- Effective April 1, 2009, employers sponsoring group health plans must provide special enrollment rights to the spouse or dependent of an eligible employee who loses coverage under a state children’s health insurance plan (CHIP) or Medicaid, or who becomes eligible for premium assistance under one of those programs. The individual has 60 days (in contrast to the usual 30-day period for other special enrollment events) to inform the employer of the change in circumstances. Employers with insured plans should expect to see information from their insurance companies regarding this change in short order, and those with self-funded plans will need to update their plan documents and employee disclosures as soon as possible.
- Effective July 1, 2009, employers with 11 or more current full-time equivalent employees in Minnesota must either allow employees to purchase individual or employer-based health coverage with pre-tax dollars through a cafeteria plan described in Internal Revenue Code Section 125 or formally opt out from this requirement by registering with the state no later than June 30, 2009. Employers that offer a group health plan (self-insured, HMO or fully insured) or who do not have any employees eligible to participate in an Internal
Revenue Code Section 125 plan are exempt from the application of the statute. Because adopting a Code Section 125 plan to permit employees to purchase individual policies on a pre-tax basis raises issues regarding whether an employer may be sponsoring an ERISA covered plan, we recommend that clients subject to the statute consult with legal counsel before adopting a 125 plan (including a state-mandated 125 plan). We would generally recommend that an employer covered by the statute opt out by July 1, 2009, and pursue any desired Code Section 125 plan or other coverage outside of the statute.
The opt-out form must be completed online and is available at the following link (along with some frequently asked questions): http://www.state.mn.us/portal/mn/jsp/content.do?programid=536917835&id=-536893703&agency=Insurance
- The Health Insurance Portability and Accountability Act (HIPAA) was amended by the Health Information Technology for Economic and Clinical Health Act (HITECH Act). While most of the changes are not effective until 2010, employers who are entering into new business associate agreements or service agreements with existing business associates may wish to look ahead and consider incorporating changes to such agreements to accommodate certain more stringent standards