Under the Department of Labor's ("DOL") interim disclosure rules issued in April, group health plans must amend their summary plan descriptions ("SPDs") effective for plan years beginning on or after June 1, 1997. Thus, for calendar year plans, employers have until January 1, 1998, to amend their SPDs to make the necessary disclosures.
Effective for plan years beginning on and after July 1, 1997, SPDs must contain the following information: (a) the role of insurance companies or other insurance issuers in the group health plan, including the name and address of the issuer, whether, and to what extent, benefits under the group health plan are guaranteed under a contract or policy, and the nature of administrative services, if any, provided by the issuer; (b) the specific local or regional DOL office that participants may contact for assistance with their rights under either HIPAA or the Employee Retirement Income Security Act ("ERISA"); and (c) a statement explaining that under federal law a group health plan may not restrict the length of any hospital stay in connection with childbirth to less than 48 hours for normal deliveries and 96 hours for cesarean section deliveries, or require that a provider obtain authorization from the plan or insurance issuer for prescribing a length of stay not in excess of the above specified periods.
In addition to requiring SPDs to be amended, the DOL has also issued rules regarding the use of a summary material modification ("SMM"). Effective January 1, 1998, calendar year plans must notify plan participants, not only of plan changes through an SMM, but also of any "material reductions in covered services or benefits" within 60 days of their adoption. Prior to HIPAA, group health plans had 210 days after the end of a plan year in which a reduction occurred to notify plan participants. A "material reduction in covered services or benefits" is any modification to a group health plan, or change in information required to be included in a SPD that, independently or in conjunction with other contemporaneous changes, would be considered by the average plan participant to be an important reduction in covered services or benefits. Examples of such modifications are changes that (a) eliminate benefits payable under the group health plan, (b) reduce benefits, (c) increase deductibles or co-payments, (d) reduce the service area covered by a health maintenance organization or (e) establish a condition or requirement such as pre-authorization to obtaining services or benefits under a group health plan. Use of E-mail Is Permitted
In addition to the above described new disclosure requirements, the HIPAA regulations permit the use of electronic media (e-mail) to disseminate group health plan SPDs and SMMs. The rules provide a safe harbor for the use of e-mail which requires that (a) employees have ready access at their worksite(s) to e-mail, (b) employers take steps to ensure actual receipt of the information or notices by participants such as return-receipt electronic mail features, (c) participants are given notice (either electronically or in paper) that such information will be transferred electronically and (d) participants are given the opportunity to receive all notices in paper upon request. The safe harbor for the use of e-mail is applicable only to group health plans. To date there is no similar safe harbor for other types of employee benefit plans.