08-07: Health Insurance Portability and Accountability Act of 1996

To:           All Health Insurers

From:      Linda Bohrer
                Acting Director
                Missouri Department of Insurance, Financial Institutions and Professional
                Registration
Re:          Health Insurance Portability and Accountability Act of 1996 ("HIPAA")
                Enforcement in Missouri

Date:       June 10, 2008

The Missouri Department of Insurance, Financial Institutions & Professional Registration (DIFP) issues this bulletin to provide notice of its intent to take over enforcement of the individual market provisions of Title XXVII of the Public Health Service Act (HIPAA). In accordance with federal regulation 45 CFR § 150.221, the Centers for Medicare and Medicaid Services (CMS) have determined that Missouri has enacted and implemented legislation (House Bill 818, 2007) to enforce such HIPAA requirements. This transition of enforcement authority will go into effect on July 1, 2008, pending DIFP addresses the remaining statutory issues discussed below. CMS will retain enforcement authority over individual health insurance policies delivered, issued or renewed before July 1, 2008.

While HB 818 made many of the changes necessary to transition HIPAA enforcement to Missouri, certain statutes are not in compliance with federal HIPAA law. The first is the definition of "waiting period" as that term is used in § 376.960(25). The definition of "waiting period" in that section should reflect the federal definition found in 45 CFR § 146.111(a)(3)(iii).

In addition, the Missouri Health Insurance Pool (MHIP) eligibility exclusion in § 376.966.3(1) cannot be applied to a "federally defined eligible individual." A federally defined eligible individual is eligible for pool coverage even if he or she is eligible for coverage under an individual health insurance plan or other type of coverage except a group health plan.

DIFP is working on legislation to remedy Missouri statutes that conflict with federal HIPAA law. Until such legislation is passed, Missouri will enforce the federal statutes and rules as stated above.

DIFP is also in discussions with CMS and the Federal Departments of Labor and Treasury regarding the group market provisions of HB 818 and existing Missouri law. CMS will retain enforcement authority over HIPAA requirements in Missouri's group insurance market until the outstanding group market issues are resolved.

In addition, DIFP submitted materials to CMS establishing MHIP as the State Alternative Mechanism to provide guarantee issue individual coverage to HIPAA eligible individuals. CMS has reviewed the materials and accepted Missouri's plan to implement MHIP as the State Alternative Mechanism. MHIP will begin to provide guarantee issue policies to HIPAA eligible individuals on July 1, 2008.

If an insurer needs to file forms to reflect this change in guarantee issue, the Life and Health Section has agreed to expedite such forms. A form will be expedited if it is a simplified rider, endorsement or amendment which only eliminates the contract's requirement to offer a HIPAA policy and does so in clear terms. In addition, an insurer seeking to expedite a filing must e-mail John Korte, Manager, Life and Health Section at john.korte@insurance.mo.gov with the filing's SERFF tracking number and the date it was submitted to SERFF. The forms may be marked with a TOI code of H16I.005C or other appropriate code. After 60 days from the date of this bulletin, changes to forms should be made on a general use basis and processed in accordance with Life and Health Section's standards.