American Benefits Council
Benefits Byte


February 6, 2014

The Benefits Byte is the American Benefits Council’s regular e-mail and online newsletter for members only, providing timely reports on legislative, regulatory and judicial developments, along with updates on the Council’s activities in support of employer-sponsored benefit plans.

The Benefits Byte is published by the American Benefits Council, based on staff reports and edited by Jason Hammersla, Council director of communications. Contact information for Council staff related to specific topics can be found at the end of each story.

Click here to read past issues on the Benefits Byte Archive page.

Follow us on Twitter at @BenefitsCouncil

HHS Proposed Regulations Require Certification of Compliance with HIPAA Standard Transactions

Under the Patient Protection and Affordable Care Act (PPACA) and proposed regulations issued in January, the U.S. Department of Health and Human Services (HHS) requires health plans to submit certain information and documentation certifying compliance with “standard transactions” under the Health Insurance Portability and Accountability Act (HIPAA). These requirements impose new obligations on insured and self-insured health plans.

Under the administrative simplification provisions of HIPAA, covered entities are required to conduct certain transactions electronically using standards and code sets designated by HHS. Transactions subject to these requirements include eligibility, claims & encounter information, claims status, enrollment and disenrollment, payment, premium payment and coordination of benefits. In addition to adding new transactions, PPACA mandated that health plans submit certain documentation and information to HHS that demonstrates compliance with electronic transaction standards and established new penalties for health plans that fail to comply.

Under the newly proposed regulations, health plans that are “controlling health plans” (a definition added by prior final regulations implementing the unique health plan identifier (HPID) requirements of HIPAA) must submit:

(1)   documentation that demonstrates compliance by obtaining certification from an outside vendor that shows the plan performs the required standard transaction and has tested these transactions; and

(2)   information about the number of covered lives under the plan so that HHS can assess penalties it if finds noncompliance.

These requirements apply with respect to three transactions: eligibility for a health plan, health care claim status and health care electronic funds transfer and remittance advice. Under the proposed regulations, the required documentation and information will be due December 31, 2015. Additional background regarding HIPAA administrative simplification and the proposed regulations are included in a summary provided courtesy of Groom Law Group.

The proposed regulations request comment by March 3. The Council intends to submit comments and welcomes member input. We will hold a P4P … Preparing for PPACA webinar on February 13 at 2 p.m. (Eastern Time) to discuss the proposed rule and solicit your feedback; please click here to register.

For more information, contact Kathryn Wilber, senior counsel, health policy, at (202) 289-6700.

Council Writes CMS Regarding Possible Medical Advantage Rate Cuts

In a February 3 letter to Marilynn Tavenner, administrator of the U.S. Department of Health and Human Services Centers for Medicare & Medicaid Services (CMS), the Council recommended that the agency maintain Medicare Advantage rates at current levels for 2015.

Proposed 2015 rates for the Medicare Advantage program, which covers seniors through private insurance, will be announced next month with final rates to be set in April. The Patient Protection and Affordable Care Act (PPACA) and subsequent payment changes resulted in a 6.7 percent rate reduction in 2014 and there is concern that additional cuts could be on the horizon.

“Many of our member companies rely on Medicare Advantage plans to provide high quality, affordable retiree health benefits to their retirees. … We are concerned that further rate reductions could detrimentally affect retirees in the form of higher out-of-pocket costs, less coverage and fewer provider options for retirees,” Council President James Klein said in the letter.

For more information, contact Kathryn Wilber, senior counsel, health policy, at (202) 289-6700.

The American Benefits Council is the national trade association for companies concerned about federal legislation and regulations affecting all aspects of the employee benefits system. The Council's members represent the entire spectrum of the private employee benefits community and either sponsor directly or administer retirement and health plans covering more than 100 million Americans.

Notice: the information contained herein is general in nature. It is not, and should not be construed as, accounting, consulting, legal or tax advice or opinion provided by the American Benefits Council or any of its employees. As required by the IRS, we inform you that any information contained herein was not intended or written to be used or referred to, and cannot be used or referred to (i) for the purpose of avoiding penalties under the Internal Revenue Code, or (ii) in promoting, marketing or recommending to another party any transaction or matter addressed herein (and any attachment).