O.K., deep breath…slow down…no need to hyper-ventilate. Even if association health plans sold to small employers won’t include all of the “essential health benefits” mandated by the Affordable Care Act (ACA), that doesn’t mean the plans can be designed free from any regulatory constraints. Washington State association health plans will not suddenly appear on the market covering only the occasional shin splints.
Undoubtedly, small group health insurance subject to the ACA includes more mandated benefits and methods for administering those benefits than mandates for large group insurance (bona fide AHPs are regulated as large group plans). BUT, federal and state laws govern the content and administration of large group health plans. Moreover, DOL has noted that in applying federal benefit standards to an AHP, the total number of employees of all covered employers gets counted in making the determination.
Accordingly, for a bona fide group or association, the determination of whether [the Mental Health Parity and Addiction Equity Act of 2008] applies under ERISA and the PHS Act depends on the size of the AHP, which generally would be based on the number of employees employed in the aggregate during the preceding calendar year by the employer members of the bona fide group or association. This interpretation is consistent with the approach described earlier in this preamble of treating AHPs like large employers. [Final Rule page 86]
As for the applicability of COBRA to an AHP, the agency will consult with IRS and provide future guidance. [Id.]
You can review federal guidelines for health plan coverage of pregnancy and for compliance with various federal laws governing employer health plans. Given DOL’s intention to treat AHPs as large groups without regard to underlying employer size, administrators can expect that DOL will provide a series of additional publications as to the applicability of various federal laws affecting health plan benefits. Here’s the Washington Insurance Commissioner’s summary:
|Large employer health plan requirements under ACA||Non-grandfathered group plans||Grandfathered group plans|
|Provide you with a “Summary of Benefits and Coverage” (SBC)||Yes||Yes|
|Cannot retroactively cancel your coverage if you made a mistake on your initial application, unless the plan finds fraud or intentional misrepresentation||Yes||Yes|
|Provide health coverage for dependent children until they turn age 26||Yes||Yes|
|Provide coverage for pre-existing conditions for all enrollees||Yes||Yes|
|Allow discounts and rewards on wellness programs of up to 30 percent on premiums||Yes||Yes|
|Renew your policy even if you become sick||Yes||Yes|
|Guarantee your right to appeal eligibility and claim denials to independent review organizations (IROs)||Yes||Fully funded plan = Yes
Self-funded plan = No
|Cover certain recommended preventive care for free||Yes||No|
|Provide you the right to choose your doctor and access to out-of-network emergency room services||Yes||Fully funded plan = Yes
Self-funded plan = No
|May require a waiting period of no more than 90 days before you can enroll in the company’s health plan||Yes||Yes|
Now let’s focus on Washington State mandates. Washington requires AHPs to file their health plan forms and rates like any other large group. Furthermore, if an insurer files on behalf of an AHP, the Insurance Commissioner requires all of the following:
G. Health plan issued to an Association or Member-Governed Group:
1. Submission requirements apply to both Grandfathered and Non-grandfathered filings, unless specifically noted:
a. You must state in the Filing Description field whether this is an in-state or out-of-state group filing. An out-of-state group filing is a filing of a group policy issued to a policyholder outside the state of Washington that provides coverage to residents of Washington.
b. Non-Grandfathered associations or member-governed group filings must use the following product name convention: “Association or member-governed true employer group under 29 U.S.C. Section 1002(5) of ERISA– [Name of the Association]” in the Product Name field on the General Information tab.
c. Grandfathered associations or member-governed group filings must use the following product name convention: “Grandfathered Association or member-governed group– [Name of the Association]” in the Product Name field on the General Information tab.
d. Rates and forms for Grandfathered association or member-governed groups must be filed separately from rates and forms for Non-grandfathered association or member-governed groups. See Rate Filing General Instructions and WAC 284-43-0330.
2. A Non-grandfathered group to whom the health plan is issued must constitute a true employer group under 29 U.S.C. § 1002(5) of the Employee Retirement Income Security Act (ERISA) of 1974. WAC 284- 43-0330(1) and (2).
a. The health plan must be filed as, and conform to the requirements for, a small group health plan if the number of participants is fifty or less. See section I of these instructions.
3. You must file all forms comprising the contract, including the group master application, enrollment form, policy, certificate of coverage(s), and other documents as appropriate. Each form submitted for review must be listed and attached on the Form Schedule tab. Each form must be in single case format. (Single case format means group-specific language with no bracketing or variability.)
a. If a form has been previously approved, you must associate the form with the Fully Negotiated filing by:
i. Listing the previously-approved policy form number(s) and form name(s) on the Form Schedule tab, using the correct form numbers. DO NOT attach the previously- approved forms.
ii. All forms associated must be from a filing with the same TOI.
iii. When you list a previously-approved form on the Form Schedule tab, you must populate the Action field with “Other” and the Action Specific Data field with “Other Explanation Filed – State Tracking #[XXXXXX]”. See the screenshot above in section I.D.3.b of these Instructions.
iv. Associated forms must have received final action from the OIC within the State Government General Records Retention Schedule timeline (8 years). If the form received final action from the OIC outside this retention schedule, the form may not be associated and must be attached to the filing for review.
4. Your filing must include a certification from an officer of the company, attached on the Supporting Documentation tab.
a. The certification must state that the group health insurance coverage in connection with this large group health plan meets the requirements of the Health Insurance Portability and Accountability Act (HIPAA) 29 CFR § 2590.702.
b. The certification must include statements that the rules for the eligibility (including continued eligibility) of any individual to enroll under the terms of the large group health plan are not based on any of the following health status-related factors (prescribed in HIPAA) in relation to the individual or a dependent of the individual:
i. Health status;
ii. Medical condition (including both physical and mental illnesses);
iii. Claims experience;
iv. Receipt of health care;
v. Medical history;
vi. Genetic information;
vii. Evidence of insurability (including conditions arising out of acts of domestic violence); or
5. Non-grandfathered major medical plan filings must attach a PDF document titled “Evidence as an Employer” on the Supporting Documentation tab. The document must include, at a minimum, the following information:
a. A copy of the association bylaws; and
b. A copy of the trust agreement or other organizational document which shows the purpose of the association and who governs the association; and
c. A statement of the association’s history; and
d. A copy of the occupational categories/ industry classifications comprising the employers in the association; and
e. An advisory opinion from the Federal Department of Labor demonstrating that the group is qualified to purchase association coverage;
f. In the absence of a Federal Department of Labor opinion, an opinion from an attorney explaining how and why the association qualifies as a true employer under 29 U.S.C. § 1002(5) of the Employee Retirement Income Security Act (ERISA) of 1974.
6. Grandfathered association or member-governed group filings must include a certification, signed by an officer of the company, under the Supporting Documentation tab verifying that the Grandfathered plan(s) meets all the criteria under WAC 284-43-0250.
7. A Large Group Analyst Checklist must be filed under the Supporting Documentation tab. A Checklist is not required for large group vision fully negotiated filings.
8. The filing must include any applicable group-specific or unique application or enrollment forms. The forms must be listed and attached on the Form Schedule tab for review.
a. The forms must use the prescribed form name requirements, e.g., “Custom App/Enr [ABC Company]”.
b. The filing must include a completed and signed “Custom Enrollment/Application Certification” for each unique application or custom enrollment form submitted for review. The certification(s) must be attached on the Supporting Documentation tab.
As for the benefits AHPs offer to employers, Washington has a long list of mandates. The Insurance Commissioner publishes the following guide for those who prefer lists over regulations.
|Health benefit||Description||Plan type*|
|Anesthesia for dental services (leg.wa.gov)||General anesthesia and related facility charges for dental procedures performed in a hospital or ambulatory surgical center must be covered for children under age seven and other specified individuals.||Group|
|Cancer chemotherapy medications (leg.wa.gov)||Health plans covering cancer chemotherapy treatment must provide coverage for self-administered anticancer medication comparable to chemotherapy medications administered by a health care provider.||Individual/family
Group (effective Jan. 1, 2012)
|Chemical dependency (leg.wa.gov)||Treatment of chemical dependency must be covered in an approved treatment facility program.||Group|
|Colorectal cancer exams and lab tests (leg.wa.gov)||Colorectal cancer examinations and lab tests consistent with the recommendation of the U.S. Preventive Services Task Force or the federal Centers for Disease Control and Prevention must be covered.||Individual/family
|Congenital anomalies in children and newborns (leg.wa.gov)||Newborn infants must be covered from birth. The coverage must include treatment of congenital anomalies.||Individual/family
|Contraceptive coverage (leg.wa.gov)||Health plans providing generally comprehensive coverage of prescription drugs and/or prescription devices must cover contraceptives on the same basis as other prescription drugs and devices.||Individual/family
|Diabetes coverage (leg.wa.gov)||Health plans must cover medically necessary diabetes equipment, supplies, education and training.||Individual/family
|Emergency medical services in an emergency department (leg.wa.gov)||Health plans must cover emergency services provided in an emergency department if a medical provider believes patient is having an emergency.||Individual/family
|Injury caused by intoxication or narcotics (leg.wa.gov)||Health plans cannot deny coverage of an injury only because it was sustained while intoxicated or under the influence of a narcotic.||Individual/family
|Mammograms (leg.wa.gov)||Health plans must cover screening or diagnostic mammography services if recommended by a physician or advanced registered nurse practitioner.||Individual/family
|Maternity and drug coverage (leg.wa.gov)||All individual health plans must include coverage for maternity services and prescription drug coverage.||Individual|
|Mental health parity (leg.wa.gov)||All health plans must include the same coverage for mental health services that they provide for other medical and surgical services.||Individual/family
|Neurodevelopmental therapies (leg.wa.gov)||Health plans must cover neurodevelopmental therapies (occupational therapy, speech therapy, physical therapy) for enrollees age six or younger.||Group|
|Phenylketonuria (PKU) (leg.wa.gov)||Health plans must cover the formulas necessary to treat PKU.||Individual/family
|Prostate cancer screening (leg.wa.gov)||Health plans must cover prostate cancer screenings recommend by the patient’s physician, advanced registered nurse practitioner or physician assistant.||Individual/family
|Temporomandibular joint disorder (TMJ) (leg.wa.gov)||Offer employers optional coverage for TMJ, which can cause pain in the jaw joint and in the muscles that control jaw movement. (Employers are not required to include this benefit in the plan.)||Group|
|Women’s health care services (leg.wa.gov)||Health plans must provide access to women’s health services through in-network providers. Services include: maternity, reproductive health, gynecological care, general exams and preventive services.||Individual/family
Can we agree that the world did not come to an end with DOL adoption of rules governing AHPs?
O.K., maybe not, but can we at least agree that Washington State takes care of its people?
O.K., maybe not enough, but will you relax a bit so you don’t need medical attention?
Chill Out Bro.