HIPPA FAQ

What is creditable coverage?

Most health coverage is creditable coverage, such as coverage under a group health plan (including COBRA continuation coverage), HMO, individual health insurance policy, Medicaid or Medicare.

Creditable coverage does not include coverage consisting solely of excepted benefits, such as coverage solely for limited-scope dental or vision benefits.

Days in a waiting period during which you have no other coverage are not creditable coverage under the plan, nor are these days taken into account when determining a significant break in coverage (generally a break of 63 days or more).  This 63-day break period may be extended under state law if your coverage is insured through an insurance company or offered through an HMO.  Check with your State Insurance Commissioner's Office to see whether a longer break period applies to you.

How does crediting for prior coverage work under HIPAA?

Most plans use the standard method of crediting coverage.

Under the standard method, you receive credit for your previous coverage that occurred without a break in coverage of 63 days or more.  Any coverage occurring prior to a break in coverage of 63 days or more is not credited against a preexisting condition exclusion period.

To illustrate, suppose an individual had coverage for 2 years followed by a break in coverage of 70 days and then resumed coverage for 8 months.  That individual would only receive credit for 8 months of coverage; no credit would be given for the 2 years of coverage prior to the break in coverage of 70 days.

Can I receive credit for previous COBRA continuation coverage?

Yes.  Under HIPAA any period of time that you are receiving COBRA continuation coverage is counted as previous health coverage as long as the coverage occurred without a break in coverage of 63 days or more.

For example, if you were covered continuously for 5 months by a previous health plan and then received 7 months of COBRA continuation coverage, you would be entitled to receive credit for 12 months of coverage by your new group health plan.

I began employment with my current employer 45 days after my previous group health plan coverage terminated.  I had coverage under my previous employer's plan for 24 continuous months prior to the termination.  I had no other coverage before my enrollment date in my new plan,  Will I be subject to the 12-month preexisting condition exclusion period imposed by my new employer?

Not if you enroll when you are first eligible.  The 45-day break in coverage does not count as a significant break in coverage under HIPAA.  Under federal law, a significant break in coverage is a break in coverage of at least 63 consecutive days.  Since you had over 12 months of creditable coverage from your previous group plan without a significant break, you would not be subject to the preexisting condition exclusion period imposed by your new employer's plan if you enroll when you are first eligible.

How can I avoid a 63-day break in coverage?

There are several things you can do.  If your last coverage was under a group health plan, you may be able to elect COBRA continuation coverage.  COBRA is the name for a federal law that provides workers and their families the opportunity to purchase group health coverage through their employer's health plan for a limited period of time (generally 18, 29, or 36 months) if they lose coverage due to specified events, including termination of employment, divorce or death.  Workers in companies with 20 or more employees generally qualify for COBRA.  Some states have laws similar to COBRA that apply to smaller companies.  You may also try to purchase an individual health insurance policy.

What can I do if I don't have enough creditable coverage to offset a preexisting condition exclusion period?

During any preexisting condition exclusion period under a new plan you may be entitled to COBRA continuation coverage under your former plan.  You may also try to purchase an individual health insurance policy.

How do newly hired employees prove that they had prior health coverage that should be credited?

Under HIPAA, an employee's former group health plan and any insurance company or HMO providing such coverage is required to provide the employee with a statement of prior health coverage, commonly referred to as a certificate of creditable coverage.

This certificate must be provided automatically to you when you lose coverage under the plan or otherwise become entitled to elect COBRA continuation coverage as well as when COBRA continuation coverage ceases.

You may also request a certificate, free of charge, until 24 months after the time your coverage ended.  For example, you may request a certificate even before your coverage ends.

What steps should I take if I am not provided a certificate by my plan or issuer?

If you do not receive a certificate by the time you should have received it or by the time you need it, your first step should be to contact the plan administrator of the plan responsible for providing the certificate and request one.  If any part of your creditable coverage was through an insurance company, you can also contact the insurance company for a certificate that reflects that part of your creditable coverage as long as you make the request within 24 months of your coverage ceasing under the insurance policy.  Group health plans and insurers that fail or refuse to provide such certificates are subject to penalties under HIPAA.

In any event, if you do not receive a certificate, you may demonstrate to your new plan that you have creditable coverage (as well as the time you were in any waiting periods) by producing documentation or other evidence of creditable coverage (such as pay stubs that reflect a deduction for health insurance, explanation of benefits forms (EOBs) or verification by a doctor or your former health care benefits provider that you had prior health insurance coverage).  Accordingly, you should keep these records and documentation in case you need them.

What is a preexisting condition?

A preexisting condition is a medical condition present before your enrollment date in any new group health plan.

Under HIPAA, the only preexisting conditions that may be excluded under a preexisting condition exclusion are those for which medical advise, diagnosis, care or treatment was recommended or received within the 6-month period before your enrollment date.  (Your enrollment date is your first day of coverage, or if there is a waiting period to get into the plan, the first day of the waiting period.)

If you had a medical condition in the past, but have not received any medical advise, diagnosis, care or treatment within the 6 months prior to your enrollment date in the plan, your old condition is not a preexisting condition to which an exclusion can be applied.  Moreover, under HIPAA, preexisting condition exclusions cannot be applied to pregnancy, regardless of whether the woman had previous health coverage.

In addition, a preexisting condition exclusion cannot be applied to a newborn, adopted child under age 18, or a child under age 18 placed for adoption as long as the child became covered under health coverage within 30 days of the birth, adoption or placement for adoption and provided that the child does not incur a subsequent 63-day break in coverage.

Finally, genetic information may not be treated as a preexisting condition in the absence of a diagnosis.  If your coverage is through an insurance company or offered through an HMO, state law may provide additional protections.

What are my new group health plan's obligations with respect to special enrollment opportunities?

A group health plan is required to allow special enrollment for certain individuals to enroll in the plan without having to wait until the plan's next regular enrollment season.

Group health plans and health insurance issuers are required to provide special enrollment periods during which individuals who previously declined coverage for themselves and their dependents may be allowed to enroll (without having to wait until the plan's next open enrollment period).

A special enrollment opportunity occurs if an individual with other health insurance loses that coverage or if a person becomes a new dependent through marriage, birth, adoption or placement for adoption.  However, you must notify the plan of your request for special enrollment within 30 days after losing your other coverage or within 30 days of having (or becoming) a new dependent.

If you enroll as a special enrollee, you may not be treated as a late enrollee for purposes of any preexisting condition exclusion period.  Therefore, the maximum preexisting condition exclusion period that may be applied is 12 months, reduced by your creditable coverage (rather than 18 months, reduced by creditable coverage).

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