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Fact Sheet

The Health Insurance Portability And Accountability Act (HIPAA)

U.S. Department of LaborEmployee Benefits Security AdministrationDecember 2004      

    The Health Insurance Portability and Accountability Act (HIPAA) offers    protections for millions of American workers that improve portability and    continuity of health insurance coverage.      

HIPAA Protects Workers And Their Families By
- Limiting exclusions for preexisting medical conditions (known as          preexisting conditions).
- Providing credit against maximum preexisting condition exclusion          periods for prior health coverage and a process for providing          certificates showing periods of prior coverage to a new group health          plan or health insurance issuer.
- Providing new rights that allow individuals to enroll for health          coverage when they lose other health coverage, get married or add a new          dependent.
- Prohibiting discrimination in enrollment and in premiums charged to          employees and their dependents based on health status-related factors.
- Guaranteeing availability of health insurance coverage for small          employers and renewability of health insurance coverage for both small          and large employers.
- Preserving the states’ role in regulating health insurance,          including the states’ authority to provide greater protections than          those available under federal law.

Preexisting Condition Exclusions
- The law defines a preexisting condition as one for          which medical advice, diagnosis, care, or treatment was recommended or          received during the 6-month period prior to an individual’s enrollment          date (which is the earlier of the first day of health coverage or the          first day of any waiting period for coverage).
- Group health plans and issuers may not exclude an          individual’s preexisting medical condition from coverage for more than          12 months (18 months for late enrollees) after an individual’s          enrollment date.
- Under HIPAA, a new employer’s plan must give          individuals credit for the length of time they had prior continuous          health coverage, without a break in coverage of 63 days or more, thereby          reducing or eliminating the 12-month exclusion period (18 months for          late enrollees).

Creditable Coverage
-  Includes prior coverage under another group health        plan, an individual health insurance policy, COBRA, Medicaid, Medicare,        CHAMPUS, the Indian Health Service, a state health benefits risk pool,          FEHBP, the Peace Corps Act, or a public health plan.

Certificates Of Creditable Coverage
- Certificates of creditable coverage must be provided          automatically and free of charge by the plan or issuer when an          individual loses coverage under the plan, becomes entitled to elect          COBRA continuation coverage or exhausts COBRA continuation coverage. A          certificate must also be provided free of charge upon request while you          have health coverage or anytime within 24 months after your coverage          ends.
- Certificates of creditable coverage should contain          information about the length of time you or your dependents had coverage          as well as the length of any waiting period for coverage that applied to          you or your dependents.
- For plan years beginning on or after          July 1, 2005, certificates of creditable coverage should also include an          educational statement that describes individuals' HIPAA portability          rights. A new model cerfiticate is available on EBSAs Web site.
- If a certificate is not received, or the information on          the certificate is wrong, you should contact your prior plan or issuer.          You have a right to show prior creditable coverage with other evidence          — like pay stubs, explanation of benefits, letters from a doctor —          if you cannot get a certificate.

Special Enrollment Rights
- Are provided for individuals who lose their coverage in          certain situations, including on separation, divorce, death, termination          of employment and reduction in hours. Special enrollment rights also are          provided if employer contributions toward the other coverage terminates.
- Are provided for employees, their spouses and new          dependents upon marriage, birth, adoption or placement for adoption.

Discrimination Prohibitions
-  Ensure that individuals are not excluded from coverage,        denied benefits, or charged more for coverage offered by a plan or        issuer, based on health status-related factors.

This fact sheet has been developed by the U.S.          Department of Labor, Employee Benefits Security Administration,          Washington, DC 20210.  It will be made available in alternate          formats upon request: Voice phone: 202.693.8664; Text telephone:          202.501.3911.  In addition, the information in this fact sheet          constitutes a small entity compliance guide for purposes of the Small          Business Regulatory Enforcement Fairness Act of 1996.    
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