• HIPAA Requires Many Health Plans to Obtain a Health Plan Identifier by November 5, 2014
  • October 13, 2014 | Author: Marvin S. ("Bucky") Swift
  • Law Firm: Snell & Wilmer L.L.P. - Phoenix Office
  • On September 5, 2012, the Department of Health and Human Services (HHS) issued final regulations adopting a standard for a national unique “health plan identifier” (HPID) and providing rules for implementing the HPID. Health plans are currently identified by several different number sets, depending on the source. For example, health plans may be identified by an IRS tax identification number, an employer identification number, the National Association of Insurance Commissioner code, the various identifiers for Forms 5500 or the proprietary descriptors used by clearinghouses.

    These regulations aim to provide consistency and uniformity when identifying health plans in standard electronic transactions to improve efficiency. As discussed below, compliance deadlines are approaching.

    What is an HPID?

    Upon application approval, a health plan is assigned a ten-digit number that is unique to that health plan so it can be easily identified by HIPAA-covered entities (e.g., health insurers, clearinghouses, group health plans and providers electronically transmitting health information) in standard electronic transactions involving the exchange of health care data between these entities. Such standard electronic transactions include, for example, health care claims, plan eligibility, premium payments and plan enrollment.

    What Are the Deadlines?

    The deadline for health plans, except “small” plans, is November 5, 2014. The deadline for “small” health plans, defined as plans with $5 million or less in annual receipts, is November 5, 2015.

    Beginning November 7, 2016, all covered entities must use an HPID whenever a covered entity identifies a health plan that has an HPID in a standard electronic transaction. If a covered entity uses a business associate to conduct standard electronic transactions on its behalf, it must require its business associate to use the HPID to identify a health plan that has an HPID during these transactions.

    Who Must Obtain an HPID?

    A “controlling health plan” (CHP) must obtain an HPID. A “subhealth plan” (SHP) may also obtain an HPID but is not required to do so.

    A CHP is a health plan that:

    • controls its own business activities, actions or policies; or
    • is controlled by an entity that is not a health plan; and
    • if the CHP has SHPs, it exercises sufficient control over the SHPs to direct their business activities, actions or policies.

    A SHP is a health plan that has its business activities, actions or policies directed by a CHP.

    A CHP may obtain an HPID for a SHP or may direct its SHP to obtain one. Self-insured group health plans that meet the CHP definition must obtain an HPID, even if the self-insured plan does not conduct or need to be identified in standard electronic transactions. Fully-insured plans generally do not need to obtain a separate HPID since the insurer’s CHP HPID can be used.

    Example A: The employer sponsors three self-funded plans (PPO, high deductible and self-funded dental). The employer must either obtain one HPID for all three plans and designate the other two as SHPs, or obtain separate HPIDs for all three plans.

    Example B: The employer sponsors two fully-insured plans and a health care FSA. The insurers must obtain the HPIDs for the two insured plans and the employer must obtain a separate HPID for the health care FSA (because the employer controls that arrangement). If the health care FSA paid out less than $5 million in claims, its deadline for obtaining an HPID is November 5, 2015.

    How Does a Plan Obtain an HPID?

    Health plans must first access the Health Insurance Oversight System (HIOS) by going to the Enterprise Portal found on the website for the Centers of Medicare and Medicaid Services (CMS). Once registered in HIOS, a health plan can then access the Health Plan and Other Entity Enumeration System (HPOES) to complete the online HPID application process. An authorizing official then reviews the application and, upon approval, assigns the plan an HPID number. The CMS website provides step-by-step instructions for the application process. There is no charge to obtain an HPID.

    A third-party administrator cannot obtain an HPID on behalf of a health plan. Each health plan can obtain only one HPID for itself.