[ Wednesday, March 10, 2004 ]


April is coming! If you have a small group health plan (i.e., you are an employer and have a health plan that has less than $5 million in pay-in or pay-out), the April 2003 implementation date for the Privacy Rule didn’t apply to you. However, your day is coming, and coming fast. For so-called “small plans”, the date for required compliance with the Privacy Rule is April 16, 2004.

On another note, certain very small plans are excluded from HIPAA: if your plan has less than 50 beneficiaries (not just employees, but dependents as well) AND is self-administered, you are not a “group health plan” under HIPAA*. I had originally figured that this was a bogus category; if you have 50 or fewer beneficiaries, there’s no way it would be economically feasible to self-administer your own plan. However, I have now found a client who meets this super-small category: a small drilling company that has a fully-insured plan, but self-administers it. This makes perfect sense, since there’s little administrative burden when the plan just includes the purchase of a fully-insured product from an insurance company. This has led me to believe that the super-small category might include a lot more folks than I originally thought.

*HIPAAcrats note: there has been some pretty insightful commentary on whether the super-small exception is really an exception. It is an exception to the definition of “group health plan,” which is a component of the definition of “health plan.” But the definition of “health plan” also includes catch-all language referencing any other arrangement for the provision of or payment for health care services. So, it seems that self-administered plans of less than 50 are not “group health plans” but might still be “health plans.” This makes no sense (which actually makes sense when you figure we’re talking about HIPAA regulations), of course, and the consensus opinion now seems to be that if you meet the super-small exception, you shouldn’t be caught up in the catch-all. That said, consider yourselves warned nonetheless.

Jeff [3:30 PM]

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