[Federal Register Volume 62, Number 242 (Wednesday, December 17, 1997)]
[Notices]
[Pages 66119-66124]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-33063]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Health Care Financing Administration

Document Identifier: HCFA-R-205 and HCFA-R-206


Emergency Clearance: Public Information Collection Requirements 
Submitted to the Office of Management and Budget (OMB)

AGENCY: Health Care Financing Administration.
    In compliance with the requirement of section 3506(c)(2)(A) of the 
Paperwork Reduction Act of 1995, the Health Care Financing 
Administration (HCFA), Department of Health and Human Services, is 
publishing the following summary of proposed collections for public 
comment. Interested persons are invited to send comments regarding this 
burden estimate or any other aspect of this collection of information, 
including any of the following subjects: (1) The necessity and utility 
of the proposed information collection for the proper performance of 
the agency's functions; (2) the accuracy of the estimated burden; (3) 
ways to enhance the quality, utility, and clarity of the information to 
be collected; and (4) the use of automated collection techniques or 
other forms of information technology to minimize the information 
collection burden.
    We are, however, requesting an emergency review of the information 
collections referenced below. In compliance with the requirement of 
section 3506(c)(2)(A) of the Paperwork Reduction Act of 1995, we have 
submitted to the Office of Management and Budget (OMB) the following 
requirements for emergency review. We are requesting an emergency 
review because the collection of this information is needed before the 
expiration of the normal time limits under OMB's regulations at 5 CFR, 
Part 1320. This is necessary to ensure compliance with section 111 of 
HIPAA necessary to implement congressional intent with respect to 
guaranteeing availability of individual health insurance coverage to 
certain individuals with prior group coverage. We cannot reasonably 
comply with the normal clearance procedures because public harm is 
likely to result because eligible individuals will not receive the 
health insurance protections under the statute.
    HCFA is requesting OMB review and approval of this collection by 
12/31/97, with a 180-day approval period. Written comments and 
recommendations will be accepted from the public if received by the 
individuals designated below by 12/29/97. It should be noted that HCFA 
will continue to consider and respond as appropriate to the public 
comments received in response to the 04/08/97 Federal Register notices 
requesting public comment on the collections referenced below. During 
this 180-day period, we will publish a separate Federal Register notice 
announcing the initiation of an extensive 60-day agency review and 
public comment period on these requirements. We will submit the 
requirements for OMB review and an extension of this emergency 
approval.
    Type of Information Request: Extension, without change, of a 
currently approved collection.
    Title of Information Collection: Individual Health Insurance. 
Reform: Portability from Group to Individual Coverage; Federal Rules 
for Access in the Individual Market; State Alternative Mechanisms to 
Federal Rules BPD-882-IFC.
    Form Number: HCFA-R-205 (OMB approval #: 0938-0703).
    Use: These information collection requirements help ensure access 
to the individual insurance market for certain individuals and allows 
the States to

[[Page 66120]]

implement their own program to meet the HIPAA requirements for access 
to the individual market. The information collection requirements 
outlined in this document are necessary for issuers and States to 
ensure individuals receive protection under section 111 of HIPAA.
    Frequency: On occasion.
    Affected Public: States, businesses or other for profit, not-for-
profit institutions, Federal Government, individuals or households.
    Number of Respondents: 1,035.
    Total Annual Responses: 3.5 million in 1997; 3 million each in 1998 
and 1999; Total Annual Hours Requested: 335,000 to 586,000 hours in 
1997; 384,000 to 882,000 in 1998; and 377,000 to 882,000 in 1999.
    Total Annual Cost: $4.9 million to $6.8 million in 1997; $5.1 
million to $8.7 million in 1998; and $5.4 million to $8.7 million in 
1999.

Section 148.120  Guaranteed Availability of Individual Health Insurance 
Coverage to Certain Individuals With Prior Group Coverage

    States are given the flexibility either to enforce the Federal 
requirements set forth in Sec. 148.120, or to implement an alternative 
mechanism, under State law, that achieves the statutory mandate of 
providing eligible individuals with access to individual health 
insurance, or comparable coverage, without preexisting condition 
exclusions. However, a State could choose to do nothing, resulting in 
Federal enforcement of the individual market regulations under HIPAA. 
Thirty States have indicated to us an intent to implement an 
alternative mechanism under Sec. 148.128. The information collection 
requirements associated with implementing and enforcing the alternative 
mechanism are discussed below for Sec. 148.128.
    If a State chooses to enforce the Federal guaranteed availability 
requirements (sometimes referred to as the ``Federal fall back'' 
requirements), the provisions of Sec. 148.120 apply, and must be 
enforced by the State under State law. Since many of these requirements 
are enforced under existing State law, for these instances, they are 
exempt from the Paperwork Reduction Act (PRA) as described under 5 CFR 
1320.3(b)(3). Although applicable PRA burden will vary by State and 
issuer, we anticipate that ten States will be required to review 
materials submitted by at most 325 issuers per State on an annual basis 
to ensure compliance with the requirements of all products guaranteed 
or alternative coverage, which are not currently required under State 
laws and regulations. Therefore, the PRA burden imposed under this 
option is the time required by the ten States to review the materials 
submitted by the issuers. This burden is 1,625 hours based on each of 
the ten States reviewing the material for 30 minutes for each issuer on 
an annual basis. We estimate the cost associated with this burden to be 
$24,375.
    If a State implements neither an alternative mechanism, nor the 
Federal fall back requirements, we will implement the Federal fall back 
provisions in that State and will enforce those requirements using the 
penalty provisions specified in Secs. 148.200 and 148.202. We 
anticipate that fewer than ten States will rely on Federal enforcement 
of the statute. In particular, the only jurisdictions that we believe 
will choose this option are the five U.S. territories.
    This section also requires an issuer who elects the alternative 
coverage option to document any actuarial calculations necessary to 
satisfy State and/or Federal oversight provisions referenced in Sec. 
148.120. Since the majority of issuers rely on automated means of 
storing their calculations, we estimate the annual burden for this 
record keeping activity to be 25 hours. This is based on the assumption 
that it will take approximately 10 issuers per State, in 15 States, on 
an annual basis, 10 minutes per issuer, to electronically store and 
verify the storage of their calculations. We estimate the cost 
associated with this burden to be $375.

Section 148.122  Guaranteed Renewability of Individual Health Insurance 
Coverage

    In this section issuers are only required to report if they are 
discontinuing a particular type of coverage or discontinuing all 
coverage. This requirement exists in the absence of this regulation 
because under current insurance practices, State insurance departments 
oversee discontinuance of insurance products in their State as a normal 
business practice. Therefore, these information collection requirements 
are exempt from the PRA under 5 CFR 1320.3(b)(2) and 5 CFR 
1320.3(b)(3). However, under HIPAA, States must review policies during 
their oversite process to make sure there is a guarantee renewability 
clause in each policy. For the 21 States that currently require 
guaranteed renewability, it is our understanding that this is normal 
business practice. For the other 34 States, however, we see this State 
burden to be about 10 minutes per policy, since States already review 
policies for other requirements and this process does not prescribe a 
timetable for reviewing the policies. We see this as a total annual 
burden of 20,000 hours. We estimate the cost associated with this 
burden to be $300,000. If the State identifies a violation and a State 
has to take some action, we believe that each State will be required to 
initiate fewer than 10 administrative actions on an annual basis 
against specific individuals or entities who failed to implement the 
Federal guarantee renewability requirements.

Section 148.124  Certification and Disclosure of Coverage

    Section 148.124 specifies that an issuer in the individual market 
must provide a written certificate of creditable coverage, and, if 
required, make other certain disclosures regarding an individual's 
coverage under an individual policy. In general, the certification and 
disclosure requirements are substantially identical to the relevant 
provisions of Sec. 146.115 that apply to health insurance coverage 
offered by issuers in the group market. The preamble accompanying the 
group market regulation explains these procedures in detail. In 
general, the certificates from issuers in the individual market and 
other disclosure of information are intended to enable individuals to 
avoid or reduce preexisting condition exclusions included under 
subsequent group health insurance coverage the individual may obtain.
    Individuals have the right to receive a certificate automatically 
(an automatic certificate) when they lose coverage under an individual 
policy. A certificate must also be provided upon a request by, or on 
behalf of, an individual for the period not later than 24 months after 
coverage ceases. The certificate must be provided at the earliest time 
that an issuer, acting in a reasonable and prompt fashion, can provide 
the certificate. The certificate must also be provided consistent with 
State law.
    An issuer of an individual policy is required, to the same extent 
as an issuer of insurance in the group market, to prepare certificates 
with respect to the coverage of any of the individual's dependents that 
are covered under the individual policy.
    We anticipate that 3 million individual market-based certificates 
will be generated on an annual basis. We are assuming that the majority 
of certificates issued in the individual market will require issuers to 
find out the application date since many individuals will have less 
than 18 months of credible coverage with that issuer.
    The range of time estimates, shown in the table below, are based on

[[Page 66121]]

discussions with industry individuals. We believe that as a routine 
business practice, the issuers' administrative staff have the necessary 
information readily available to generate the required certificates. In 
addition, we have determined that the majority of issuers have or will 
have the capability to automatically computer generate and disseminate 
the necessary certification when appropriate.

----------------------------------------------------------------------------------------------------------------
                                                                   Average time                                 
                                       Total           Total       (in minutes)    Burden hours                 
                                    respondents      responses     per response       (range)      Cost (range) 
                                                                      (range)                                   
----------------------------------------------------------------------------------------------------------------
1997............................           1,000       3,418,052            4.63         263,548      $3,897,932
                                  ..............  ..............            8.95         509,665       5,716,826
1998............................           1,000       2,929,759            6.94         338,781       4,542,924
                                  ..............  ..............           17.11         835,517       8,035,131
1999............................           1,000       2,929,759            6.81         332,480       4,746,736
                                  ..............  ..............           17.11         835,517       8,035,131
----------------------------------------------------------------------------------------------------------------

Section 148.126  Determination of an Eligible Individual

    In this section, issuers may maintain records for those individuals 
who they determine are not HIPAA eligible individuals. We estimate this 
to be on average less than 50 individuals per the 1,000 issuers 
nationwide each year. At 20 minutes per record, this represents an 
annual burden of 16,667 hours. We estimate the cost associated with 
this burden to be $183,000.

Section 148.128  State Flexibility in Individual Market Reforms--
Alternative Mechanisms

    As explained above, 30 or more States may implement acceptable 
alternative mechanisms as allowed under this section. It is estimated 
that this reporting burden will range from 33,000 to 38,500 hours 
depending on the number of States that choose to submit the required 
information. We estimate the cost associated with this burden to be 
$495,000 to $577,500.

Section 148.200  Enforcement and Section 148.202 Civil Money Penalties

    We anticipate identifying violations through individual 
nonstandardized consumer complaints. Therefore, the complaints 
submitted and our enforcement activities do not fall within the 
requirements of the PRA, as outlined in 5 CFR 1320.3(c) and 5 CFR 
1320.4(a).
    Type of Information Request: Extension, without change, of a 
currently approved collection.
    Title of Information Collection: Information Requirements 
Referenced in HIPAA for Group Health Plans.
    Form Number: HCFA-R-206 (OMB approval #: 0938-0702).
    Use: This regulation and related information collection 
requirements will ensure that group health plans provide individuals 
with documentation necessary to demonstrate prior creditable coverage, 
and that group health plans notify individuals of their special 
enrollment rights in the group health insurance market.
    Frequency: On occasion.
    Affected Public: State and local governments, Business or other for 
profit, not-for-profit institutions, individuals or households, Federal 
government.
    Number of Respondents: 1,430.
    Total Annual Responses: Due to the rolling effective dates in the 
statute, the number of annual responses is estimated to be 32.5 million 
in 1997, but will increase to 41 million in 1998 and 42.5 million in 
1999.
    Total Annual Hours Requested: 1.8 million to 3.6 million hours in 
1997; 2.3 million to 5.8 million hours in 1998; and 2.6 million to 5.9 
million hours in 1999.
    Total Annual Costs: $36.8 million to $53.9 million in 1997; $42.4 
million to $76.3 million in 1998; and $43.5 million to $77.3 million in 
1999. 45 CFR Secs. 146.120, 146.122, 146.150, 146.152, 146.160, and 
146.180 of this document contain information collection requirements.

45 CFR 146.120  Certificates and Disclosure of Previous Coverage

    This section sets forth guidance regarding the certification and 
other disclosure of information requirements relating to prior 
creditable coverage of an individual. In general, the certificate must 
be provided in writing and must include the following information: (1) 
The date any waiting or affiliation period began, (2) the date coverage 
began, and (3) the date coverage ended (or indicate if coverage is 
continuing). The regulations also allow a plan or issuer in an 
appropriate case to simply state in the certificate that the individual 
has at least 18 months of creditable coverage that is not interrupted 
by a significant break and indicate the date coverage ended. In 
general, individuals have the right to receive a certificate 
automatically (an automatic certificate) when they lose coverage under 
a plan and when they have a right to elect COBRA continuation coverage.
    We anticipate that approximately 1,400 issuers will be required to 
produce 30 million certifications per year based on the model 
certificate provided. Our estimate of issuers (1,400) includes 
commercial insurers and HMOs, but does not include some types of 
issuers, such as Preferred Provider Organizations (PPOs); however, 
these types of issuers are small in number. The time estimate includes 
the time required to gather the pertinent information, create a 
certificate, and mail the certificate to the plan participant. This 
time estimate is based on discussions with industry individuals. We 
believe that, as a routine business practice, the issuers' 
administrative staff have the necessary information readily available 
to generate the required certificates. In addition, we have determined 
that the majority of issuers have or will have the capability to 
automatically computer generate and disseminate the necessary 
certification when appropriate. These estimates include the 
certificates required by issuers acting as service providers on behalf 
of group health plans and state and local government health plans. We 
anticipate that most, if not all, state and local government health 
plans will contract with an issuer to develop the certificate.

[[Page 66122]]



                                          Estimates for Certifications                                          
----------------------------------------------------------------------------------------------------------------
                                                                   Average time                                 
                                       Total           Total       per response    Burden hours                 
              Year                  respondents      responses        (range)         (range)      Cost (range) 
                                                                     (minutes)                                  
----------------------------------------------------------------------------------------------------------------
1997............................           1,400      32,698,845            3.32       1,809,119     $36,366,106
                                  ..............  ..............            6.34       3,456,036      53,434,628
1998............................           1,400      28,072,131            5.19       2,242,866      40,928,939
                                  ..............  ..............           12.23       5,720,198      74,859,759
1999............................           1,400      28,055,984            5.37       2,510,461      42,124,907
                                  ..............  ..............           12.41       5,804,408      75,760,119
----------------------------------------------------------------------------------------------------------------

    Note: The costs above include the costs associated with issuers 
acting as service providers for group health plans. The costs are 
also included in the Department of Labor's estimates.

    Notice to all participants: Under this section, issuers are 
required to notify all participants at the time of enrollment stating 
the terms of the issuer's pre-existing condition exclusion provisions, 
the participant's right to demonstrate creditable coverage, and that 
the issuer will assist in securing a certificate if necessary.
    We have estimated the burden associated with this information 
collection requirement to be the time required for issuers to develop 
standardized language outlining the existence and terms of any 
preexisting condition exclusion under the plan and the rights of 
individuals to demonstrate creditable coverage. In specific, we 
anticipate that issuers will be required to develop approximately 
660,000 notices in 1997; 5.6 million notices in 1998; and 6.2 million 
notices in 1999. At 30 seconds for each notice, we estimate the total 
hour burden to be 4,400 hours in 1997; 30,000 hours in 1998; and 34,000 
hours in 1999. The respective costs will be $49,000 in 1997; $330,000 
in 1998; and $377,000 in 1999. These estimates and subsequent estimates 
are based on an hourly wage of $11 for issuers and $15 for State and 
local government employees. These estimates include the notices 
required by issuers on behalf of state and local government health 
plans, since we anticipate that most, if not all state and local 
government health plans will contract with an issuer to develop the 
notice. The estimates have been disaggregated below:

----------------------------------------------------------------------------------------------------------------
                                                                   State health    Local health                 
                      Year                            Issuers          plans           plans       Total notices
----------------------------------------------------------------------------------------------------------------
Total notices:                                                                                                  
    1997........................................         320,000         129,826         214,880         664,706
    1998........................................       4,878,200         259,653         429,761       5,567,614
    1999........................................       5,734,300         259,653         429,761       6,189,714
Total burden hours:                                                                                             
    1997........................................           1,592           1,078           1,784           4,454
    1998........................................          14,293           2,155           3,567          30,015
    1999........................................          28,557           2,155           3,567          34,279
----------------------------------------------------------------------------------------------------------------

    Notice to individual of period of preexisting condition exclusion. 
Within a reasonable time following the receipt of the certificate, 
information relating to the alternative method, or other evidence of 
coverage, a plan or issuer is required to make a determination 
regarding the length of any preexisting condition exclusion period that 
applies to the individual and notify the individual of its 
determination. Whether a determination and notification is made within 
a reasonable period of time will depend upon the relevant facts and 
circumstances including whether the application of the preexisting 
condition exclusion period would prevent access to urgent medical 
services. The individual need only be notified, however, if, after 
considering the evidence, a preexisting condition exclusion period will 
be imposed on the individual. The basis of the determination, including 
the source and substance of any information on which the plan or issuer 
relied, must be included in the notice. The plan's appeals procedures 
and the opportunity of the individual to present additional evidence 
must also be explained in the notification.
    We estimate that issuers will be required to develop approximately 
29,000 notices in 1997; 425,000 notices in 1998; and 498,000 notices in 
1999. At 2 minutes for each notice, we estimate the total hour burden 
to be 960 hours in 1997; 14,000 hours in 1998; and 16,600 hours in 
1999. We estimate the respective costs associated with these burdens to 
be $10,600 in 1997; $156,000 in 1998; and $183,000 in 1999. These 
estimates include the notices required by issuers on behalf of state 
and local government health plans, since we anticipate that most, if 
not all state and local government health plans will contract with an 
issuer to develop the notice. The estimates have been disaggregated 
below:

----------------------------------------------------------------------------------------------------------------
                                                                   State health    Local health                 
                      Year                            Issuers          plans           plans       Total notices
----------------------------------------------------------------------------------------------------------------
Total notices:                                                                                                  
    1997........................................          27,650             588             766          29,004
    1998........................................         422,136           1,176           1,531         425,143
    1999........................................         496,182           1,176           1,531         498,889
Total burden hours:                                                                                             

[[Page 66123]]

                                                                                                                
    1997........................................             921              20              25          29,004
    1998........................................          14,057              40              51          14,148
    1999........................................          16,553              40              51          16,644
----------------------------------------------------------------------------------------------------------------

45 CFR 146.117  Special Enrollment Periods

    This section in the regulation provides guidance regarding new 
enrollment rights that employees and dependents have under HIPAA. A 
health insurance issuer offering group health insurance coverage is 
required to provide a description of the special enrollment rights to 
anyone who declines coverage at the time of enrollment. The regulations 
provide a model of such a description containing the minimum 
information mandated by the statute.
    The first burden associated with this requirement is the time 
required for health insurance issuers and state and local government 
health plans to incorporate the model notice into the plan's standard 
policy information. We estimate the burden to be 2 hours annually per 
issuer, for a total burden of 2,800 hours. The cost associated with 
this hour burden is estimated to be $30,800 annually.
    The second burden associated with this requirement is the time 
required to disseminate the notice to new enrollees. We estimate that 
issuers will be required to develop approximately 1 million notices in 
1997; 5.3 million notices in 1998; and 5.9 million notices in 1999. At 
30 seconds for each notice, we estimate the total hour burden to be 
8,300 hours in 1997; 43,000 hours in 1998; and 48,000 hours in 1999. We 
have estimated the costs associated with these hour burdens to be 
$91,000 in 1997; $469,000 in 1998; and $527,000 in 1999. These 
estimates include the notices required by issuers on behalf of state 
and local government health plans, since we anticipate that most, if 
not all state and local government health plans will contract with an 
issuer to develop the notice. The estimates have been disaggregated 
below:

----------------------------------------------------------------------------------------------------------------
                                                                   State health    Local health                 
                      Year                            Issuers          plans           plans       Total notices
----------------------------------------------------------------------------------------------------------------
Total notices:                                                                                                  
    1997........................................         245,508         287,938         500,750       1,034,196
    1998........................................       3,750,024         575,875       1,001,500       5,327,399
    1999........................................       4,407,828         575,875       1,001,500       5,985,203
Total burden hours:                                                                                             
    1997........................................           1,964           2,304           4,006           8,273
    1998........................................          30,000           4,607           8,012          42,619
    1999........................................          35,263           4,607           8,012          47,881
----------------------------------------------------------------------------------------------------------------

45 CFR 146.150  Guaranteed Availability of Coverage for Employers in 
the PHS Act Group Market Provisions

    This section allows a health insurance issuer to deny health 
insurance coverage in the small group market if the issuer has 
demonstrated to the applicable State authority (if required by the 
State authority) that it does not have the financial reserves necessary 
to underwrite additional coverage and that it is applying this denial 
uniformly to all employers in the small group market in the State 
consistent with applicable State law and without regard to the claims 
experience of those employers and their employees (and their 
dependents) or any health status-related factor relating to those 
employees and dependents. Thus, issuers are only required to report to 
the applicable State authority if they are discontinuing coverage in 
the small group market.
    This requirement exists in the absence of this regulation because 
under current insurance practices, State insurance departments oversee 
discontinuance of insurance products in their State as a normal 
business practice. Therefore, these information collection requirements 
are exempt from the PRA under 5 CFR 1320.3(b)(2) and 5 CFR 
1320.3(b)(3). However, under HIPAA, States must review policies during 
their oversight process to make sure there is a guaranteed availability 
clause in each policy. For the 37 States that currently require 
guaranteed availability, it is our understanding that this is normal 
business practice. For the other 18 States, however, we see this State 
burden to be about 10 minutes per policy, since States already review 
policies for other requirements and this process does not prescribe a 
timetable for reviewing the policies. We see this as a total burden of 
10,850 hours. We have estimated the cost associated with this hour 
burden to be $163,000. If the State identifies a violation and a State 
has to take some action, we believe that each State will be required to 
initiate fewer than 10 administrative actions on an annual basis 
against specific individuals or entities who failed to implement the 
Federal guarantee availability requirements.

45 CFR 146.152  Guaranteed Renewability of Coverage for Employers in 
the PHS Act Group Market Provisions

    In this section issuers are only required to report if they are 
discontinuing a particular type of coverage or discontinuing all 
coverage. This requirement exists in the absence of this regulation 
because under current insurance practices, State insurance departments 
oversee discontinuance of insurance products in their State as a normal 
business practice. Therefore, these information collection requirements 
are exempt from the PRA under 5 CFR 1320.3(b)(2) and 5 CFR 
1320.3(b)(3). However, under HIPAA, States must review policies during 
their oversight process to make sure there is a guaranteed availability 
clause in each policy. For the 43 States that currently require 
guaranteed renewability, it is our understanding that this is normal 
business practice. For the other 12 States, however, we see this State 
burden to be about 10 minutes per policy, since States already review 
policies for other requirements and this process does not prescribe a 
timetable for reviewing the policies. We see this

[[Page 66124]]

as a total burden of 6,700 hours. We have estimated the cost associated 
with this hour burden to be $100,500. If the State identifies a 
violation and a State has to take some action, we believe that each 
State will be required to initiate fewer than 10 administrative actions 
on an annual basis against specific individuals or entities who failed 
to implement the Federal guarantee renewability requirements.

45 CFR 146.160  Disclosure of Information by Issuers to Employers 
Seeking Coverage in the Small Group Market in the PHS Act Provisions

    This section requires issuers to disclose information to employers 
seeking coverage in the small group market. This section requires 
information to be provided by a health insurance issuer offering any 
health insurance coverage to a small employer. This information 
includes the issuer's right to change premium rates and the factors 
that may affect changes in premium rates, renewability of coverage, any 
preexisting condition exclusion, any affiliation periods applied by 
HMOs, the geographic areas served by HMOs, and the benefits and 
premiums available under all health insurance coverage for which the 
employer is qualified. The issuer is exempted from disclosing 
information that is proprietary or trade secret information under 
applicable law.
    The information described in this section must be language that is 
understandable by the average small employer and sufficient to 
reasonably inform small employers of their rights and obligations under 
the health insurance coverage. This requirement is satisfied if the 
issuer provides an outline of coverage, the minimum contribution and 
group participation rules that apply to any particular type of 
coverage, and any other information required by the State. An outline 
of coverage is defined as a general description of benefits and 
premiums. This would include an outline of coverage similar to the 
manner in which Medigap policies are presented, allowing the employer 
to easily compare one policy form to another to determine what is 
covered and how much the coverage will cost.
    We have estimated the total burden associated with this activity to 
be 2,400 hours. We anticipate that 1,200 issuers will be required to 
provide disclosure to small employers on an annual basis. We estimate 
this time to be approximately 2 hours for each issuer to develop and 
update the standard information related to the general description of 
benefits and premiums on an annual basis and include this information 
in their policy information. We have estimated the cost associated with 
this hour burden to be $36,000.

45 CFR 146.180  Treatment of non-Federal Government Plans

    Section 145.180(b) includes rules pertaining to nonfederal 
governmental plans, which are permitted under HIPAA to elect to be 
exempted from some or all of HIPAA's requirements in the PHS Act. The 
regulation establishes the form and manner of the election. In 
particular, a nonfederal governmental plan making this election is 
required to notify plan participants, at the time of enrollment and on 
an annual basis, of the fact and consequences of the election. The 
burden imposed by this is the requirement for plans to disseminate 
standard notification language describing the plans' election and the 
consequences of this election. We anticipate that between 3,500 and 
5,000 nonfederal governmental plans will make this election and will 
therefore be required to disseminate notifications to their 
participants on an annual basis. Since this is standard language that 
will be incorporated into plans' existing policy documents, we see the 
burden as approximately 2 hours per plan to develop and update this 
standardized disclosure statement on an annual basis. Thus, we estimate 
the total burden for this activity to range from 7,000 to 10,000 hours. 
We estimate the cost associated with these hourly burdens to range from 
$77,000 to $110,000 per year.
    The above estimate does not include the cost of disseminating the 
notices to all plan participants on an annual basis and to new 
enrollees at the time of enrollment. Although we do not have an 
accurate estimate of the number of nonfederal governmental plans will 
choose to opt out of these provisions, we have provided for a range of 
50 to 100 percent. Using these ranges, we estimated 400,000 to 800,000 
of these notices would need to be produced in 1997 and 800,000 to 1.6 
million in 1998 and 1999. At 30 seconds per notice, we estimate the 
total burden hours to range from 3,400 to 6,800 in 1997; and 6,800 to 
13,600 in 1998 and 1999. We have estimated the costs associated with 
these hour burdens to range from $37,400 to $74,800 in 1997; and from 
$74,800 to $149,600 in 1998 and 1999.
    We have submitted a copy of this notice to OMB for its review of 
these information collections. A notice will be published in the 
Federal Register when approval is obtained.
    To obtain copies of the supporting statement and any related forms 
for the proposed paperwork collections referenced above, E-mail your 
request, including your address, phone number, and HCFA form number(s) 
referenced above, to P<a href="/cdn-cgi/l/email-protection#0e6f7e6b7c79617c654e666d686f20696178"><span class="__cf_email__" data-cfemail="1879687d6a6f776a7358707b7e79367f776e">[email protected]</span></a>, or call the Reports Clearance 
Office on (410) 786-1326.
    Interested persons are invited to send comments regarding the 
burden or any other aspect of these collections of information 
requirements. However, as noted above, comments on these information 
collection and recordkeeping requirements must be mailed and/or faxed 
to the designees referenced below, by 12/29/97:

Health Care Financing Administration, Office of Information Services, 
Information Technology Investment Management Group, Division of HCFA 
Enterprise Standards, Room C2-26-17, 7500 Security Boulevard, 
Baltimore, MD 21244-1850. Fax Number: (410) 786-1415, Attn: John Burke 
HCFA-R-205 and/or HCFA-R-206
    and,
Office of Information and Regulatory Affairs, Office of Management and 
Budget, Room 10235, New Executive Office Building, Washington, DC 
20503, Fax Number: (202) 395-6974 or (202) 395-5167, Attn: Allison 
Herron Eydt, HCFA Desk Officer.

    Dated: December 10, 1997.
John P. Burke III,
HCFA Reports Clearance Officer, HCFA, Office of Information Services, 
Information Technology Investment Management Group, Division of HCFA 
Enterprise Standards.
[FR Doc. 97-33063 Filed 12-16-97; 8:45 am]
BILLING CODE 4120-03-P


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