the Departments 

of Labor and the Treasury, issued 

guidance establishing a temporary 

enforcement safe harbor for group 

health plans established or maintained 

by certain nonprofit organizations that 

have religious objections to 

contraceptive coverage (and any group 

health insurance coverage provided in 

connection with such plans).6

The guidance provides that, under the 

temporary enforcement safe harbor, the 

Departments will not take any 

enforcement action against an employer, 

group health plan, or health insurance 

issuer for failing to cover some or all 

recommended contraceptive services in 

a non-grandfathered group health plan 

(or any group health insurance coverage 

provided in connection with such a 

plan) where the plan is established or 

maintained by an organization meeting 

all of the following criteria: 

• The organization is organized and 

operates as a nonprofit entity. 

• From February 10, 2012, onward, 

the group health plan established or 

maintained by the organization has 

consistently not covered all or the same 

subset of recommended contraceptive 

services, consistent with any applicable 

state law, because of the religious beliefs 

of the organization. 

• The group health plan established 

or maintained by the organization (or 

another entity on behalf of the plan, 

such as a health insurance issuer or 

third party administrator) provides to 

participants a notice indicating that 

some or all contraceptive services will 

not be covered under the plan for the 

first plan year beginning on or after 

August 1, 2012, as set forth in the 

guidance. 

• The organization self-certifies that it 

satisfies the foregoing three criteria and 

documents its self-certification, as set 

forth in the guidance. 

The temporary enforcement safe 

harbor is also available for insured 

student health insurance coverage 

arranged by nonprofit institutions of 

higher education with religious 

objections to contraceptive coverage that 

similarly meet the four criteria.7

The temporary enforcement safe 

harbor is in effect until the first plan 

year that begins on or after August 1, 

2013. The Departments committed to 

rulemaking during this 1-year safe 

harbor period to provide women with 

contraceptive coverage without cost 

sharing as required by section 2713 of 

the PHS Act, while protecting certain 

additional organizations from having to 

contract, arrange, pay, or refer for any 

contraceptive coverage to which they 

object on religious grounds. 

The first step toward realizing these 

policy goals was an advance notice of 

proposed rulemaking (ANPRM) 

published on March 21, 2012 (77 FR 

16501). The ANPRM presented potential 

approaches and solicited comments on 

alternative ways to fulfill the 

requirements of section 2713 of the PHS 

Act when health coverage is established 

or maintained by eligible organizations, 

or arranged by eligible organizations 

that are religious institutions of higher 

education,8 with religious objections to 

contraceptive coverage. The 90-day 

comment period on the ANPRM closed 

on June 19, 2012. 

These proposed rules mark the next 

step in the process. The proposed rules 

would make two principal changes to 

the preventive services coverage rules to 

provide women contraceptive coverage 

without cost sharing, while taking into 

account religious objections to 

contraceptive services of eligible 

organizations, including eligible 


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organizations that are religious 

institutions of higher education, that 

establish or maintain or arrange health 

coverage. First, the proposed rules 

would amend the criteria for the 

religious employer exemption to ensure 

that an otherwise exempt employer plan 

is not disqualified because the 

employer’s purposes extend beyond the 

inculcation of religious values or 

because the employer serves or hires 

people of different religious faiths. 

Second, the proposed rules would 

establish accommodations for health 

coverage established or maintained by 

eligible organizations, or arranged by 

eligible organizations that are religious 

institutions of higher education, with 

religious objections to contraceptive 

coverage. The proposed rules also 

propose related amendments to other 

rules, consistent with the proposed 

accommodations. The Departments 

intend to finalize all such proposed 

amendments before the end of the 

temporary enforcement safe harbor. 

Comments are welcome on any aspect 

of the proposed rules, including on how 

best to provide women with 

contraceptive coverage without cost 

sharing as required by section 2713 of 

the PHS Act, while protecting eligible 

organizations from having to contract, 

arrange, pay, or refer for any 

contraceptive coverage to which they 

object on religious grounds. 

II. Overview of the Public Comments on 

the Advance Notice of Proposed 

Rulemaking 

The Departments received 

approximately 200,000 comments in 

response to the ANPRM. Commenters 

represented a wide variety of 

stakeholders, including religious 

groups; religiously affiliated educational 

institutions, health care organizations, 

charities, and associations; civil rights 

organizations; consumer groups; group 

health plan sponsors and 

administrators; third party 

administrators and other plan service 

providers; health insurance issuers; law 

and public policy organizations; states; 

secular organizations; private citizens; 

and women’s rights and reproductive 

health advocacy organizations. 

Comments addressed both the 

religious employer exemption and the 

suggested accommodations, among 

other issues. Although the Departments 

do not separately address each comment 

received, the significant issues raised in 

the comments are summarized in this 

section. The Departments considered 

these comments in developing the 

policies in these proposed rules. 

A. Comments on the Religious Employer 

Exemption 

Some commenters asserted that the 

definition of religious employer as 

formulated in the 2012 final rules is too 

narrow. Some of these commenters 

expressed concern that the group health 

plans of a number of religious 

employers, including houses of 

worship, do not qualify for the 

exemption because the employers’ 

purposes extend beyond the inculcation 

of religious values or because the 

employers serve or hire people of 

different religious faiths. Commenters 

noted that employers may not know the 

religious beliefs of those they serve or 

hire, and that employment 

discrimination laws may prohibit them 

from inquiring about the religious 

beliefs of their employees. Other 

commenters expressed concern that the 

definition of religious employer is not 

broad enough to allow them to continue 

their current exclusion of contraceptive 

services from coverage under their 

group health plans and warned that, if 

the definition of religious employer is 

not broadened, they could cease to offer 

health coverage to their employees in 

order to avoid having to offer coverage 

to which they object on religious 

grounds. 

Commenters also asserted that federal 

laws, including the Affordable Care Act, 

provide for conscience clauses and 

religious exemptions broader than the 

religious employer exemption provided 

for in the 2012 final rules. Other 

commenters asserted that the narrow 

scope of the exemption raises concerns 

under the First Amendment and the 

Religious Freedom Restoration Act 

(RFRA). Some commenters asserted that 

the criteria for the religious employer 

exemption could result in excessive 

government entanglement in religion. 

Several commenters expressed concern 

that the definition of religious employer 

sets a precedent for use in other areas 

of federal and state law. These 

commenters urged that the definition of 

religious employer be broadened such 

that more group health plans may 

qualify for the exemption. 

Other commenters, however, disputed 

claims that the contraceptive coverage 

requirement infringes on rights 

protected by the First Amendment or 

RFRA, noting that the requirement is 

neutral and generally applicable. They 

also explained that the requirement 

does not substantially burden religious 

exercise and, in any event, serves 

compelling governmental interests and 

is the least restrictive means to achieve 

those interests. 

Some commenters supported the 

inclusion of contraceptive services in 

the HRSA Guidelines and urged that the 

Departments not broaden the religious 

employer exemption. These commenters 

asserted that the definition of religious 

employer is appropriately targeted at 

houses of worship and argued that 

making contraceptive coverage available 

to as many women as possible would 

enhance access to important preventive 

health care services and would 

significantly reduce long-term health 

care costs and consequences associated 

with unplanned pregnancies. These 

commenters asserted that expanding the 

exemption would undermine the 

benefits of the law. Some commenters 

believed that the exemption should be 

eliminated entirely due to the 

importance of extending these benefits 

to as many women as possible. 

Several commenters requested 

clarification as to whether, if employees 

of multiple employers are covered 

under a single group health plan, each 

employer must independently meet the 

definition of religious employer for the 

plan to qualify for the exemption. 

B. Comments on the Suggested 

Accommodations for Health Coverage 

Established or Maintained by Religious 

Organizations or Arranged by Religious 

Institutions of Higher Education 

Several commenters asserted that the 

suggested accommodations described in 

the ANPRM would fail to adequately 

accommodate religious objections to 

contraceptive coverage. These 

commenters emphasized that, in their 

view, religious organizations would 

continue to be involved, whether 

directly or indirectly, in providing 

coverage for services that they find 

religiously objectionable. For example, 

with respect to insured group health 

plans, these commenters disputed the 

claim that contraceptive coverage is at 

least cost neutral and argued that plan 

sponsors would end up funding the 

coverage in the form of higher 

premiums or fees. These commenters 

generally argued that, in order to 

provide adequate relief, the 

Departments would need to rescind the 

contraceptive coverage requirement in 

its entirety, provide an exemption for 

the group health plan of any 

organization with a religious or moral 

objection to contraceptive coverage, or 

provide government funding for 

provision of contraceptive services. 

Other commenters recommended that 

the Departments expand the suggested 

accommodations to encompass the 

group health plans of a broader class of 

religiously affiliated organizations. 

Several commenters stated that the rules 


srobinson on DSK4SPTVN1PROD with PROPOSALS
8460 Federal Register / Vol. 78, No. 25 / Wednesday, February 6, 2013 / Proposed Rules 

should accommodate all organizations 

with a religious or moral objection to 

contraceptive coverage, whether the 

organization is religious or secular, or 

nonprofit or for-profit, among other 

potential distinctions. These 

commenters also argued that an 

accommodation should be available 

without regard to whether an 

organization has covered contraceptive 

services in its group health plan in the 

past. 

Some commenters recommended 

using criteria in other federal laws, such 

as the National Labor Relations Act, for 

determining whether the group health 

plan of an organization qualifies for an 

accommodation. Some commenters 

suggested accommodating the group 

health plans of religiously affiliated 

organizations recognized as tax-exempt 

under an IRS group ruling. 

In contrast, other commenters urged 

that any accommodation apply only to 

health coverage established or 

maintained by a limited class of 

religiously affiliated organizations or 

arranged by a limited class of religiously 

affiliated institutions of higher 

education. For example, several 

commenters suggested limiting any 

accommodation to only health coverage 

established or maintained by nonprofit 

organizations owned or controlled by a 

church, association of churches, or 

religious order, or arranged by nonprofit 

institutions of higher education owned 

or controlled by a religious organization 

as defined for purposes of Title IX of the 

Education Amendments of 1972. These 

commenters also generally argued that 

health coverage established or 

maintained by for-profit organizations 

or arranged by for-profit institutions of 

higher education, or health coverage 

established or maintained by 

organizations, or arranged by 

institutions of higher education, that 

object to only some types of 

contraceptive services, should not 

qualify for an accommodation. 

A number of commenters supported a 

self-certification process, similar to that 

used for the temporary enforcement safe 

harbor, for religious organizations 

seeking to avail themselves of an 

accommodation. Some commenters 

urged that the Departments adopt 

appropriate oversight and enforcement 

mechanisms to monitor compliance 

with the criteria for any accommodation 

and recommended self-certification as a 

tool to promote transparency and 

support compliance and enforcement. 

Other commenters suggested that the 

Departments consider any such selfcertification to be conclusive to avoid 

inquiry into a religious organization’s 

character, mission, or practices. 

Comments were quite varied 

regarding the ANPRM’s suggested 

approaches with respect to the 

provision of contraceptive coverage to 

participants and beneficiaries enrolled 

in self-insured group health plans 

established or maintained by religious 

organizations with religious objections 

to such coverage. Many commenters 

supported the general approach 

suggested in the ANPRM of ensuring 

that participants and beneficiaries 

enrolled in such self-insured plans 

receive contraceptive coverage without 

cost sharing. These commenters stated 

that any accommodation should not 

create delays in or barriers to 

contraceptive benefits, and that these 

benefits should be provided without 

participants and beneficiaries having to 

specifically elect such benefits. 

Concerns were raised by some 

commenters about an objecting 

organization’s ability to not administer, 

facilitate, or otherwise involve itself in 

the provision of contraceptive coverage 

to such participants and beneficiaries. 

Many commenters were concerned 

about how third party administrators 

would be able to fund these benefits. 

They noted that drug rebates, one 

suggested source of funds, often belong 

to another entity (such as the plan 

sponsor and/or the plan participants 

and beneficiaries), not the third party 

administrator, and stated that, in their 

view, costs incurred by third party 

administrators would ultimately be 

passed on to plan sponsors and/or plan 

participants and beneficiaries unless a 

separate source of funding could be 

found, such as some form of public 

funding or stand-alone contraceptive 

coverage with no premium or cost 

sharing. Others raised questions about 

the responsibility for communications 

regarding contraceptive coverage. Some 

third party administrators were 

concerned about becoming surrogate 

insurers, which might subject them to 

the application of state insurance laws. 

At the same time, other commenters 

believed that, with funding, notice, and 

adequate claims information, 

contraceptive coverage could be 

administered effectively by third party 

administrators. 

III. Provisions of the Proposed Rules 

A. Overview 

The Departments aim to secure the 

protections under section 2713 of the 

PHS Act that are designed to enhance 

coverage of important preventive 

services for women without cost sharing 

while accommodating the religious 

objections to contraceptive coverage of 

eligible organizations. 

The Departments propose two key 

changes to the preventive services 

coverage rules codified in 26 CFR 

54.9815–2713T, 29 CFR 2590.715–2713, 

and 45 CFR 147.130 to meet these goals. 

First, the proposed rules would amend 

the criteria for the religious employer 

exemption to ensure that an otherwise 

exempt employer plan is not 

disqualified because the employer’s 

purposes extend beyond the inculcation 

of religious values or because the 

employer serves or hires people of 

different religious faiths. Second, the 

proposed rules would establish 

accommodations for health coverage 

established or maintained by eligible 

organizations, or arranged by eligible 

organizations that are religious 

institutions of higher education, with 

religious objections to contraceptive 

coverage. 

Amendments to rules concerning 

excepted benefits and Affordable 

Insurance Exchanges (Exchanges) are 

also proposed in connection with the 

proposed accommodations. 

B. Explanation of Terms 

In these proposed rules, all references 

to ‘‘contraceptive coverage’’ are 

references to coverage of the 

contraceptive services that are required 

to be covered without cost sharing in 

accordance with the HRSA Guidelines 

(that is, all FDA-approved contraceptive 

methods, sterilization procedures, and 

patient education and counseling for all 

women with reproductive capacity, as 

prescribed by a health care provider). 

All references to ‘‘accommodation’’ 

are references to an arrangement under 

which contraceptive coverage is 

provided without cost sharing to plan 

participants and beneficiaries (or, in the 

case of student health insurance 

coverage, student enrollees and their 

covered dependents) independent of 

health coverage established or 

maintained or arranged by an objecting 

religious organization, including an 

objecting religious institution of higher 

education. 

Finally, all references to ‘‘religious 

organization’’ and ‘‘religious institution 

of higher education’’ are references to 

the class of organizations and 

institutions of higher education that 

establish or maintain or arrange health 

coverage that qualifies for an 

accommodation. These organizations 

are collectively referred to as ‘‘eligible 

organizations’’ in these proposed rules. 


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9For simplicity, this preamble refers only to 

provisions of 45 CFR 147.130. Parallel provisions to 

45 CFR 147.130 are contained in 26 CFR 54.9815– 

2713T and 29 CFR 2590.715–2713. 

10For simplicity, this preamble refers only to 

provisions of 45 CFR 147.131. Parallel provisions to 

45 CFR 147.131 are contained in 26 CFR 54.9815– 

2713A and 29 CFR 2590.715–2713A. 

11 76 FR 46623. 

C. Religious Employer Exemption and 

Accommodations for Health Coverage 

Established or Maintained or Arranged 

by Eligible Organizations 

For purposes of organization and 

clarity, proposed 45 CFR 147.130(a)9

would provide that the requirement to 

provide coverage for recommended 

preventive services without cost sharing 

is subject to a new 45 CFR 147.131, 

which would establish standards and 

processes related to both the religious 

employer exemption and the 

accommodations for health coverage 

established or maintained or arranged 

by eligible organizations, as discussed 

in more detail later in this section. 

Accordingly, the proposed rules 

would move to new 45 CFR 147.13110

the language currently in 45 CFR 

147.130(a)(1)(iv)(A) and (B) 

(incorporated by reference in the rules 

of the Departments of Labor and the 

Treasury) that authorizes HRSA to 

exempt group health plans of religious 

employers (and group health insurance 

coverage provided in connection with 

such plans) from the contraceptive 

coverage requirement and that defines 

religious employer for this purpose, and 

would amend the authorization and 

definition as discussed later in this 

section. 

1. Religious Employer Exemption 

Currently, under the 2012 final rules, 

a religious employer is one that: (1) Has 

the inculcation of religious values as its 

purpose; (2) primarily employs persons 

who share its religious tenets; (3) 

primarily serves persons who share its 

religious tenets; and (4) is a nonprofit 

organization described in section 

6033(a)(1) and 6033(a)(3)(A)(i) or (iii) of 

the Code. Section 6033(a)(3)(A)(i) and 

(iii) of the Code refers to churches, their 

integrated auxiliaries, and conventions 

or associations of churches, as well as 

to the exclusively religious activities of 

any religious order. The Departments 

explained in the 2011 amended interim 

final rules that this definition was 

intended to focus the religious employer 

exemption on ‘‘the unique relationship 

between a house of worship and its 

employees in ministerial positions.’’11

Some commenters brought to the 

Departments’ attention that the group 

health plans of certain religious entities 

that meet the fourth prong of the 

definition of religious employer 

(providing that a religious employer is 

a nonprofit organization described in 

section 6033(a)(1) and (a)(3)(A)(i) or (iii) 

of the Code) may not qualify for the 

exemption because those entities 

provide benevolent services to their 

communities. For example, if a church 

maintains a soup kitchen that provides 

free meals to low-income individuals 

irrespective of their religious faiths, it 

could fail to satisfy the third prong of 

the definition of religious employer 

(providing that a religious employer 

primarily serves persons who share its 

religious tenets). The same question 

could arise if a church runs a parochial 

school that employs people of different 

religious faiths. 

The Departments agree that the 

exemption should not exclude group 

health plans of religious entities that 

would qualify for the exemption but for 

the fact that, for example, they provide 

charitable social services to persons of 

different religious faiths or employ 

persons of different religious faiths 

when running a parochial school. 

Indeed, this was never the Departments’ 

intention in connection with the 2011 

amended interim final rules or the 2012 

final rules. Accordingly, in 45 CFR 

147.131(a) (and the related rules of the 

Departments of Labor and the Treasury), 

the Departments propose to amend the 

definition of religious employer that 

was adopted in the 2012 final rules by 

eliminating the first three prongs of the 

definition and clarifying the application 

of the fourth. Under this proposal, an 

employer that is organized and operates 

as a nonprofit entity and referred to in 

section 6033(a)(3)(A)(i) or (iii) of the 

Code would be considered a religious 

employer for purposes of the religious 

employer exemption. For this purpose, 

an organization that is organized and 

operates as a nonprofit entity is not 

limited to any particular form of entity 

under state law, but may include 

organizations such as trusts and 

unincorporated associations, as well as 

nonprofit, not-for-profit, non-stock, 

public benefit, and similar types of 

corporations. However, for this purpose, 

an organization is not considered to be 

organized and operated as a nonprofit 

entity if its assets or income accrue to 

the benefit of private individuals or 

shareholders. Under this standard, it is 

not necessary to determine the federal 

tax-exempt status of the nonprofit entity 

in determining whether the religious 

employer exemption applies. The 

Departments note that eliminating the 

first three prongs would avoid any 

inquiry into an employer’s purposes, as 

well as any inquiry into the religious 

beliefs of its employees and the 

religious beliefs of those it serves. 

The Departments believe that this 

proposal would not expand the universe 

of employer plans that would qualify for 

the exemption beyond that which was 

intended in the 2012 final rules. As 

previously noted, when the 

Departments first defined religious 

employer, the primary goal was to 

exempt the group health plans of houses 

of worship. Section 6033(a)(3)(A)(i) and 

(iii) of the Code refers to churches, their 

integrated auxiliaries, and conventions 

or associations of churches, as well as 

to the exclusively religious activities of 

any religious order. By restricting the 

exemption primarily to group health 

plans established or maintained by 

churches, synagogues, mosques, and 

other houses of worship, and religious 

orders, the fourth prong of the current 

definition of religious employer would 

alone suffice to meet the goal. By 

eliminating the first three prongs of the 

current definition, there no longer 

would be any question as to whether 

group health plans of houses of worship 

that provide educational, charitable, or 

social services to their communities 

qualify for the exemption. 

The Departments welcome comments 

on this proposal, including whether it 

would unduly expand the universe of 

employer plans that would qualify for 

the exemption and whether additional 

or different language is needed to clarify 

the scope of the exemption. 

2. Accommodations for Health Coverage 

Established or Maintained or Arranged 

by Eligible Organizations 

In proposed 45 CFR 147.131(b) 

through (e) (and the related rules of the 

Departments of Labor and the Treasury) 

and as discussed later in this section, 

the Departments propose policies 

relating to the accommodation of certain 

group health plans and group health 

insurance coverage with respect to the 

contraceptive coverage requirement. 

The Departments propose a comparable 

accommodation with respect to student 

health insurance coverage arranged by 

eligible organizations that are religious 

institutions of higher education. The 

Departments believe these proposed 

accommodations, as opposed to the 

exemption that is provided to religious 

employers, are warranted given that 

participants and beneficiaries in group 

health plans established or maintained 

by eligible organizations, as well as 

student enrollees and their covered 

dependents in student health insurance 

coverage arranged by eligible 

organizations, may be less likely than 

participants and beneficiaries in group 

health plans established or maintained 


srobinson on DSK4SPTVN1PROD with PROPOSALS
8462 Federal Register / Vol. 78, No. 25 / Wednesday, February 6, 2013 / Proposed Rules 

by religious employers to share such 

religious objections of the eligible 

organizations. The proposed 

accommodations would provide such 

plan participants and beneficiaries 

contraceptive coverage without cost 

sharing while insulating their employers 

or institutions of higher education from 

contracting, arranging, paying, or 

referring for such coverage. 

a. Definition of Eligible Organization 

These proposed rules would provide 

that group health plans established or 

maintained by eligible organizations 

with religious objections to 

contraceptive coverage (and group 

health insurance coverage provided in 

connection with such plans), and 

student health insurance coverage 

arranged by eligible organizations that 

are religious institutions of higher 

education with such objections, comply 

with the requirement to provide 

coverage for contraceptive services 

under section 2713 of the PHS Act if the 

conditions of the accommodation are 

satisfied. 

For purposes of these proposed rules 

only, the Departments propose to define 

an eligible organization as an 

organization that meets all of the 

following criteria: 

• The organization opposes providing 

coverage for some or all of the 

contraceptive services required to be 

covered under section 2713 of the PHS 

Act on account of religious objections. 

• The organization is organized and 

operates as a nonprofit entity. 

• The organization holds itself out as 

a religious organization. 

• The organization self-certifies that it 

satisfies the first three criteria, as 

described later in this section. 

This proposed definition of eligible 

organization is intended to allow health 

coverage established or maintained or 

arranged by nonprofit religious 

organizations, including nonprofit 

religious institutional health care 

providers, educational institutions, and 

charities, with religious objections to 

contraceptive coverage to qualify for an 

accommodation. For this purpose, an 

organization that is organized and 

operated as a nonprofit entity is not 

limited to any particular form of entity 

under state law, but may include 

organizations such as trusts and 

unincorporated associations, as well as 

nonprofit, not-for-profit, non-stock, 

public benefit, and similar types of 

corporations. However, for this purpose 

an organization is not considered to be 

organized and operated as a nonprofit 

entity if its assets or income accrue to 

the benefit of private individuals or 

shareholders. 

The Departments believe that the 

proposed definition of eligible 

organization would strike an 

appropriate balance because it would 

limit any accommodation to nonprofit 

organizations that hold themselves out 

as religious. The Departments solicit 

comments on whether the proposed 

definition of eligible organization would 

allow an appropriate universe of 

nonprofit religious organizations and 

institutions of higher education 

establishing or maintaining or arranging 

health coverage to qualify for an 

accommodation, including comments 

on whether it would be too broad or too 

narrow. 

The Departments do not propose that 

the definition of eligible organization 

extend to for-profit secular employers. 

Religious accommodations in related 

areas of federal law, such as the 

exemption for religious organizations 

under Title VII of the Civil Rights Act 

of 1964, are available to nonprofit 

religious organizations but not to forprofit secular organizations. 

Accordingly, the Departments believe it 

would be appropriate to define eligible 

organization to include nonprofit 

religious organizations, but not to 

include for-profit secular organizations. 

b. Self-Certification 

Each organization seeking 

accommodation under the proposed 

rules would be required to self-certify 

that it meets the definition of eligible 

organization, following a selfcertification process similar to that 

under the temporary enforcement safe 

harbor. The self-certification would also 

specify the contraceptive services for 

which the organization will not 

establish, maintain, administer, or fund 

coverage. The organization would not be 

required to submit the self-certification 

to any of the Departments. The 

organization would maintain the selfcertification (executed by an authorized 

representative of the organization) in its 

records for each plan year to which the 

accommodation applies and make the 

self-certification available for 

examination upon request so that 

regulators, issuers, third party 

administrators, and plan participants 

and beneficiaries may verify that an 

organization has qualified for an 

accommodation, while avoiding any 

inquiry into the organization’s 

character, mission, or practices. The 

Departments intend to specify in 

guidance the form to be used for the 

self-certification. 

c. Separate Contraceptive Coverage 

Without Cost Sharing for Plan 

Participants and Beneficiaries 

These proposed rules aim to provide 

women with contraceptive coverage 

without cost sharing and to protect 

eligible organizations from having to 

contract, arrange, pay, or refer for 

contraceptive coverage to which they 

object on religious grounds. 

1. Insured Plans 

To achieve these goals, under HHS’s 

authority in section 2792 of the PHS Act 

to promulgate rules ‘‘necessary or 

appropriate’’ to carry out the provisions 

of title XXVII of the PHS Act, and the 

parallel authorities of the Department of 

Labor in section 734 of ERISA and the 

Department of the Treasury in section 

9833 of the Code, these proposed rules 

would provide that, in the case of an 

insured group health plan established or 

maintained by an eligible organization, 

the health insurance issuer providing 

group coverage in connection with the 

plan would assume sole responsibility, 

independent of the eligible organization 

and its plan, for providing contraceptive 

coverage without cost sharing, 

premium, fee, or other charge to plan 

participants and beneficiaries. 

The eligible organization would 

provide the issuer with a copy of its 

self-certification. If the plan uses a 

separate issuer for certain coverage, 

such as prescription drug coverage, the 

eligible organization may also need to 

provide a copy of its self-certification to 

the separate issuer. Nothing more would 

be required of the eligible organization 

to qualify for the accommodation. 

The proposed rules would direct the 

issuer receiving the copy of the selfcertification to ensure that the coverage 

for those contraceptive services 

identified in the self-certification is not 

included in the group policy, certificate, 

or contract of insurance; that such 

coverage is not reflected in the group 

health insurance premium; and that no 

fee or other charge in connection with 

such coverage is imposed on the eligible 

organization or its plan. 

The proposed rules would further 

direct the issuer receiving the copy of 

the self-certification to provide 

contraceptive coverage under individual 

policies, certificates, or contracts of 

insurance (hereinafter referred to as 

individual health insurance policies) for 

plan participants and beneficiaries 

without cost sharing, premium, fee, or 

other charge. The coverage would not be 

offered by or through a group health 

plan. (As discussed later in this section, 

the Departments propose that this type 


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Federal Register / Vol. 78, No. 25 / Wednesday, February 6, 2013 / Proposed Rules 8463 

12Bertko, John, F.S.A., M.A.A.A., Director of 

Special Initiatives and Pricing, Center for Consumer 

Information and Insurance Oversight, Centers for 

Medicare & Medicaid Services, Glied, Sherry, Ph.D., 

Assistant Secretary for Planning and Evaluation, 

Department of Health and Human Services (ASPE/ 

HHS), et al., ‘‘The Cost of Covering Contraceptives 

Through Health Insurance,’’ (February 9, 2012), 

available at: http://aspe.hhs.gov/health/reports/ 

2012/contraceptives/ib.shtml. 

of individual health insurance policy be 

a new category of excepted benefits.) 

The issuer would automatically enroll 

plan participants and beneficiaries in a 

separate individual health insurance 

policy that covers recommended 

contraceptive services. The Departments 

envision that the issuer would ensure 

that contraceptive coverage for plan 

participants and beneficiaries is 

effective at the beginning of the plan 

year of their group health plan, to the 

extent possible, to prevent a delay or 

gap in contraceptive coverage. The 

eligible organization would have no role 

in contracting, arranging, paying, or 

referring for this separate contraceptive 

coverage. Such coverage would be 

offered at no charge to plan participants 

and beneficiaries, that is, the issuer 

would provide benefits for such 

contraceptive services without the 

imposition of any cost sharing 

requirement (such as a copayment, 

coinsurance, or a deductible), premium, 

fee, or other charge, consistent with 

section 2713 of the PHS Act. The 

requirements of section 2713 of the PHS 

Act, its implementing regulations, and 

other applicable federal and state law 

(as well as their enforcement 

mechanisms) would continue to apply 

with respect to such coverage. For 

example, an issuer providing such 

coverage could use reasonable medical 

management techniques consistent with 

45 CFR 147.130(a)(4). 

The Departments believe that, in the 

case of insured group health plans, this 

proposed arrangement would alleviate 

the need for the eligible organization to 

contract, arrange, pay, or refer for 

contraceptive coverage while providing 

contraceptive coverage to plan 

participants and beneficiaries at no 

additional cost. Actuaries, economists, 

and insurers estimate that providing 

contraceptive coverage is at least cost 

neutral, and may result in cost-savings 

when taking into account all costs and 

benefits for the insurer.12 In this 

instance, contraceptive coverage 

without cost sharing would be provided 

to plan participants and beneficiaries 

through individual health insurance 

policies, separate from the group policy 

through which all other coverage would 

be provided to plan participants and 

beneficiaries. The Departments believe 

that issuers generally would find that 

providing such contraceptive coverage 

is cost neutral because they would be 

they would be insuring the same set of 

individuals under both policies and 

would experience lower costs from 

improvements in women’s health and 

fewer childbirths. 

The Departments note that a health 

insurance issuer providing coverage in 

connection with a plan established or 

maintained by an eligible organization 

would be held harmless under the 

accommodation if a representation by 

the organization to the issuer that the 

organization is an eligible organization 

on which the issuer relied in good faith 

were determined later to be incorrect. 

Conversely, the eligible organization 

and its plan would be held harmless if 

the issuer were to fail to comply with 

the requirement that it provide separate 

contraceptive coverage for plan 

participants and beneficiaries at no 

charge. 

The Departments request comments 

on this proposed arrangement. 

2. Self-Insured Plans 

The Departments are considering 

alternative approaches for providing 

participants and beneficiaries in selfinsured group health plans established 

or maintained by eligible organizations 

with contraceptive coverage at no 

additional cost, while protecting the 

eligible organizations from having to 

contract, arrange, pay, or refer for such 

coverage. Under each of these 

approaches, a health insurance issuer 

that provides individual health 

insurance policies for contraceptive 

coverage for plan participants and 

beneficiaries at no additional cost 

would be able to offset the costs of 

providing such coverage by claiming an 

adjustment in Federally-facilitated 

Exchange (FFE) user fees that would 

reduce the amount of the such fees for 

the issuer (or an affiliated issuer), as 

discussed later in this section. The 

Departments envision that the issuer 

would ensure that contraceptive 

coverage for plan participants and 

beneficiaries is effective at the 

beginning of the plan year of their group 

health plans, to the extent possible, to 

prevent a delay or gap in contraceptive 

coverage. Under each of these 

approaches, HHS would assist in 

identifying issuers offering the separate 

individual health insurance policies for 

contraceptive coverage. 

Under all approaches, if there is a 

third party administrator for the selfinsured group health plan of the eligible 

organization, the eligible organization 

would provide the third party 

administrator with a copy of its selfcertification. If the plan uses a separate 

third party administrator for certain 

coverage, such as prescription drug 

coverage, the eligible organization 

would also provide a copy of its selfcertification to the separate third party 

administrator if the coverage 

administered by the separate third party 

administrator includes coverage of any 

contraceptive service listed in the selfcertification. 

Further, under all approaches, a third 

party administrator receiving a copy of 

the self-certification would 

automatically arrange separate 

individual health insurance policies for 

contraceptive coverage from an issuer 

providing such polices, as described 

above. The issuer providing the 

coverage (or an affiliated issuer) would 

receive an additional adjustment in the 

user fees that otherwise would be 

charged by an FFE in an amount that 

would offset a reasonable charge by the 

third party administrator for performing 

this service. In turn, the issuer would be 

required to pass the amount of this 

additional adjustment in FFE user fees 

on to the third party administrator as a 

condition of receiving any FFE user fee 

adjustment, and would be required to 

attest to HHS that it has in fact passed 

the amount of this additional 

adjustment on to the third party 

administrator. As a condition of 

payment of this amount by the issuer, 

the third party administrator would not 

be permitted to charge any amount to 

the eligible organization, its plan, or to 

plan participants or beneficiaries for 

performing the service. The 

Departments note that the issuer could 

either be affiliated with or be 

independent of the third party 

administrator. 

The Departments solicit comment on 

which of the proposed approaches 

below would best provide participants 

and beneficiaries in self-insured group 

health plans established or maintained 

by eligible organizations with 

contraceptive coverage at no additional 

cost, while protecting eligible 

organizations from having to contract, 

arrange, pay, or refer for such coverage. 

The Departments also request comment 

on whether there are other approaches 

that should be considered that would 

achieve the same goals. 

Under the first approach, a third party 

administrator receiving the copy of the 

self-certification would have an 

economic incentive to voluntarily 

arrange for the separate individual 

health insurance policies for 

contraceptive coverage for plan 

participants and beneficiaries because it 

would be compensated for a reasonable 

charge for automatically arranging for 

the contraceptive coverage through 


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13To the extent the plan uses more than one third 

party administrator (for example, one pharmacy 

benefit manager (PBM) to handle claims 

administration for prescription drugs and another 

entity to handle claims for inpatient and outpatient 

medical/surgical benefits), each third party 

administrator would become the plan administrator 

upon receiving the copy of the self-certification 

with respect to the types of claims that it normally 

processes (that is, the PBM would continue to 

handle claims for prescription drugs and the other 

entity would continue to handle claims for 

inpatient and outpatient medical/surgical benefits), 

and each would do so in accordance with section 

2713 of the PHS Act (even if plan terms might 

otherwise provide differently) as plan 

administration with an independent funding 

source. 

payment by the issuer of the 

contraceptive coverage. Under this 

approach, in automatically arranging for 

the contraceptive coverage, the third 

party administrator would be acting, not 

as the third party administrator to the 

self-insured plan of the eligible 

organization, but rather in its 

independent capacity apart from its 

capacity as the agent of the plan. Under 

this approach, the self-insured plan of 

the eligible organization would be 

treated as complying with the 

requirement to provide contraceptive 

coverage based on the third party 

administrator’s receipt of the copy of the 

self-certification. 

Under the second approach, coverage 

under the plan of the eligible 

organization would comply with the 

requirement to provide contraceptive 

coverage without cost sharing only if the 

third party administrator administering 

coverage in connection with the plan 

automatically arranges for an issuer to 

assume sole responsibility for providing 

separate individual health insurance 

policies offering contraceptive coverage 

without cost sharing, premium, fee, or 

other charge to plan participants and 

beneficiaries, the eligible organization, 

or its plan. As discussed above, any 

reasonable administrative costs of the 

third party administrator in performing 

this service would be covered through 

payment by the issuer of the 

contraceptive coverage. If the third party 

administrator performs the services, 

coverage under the plan of the eligible 

organization would comply with 45 CFR 

147.130. While the third party 

administrator would not be directly 

responsible for assuring compliance 

with section 2713 of the PHS Act, the 

Departments expect that third party 

administrators would seek to assist 

eligible organizations such that eligible 

organizations would be able to avail 

themselves of the proposed 

accommodation. 

Under the third approach, the third 

party administrator receiving the copy 

of the self-certification would be 

directly responsible for automatically 

arranging for contraceptive coverage for 

plan participants and beneficiaries. 

Specifically, the self-certification would 

have the effect of designating the third 

party administrator 13 as the plan 

administrator under section 3(16) of 

ERISA solely for the purpose of 

fulfilling the requirement that the plan 

provide contraceptive coverage without 

cost sharing. The third party 

administrator would satisfy its 

responsibility to automatically arrange 

for contraceptive coverage for plan 

participants and beneficiaries by 

arranging for an issuer to assume sole 

responsibility for providing separate 

individual health insurance policies 

offering contraceptive coverage without 

cost sharing, premium, fee, or other 

charge to plan participants and 

beneficiaries, the eligible organization, 

or its plan. The Departments note that 

there would be no obligation on a third 

party administrator to enter into or 

continue a third party administration 

contract with an eligible organization if 

the third party administrator were to 

object to having to carry out this 

responsibility. Although this approach 

would place the legal responsibility for 

assuring compliance with section 2713 

of the PHS Act solely on the third party 

administrator, it would have legal 

implications under ERISA’s reporting, 

disclosure, claims processing, and 

fiduciary provisions for both the third 

party administrator and the eligible 

organization. The Departments seek 

comment specifically on potential 

issues arising under ERISA if the third 

party administrator were to become the 

designated plan administrator under 

section 3(16) of ERISA, and therefore a 

plan fiduciary, even for the limited 

purposes contemplated. 

The Departments also seek comment 

on whether there is a need to provide 

an accommodation for self-insured 

plans of eligible organizations without 

third party administrators, and, if so, 

how best to ensure that participants and 

beneficiaries in such plans receive 

separate contraception coverage without 

cost sharing. No comments were 

submitted in response to the request in 

the ANPRM on the extent to which 

there are such plans without a third 

party administrator. The Departments 

continue to believe that there are very 

few, if any, self-insured plans of eligible 

organizations in this circumstance. 

The Departments solicit comment on 

these alternative approaches. 

3. Notice of Availability of 

Contraceptive Coverage and 

Coordination of Benefits 

The proposed rules would direct a 

health insurance issuer providing 

separate individual health insurance 

policies for contraceptive coverage at no 

additional cost to participants and 

beneficiaries in plans of eligible 

organizations to provide a written notice 

to plan participants and beneficiaries 

regarding the availability of the separate 

contraceptive coverage. Issuers 

providing such contraceptive coverage 

would be responsible for providing the 

notice of availability of such coverage to 

participants and beneficiaries in both 

insured and self-insured group health 

plans of eligible organizations. The 

notice would be provided directly to 

plan participants and beneficiaries by 

the issuer, separate from but 

contemporaneous with (to the extent 

possible) any application materials 

distributed in connection with 

enrollment (or re-enrollment) in group 

coverage established, maintained, or 

arranged by the eligible organization in 

any plan year to which the 

accommodation is to apply. As such, 

this notice generally would be provided 

annually. To satisfy the proposed notice 

requirement, issuers could use the 

model language set forth in the 

proposed rules or substantially similar 

language. The Departments request 

comments on the proposed notice 

requirement, including ways to improve 

the proposed model language, the 

timing and delivery (including 

electronically) of the notice to plan 

participants and beneficiaries, and 

whether this notice requirement could 

be combined with other existing notice 

requirements to simplify administration 

for issuers. 

The Departments also seek comment 

on whether there are efficient ways to 

limit the benefits provided under the 

separate individual health insurance 

policies for contraceptive coverage to 

match the contraceptive benefits 

identified in the self-certification or 

whether the separate individual health 

insurances policies for contraceptive 

coverage should simply cover the full 

set of recommended contraceptive 

services. One option would be to require 

coordination of benefits such that the 

contraceptive coverage is secondary to 

the coverage provided by the group 

health plan established or maintained 

by the eligible organization (and any 

group health insurance coverage 

provided in connection with the plan). 

The Departments solicit comment on 

this issue. 


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14For simplicity, the discussion that follows uses 

the shorthand ‘‘contraceptive coverage’’ to refer to 

contraceptive coverage for participants and 

beneficiaries in self-insured plans established or 

maintained by eligible organizations at no cost to 

plan participants or beneficiaries. 

d. Adjustments of Federally-Facilitated 

Exchange (FFE) User Fees 

To fund contraceptive coverage for 

participants and beneficiaries in selfinsured plans established or maintained 

by eligible organizations at no cost to 

plan participants or beneficiaries, HHS 

proposes that the existing proposed FFE 

user fee calculation, set forth in the 

December 7, 2012 proposed rule titled 

‘‘Patient Protection and Affordable Care 

Act; HHS Notice of Benefit and Payment 

Parameters for 2014’’ (77 FR 73213), 

take into account that an issuer that 

offers a qualified health plan (QHP) 

through an FFE (or an affiliated issuer 

in a state without an FFE) provides such 

contraceptive coverage by reducing the 

amount of the user fee. 

Consistent with Office of Management 

and Budget (OMB) Circular No. A25–R, 

the proposed revised FFE user fee 

calculation (which would result in an 

adjustment of the FFE user fee) would 

facilitate the proposed accommodation 

of self-insured plans established or 

maintained by eligible organizations by 

ensuring that plan participants and 

beneficiaries have separate individual 

health insurance policies for 

contraceptive coverage at no additional 

cost such that eligible organizations are 

not required to administer or fund such 

coverage. It would thereby support 

many of the goals of the Affordable Care 

Act, including improving the health of 

the population, reducing health care 

costs, providing access to health 

coverage, encouraging eligible 

organizations to continue to offer health 

coverage, and ensuring access to 

affordable QHPs via efficiently operated 

Exchanges. Moreover, as described in 

the 2012 final rules and the ANPRM, 

there are significant benefits associated 

with contraceptive coverage without 

cost sharing. Such contraceptive 

coverage significantly furthers the 

governmental interests in promoting 

public health and in promoting gender 

equality. 

Under this proposal, the FFE user fee 

calculation would take into account 

contraceptive coverage that is provided 

by an issuer in a state without an FFE 

so long as the issuer is affiliated with an 

issuer that offers a QHP through an 

FFE.14 The affiliated issuer would not 

be required to be a QHP issuer. An 

issuer that provides contraceptive 

coverage in a state without an FFE could 

offset the estimated cost of such 

coverage through an affiliated QHP 

issuer in a state with an FFE. This 

would encourage issuers to provide this 

type of coverage widely, to meet the 

goal of providing all plan participants 

and beneficiaries of self-insured plans 

established or maintained by eligible 

organizations with separate 

contraceptive coverage without cost 

sharing. 

HHS proposes that, in order for the 

FFE user fee calculation to take into 

account that a QHP issuer (or an 

affiliated issuer) provides contraceptive 

coverage, the issuer providing coverage 

for contraceptive services for the plan 

participants and beneficiaries of a selfinsured plan established or maintained 

by an eligible organization must provide 

coverage for all recommended 

contraceptive services identified in the 

self-certification of the eligible 

organization, and do so without cost 

sharing, premiums, fees, or other costs 

to the plan participants and 

beneficiaries. It also must pay the 

reasonable charge of third party 

administrators. The contraceptive 

coverage would be subject to all 

applicable federal and state laws, 

including state filing and rate review 

requirements. HHS seeks comment on 

ways to streamline the regulatory 

processes for, and minimize the costs of, 

obtaining approval of such coverage in 

all states. 

HHS further proposes that, if an issuer 

provides contraceptive coverage to plan 

participants and beneficiaries of selfinsured plans of eligible organizations at 

no additional cost, and it, or another 

issuer in the same issuer group, is 

required to pay an FFE user fee, an 

adjustment in the FFE user fee may be 

sought for the estimated cost of the 

contraceptive coverage. HHS would use 

the definition of issuer group proposed 

at 45 CFR 156.20 for this purpose. That 

section proposes that issuer group 

means all entities treated under section 

52(a) or (b) of the Code as a member of 

the same controlled group of 

corporations as (or under common 

control with) a health insurance issuer, 

or issuers affiliated by the common use 

of a nationally licensed service mark. 

HHS seeks comment on whether this 

definition would provide the 

appropriate amount of flexibility in 

calculating the FFE user fee to correctly 

reflect the costs of issuers in states 

without an FFE, and on the advantages 

and disadvantages of permitting an 

adjustment in the FFE user fee with 

respect to unaffiliated issuers. 

Under this proposal, the issuer 

providing the contraceptive coverage 

would provide certain information and 

documentation (jointly with the 

affiliated QHP issuer if applicable) to 

HHS. First, monthly data on the number 

of individuals for whom the 

contraceptive coverage is being 

provided would be submitted, along 

with an attestation that a copy of the 

self-certification of the eligible 

organization was provided by the third 

party administrator that arranged for the 

coverage for the plan participants and 

beneficiaries. Second, the issuer(s) 

would be required to provide an 

attestation that coverage for all 

recommended contraceptive services 

identified in the self-certification of the 

eligible organization is being provided, 

and being provided without cost 

sharing, premiums, fee, or other costs to 

the plan participants or beneficiaries. 

The issuer also would attest to HHS that 

it passed the portion of its adjustment 

attributable to reasonable charges by 

third party administrators on to those 

parties. Third, the issuer(s) would be 

required to identify the QHP(s) being 

offered through an FFE with respect to 

which the FFE user fee adjustment is to 

be made. In addition, if the issuer 

providing the contraceptive coverage is 

not the QHP issuer for which the 

adjustment in the FFE user fee is being 

sought, HHS proposes to require an 

attestation that the issuers are from the 

same issuer group. Finally, the issuer(s) 

would be required to submit to HHS an 

estimate of the cost of the contraceptive 

coverage, along with data or 

documentation supporting that estimate. 

HHS approval of the cost estimate 

would be required before a QHP issuer 

could receive an FFE user fee 

adjustment. HHS solicits comment on 

whether additional information or 

attestations should be required of 

issuers, for example, whether issuers 

should be required to attest that they 

provided the required notice of 

availability of contraceptive coverage to 

plan participants and beneficiaries. 

HHS is considering two approaches to 

ensuring that the cost estimate 

reasonably reflects the cost of the 

contraceptive coverage. One approach 

would require the issuer(s) to submit to 

HHS the estimated per capita cost of the 

contraceptive coverage, as well as an 

actuarial memorandum prepared by a 

member of the American Academy of 

Actuaries in accordance with generally 

accepted actuarial principles and 

methodologies validating the estimate. 

HHS seeks comment on appropriate 

standards to guide such calculations. 

Under this approach, HHS expects that, 

in 2016 and beyond, the estimated cost 

of providing the contraceptive coverage 

would be based on the issuer’s 

experience in previous years. 


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8466 Federal Register / Vol. 78, No. 25 / Wednesday, February 6, 2013 / Proposed Rules 

HHS also proposes that the estimate 

of the cost of the contraceptive coverage 

could include a reasonable charge for 

the issuer’s administrative costs, 

including the costs of obtaining 

regulatory approval of the contraceptive 

coverage policy in the applicable state 

as well as a third party administrator’s 

charge. HHS seeks comment on the 

magnitude of a reasonable 

administrative charge. HHS recognizes 

that the contraceptive coverage that 

issuers would provide under this 

proposed accommodation could see 

limited enrollment in a particular state. 

Given the potentially narrow markets 

available to the issuers of the 

contraceptive coverage, the per capita 

cost of administering this type of 

coverage may be higher than that for 

major medical coverage or other 

excepted benefits. On the other hand, 

given that a third party administrator 

would be connecting the plan 

participants and beneficiaries with the 

issuer, and there would therefore be 

reduced marketing costs, the 

administrative costs could be lessened. 

HHS seeks comment on the appropriate 

magnitude of these administrative costs 

generally, as well as ways of minimizing 

the administrative costs. In particular, 

HHS notes the issues associated with 

reimbursing for fixed costs, including 

the cost of obtaining regulatory approval 

for the policy in the applicable state. 

Fixed administrative costs could be 

amortized across the expected life of the 

policy, or could be reimbursed in the 

first year of operation. HHS seeks 

comment on the appropriate manner of 

compensating for such costs. 

HHS also seeks comment on whether 

HHS should limit the number of issuers 

providing the contraceptive coverage in 

each state with respect to which an FFE 

user fee adjustment may be made. If 

HHS were to modify its proposal in this 

way, HHS would add that an issuer 

must be willing and have the ability to 

offer the contraceptive coverage to any 

participant or beneficiary in a selfinsured plan of an eligible organization 

who resides in the state. 

HHS notes that the estimate of the 

cost of the contraceptive coverage could 

include a reasonable margin. HHS seeks 

comment on the magnitude of a 

reasonable margin, and notes that the 

proposed HHS Notice of Benefit and 

Payment Parameters for 2014 proposes a 

presumed margin of 3 percent within 

allowable administrative costs for the 

risk corridors program. 

The proposed inclusion of reasonable 

administrative costs and margin in the 

estimate of the cost of the contraceptive 

coverage is intended to ensure that 

issuers receive reasonable compensation 

for providing the contraceptive 

coverage, as they would expect to 

receive in their other commercial 

businesses. HHS would review the 

submission by the issuer(s) to ensure 

that the cost estimate reflects reasonable 

assumptions and was calculated in 

accordance with applicable standards 

and generally accepted actuarial 

principles and methodologies. HHS 

would multiply the estimated per capita 

cost of the contraceptive coverage by the 

number of individuals being provided 

the contraceptive coverage each month 

in order to determine the magnitude of 

the FFE user fee adjustment. The 

amount should also take into account 

the reasonable administrative charges of 

third party administrators. 

Alternatively, HHS could provide a 

national per capita estimate for the cost 

of the contraceptive coverage, which 

would also include adjustments for 

reasonable administrative costs and 

margin. This estimate could then be 

multiplied by the monthly enrollment 

in the contraceptive coverage in order to 

determine the magnitude of the FFE 

user fee adjustment for each QHP issuer 

concerned. This latter approach would 

provide for a more standardized 

approach, but could result in FFE user 

fee adjustments that do not fund the 

entire cost of the contraceptive coverage 

for some issuers, or that overcompensate 

other issuers. The former approach, 

however, would place a greater 

administrative burden on issuers, and 

would require a more in-depth review 

by HHS. HHS seeks comment on these 

two approaches, as well as alternative 

approaches for determining the 

estimated cost of the contraceptive 

coverage. 

In both approaches to establishing an 

estimated cost of providing the 

contraceptive coverage described above, 

HHS seeks comment on the appropriate 

manner of accounting for a third party 

administrator’s administrative costs of 

arranging for the contraceptive coverage 

in the issuer’s estimated cost of the 

contraceptive coverage. For example, a 

flat administrative fee approved by HHS 

could be included in that estimated 

cost—with that flat administrative fee 

including an appropriate margin for the 

third party administrator. However, 

such an approach risks providing overor under-incentives to the third party 

administrator for arranging for the 

contraceptive coverage, if the flat 

administrative fee is too high or too low. 

Alternatively, the third party 

administrator’s actual reasonable 

charge, or actual reasonable 

administrative costs, for arranging the 

contraceptive coverage could be 

included in the estimated cost of the 

contraceptive coverage. HHS seeks 

comment on these and other approaches 

to estimating the third party 

administrator’s administrative costs, 

and how HHS may ensure that they 

reflect reasonable administrative costs. 

HHS proposes that, if the information 

described previously is provided and 

the cost estimate is approved, the FFE 

user fee will be reduced for the issuer 

of the identified QHP(s) by the amount 

of the approved estimate of the cost of 

the contraceptive coverage (multiplied 

by enrollment in the coverage for the 

month). While a highly unlikely 

occurrence given the relatively small 

population under consideration, HHS 

proposes that, if the amount of the 

adjustment is greater than the amount of 

the obligation to pay the FFE user fee in 

a particular month, the issuer of the 

identified QHP(s) will be provided a 

credit for the FFE user fee charged in 

succeeding months in the amount of the 

excess, consistent with OMB Circular 

No. A25–R. HHS seeks comment on 

whether a QHP issuer’s FFE user fee 

should be adjusted for any excess in 

succeeding months at all; whether, if a 

QHP issuer’s FFE user fee is adjusted for 

any excess in succeeding months, any 

time limit should be placed on how 

much later the adjustment should take 

place; and alternative methods of 

compensating an issuer with greater 

contraceptive coverage costs than its (or 

its affiliated QHP issuer’s) FFE user fees. 

HHS also proposes that an issuer 

providing contraceptive coverage for 

which the FFE user fee has been 

adjusted (whether the adjustment was 

provided to the issuer or an affiliated 

QHP issuer) must maintain for 10 years 

and make available to HHS upon 

request: documentation demonstrating 

that the contraceptive coverage was 

provided to participants or beneficiaries 

in a self-insured plan of an eligible 

organization, as evidenced by the copy 

of the self-certification that was 

provided by the third party 

administrator that arranged for such 

coverage; documentation demonstrating 

that the contraceptive coverage was 

provided without the imposition of any 

cost sharing, premium, fee, or other 

charge; documentation or data 

supporting the estimate of the cost of 

the contraceptive coverage; and 

documentation or data on the actual 

cost of providing the contraceptive 

coverage. This record-keeping 

requirement is consistent with 

timeframes under the False Claims Act, 

31 U.S.C. 3729–3733. HHS is 

considering mechanisms for ensuring 

program integrity with respect to the 

provision of the contraceptive coverage 

under this proposed accommodation. 


srobinson on DSK4SPTVN1PROD with PROPOSALS
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15Because student health plans are not 

employment-based, they are not group health plans 

under federal law. Section 2791(a)(1) of the PHS 

Act defines ‘‘group health plan’’ as an employee 

welfare benefit plan as defined in section 3(1) of 

ERISA to the extent that the plan provides medical 

care to employees and their dependents directly or 

through insurance, reimbursement, or otherwise. 

These mechanisms may include 

requiring cooperation with audits and 

investigations, and requiring corrective 

action. HHS seeks comment on the 

oversight requirements that should be 

implemented with respect to the 

contraceptive coverage under this 

proposal. 

Finally, HHS is proposing that a QHP 

issuer that is to receive an FFE user fee 

adjustment as described above prior to 

January 1, 2014, will be provided a 

credit in the amount of the adjustment 

beginning in January 2014. HHS seeks 

comment on issuers’ ability to fund the 

contraceptive coverage under the 

proposal between the end of the 

temporary enforcement safe harbor and 

December 31, 2013, if HHS is not able 

to provide the FFE user fee adjustment 

until January 2014. 

The Departments also seek comment 

on alternative ways to finance separate 

contraceptive coverage without cost 

sharing with respect to participants and 

beneficiaries in self-insured plans of 

eligible organizations. 

e. Treatment of Multiple Employer 

Group Health Plans 

The Departments recognize that, in 

some instances, several affiliated 

employers—only some of which are 

eligible organizations or religious 

employers—offer health coverage to 

their employees and their covered 

dependents through a single group 

health plan. The Departments 

considered allowing all employers in 

such instances to qualify for an 

accommodation or the religious 

employer exemption if any single 

employer met the definition of eligible 

organization or religious employer. 

Alternatively, the Departments 

considered precluding all employers in 

such instances from qualifying for an 

accommodation or the religious 

employer exemption if any single 

employer failed to meet the definition of 

eligible organization or religious 

employer. 

The Departments propose to make the 

accommodation or the religious 

employer exemption available on an 

employer-by-employer basis. That is, 

each employer would have to 

independently meet the definition of 

eligible organization or religious 

employer in order to take advantage of 

the accommodation or the religious 

employer exemption with respect to its 

employees and their covered 

dependents. Conversely, an employer 

that did not meet the definition of 

eligible organization or religious 

employer could not take advantage of 

the accommodation or the religious 

employer exemption with respect to its 

employees and their covered 

dependents. This approach would 

prevent what could be viewed as a 

potential way for employers that are not 

eligible for the accommodation or the 

religious employer exemption to avoid 

the contraceptive coverage requirement 

by offering coverage in conjunction with 

an eligible organization or religious 

employer through a common plan. The 

Departments seek comment on this 

approach, including comments on the 

extent to which an employer-byemployer approach would pose 

administrative challenges for plans and 

issuers, as well as comments on 

alternative approaches. 

f. Student Health Insurance Coverage 

Many institutions of higher education 

administer programs that provide 

students and their dependents with 

access to health coverage. Some 

institutions of higher education sponsor 

self-insured student health plans, but 

the vast majority of student health plans 

are insured, meaning that a health 

insurance issuer contracts with the 

institution of higher education to issue 

a blanket health insurance policy, from 

which students can buy coverage. Under 

final rules published by HHS on March 

21, 2012, student health insurance 

coverage is a type of individual health 

insurance coverage offered to students 

and their covered dependents under a 

written agreement between an 

institution of higher education and an 

issuer.15

Some religiously affiliated colleges 

and universities object to signing a 

written agreement for student health 

insurance coverage that provides 

benefits for contraceptive services. Such 

colleges and universities sometimes 

include funding for student health plans 

in their student financial aid packages 

and object to funding student health 

plans that include coverage for 

contraceptive services. 

The proposed rules would provide for 

an accommodation for student health 

insurance coverage arranged by a 

nonprofit religious institution of higher 

education with religious objections to 

contraceptive coverage comparable to 

the proposed accommodation for group 

health insurance coverage provided in 

connection with a group health plan 

established or maintained by a nonprofit 

religious organization with religious 

objections to contraceptive coverage. 

Accordingly, among other things, upon 

receiving a copy of the self-certification 

from an institution of higher education 

that meets the criteria for being an 

eligible organization, an issuer offering 

student health insurance coverage 

would provide contraceptive coverage, 

without cost sharing or additional 

premium, fee, or other charge, directly 

to student enrollees and their covered 

dependents, independent of the issuer’s 

written agreement with the institution 

of higher education to offer the student 

health plan. The Departments solicit 

comments on this proposal. 

g. Contraceptive-Only Excepted Benefits 

In order to implement the proposed 

accommodations, it would be necessary 

and appropriate to establish a new 

contraceptive-only excepted benefits 

category. Sections 2722(c)(2) and 

2763(b) of the PHS Act provide that the 

requirements of parts A and B of title 

XXVII of the PHS Act do not apply to 

any individual health insurance 

coverage in relation to its provision of 

excepted benefits described in section 

2791(c)(2) of the PHS Act if the benefits 

are provided under a separate policy, 

certificate, or contract of insurance. 

Section 2791(c)(2) of the PHS Act 

provides that this category of excepted 

benefits includes limited scope dental 

or vision benefits, as well as benefits for 

long-term care, nursing home care, 

home health care, or community-based 

care, or any combination thereof. The 

law authorizes similar limited benefits 

to be specified in rule as excepted 

benefits. Additionally, section 2792 of 

the PHS Act authorizes HHS to 

promulgate such rules as may be 

necessary or appropriate to carry out the 

provisions of title XXVII of the PHS Act. 

Parallel provisions in section 734 of 

ERISA and section 9833 of the Code do 

the same with respect to the 

Departments of Labor and the Treasury. 

Pursuant to the authority in section 

2791(c)(2) of the PHS Act (and 

companion provisions in ERISA and the 

Code), the proposed rules would 

provide that benefits for contraceptive 

services only, when provided under a 

separate individual market health 

insurance policy, certificate, or contract 

of insurance constitute excepted 

benefits (subject to the conditions 

discussed later in this section). The 

Departments propose to establish this 

new category of excepted benefits to 

ensure that individual health insurance 

policies providing contraceptive 

coverage offered by an issuer pursuant 

to the proposed accommodations are not 

subject to certain generally applicable 

PHS Act and Affordable Care Act 


srobinson on DSK4SPTVN1PROD with PROPOSALS
8468 Federal Register / Vol. 78, No. 25 / Wednesday, February 6, 2013 / Proposed Rules 

requirements, such as guaranteed 

availability (section 2702 of the PHS 

Act) given the unique nature of this 

coverage. Thus, for example, while 

issuers would offer this coverage to plan 

participants and beneficiaries in plans 

established or maintained by eligible 

organizations, issuers would not be 

required to make this coverage available 

to all other individuals in a state. These 

proposed amendments are reflected in 

proposed 45 CFR 148.220(b). 

Notwithstanding this proposed 

excepted benefits status, the 

Departments believe that a core set of 

basic consumer protection requirements 

should apply to individual health 

insurance policies providing 

contraceptive-only coverage. This core 

set of consumer protection requirements 

would be drawn from the broader set of 

requirements applicable to individual 

health insurance coverage under the 

PHS Act. This core set would include 

the requirements regarding guaranteed 

renewability of coverage (section 2703 

of the PHS Act), the prohibition against 

lifetime and annual dollar limits on 

benefits (section 2711 of the PHS Act), 

the prohibition against rescissions of 

coverage (section 2712 of the PHS Act), 

and internal appeals and external 

review rights (section 2719 of the PHS 

Act). Accordingly, pursuant to the 

authority in section 2792 of the PHS Act 

to promulgate rules that are ‘‘necessary 

or appropriate’’ to carry out section 

2713 of the PHS Act (and companion 

provisions in ERISA and the Code), the 

proposed rules would require 

compliance with these provisions of 

federal law as a condition of excepted 

benefits status. The Departments 

welcome comments on which 

requirements of the PHS Act, ERISA, 

and the Code should or should not 

apply to individual health insurance 

policies that provide contraceptive-only 

coverage. We also seek comments on 

how to simplify the establishment of 

these products and how best to ensure 

their availability in all states, including 

alternatives to excepted benefits in any 

state without any such product. 

D. No Effect on Other Law 

The religious employer exemption 

and accommodations in these proposed 

rules are intended to have meaning 

solely with respect to the contraceptive 

coverage requirement under section 

2713 of the PHS Act and the companion 

provisions of ERISA and the Code. 

Whether an employer or organization 

(including an institution of higher 

education) is designated as ‘‘religious’’ 

for these purposes is not intended as a 

judgment about the mission, sincerity, 

or commitment of the employer or 

organization (including an institution of 

higher education), or intended to 

differentiate among the religious merits, 

commitment, mission, or public or 

private standing of religious entities. 

The use of such designation is limited 

solely to defining the class of employers 

or organizations (including institutions 

of higher education) that would qualify 

for the religious employer exemption 

and accommodations under these 

proposed rules. The definition of 

religious employer or eligible 

organization in these proposed rules is 

not being proposed to apply with 

respect to, or relied upon for the 

interpretation of, any other provision of 

the PHS Act, ERISA, the Code, or any 

other provision of federal law, nor is it 

intended to set a precedent for any other 

purpose. For example, nothing in these 

proposed rules should be construed as 

affecting the interpretation of federal or 

state civil rights statutes, such as Title 

VII of the Civil Rights Act of 1964 or 

Title IX of the Education Amendments 

of 1972. 

Furthermore, nothing in these 

proposed rules would preclude 

employers or others from expressing 

their opposition, if any, to the use of 

contraceptives; require anyone to use 

contraceptives; or require health care 

providers to prescribe contraceptives if 

doing so is against their religious 

beliefs. 

Finally, the provisions of these 

proposed rules would not prevent states 

from enacting stronger consumer 

protections than these minimum 

standards. Federal health insurance 

regulation generally establishes a federal 

floor to ensure that individuals in every 

state have certain basic protections. 

State health insurance laws requiring 

coverage for contraceptive services that 

provide more access to contraceptive 

coverage than the federal standards 

would therefore continue under the 

proposed rules. The Departments solicit 

comment on the interaction between 

state law and these proposed rules. 

IV. Economic Impact and Paperwork 

Burden 

A. Executive Orders 12866 and 13563— 

Department of Health and Human 

Services and Department of Labor 

Executive Orders 12866 and 13563 

direct agencies to assess all costs and 

benefits of available regulatory 

alternatives and, if regulation is 

necessary, to select regulatory 

approaches that maximize net benefits 

(including potential economic, 

environmental, and public health and 

safety effects; distributive impacts; and 

equity). Executive Order 13563 

emphasizes the importance of 

quantifying both costs and benefits, 

reducing costs, harmonizing rules, and 

promoting flexibility. 

Section 3(f) of Executive Order 12866 

defines a ‘‘significant regulatory action’’ 

as an action that is likely to result in a 

rule: (1) Having an annual effect on the 

economy of $100 million or more in any 

one year, or adversely and materially 

affecting a sector of the economy, 

productivity, competition, jobs, the 

environment, public health or safety, or 

state, local, or tribal governments or 

communities (also referred to as 

‘‘economically significant’’); (2) creating 

a serious inconsistency or otherwise 

interfering with an action taken or 

planned by another agency; (3) 

materially altering the budgetary 

impacts of entitlement grants, user fees, 

or loan programs or the rights and 

obligations of recipients thereof; or (4) 

raising novel legal or policy issues 

arising out of legal mandates, the 

President’s priorities, or the principles 

set forth in the Executive Order. 

A regulatory impact analysis must be 

prepared for major rules with 

economically significant effects ($100 

million or more in any one year), and 

an ‘‘economically significant’’ 

regulatory action is subject to review by 

the Office of Management and Budget 

(OMB). The Departments have 

concluded that these proposed rules are 

not likely to have economic impacts of 

$100 million or more in any one year, 

and therefore do not meet the definition 

of ‘‘economically significant’’ under 

Executive Order 12866. 

1. Need for Regulatory Action 

As stated earlier in this preamble, the 

Departments previously issued 

amended interim final rules authorizing 

an exemption for group health plans 

established or maintained by religious 

employers (and any group health 

insurance coverage provided in 

connection with such plans) from 

certain coverage requirements under 

section 2713 of the PHS Act (76 FR 

46621, August 3, 2011). The amended 

interim final rules were finalized on 

February 15, 2012 (77 FR 8725). The 

Departments are proposing in these 

proposed rules to amend the definition 

of religious employer in the HHS rule at 

45 CFR 147.130(a)(1)(iv)(B) 

(incorporated by reference in the rules 

of the Departments of Labor and the 

Treasury) by eliminating the first three 

prongs of the definition of religious 

employer that was established in the 

2012 final rules and clarifying the fourth 

prong. Under this proposal, an employer 

that is an organization that is organized 

and operates as a nonprofit entity and 


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Federal Register / Vol. 78, No. 25 / Wednesday, February 6, 2013 / Proposed Rules 8469 

is referred to in section 6033(a)(3)(A)(i) 

or (iii) of the Code would be considered 

a religious employer and its group 

health plan would qualify for the 

exemption from the requirement to 

cover contraceptive services. In 

addition, the proposed rules would 

establish accommodations for health 

coverage established or maintained or 

arranged by eligible organizations, 

which have religious objections to 

contraceptive coverage, while providing 

women contraceptive coverage without 

cost sharing. 

2. Anticipated Effects 

The Departments expect that these 

proposed rules would not result in any 

additional significant burden on or costs 

to the affected entities. 

B. Special Analyses—Department of the 

Treasury 

For purposes of the Department of the 

Treasury, it has been determined that 

this notice of proposed rulemaking is 

not a significant regulatory action as 

defined in Executive Order 12866, as 

amended by Executive Order 13563. 

Therefore, a regulatory assessment is not 

required. It has also been determined 

that section 553(b) of the Administrative 

Procedure Act (5 U.S.C. chapter 5) does 

not apply to this proposed rule. It is 

hereby certified that the collections of 

information contained in this notice of 

proposed rulemaking would not have a 

significant impact on a substantial 

number of small entities. Accordingly, a 

regulatory flexibility analysis under the 

Regulatory Flexibility Act (5 U.S.C. 

chapter 6) is not required. 

The proposed rules would require 

each organization seeking 

accommodation under the proposed 

rules to self-certify that it meets the 

definition of eligible organization in the 

proposed rules. Each organization must 

self-certify that: (1) On account of 

religious objections, it opposes 

providing coverage for some or all of the 

contraceptive items or services that it 

would otherwise be required to provide; 

(2) it is organized and operates as a 

nonprofit entity; and (3) it holds itself 

out as a religious organization. The selfcertification must be executed by an 

authorized representative of the 

organization. The organization must 

maintain the self-certification in its 

records for each plan year to which the 

accommodation is to apply and make it 

available for examination upon request. 

The proposed rules would also require 

each eligible organization that 

establishes or maintains an insured 

group health plan to provide a copy of 

its self-certification to the group health 

insurance issuer. If the group health 

plan of the eligible organization is selfinsured, the proposed rules would 

direct the eligible organization to 

provide a copy of its self-certification to 

the third party administrator. 

The Departments intend to specify in 

guidance the form to be used for the 

self-certification, similar to the form 

previously prescribed in guidance for 

the temporary enforcement safe harbor. 

The Departments are unable to estimate 

the number of eligible organizations that 

would seek an accommodation. The 

Departments seek comment on the 

likely number of eligible organizations 

seeking an accommodation. Of the 

eligible organizations, some would 

likely be small entities. It is estimated 

that each eligible organization would 

need only approximately 50 minutes of 

labor (30 minutes of clerical labor at a 

cost of $30.64 per hour, 10 minutes for 

a manager at a cost of $55.22 per hour, 

5 minutes for legal counsel at a cost of 

$83.10 per hour, and 5 minutes for a 

senior executive at a cost of $112.43 per 

hour) each year to prepare and provide 

the information in the self-certification. 

This would not be a significant 

economic impact. For these reasons, this 

information collection requirement 

would not have a significant impact on 

a substantial number of small entities. 

The proposed rules also would 

require health insurance issuers 

providing separate contraceptive 

coverage to provide written notice to 

plan participants and beneficiaries 

regarding the availability of the 

contraceptive coverage. The notice 

would be provided separate from but 

contemporaneous with (to the extent 

possible) any application materials 

distributed in connection with 

enrollment (or re-enrollment) in group 

coverage established, maintained, or 

arranged by the eligible organization in 

any plan year to which the 

accommodation is to apply. The 

proposed rules contain model language 

for issuers to use to satisfy the notice 

requirement. There are 446 issuers in 

the individual and group markets. It is 

believed that very few, if any, of them 

are small entities. Moreover, the cost for 

preparation and distribution of the 

notice would not be significant. It is 

estimated that each issuer would need 

approximately 1 hour of clerical labor 

(at $31.64 per hour) and 15 minutes of 

management review (at $55.22 per hour) 

to prepare the notices for a total cost of 

approximately $44. It is estimated that 

each notice would require $0.46 in 

postage and $0.05 in materials cost 

(paper and ink) and the total postage 

and materials cost for each notice sent 

via mail would be $0.51. For these 

reasons, these information collection 

requirements would not have a 

significant impact on a substantial 

number of small entities. 

HHS is soliciting public comment on 

each of these issues for purposes of the 

following section as well. 

Pursuant to section 7805(f) of the 

Code, this proposed rule has been 

submitted to the Chief Counsel for 

Advocacy of the Small Business 

Administration for comment on its 

impact on small business. 

C. Paperwork Reduction Act— 

Department of Health and Human 

Services 

Under the Paperwork Reduction Act 

of 1995, HHS is required to provide 60- 

day notice in the Federal Register and 

solicit public comment before an 

information collection requirement 

(ICR) is submitted to the Office of 

Management and Budget (OMB) for 

review and approval. These proposed 

rules contain proposed ICRs that are 

subject to review by OMB. A description 

of these provisions is given in the 

following paragraphs with an estimate 

of the annual burden. In order to fairly 

evaluate whether an ICR should be 

approved by OMB, section 3506(c)(2)(A) 

of the Paperwork Reduction Act of 1995 

requires that HHS solicit public 

comment on the following issues: 

• The need for the information 

collection and its usefulness in carrying 

out the proper functions of HHS. 

• The accuracy of our estimate of the 

information collection burden. 

• The quality, utility, and clarity of 

the information to be collected. 

• Recommendations to minimize the 

information collection burden on the 

affected public, including automated 

collection techniques. 

HHS is soliciting public comment on 

each of these issues for the following 

sections of these proposed rules that 

contain proposed ICRs. Average labor 

costs (including fringe benefits) used to 

estimate the costs are calculated using 

data available from the Bureau of Labor 

Statistics. 

1. Self-Certification (§§ 147.131(b)(4), 

147.131(c)(1), 147.131(c)(2)) 

Each organization seeking 

accommodation under the proposed 

rules would be required to self-certify 

that it meets the definition of an eligible 

organization. The self-certification 

would be executed by an authorized 

representative of the organization and 

would also specify the contraceptive 

services for which the organization will 

not establish, maintain, administer, or 

fund coverage. The self-certification 

would not be submitted to any of the 

Departments. The form that would be 


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8470 Federal Register / Vol. 78, No. 25 / Wednesday, February 6, 2013 / Proposed Rules 

used by organizations for their selfcertification would be specified. This 

form is available for inspection at 

http://www.cms.gov/Regulations-andGuidance/Legislation/ 

PaperworkReductionActof1995/PRAListing.html. The organization would 

maintain the self-certification in its 

records for each plan year to which the 

accommodation is to apply. The eligible 

organization would need to provide a 

copy of its self-certification to a health 

insurance issuer (for insured group 

health plans or student health insurance 

coverage) or to a third party 

administrator (for self-insured group 

health plans). 

HHS does not have an estimate for 

how many organizations would seek an 

accommodation. HHS seeks comment 

on the likely number of organizations 

seeking an accommodation or the 

number of participants and beneficiaries 

in the plans of such organizations. 

Therefore, the burden for only one 

eligible organization, as opposed to all 

eligible organizations in total, is 

estimated. It is assumed that, for each 

eligible organization, clerical staff 

would gather and enter the necessary 

information, send the self-certification 

electronically to the issuer or third party 

administrator, and retain a copy for 

record-keeping, a manager and legal 

counsel would review it, and a senior 

executive would execute it. HHS 

estimates that an organization would 

need approximately 50 minutes (30 

minutes of clerical labor at a cost of 

$30.64 per hour, 10 minutes for a 

manager at a cost of $55.22 per hour, 5 

minutes for legal counsel at a cost of 

$83.10 per hour, and 5 minutes for a 

senior executive at a cost of $112.43 per 

hour) to execute the self-certification. 

Therefore, the total annual burden for 

preparing and providing the information 

in the self-certification would be 

approximately $41 for each eligible 

organization. 

With respect to self-insured plans of 

eligible organizations, the third party 

administrator would provide a health 

insurance issuer a copy of the selfcertification of the eligible organization. 

The third party administrator would be 

able to provide a copy of the selfcertification to the issuer electronically 

at minimal cost. 

2. Notice of Availability of 

Contraceptive Coverage (§ 147.131(d)) 

The proposed rules would direct a 

health insurance issuer providing 

separate individual contraceptive 

coverage at no additional cost to 

participants and beneficiaries in insured 

plans of eligible organizations (or to 

student enrollees and covered 

dependents in student health insurance 

coverage arranged by eligible 

organizations) and to participants and 

beneficiaries in self-insured plans of 

eligible organizations whose coverage is 

automatically arranged for them by a 

third party administrator to provide a 

written notice to such plan participants 

and beneficiaries (or to such student 

enrollees and covered dependents) 

regarding the separate contraceptive 

coverage. The notice would be separate 

from but contemporaneous with (to the 

extent possible) any application 

materials distributed in connection with 

enrollment (or re-enrollment) in group 

coverage of the eligible organization in 

any plan year to which the 

accommodation is to apply and would 

be provided annually. To satisfy the 

proposed notice requirement, issuers 

could use the model language set forth 

in the proposed rules or substantially 

similar language. 

It is unknown how many issuers 

provide health insurance coverage in 

connection with insured plans of 

eligible organizations or how many 

third party administrators provide 

services to self-insured plans of eligible 

organizations or how many issuers 

would provide separate individual 

contraceptive coverage to plan 

participants and beneficiaries of selfinsured plans of eligible organizations. 

Therefore, the burden for only one 

issuer, as opposed to all issuers in total, 

is estimated. It is estimated that each 

issuer would need approximately 1 hour 

of clerical labor (at $31.64 per hour) and 

15 minutes of management review (at 

$55.22 per hour) to prepare the notices 

for a total cost of approximately $44. It 

is estimated that each notice would 

require $0.46 in postage and $0.05 in 

materials cost (paper and ink) and the 

total postage and materials cost for each 

notice sent via mail would be $0.51. 

3. FFE User Fee Adjustments 

(§ 156.50(d)) 

In order for a QHP issuer to be eligible 

for the proposed FFE user fee 

adjustment, the proposed rules would 

provide that the issuer providing the 

contraceptive coverage would provide 

certain information and documentation 

(jointly with the affiliated QHP issuer 

for which the reduction in the FFE user 

fee is being sought, if the issuers are not 

the same) to HHS. First, monthly data 

on the number of individuals for whom 

the contraceptive coverage is being 

provided would be required, along with 

an attestation that a copy of the selfcertification of the eligible organization 

was provided by the third party 

administrator that arranged for the 

coverage for the plan participants and 

beneficiaries. Second, the issuer would 

provide an attestation that coverage for 

all recommended contraceptive services 

identified in the self-certification of the 

eligible organization is being provided, 

and being provided without cost 

sharing, premiums, fee, or other costs to 

the plan participants or beneficiaries. 

The issuer also would attest to HHS that 

it passed the portion of its adjustment 

attributable to reasonable charges by 

third party administrators on to those 

parties. Third, the issuer(s) would 

identify the QHP(s) being offered 

through an FFE with respect to which 

the FFE user fee reduction is to be 

applied. In addition, where the issuer 

providing the contraceptive coverage is 

not the QHP issuer for which the 

reduction in the FFE user fee is being 

sought, an attestation that the issuers are 

from the same issuer group would be 

submitted. Finally, the issuer(s) would 

submit to HHS an estimate of the cost 

of the contraceptive coverage, along 

with data or documentation supporting 

that estimate. HHS approval of the cost 

estimate would be required before a 

QHP issuer could receive an FFE user 

fee adjustment. 

Although the number of QHP issuers 

that would seek an FFE user fee 

adjustment is unknown at this point, 

HHS anticipates that a small number of 

issuer groups would provide such 

contraceptive coverage nationwide, and 

that, for purposes of efficiency, those 

issuer groups would consolidate their 

applications for FFE user fee 

adjustments with fewer than 9 issuers of 

QHPs on FFEs. Collections from fewer 

than 10 persons are exempt from the 

Paperwork Reduction Act under 44 

U.S.C. 3502(3)(A)(i). Therefore, HHS 

does not plan to seek OMB approval for 

this proposed ICR. However, in the 

event that, by the time of the issuance 

of the final rules, HHS believes that the 

number of QHP issuers that would seek 

an FFE user fee adjustment would be 

greater than 9, HHS would seek OMB 

approval for this proposed ICR. 

To obtain copies of the supporting 

statement and any related forms for the 

proposed ICRs referenced above, access 

CMS’s web site at http://www.cms.gov/ 

Regulations-and-Guidance/Legislation/ 

PaperworkReductionActof1995/PRAListing.html or email your request, 

including your address, phone number, 

OMB number, and CMS document 

identifier, to paperwork@cms.hhs.gov, 

or call the Reports Clearance Office at 

(410) 786–1326. 

If you comment on these proposed 

ICRs, please do either of the following: 

1. Submit your comments 

electronically as specified in the 


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Federal Register / Vol. 78, No. 25 / Wednesday, February 6, 2013 / Proposed Rules 8471 

16 In early 2013, that threshold level is 

approximately $139 million. 

ADDRESSES section of these proposed 

rules; or 

2. Submit your comments to the 

Office of Information and Regulatory 

Affairs, Office of Management and 

Budget, Attention: CMS Desk Officer, 

9968–P, FAX: (202) 395–5806, or email: 

OIRA_submission@omb.eop.gov. 

D. Paperwork Reduction Act— 

Department of Labor and Department of 

the Treasury 

As noted above, each organization 

seeking accommodation under the 

proposed rules would be required to 

self-certify that it meets the definition of 

an eligible organization. This proposed 

requirement, which is the same in all 

three sets of proposed rules, is set out 

in proposed 26 CFR 54.9815– 

2713A(b)(4) and proposed 29 CFR 

2590.715–2713A(b)(4). The Departments 

are soliciting public comments for 60 

days concerning this record-keeping 

requirement. The Departments will 

submit a copy of these proposed rules 

to OMB in accordance with 44 U.S.C. 

3507(d) for review of the proposed ICRs. 

The Departments and OMB are 

particularly interested in comments 

that: 

• Evaluate whether the collection of 

information is necessary for the proper 

performance of the functions of the 

agency, including whether the 

information will have practical utility; 

• Evaluate the accuracy of the 

agency’s estimate of the burden of the 

collection of information, including the 

validity of the methodology and 

assumptions used; 

• Enhance the quality, utility, and 

clarity of the information to be 

collected; and 

• Minimize the burden of the 

collection of information on those who 

are to respond, including through the 

use of appropriate automated, 

electronic, mechanical, or other 

technological collection techniques or 

other forms of information technology, 

for example, by permitting electronic 

submission of responses. 

Comments should be sent to the 

Office of Information and Regulatory 

Affairs, Attention: Desk Officer for the 

Employee Benefits Security 

Administration either by Fax to (202) 

395–5806 or by email to 

oira_submission@omb.eop.gov. A copy 

of the proposed ICRs may be obtained 

by contacting the PRA addressee: G. 

Christopher Cosby, Office of Policy and 

Research, Department of Labor, 

Employee Benefits Security 

Administration, 200 Constitution 

Avenue NW., Room N–5718, 

Washington, DC 20210; telephone: (202) 

693–8410; Fax: (202) 219–4745 (please 

note that these numbers are not toll-free 

numbers); email: ebsa.opr@dol.gov. 

Proposed ICRs submitted to OMB also 

are available at www.reginfo.gov (http:// 

www.reginfo.gov/public/do/PRAMain). 

Consistent with the HHS analysis 

presented above, the Departments do 

not have an estimate for how many 

organizations would seek an 

accommodation. The Departments seek 

comment on the likely number of 

organizations seeking an 

accommodation and the number of 

participants and beneficiaries in the 

plans of such organizations. The 

Departments rely on the same estimates 

noted above: 50 minutes per 

organization to execute the selfcertification (i.e., approximately $41 for 

each eligible organization). 

With respect to self-insured plans of 

eligible organizations, the third party 

administrator would provide a health 

insurance issuer a copy of the selfcertification of the eligible organization. 

The third party administrator would be 

able to provide a copy of the selfcertification to the issuer electronically 

at minimal cost. 

The Departments note that persons 

are not required to respond to, and 

generally are not subject to any penalty 

for failing to comply with, an ICR unless 

the ICR has a valid OMB control 

number. The paperwork burden 

estimates are summarized as follows: 

Type of Review: New collection. 

Agencies: Employee Benefits Security 

Administration, Department of Labor; 

Internal Revenue Service, Department of 

the Treasury. 

Title: Self-Certification; Preventive 

Services Coverage. 

OMB Number: XXXX–XXXX; XXXX– 

XXXX. 

Affected Public: Business or other forprofit; not-for-profit institutions. 

Total Respondents: Unknown. 

Total Responses: Unknown. 

Frequency of Response: Once. 

Estimated Total Annual Burden 

Hours: 50 minutes per respondent. 

Estimated Total Annual Burden Cost: 

Unknown. 

V. Unfunded Mandates Reform Act 

For purposes of the Unfunded 

Mandates Reform Act of 1995 (Pub. L. 

104–4), as well as Executive Order 

12875, these proposed rules do not 

include any proposed federal mandate 

that may result in expenditures by state, 

local, or tribal governments, nor does it 

include any proposed federal mandates 

that may impose an annual burden of 

$100 million, adjusted for inflation, or 

more on the private sector.16

VI. Federalism—Department of Health 

and Human Services and Department of 

Labor 

Executive Order 13132 outlines 

fundamental principles of federalism, 

and requires the adherence to specific 

criteria by federal agencies in the 

process of their formulation and 

implementation of policies that have 

‘‘substantial direct effects’’ on states, the 

relationship between the federal 

government and states, or the 

distribution of power and 

responsibilities among the various 

levels of government. Federal agencies 

promulgating rules that have these 

federalism implications must consult 

with state and local officials, and 

describe the extent of their consultation 

and the nature of the concerns of state 

and local officials in the preamble to the 

rules. 

In the Departments’ view, these 

proposed rules have federalism 

implications, but the federal 

implications are substantially mitigated 

because, with respect to health 

insurance issuers, 15 states have 

enacted specific laws, rules, or bulletins 

that meet or exceed the federal 

standards requiring coverage of 

specified preventive services without 

cost sharing. The remaining states 

which provide oversight for these 

federal law requirements are doing so 

using their general authority to enforce 

these federal standards. Therefore, the 

proposed rules are not likely to require 

substantial additional oversight of states 

by HHS. 

In general, section 514 of ERISA 

provides that state laws are superseded 

to the extent that they relate to any 

covered employee benefit plan, and 

preserves state laws that regulate 

insurance, banking, or securities. ERISA 

also prohibits states from regulating a 

covered plan as an insurance or 

investment company or bank. HIPAA 

added a new preemption provision to 

ERISA (as well as to the PHS Act) 

narrowly preempting state requirements 

for group health insurance coverage. 

States may continue to apply state law 

requirements but not to the extent that 

such requirements prevent the 

application of the federal requirement 

that group health insurance coverage 

provided in connection with group 

health plans provide coverage for 

specified preventive services without 

cost sharing. HIPAA’s Conference 

Report states that the conferees intended 

the narrowest preemption of state laws 

with regard to health insurance issuers 

(H.R. Conf. Rep. No. 104–736, 104th 

Cong. 2d Session 205, 1996). State 

insurance laws that are more stringent 


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8472 Federal Register / Vol. 78, No. 25 / Wednesday, February 6, 2013 / Proposed Rules 

17This authority applies to insurance issued with 

respect to group health plans generally, including 

plans covering employees of church organizations. 

Thus, this discussion of federalism applies to all 

group health insurance coverage that is subject to 

the PHS Act, including those church plans that 

provide coverage through a health insurance issuer 

(but not to church plans that do not provide 

coverage through a health insurance issuer). 

than the federal requirement are 

unlikely to ‘‘prevent the application of’’ 

the preventive services coverage 

provision, and therefore are not 

preempted. Accordingly, states have 

significant latitude to impose 

requirements on health insurance 

issuers that are more restrictive than 

those in federal law. 

Guidance conveying this 

interpretation was published in the 

Federal Register on April 8, 1997 (62 FR 

16904), and December 30, 2004 (69 FR 

78720), and these proposed rules would 

clarify and implement the statute’s 

minimum standards and would not 

significantly reduce the discretion given 

the states by the statute. 

The PHS Act provides that the states 

may enforce the provisions of title 

XXVII of the PHS Act as they pertain to 

issuers, but that the Secretary of HHS 

will enforce any provisions that a state 

does not have authority to enforce or 

that a state has failed to substantially 

enforce. When exercising its 

responsibility to enforce provisions of 

the PHS Act, HHS works cooperatively 

with the state for the purpose of 

addressing the state’s concerns and 

avoiding conflicts with the exercise of 

state authority.17 HHS has developed 

procedures to implement its 

enforcement responsibilities, and to 

afford states the maximum opportunity 

to enforce the PHS Act’s requirements 

in the first instance. In compliance with 

Executive Order 13132’s requirement 

that agencies examine closely any 

policies that may have federalism 

implications or limit the policymaking 

discretion of states, the Departments 

have engaged in numerous efforts to 

consult and work cooperatively with 

affected state and local officials. 

In conclusion, throughout the process 

of developing these proposed rules, to 

the extent feasible within the specific 

preemption provisions of ERISA and the 

PHS Act, the Departments have 

attempted to balance states’ interests in 

regulating health plans and health 

insurance issuers, and the rights of 

those individuals that Congress 

intended to protect in the PHS Act. 

VII. Statutory Authority 

The Department of the Treasury 

regulations are proposed to be adopted 

pursuant to the authority contained in 

sections 7805 and 9833 of the Code. 

The Department of Labor regulations 

are proposed to be adopted pursuant to 

the authority contained in 29 U.S.C. 

1002(16), 1027, 1059, 1135, 1161–1168, 

1169, 1181–1183, 1181 note, 1185, 

1185a, 1185b, 1185d, 1191, 1191a, 

1191b, and 1191c; sec. 101(g), Public 

Law 104–191, 110 Stat. 1936; sec. 

401(b), Public Law 105–200, 112 Stat. 

645 (42 U.S.C. 651 note); sec. 512(d), 

Public Law 110–343, 122 Stat. 3881; sec. 

1001, 1201, and 1562(e), Public Law 

111–148, 124 Stat. 119, as amended by 

Public Law 111–152, 124 Stat. 1029; 

Secretary of Labor’s Order 3–2010, 75 

FR 55354 (September 10, 2010). 

The Department of Health and Human 

Services regulations are proposed to be 

adopted pursuant to the authority 

contained in sections 2701 through 

2763, 2791, and 2792 of the PHS Act (42 

U.S.C. 300gg through 300gg–63, 300gg– 

91, and 300gg–92), as amended; and 

Title I of the Affordable Care Act, 

sections 1301–1304, 1311–1312, 1321– 

1322, 1324, 1334, 1342–1343, 1401– 

1402, and 1412, Public Law 111–148, 

124 Stat. 119 (42 U.S.C. 18021–18024, 

18031–18032, 18041–18042, 18044, 

18054, 18061, 18063, 18071, 18082, 26 

U.S.C. 36B, and 31 U.S.C. 9701). 

List of Subjects 

26 CFR Part 54 

Excise taxes, Health care, Health 

insurance, Pensions, Reporting and 

recordkeeping requirements. 

29 CFR Part 2590 

Continuation coverage, Disclosure, 

Employee benefit plans, Group health 

plans, Health care, Health insurance, 

Medical child support, Reporting and 

recordkeeping requirements. 

45 CFR Part 147 

Health care, Health insurance, 

Reporting and recordkeeping 

requirements, and State regulation of 

health insurance. 

45 CFR Part 148 

Administrative practice and 

procedure, Health care, Health 

insurance, Penalties, and Reporting and 

recordkeeping requirements. 

45 CFR Part 156 

Administrative practice and 

procedure, Advertising, Advisory 

committees, Brokers, Conflict of 

interest, Consumer protection, Grant 

programs—health, Grants 

administration, Health care, Health 

insurance, Health maintenance 

organization (HMO), Health records, 

Hospitals, American Indian/Alaska 

Natives, Individuals with disabilities, 

Loan programs—health, Organization 

and functions (Government agencies), 

Medicaid, Public assistance programs, 

Reporting and recordkeeping 

requirements, State and local 

governments, Sunshine Act, Technical 

assistance, Women, and Youth. 

Department of the Treasury 

Internal Revenue Service 

Accordingly, 26 CFR part 54 is 

proposed to be amended as follows: 

PART 54—PENSION EXCISE TAXES 

■ Paragraph 1. The authority citation 

for part 54 continues to read in part as 

follows: 

Authority: 26 U.S.C. 7805. * * * 

■ Par. 2. Section 54.9801–2 is amended 

by revising the definition of excepted 

benefits as follows: 

§ 54.9801–2 Definitions. 

* * * * * 

Excepted benefits means the benefits 

described as excepted in § 54.9831(c), or 

45 CFR § 148.220 (describing when 

individual health insurance policies 

constitute excepted benefits). 

* * * * * 

■ Par. 3. Section 54.9815–2713 is 

amended by adding paragraph (a)(1) 

introductory text and revising paragraph 

(a)(1)(iv) to read as follows: 

§ 54.9815–2713 Coverage of preventive 

health services. 

(a) Services—(1) In general. Beginning 

at the time described in paragraph (b) of 

this section and subject to § 54.9815– 

2713A, a group health plan, or a health 

insurance issuer offering group health 

insurance coverage, must provide 

coverage for all of the following items 

and services, and may not impose any 

cost sharing requirement (such as a 

copayment, coinsurance, or a 

deductible) with respect to those items 

and services: 

* * * * * 

(iv) With respect to women, to the 

extent not described in paragraph 

(a)(1)(i) of this section, evidenceinformed preventive care and screenings 

provided for in binding comprehensive 

health plan coverage guidelines 

supported by the Health Resources and 

Services Administration, in accordance 

with 45 CFR 147.131(a). 

* * * * * 

■ Par. 4. Section 54.9815–2713A is 

added to read as follows: 

§ 54.9815–2713A Accommodations in 

connection with coverage of preventive 

health services. 

(a) Eligible organizations. An eligible 

organization is an organization that 


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Federal Register / Vol. 78, No. 25 / Wednesday, February 6, 2013 / Proposed Rules 8473 

satisfies all of the following 

requirements: 

(1) The organization opposes 

providing coverage for some or all of 

any contraceptive services required to 

be covered under § 54.9815– 

2713(a)(1)(iv) on account of religious 

objections. 

(2) The organization is organized and 

operates as a nonprofit entity. 

(3) The organization holds itself out as 

a religious organization. 

(4) The organization maintains in its 

records a self-certification, made in the 

manner and form specified by the 

Secretary of Health and Human 

Services, for each plan year to which the 

accommodation is to apply, executed by 

a person authorized to make the 

certification on behalf of the 

organization, indicating that the 

organization satisfies the criteria in 

paragraphs (a)(1) through (3) of this 

section, and, specifying those 

contraceptive services for which the 

organization will not establish, 

maintain, administer, or fund coverage, 

and makes such certification available 

for examination upon request. 

(b) Contraceptive coverage—selfinsured group health plan coverage. 

[Reserved.] 

(c) Contraceptive coverage—insured 

group health plan coverage—(1) A 

group health plan established or 

maintained by an eligible organization 

and that provides benefits through one 

or more issuers complies with any 

requirement under § 54.9815– 

2713(a)(1)(iv) to provide contraceptive 

coverage if the eligible organization or 

plan administrator furnishes each issuer 

that would otherwise provide coverage 

for any contraceptive services required 

to be covered under § 54.9815– 

2713(a)(1)(iv) with a copy of the selfcertification described in paragraph 

(a)(4) of this section. 

(2) A group health insurance issuer 

that receives a copy of the selfcertification described in paragraph 

(a)(4) of this section with respect to a 

plan for which the issuer would 

otherwise provide coverage for any 

contraceptive services required to be 

covered under § 54.9815–2713(a)(1)(iv) 

must automatically provide health 

insurance coverage for any 

contraceptive services required to be 

covered by § 54.9815–2713(a)(1)(iv) and 

identified in the self-certification, 

through a separate health insurance 

policy that is excepted under 45 CFR 

148.220(b)(7), for each plan participant 

and beneficiary. The issuer providing 

the individual market excepted benefits 

policy may not impose any cost sharing 

requirement (such as a copayment, 

coinsurance, or a deductible) with 

respect to coverage of those services, or 

impose any premium, fee, or other 

charge, or portion thereof, directly or 

indirectly, on the eligible organization, 

its group health plan, or plan 

participants or beneficiaries with 

respect to coverage of those services. 

(d) Notice of availability of 

contraceptive coverage. An issuer 

providing contraceptive coverage 

arranged pursuant to paragraph (b) or (c) 

of this section must provide to plan 

participants and beneficiaries written 

notice of the availability of the 

contraceptive coverage, separate from 

but contemporaneous with (to the extent 

possible) application materials 

distributed in connection with 

enrollment (or re-enrollment) in group 

coverage of the eligible organization for 

any plan year to which this paragraph 

applies. The following model language, 

or substantially similar language, may 

be used to satisfy the notice requirement 

of this paragraph: ‘‘The organization 

that establishes and maintains, or 

arranges, your health coverage has 

certified that your group health plan 

qualifies for an accommodation with 

respect to the federal requirement to 

cover all Food and Drug 

Administration-approved contraceptive 

services for women, as prescribed by a 

health care provider, without cost 

sharing. This means that your health 

coverage will not cover the following 

contraceptive services: [contraceptive 

services specified in self-certification]. 

Instead, these contraceptive services 

will be covered through a separate 

individual health insurance policy, 

which is not administered or funded by, 

or connected in any way to, your health 

coverage. You and any covered 

dependents will be enrolled in this 

separate individual health insurance 

policy at no additional cost to you. If 

you have any questions about this 

notice, contact [contact information for 

health insurance issuer].’’ 

Department of Labor 

Employee Benefits Security 

Administration 

For the reasons stated in the 

preamble, the Department of Labor 

proposes to amend 29 CFR part 2590 as 

follows: 

PART 2590—RULES AND 

REGULATIONS FOR GROUP HEALTH 

PLANS 

■ 1. The authority citation for part 2590 

continues to read as follows: 

Authority: 29 U.S.C. 1027, 1059, 1135, 

1161–1168, 1169, 1181–1183, 1181 note, 

1185, 1185a, 1185b, 1185c, 1185d, 1191, 

1191a, 1191b, and 1191c; sec. 101(g), Public 

Law 104–191, 110 Stat. 1936; sec. 401(b), 

Public Law 105–200, 112 Stat. 645 (42 U.S.C. 

651 note); sec. 512(d), Public Law 110–343, 

122 Stat. 3881; sec. 1001, 1201, and 1562(e), 

Public Law 111–148, 124 Stat. 119, as 

amended by Public Law 111–152, 124 Stat. 

1029; Secretary of Labor’s Order 3–2010, 75 

FR 55354 (September 10, 2010). 

■ 2. Section 2590.701–2 is amended by 

revising the definition of Excepted 

benefits as follows: 

§ 2590.701–2 Definitions. 

* * * * * 

Excepted benefits means the benefits 

described as excepted in § 2590.732(c), 

or 45 CFR § 148.220 (describing when 

individual health insurance policies 

constitute excepted benefits). 

* * * * * 

■ 3. Section 2590.715–2713 is amended 

by revising paragraphs (a)(1) 

introductory text and (a)(1)(iv) to read as 

follows: 

§ 2590.715–2713 Coverage of preventive 

health services. 

(a) Services—(1) In general. Beginning 

at the time described in paragraph (b) of 

this section and subject to § 2590.715– 

2713A, a group health plan, or a health 

insurance issuer offering group health 

insurance coverage, must provide 

coverage for all of the following items 

and services, and may not impose any 

cost sharing requirement (such as a 

copayment, coinsurance, or a 

deductible) with respect to those items 

and services: 

* * * * * 

(iv) With respect to women, to the 

extent not described in paragraph 

(a)(1)(i) of this section, evidenceinformed preventive care and screenings 

provided for in binding comprehensive 

health plan coverage guidelines 

supported by the Health Resources and 

Services Administration, in accordance 

with 45 CFR 147.131(a). 

* * * * * 

■ 4. A new § 2590.715–2713A is added 

to read as follows: 

§ 2590.715–2713A Accommodations in 

connection with coverage of preventive 

health services. 

(a) Eligible organizations. An eligible 

organization is an organization that 

satisfies all of the following 

requirements: 

(1) The organization opposes 

providing coverage for some or all of 

any contraceptive services required to 

be covered under § 2590.715– 

713(a)(1)(iv) on account of religious 

objections. 

(2) The organization is organized and 

operates as a nonprofit entity. 

(3) The organization holds itself out as 

a religious organization. 


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8474 Federal Register / Vol. 78, No. 25 / Wednesday, February 6, 2013 / Proposed Rules 

(4) The organization maintains in its 

records a self-certification, made in the 

manner and form specified by the 

Secretary of Health and Human 

Services, for each plan year to which the 

accommodation is to apply, executed by 

a person authorized to make the 

certification on behalf of the 

organization, indicating that the 

organization satisfies the criteria in 

paragraphs (a)(1) through (3) of this 

section, and, specifying those 

contraceptive services for which the 

organization will not establish, 

maintain, administer, or fund coverage, 

and makes such certification available 

for examination upon request. 

(b) Contraceptive coverage—selfinsured group health plan coverage. 

[Reserved.] 

(c) Contraceptive coverage—insured 

group health plan coverage. (1) A group 

health plan established or maintained 

by an eligible organization and that 

provides benefits through one or more 

issuers complies with any requirement 

under § 2590.715–2713(a)(1)(iv) to 

provide contraceptive coverage if the 

eligible organization or plan 

administrator furnishes each issuer that 

would otherwise provide coverage for 

any contraceptive services required to 

be covered under § 2590.715– 

2713(a)(1)(iv) with a copy of the selfcertification described in paragraph 

(a)(4) of this section. 

(2) A group health insurance issuer 

that receives a copy of the selfcertification described in paragraph 

(a)(4) of this section with respect to a 

plan for which the issuer would 

otherwise provide coverage for any 

contraceptive services required to be 

covered under § 2590.715–2713(a)(1)(iv) 

must automatically provide health 

insurance coverage for any 

contraceptive services required to be 

covered by § 2590.715–2713(a)(1)(iv) 

and identified in the self-certification, 

through a separate health insurance 

policy that is excepted under 45 CFR 

148.220(b)(7), for each plan participant 

and beneficiary. The issuer providing 

the individual market excepted benefits 

policy may not impose any cost sharing 

requirement (such as a copayment, 

coinsurance, or a deductible) with 

respect to coverage of those services, or 

impose any premium, fee, or other 

charge, or portion thereof, directly or 

indirectly, on the eligible organization, 

its group health plan, or plan 

participants or beneficiaries with 

respect to coverage of those services. 

(d) Notice of availability of 

contraceptive coverage. An issuer 

providing contraceptive coverage 

arranged pursuant to paragraph (b) or (c) 

of this section must provide to plan 

participants and beneficiaries written 

notice of the availability of the 

contraceptive coverage, separate from 

but contemporaneous with (to the extent 

possible) application materials 

distributed in connection with 

enrollment (or re-enrollment) in group 

coverage of the eligible organization for 

any plan year to which this paragraph 

applies. The following model language, 

or substantially similar language, may 

be used to satisfy the notice requirement 

of this paragraph: ‘‘The organization 

that establishes and maintains, or 

arranges, your health coverage has 

certified that your group health plan 

qualifies for an accommodation with 

respect to the federal requirement to 

cover all Food and Drug 

Administration-approved contraceptive 

services for women, as prescribed by a 

health care provider, without cost 

sharing. This means that your health 

coverage will not cover the following 

contraceptive services: [contraceptive 

services specified in self-certification]. 

Instead, these contraceptive services 

will be covered through a separate 

individual health insurance policy, 

which is not administered or funded by, 

or connected in any way to, your health 

coverage. You and any covered 

dependents will be enrolled in this 

separate individual health insurance 

policy at no additional cost to you. If 

you have any questions about this 

notice, contact [contact information for 

health insurance issuer].’’ 

Department of Health and Human 

Services 

For the reasons stated in the 

preamble, the Department of Health and 

Human Services proposes to amend 45 

CFR Subtitle A parts 147, 148, and 156 

as follows: 

PART 147—HEALTH INSURANCE 

REFORM REQUIREMENTS FOR THE 

GROUP AND INDIVIDUAL HEALTH 

INSURANCE MARKETS 

■ 1. The authority citation for part 147 

continues to read as follows: 

Authority: 2701 through 2763, 2791, and 

2792 of the Public Health Service Act (42 

U.S.C. 300gg through 300gg–63, 300gg–91, 

and 300gg–92), as amended. 

■ 2. Section 147.130 is amended by 

revising paragraphs (a)(1) introductory 

text and (a)(1)(iv) to read as follows: 

§ 147.130 Coverage of preventive health 

services. 

(a) Services—(1) In general. Beginning 

at the time described in paragraph (b) of 

this section and subject to § 147.131, a 

group health plan, or a health insurance 

issuer offering group or individual 

health insurance coverage, must provide 

coverage for all of the following items 

and services, and may not impose any 

cost sharing requirement (such as a 

copayment, coinsurance, or a 

deductible) with respect to those items 

and services: 

* * * * * 

(iv) With respect to women, to the 

extent not described in paragraph 

(a)(1)(i) of this section, evidenceinformed preventive care and screenings 

provided for in binding comprehensive 

health plan coverage guidelines 

supported by the Health Resources and 

Services Administration. 

* * * * * 

■ 2. A new § 147.131 is added to read 

as follows: 

§ 147.131 Exemption and accommodations 

in connection with coverage of preventive 

health services. 

(a) Religious employers. In issuing 

guidelines under § 147.130(a)(1)(iv), the 

Health Resources and Services 

Administration may establish an 

exemption from such guidelines with 

respect to a group health plan 

established or maintained by a religious 

employer (and health insurance 

coverage provided in connection with a 

group health plan established or 

maintained by a religious employer) 

with respect to any requirement to cover 

contraceptive services under such 

guidelines. For purposes of this 

paragraph (a), a ‘‘religious employer’’ is 

an organization that is organized and 

operates as a nonprofit entity and is 

referred to in section 6033(a)(3)(A)(i) or 

(a)(3)(A)(iii) of the Internal Revenue 

Code of 1986, as amended. 

(b) Eligible organizations. An eligible 

organization is an organization that 

satisfies all of the following 

requirements: 

(1) The organization opposes 

providing coverage for some or all of 

any contraceptive services required to 

be covered under § 147.130(a)(1)(iv) on 

account of religious objections. 

(2) The organization is organized and 

operates as a nonprofit entity. 

(3) The organization holds itself out as 

a religious organization. 

(4) The organization maintains in its 

records a self-certification, made in the 

manner and form specified by the 

Secretary of Health and Human 

Services, for each plan year to which the 

accommodation is to apply, executed by 

a person authorized to make the 

certification on behalf of the 

organization, indicating that the 

organization satisfies the criteria in 

paragraphs (b)(1) through (3) of this 

section, and, specifying those 

contraceptive services for which the 


srobinson on DSK4SPTVN1PROD with PROPOSALS
Federal Register / Vol. 78, No. 25 / Wednesday, February 6, 2013 / Proposed Rules 8475 

organization will not establish, 

maintain, administer, or fund coverage, 

and makes such certification available 

for examination upon request. 

(c) Contraceptive coverage—insured 

group health plan coverage. (1) A group 

health plan established or maintained 

by an eligible organization and that 

provides benefits through one or more 

issuers complies with any requirement 

under § 147.130(a)(1)(iv) to provide 

contraceptive coverage if the eligible 

organization or plan administrator 

furnishes each issuer that would 

otherwise provide coverage for any 

contraceptive services required to be 

covered under § 147.130(a)(1)(iv) with a 

copy of the self-certification described 

in paragraph (b)(4) of this section. 

(2) A group health insurance issuer 

that receives a copy of the selfcertification described in paragraph 

(b)(4) of this section with respect to a 

plan for which the issuer would 

otherwise provide coverage for any 

contraceptive services required to be 

covered under § 147.130(a)(1)(iv) must 

automatically provide health insurance 

coverage for any contraceptive services 

required to be covered by 

§ 147.130(a)(1)(iv) and identified in the 

self-certification, through a separate 

health insurance policy that is excepted 

under § 148.220(b)(7) of this subtitle, for 

each plan participant and beneficiary. 

The issuer providing the individual 

market excepted benefits policy may not 

impose any cost sharing requirement 

(such as a copayment, coinsurance, or a 

deductible) with respect to coverage of 

those services, or impose any premium, 

fee, or other charge, or portion thereof, 

directly or indirectly, on the eligible 

organization, its group health plan, or 

plan participants or beneficiaries with 

respect to coverage of those services. 

(d) Notice of availability of 

contraceptive coverage. An issuer 

providing contraceptive coverage 

arranged pursuant to paragraph (c) of 

this section must provide to plan 

participants and beneficiaries written 

notice of the availability of the 

contraceptive coverage, separate from 

but contemporaneous with (to the extent 

possible) application materials 

distributed in connection with 

enrollment (or re-enrollment) in group 

coverage of the eligible organization for 

any plan year to which this paragraph 

applies. The following model language, 

or substantially similar language, may 

be used to satisfy the notice requirement 

of this paragraph: ‘‘The organization 

that establishes and maintains, or 

arranges, your health coverage has 

certified that your [group health plan/ 

student health insurance coverage] 

qualifies for an accommodation with 

respect to the federal requirement to 

cover all Food and Drug 

Administration-approved contraceptive 

services for women, as prescribed by a 

health care provider, without cost 

sharing. This means that your health 

coverage will not cover the following 

contraceptive services: [contraceptive 

services specified in self-certification]. 

Instead, these contraceptive services 

will be covered through a separate 

individual health insurance policy, 

which is not administered or funded by, 

or connected in any way to, your health 

coverage. You and any covered 

dependents will be enrolled in this 

separate individual health insurance 

policy at no additional cost to you. If 

you have any questions about this 

notice, contact [contact information for 

health insurance issuer].’’ 

(e) Application to student health 

insurance coverage. The provisions of 

this section apply to student health 

insurance coverage arranged by an 

eligible organization that is an 

institution of higher education in a 

manner comparable to that in which 

they apply to group health insurance 

coverage provided in connection with a 

group health plan established or 

maintained by an eligible organization 

that is an employer. In applying this 

section in the case of student health 

insurance coverage, a reference to ‘‘plan 

participants and beneficiaries’’ is a 

reference to student enrollees and their 

covered dependents. 

PART 148—REQUIREMENTS FOR THE 

INDIVIDUAL HEALTH INSURANCE 

MARKET 

■ 3. The authority citation for part 148 

continues to read as follows: 

Authority: Secs. 2741 through 2763, 2791, 

and 2792 of the Public Health Service Act (42 

U.S.C. 300gg–41 through 300gg–63, 300gg– 

91, and 300gg–92). 

■ 4. Section 148.220 is amended as 

follows: 

■ a. In the introductory text of 

paragraph (b), the reference ‘‘(b)(6)’’ is 

removed and the reference ‘‘(b)(7)’’ is 

added in its place. 

■ b. Adding paragraph (b)(7). 

The addition reads as follows: 

§ 148.220 Excepted benefits. 

* * * * * 

(b) * * * 

(7) Individual health insurance 

coverage that provides coverage only for 

contraceptive services pursuant to 

§ 147.131(c) of this subtitle, 26 CFR 

54.9815–2713A(b) or (c), or 29 CFR 

2590.715–2713A(b) or (c), but only if 

such coverage complies with the 

requirements in the following 

provisions: 

(i) Section 2703 of the PHS Act 

(relating to guaranteed renewability of 

coverage). 

(ii) Section 2711 of the PHS Act 

(relating to the prohibition on lifetime 

and annual dollar limits on benefits). 

(iii) Section 2712 of the PHS Act 

(relating to the prohibition on 

rescissions of coverage). 

(iv) Section 2719 of the PHS Act 

(relating to internal appeals and external 

review). 

PART 156—HEALTH INSURANCE 

ISSUER STANDARDS UNDER THE 

AFFORDABLE CARE ACT, INCLUDING 

STANDARDS RELATED TO 

EXCHANGES 

■ 5. The authority citation for part 156 

continues to read as follows: 

Authority: Title I of the Affordable Care 

Act, sections 1301–1304, 1311–1312, 1321– 

1322, 1324, 1334, 1342–1343, 1401–1402, 

and 1412, Pub. L. 111–148, 124 Stat. 119 (42 

U.S.C. 18021–18024, 18031–18032, 18041– 

18042, 18044, 18054, 18061, 18063, 18071, 

18082, 26 U.S.C. 36B, and 31 U.S.C. 9701). 

■ 6. Section 156.150 is amended by 

adding paragraph (d) to read as follows: 

§ 156.50 Financial support. 

* * * * * 

(d) Adjustment of Federally-facilitated 

Exchange user fee. If a QHP issuer (or 

another issuer in the same issuer group) 

provides individual health insurance 

coverage consisting of coverage for any 

contraceptive services required to be 

covered under § 147.130(a)(1)(iv) of this 

subchapter, and identified in the selfcertification referenced in 

§ 147.131(b)(4) of this subchapter, to any 

plan participant or beneficiary with 

respect to whom the QHP issuer 

receives the written notice referenced in 

26 CFR 54.9815–2713A(b) or 29 CFR 

2590.715–2713A(b), the QHP issuer may 

qualify for a reduction in the user fee for 

a Federally-facilitated Exchange 

specified in paragraph (c) as described 

in this paragraph (d). 

(1) In order for a QHP issuer to be 

eligible for the Federally-facilitated 

Exchange user fee reduction, in 

providing such contraceptive coverage 

to such individuals, the QHP issuer (or 

another issuer in the same issuer group) 

may not impose any cost-sharing 

requirement (such as a copayment, 

coinsurance, or a deductible), or impose 

any premium, fee, or other charge, 

directly or indirectly, with respect to 

such contraceptive coverage, and must 

satisfy the other conditions set forth in 

this section. 

(2) If an issuer provides such 

contraceptive coverage to such 

individuals, and it, or another issuer in 

the same issuer group, is required to pay 


srobinson on DSK4SPTVN1PROD with PROPOSALS
8476 Federal Register / Vol. 78, No. 25 / Wednesday, February 6, 2013 / Proposed Rules 

the Federally-facilitated Exchange user 

fee, a reduction in that user fee may be 

sought for the HHS-approved estimated 

cost of such contraceptive coverage. 

(3) In order for a QHP issuer to be 

eligible for the Federally-facilitated 

Exchange user fee reduction, the issuer 

of such contraceptive coverage to such 

individuals must (jointly with the issuer 

seeking the reduction in the Federallyfacilitated Exchange user fee, if not the 

same issuers) do all of the following: 

(i) Provide monthly data on the 

number of individuals to whom the 

contraceptive coverage is being 

provided, and provide an attestation by 

the issuer providing the contraceptive 

coverage that the issuer received a copy 

of the written notice referenced in 26 

CFR 54.9815–2713A(b) or 29 CFR 

2590.715–2713A(b) with respect to each 

plan participant or beneficiary. 

(ii) Provide an attestation by the 

issuer providing the contraceptive 

coverage that the issuer provided 

contraceptive coverage in accordance 

with paragraph (d) of this section and 

that the issuer passed the portion of the 

reduction in the Federally-facilitated 

Exchange user fee attributable to 

reasonable charges by third party 

administrators on to the third party 

administrators. 

(iii) Identify the QHP(s) being offered 

through a Federally-facilitated Exchange 

with respect to which the user fee 

reduction is to be applied, and, if the 

issuer providing the contraceptive 

coverage is not the issuer seeking the 

user fee reduction, provide an 

attestation by the issuer providing the 

contraceptive coverage that both the 

issuer providing the contraceptive 

coverage and the issuer seeking the user 

fee reduction belong to the same issuer 

group. 

(iv) Submit an estimate of the cost of 

the contraceptive coverage to HHS for 

approval, in the manner and timeframe 

specified by HHS, concurrent with 

documentation or data supporting that 

estimate. 

(4) If the information specified under 

paragraphs (d)(3)(i) through (iii) of this 

section is provided and the estimate 

specified under paragraph (d)(3)(iv) of 

this section is submitted and approved 

by HHS, the issuer of the identified 

QHP(s) will be provided a reduction in 

its obligation to pay the Federallyfacilitated Exchange user fee specified 

in paragraph (c) in an amount equal in 

value to the approved estimated cost of 

the contraceptive coverage, as long as an 

exception from OMB Circular No. A–25 

is in effect. If the amount of the 

reduction is greater than the amount of 

the obligation to pay the Federallyfacilitated Exchange user fee in a 

particular month, the issuer of the 

identified QHP(s) will be provided a 

credit in succeeding months in the 

amount of the excess. An issuer that is 

eligible for a user fee reduction in 

accordance with this paragraph (d) prior 

to January 1, 2014, will be provided a 

credit in the amount of the user fee 

reduction beginning January 2014. 

(5) An issuer providing contraceptive 

coverage for which a reduction in the 

Federally-facilitated Exchange user fee 

has been provided under paragraph 

(d)(4) of this section (whether the 

reduction was provided to the issuer or 

another issuer in the same issuer group) 

must maintain for 10 years and make 

available to HHS upon request all of the 

following: 

(i) Documentation demonstrating that 

the contraceptive coverage was 

provided to plan participants or 

beneficiaries with respect to whom the 

issuer received a copy of the written 

notice referenced in 26 CFR 54.9815– 

2713A(b) or 29 CFR 2590.715–2713A(b). 

(ii) Documentation demonstrating that 

the contraceptive coverage was 

provided in accordance with paragraph 

(d) of this section. 

(iii) Documentation or data 

supporting the estimate of the cost of 

the contraceptive coverage. 

(iv) Documentation or data on the 

actual cost of providing the 

contraceptive coverage. 

Signed this 30th day of January 2013. 

Steven T. Miller, 

Deputy Commissioner for Services and 

Enforcement, Internal Revenue Service. 

Signed this 30th day of January 2013. 

Phyllis C. Borzi, 

Assistant Secretary, Employee Benefits 

Security Administration, Department of 

Labor. 

Dated: January 29, 2013. 

Marilyn Tavenner, 

Acting Administrator, Centers for Medicare 

& Medicaid Services. 

Approved: January 29, 2013. 

Kathleen Sebelius, 

Secretary, Department of Health and Human 

Services. 

[FR Doc. 2013–02420 Filed 2–1–13; 11:15 am] 

BILLING CODE 4830–01; 4510–029; 4120–01; 6325–64–P 

SAINT LAWRENCE SEAWAY 

DEVELOPMENT CORPORATION 

33 CFR Part 401 

[Docket No. SLSDC–2013–0001; 2135– 

AA31] 

Seaway Regulations and Rules: 

Periodic Update, Various Categories 

AGENCY: Saint Lawrence Seaway 

Development Corporation, DOT. 

ACTION: Notice of Proposed Rulemaking. 

SUMMARY: The Saint Lawrence Seaway 

Development Corporation (SLSDC) and 

the St. Lawrence Seaway Management 

Corporation (SLSMC) of Canada, under 

international agreement, jointly publish 

and presently administer the St. 

Lawrence Seaway Regulations and 

Rules (Practices and Procedures in 

Canada) in their respective jurisdictions. 

Under agreement with the SLSMC, the 

SLSDC is amending the joint regulations 

by updating the Seaway Regulations and 

Rules in various categories. The 

proposed changes will update the 

following sections of the Regulations 

and Rules: Condition of Vessels; Seaway 

Navigation; Dangerous Cargo; and, 

Information and Reports. These 

proposed amendments are necessary to 

take account of updated procedures and 

will enhance the safety of transits 

through the Seaway. Several of the 

proposed amendments are merely 

editorial or for clarification of existing 

requirements. 

DATES: Any party wishing to present 

views on the proposed amendment may 

file comments with the Corporation on 

or before March 8, 2013. 

ADDRESSES: You may submit comments 

identified by Docket Number SLSDC 

2013–0001 by any of the following 

methods: 

• Web Site: http:// 

www.Regulations.gov . Follow the 

online instructions for submitting 

comments/submissions. 

• Fax: 1–202–493–2251. 

• Mail: Docket Management Facility; 

U.S. Department of Transportation, 1200 

New Jersey Avenue SE., West Building 

Ground Floor, Room W12–140, 

Washington, DC 20590–001. 

• Hand Delivery: Documents may be 

submitted by hand delivery or courier to 

West Building Ground Floor, Room 

W12–140, 1200 New Jersey Avenue, SE., 

Washington, DC 20590–001, between 9 

a.m. and 5 p.m., Monday through 

Friday, except Federal Holidays. 

Instructions: All submissions must 

include the agency name and docket 

number or Regulatory Identification 

Number (RIN) for this rulemaking. Note 


srobinson on DSK4SPTVN1PROD with PROPOSALS