By Employee Benefit Research Group
Sponsors of most self-insured group health plans are reminded that, if they have not yet done so, they must obtain a health plan identifying number (HPID) by November 5, notwithstanding the lack of clarity in some key areas in the final regulations and related guidance from the Centers for Medicare and Medicaid Services (CMS). The HPID requirement applies to all “controlling health plans,” although those with $5 million or less in annual receipts have an additional year—until November 5, 2015. A controlling health plan controls its own business activities, actions, or policies, or is controlled by an entity, such as an employer, that is not a health plan. An employer may obtain an HPID for each of its controlling health plans using a single-employer identification number (EIN).
Health flexible spending accounts (FSAs), health savings accounts (HSAs), and health reimbursement arrangements (HRAs) that cover only deductibles or out-of-pocket costs do not require an HPID. An HRA may require an HPID if it meets the definition of a “group health plan.”
The intended purpose of HPIDs is to streamline and administratively simplify electronic transactions, including claims for benefits, premium payments, benefit enrollment/disenrollment, and payment authorizations.
In general, an employer may authorize third-party administrators to obtain an HPID on its behalf for the self-insured group health plan; insurance carriers are responsible for obtaining the HPID for fully insured plans.
For information about obtaining an HPID, see the following CMS web pages:
• A Quick Reference Guide to Obtaining a Controlling Health Plan HPID
• Frequently Asked Questions
• Health Plan and Other Entity Enumeration System Data Elements
• HPID User Manual
The CMS guidance thus far leaves many questions unanswered, leaving plan sponsors to rely on legal counsel or other advisers in attempting to comply in good faith. For example, employers that provide health and life insurance under a single plan (i.e., as filed by one Form 5500) for former employees/retirees will have to consider if only one HPID is necessary for both the current and former employee coverages. Similarly, if a group health plan sponsor tracks different benefit options under a plan, the guidance is not clear if each option is a “subhealth” plan requiring individual HPIDs or if the options must be treated as part of a single plan with one HPID. In addition, the guidance is not clear about single or multiple HPIDs in situations involving an employer that provides coverage in multiple geographic regions through several preferred provider organizations (PPOs) or health maintenance organizations (HMOs).
For additional information about HPIDs, please contact your Milliman consultant.