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THE WOMEN’S HEALTH AND CANCER RIGHTS ACT
The Women’s Health and Cancer Rights Act of 1998 (WHCRA) was signed into law by President Clinton on October 21, 1998. It includes specific protections for breast cancer patients who elect reconstruction in connection with a mastectomy. The WHCRA amends ERISA and the PHS Act and is administered, as are other laws, by the DOL and the Department of Health and Human Services.
The WHCRA applies to all group health plans, insured and self-funded, that provide coverage for medical and surgical benefits with respect to a mastectomy. Requirements of the WHCRA are effective for plan years beginning on or after October 21, 1998.
Revised group health plan coverage requires that plans offering coverage for mastectomy must also provide coverage for reconstructive surgery in a manner determined in consultation with the attending physician and the patient. Coverage, in compliance with the WHCRA, includes the following:
Reconstruction of the breast on which the mastectomy was performed,
Surgery and reconstruction of the other breast to produce a symmetrical appearance, and
Prosthesis and treatment of physical complications at all stages of the mastectomy, including lymphedemas
THE NEWBORNS’ AND MOTHERS’ HEALTH PROTECTION ACT
Effective for health plan years beginning on or after January 1, 1998, the Newborns’ and Mothers’ Health Protection Act of 1996 (NMPHA) amended ERISA and the Public Health Service (PHS) Act by placing requirements on minimum length of hospital stays in connection with childbirth. Specifically, a group health plan may not restrict the hospitalization period after childbirth for the mother or for the newborn to less than 48 hours for vaginal delivery and 96 hours for a cesarean delivery. This restriction does not apply if the decision to discharge the mother or her newborn child before the expiration of the minimum length of stay is made by the attending health care provider in consultation with the mother. That is, if the physician and mother agree, the mother, her newborn, or both may leave the hospital earlier than the required time. This decision is not permitted to be made by an insurance carrier or plan sponsor.
THE MENTAL HEALTH PARITY ACT
Effective for health plan years beginning on or after January 1, 1998, the Mental Health Parity Act (MHPA) amended ERISA to prohibit annual or lifetime dollar limits on mental health treatments, unless the same dollar limits also apply to medical and surgical benefits under the employer’s health plan. The MHPA does not require the employer’s group health plan to provide any mental health benefits, nor does it place any restrictions on the terms or conditions relating to the amount, duration, or scope of the mental health benefits under the plan (e.g., cost sharing, limits on the number of visits or days of coverage, and requirements relating to medical necessity). For purposes of the MHPA, mental health benefits do not include benefits for the treatment of substance abuse or chemical dependency.
The MHPA applies to both insured and self-funded health plans offered by employers of at least 50 employees. It does not cover small employers (those employing at least two but not more than 50 employees during a preceding calendar year and who employ at least two employees on the first day of the plan year).
THE HEALTH INSURANCE PORTABILITY AND ACCOUNTABILITY ACT
HIPAA added new dimensions to employee benefits. As indicated in the title of the law, HIPAA was passed as a means to provide greater portability of employee health care coverage, particularly as individuals move from one job to another. Preexisting condition exclusions (PCEs) in employer group health plans were perceived to be arbitrary deterrents to changing jobs, in effect creating “job lock”.
Unique aspects of this legislation included the new health plan portability rules, the preexisting condition exclusion, guaranteed renewability, certification of creditable coverage, excepted benefits, special enrollment periods, nondiscrimination requirements, disclosure requirements, the creation of medical savings accounts, and long-term care insurance provisions.
Health Care Portability
Effective July 1, 1997, HIPAA created new health coverage portability provisions. The purpose of HIPAA is to ensure that employees leaving an employer’s health plan have access to a new employer’s plan without limitations because of preexisting conditions, waiting periods, or health status. The law applies to health plans with two or more active participants who were employees on the first day of the plan year. The portability requirements limit preexisting conditions exclusions, prohibit exclusion from coverage based on health status, and guarantee renewability of health insurance coverage.
The Preexisting Conditions Exclusion
In general, HIPAA limits PCEs to 12 months. The requirements are as follows:
- Employers may have an 18-month PCE for employees who do not enroll as soon as they become eligible for benefits, but they must reduce the 12- or 18-month cap by one month for each month of prior continuous, creditable coverage. (Creditable coverage is coverage that may have been provided under a previous group health plan, individual health insurance, Medicare, COBRA, or other federal health programs.)
- Employers cannot apply a PCE to newborns, adopted children, or pregnancies that exist on the day coverage begins.
- If there is a break in coverage of more than 63 days, prior continuous coverage does not have to be counted against the 12- or 18-month cap.
- A health plan must provide a written certificate of creditable coverage when an individual ceases health plan or COBRA coverage, or if any employee requests such certification within 24-months from the date coverage ends.
Guaranteed Renewability
Individuals with at least 18 months of coverage under a previous plan must, after exhausting all possible avenues for health coverage, be offered the opportunity to purchase an individual policy in their state (unless the state already has a program in place to offer coverage in this situation).
Certificate of Creditable Coverage
HIPAA requires employers to provide employees a written certificate of coverage outlining coverage provided during the 24-month period before coverage ceased. There are three occasions when the certification statement must be given to an employee, a qualified beneficiary, or both:
- At the time coverage ends, which can be at the same time as COBRA notification
- At the time COBRA coverage (if elected) ends
- Upon request by an employee at any time within 24 months following the end of coverage.
The certificate must show all periods of creditable coverage.
Creditable coverage does not include accident and disability income, liability, workers’ compensation, or automobile medical insurance. Coverage for limited benefits (e.g., limited dental, vision, and long-term care) or for plans under which health benefits are “incidental” is also not considered creditable. Waiting periods and HMO affiliation periods count as creditable coverage and need to be indicated on the certificate.
The certificates may be provided either by the employer or by the health insurance carrier, but need not be provided by both. An employee’s current (i.e. new) employer may request information from a prior employer about categories of benefits, but the prior employer may charge for the costs of disclosing that information.
Special Enrollment
As of July 1, 1997, employers must allow employees to enroll in health coverage during certain special enrollment periods in addition to the initial and open enrollment periods. If an employee does not enroll in the employer’s health plan when he or she first becomes eligible, because the employee wants to keep his or her current health plan (e.g., COBRA coverage from a previous employer), the employer must allow the employee to enroll in the plan within 30 days of the date the other coverage is exhausted. If the employee stops paying for COBRA coverage before it runs out, the employer could require the employee to wait to enroll during the next open enrollment period, if one exists.
An employer may require that when coverage is declined during the initial enrollment period, the employee must put in writing that the declination is due to other coverage. The employee who then exhausts other coverage must request enrollment in the employer’s health plan within 30 days of the date of the loss of the other coverage.
New dependents of eligible employees by marriage, birth, adoption, or placement for adoption must be permitted to enroll in the organization’s health plan if the employer is notified within 30 days of such event. The coverage becomes effective on the date of the birth, adoption, or placement for adoption. For a marriage, coverage can become effective no later than the first day of the first month beginning after the date the completed request for enrollment is received.
Nondiscrimination Requirements
HIPAA furthered the requirements prohibiting discrimination. Specifically, a group health plan may not establish rules for individual eligibility based on any of the following:
- Health status
- Medical condition (including both physical and mental illnesses)
- Claims experience
- Medical history
- Genetic information
- Evidence of insurability
- Disability
The nondiscrimination requirement does not mean that a group health plan is required to provide particular benefits, procedures, treatment, or service. A plan may establish limitations or restrictions on benefits or coverage for covered groups of individuals in similar situations, such as union status or other employment status.
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