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Judicial Watch • Obamacare records from DOH HS Part 3 982011

Obamacare records from DOH HS Part 3 982011

Obamacare records from DOH HS Part 3 982011

Page 1: Obamacare records from DOH HS Part 3 982011

Category:General

Number of Pages:1084

Date Created:August 30, 2011

Date Uploaded to the Library:February 20, 2014

Tags:PRELIMINARY, Discussion, Conclusion, Departments, coverage, affordable, benefits, facts, draft, DOMA, Department of the Treasury, health, HHS, Insurance, Group, Distribution, individual, September, section, department, EPA, IRS, ICE, CIA


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From: 	Baum, Beth -EBSA 
To: 	Baum, Beth -EBSA; Benson, Susanna -SOL; Butikofer, James -EBSA; Corrigan, Dara (HHS/OHR); Cosby, Chris -EBSA; Helen.Morrison@do.treas.gov; Karen Levin -HOME; Knopf Kevin -OTP; Kosin, Donald (HHS/OGC); Levin Karen; Mayhew, James (CMS/CPC); Russell.E.Weinheimer@IRSCOUNSEL.TREAS.GOV; Schumacher, Elizabeth -EBSA; Tawshunsky Alan; Taylor, William -SOL; Turner, Amy -EBSA; Dailey, Joan (HHS/OGC); Stafford, Leslie (HHS/OGC) 
Subject: 	Pkg Overview and Reg Text 6.17.10 5pm Response OMB Passback 
Date: 	Thursday, June 17, 2010 4:57:27 
Attachments: 	Pkg Overview and Reg Text 6.17.10 5pm Response OMB Passback.doc 
 Attached the draft the 4-pack that plan send back OMB this evening response their passback. 
PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
[Billing Codes: 4830-01-P; 4510-29-P; 4120-01-P] 
DEPARTMENT THE TREASURY Internal Revenue Service 

Security Administration, Department Labor; Office Consumer Information and Insurance Oversight, Department Health and Human Services. ACTION:  Interim final rules with request for comments. 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
SUMMARY: This document contains interim final regulations implementing the rules for group health plans and health insurance coverage the group and individual markets under provisions the Patient Protection and Affordable Care Act regarding preexisting condition exclusions, lifetime and annual dollar limits benefits, rescissions, prohibition discrimination favor highly compensated individuals, and patient protections.  DATES: Effective date. These interim final regulations are effective [INSERT DATE DAYS AFTER PUBLICATION FEDERAL REGISTER 
Comment date. Comments are due before [INSERT DATE DAYS AFTER PUBLICATION FEDERAL REGISTER]. 
Applicability dates:  Individual health insurance coverage. These interim final regulations, except these interim final regulations those under PHS Act section 2704 (45 CFR 147.108), generally apply individual health insurance issuers for policy years beginning after September 23, 2010.  These interim final regulations under PHS Act section 2704 (45 CFR 147.108) generally apply individual health insurance issuers for policy years beginning after January 2014, except 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
that the case enrollees who are under years age, these interim final regulations under PHS Act section 2704 apply for policy years beginning after September 23, 2010. 
ADDRESSES: Written comments may submitted any the addresses specified below.  Any comment that submitted any Department will shared with the other Departments.  Please not submit duplicates.  
All comments will made available the public.  WARNING: not include any personally identifiable information (such name, address, other contact information) 
confidential business information that you not want publicly disclosed.  All comments are posted the Internet exactly received, and can retrieved most Internet search engines. deletions, modifications, redactions will made the comments received, they are 
Assistance, Employee Benefits Security Administration, Room N-5653, U.S. Department Labor, 200 Constitution Avenue NW, Washington, 20210, Attention: RIN 1210-AB43. 
Comments received the Department Labor will posted without change http://www.regulations.gov and http://www.dol.gov/ebsa, and available for public inspection the Public Disclosure Room, N-1513, Employee Benefits Security Administration, 200 Constitution Avenue, NW, Washington, 20210.   

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
Department Health and Human Services. commenting, please refer file code OCIIO-XXXX-IFC.  Because staff and resource limitations, cannot accept comments facsimile (FAX) transmission. You may submit comments one four ways (please choose only one the ways listed): Electronically. You may submit electronic comments this regulation http://www.regulations.gov.  Follow the instructions under the More Search Options tab. regular mail. You may mail written comments the following address ONLY: 

Mail Stop C4-26-05, 
7500 Security Boulevard,   
Baltimore, 21244-1850. 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution hand courier. you prefer, you may deliver (by hand courier) your written comments before the close the comment period either the following addresses: For delivery Washington, DC-Office Consumer Information and Insurance Oversight, 
Department Health and Human Services,  
Room 445-G, Hubert Humphrey Building, 
200 Independence Avenue, SW, 
Washington, 20201 

(Because access the interior the Hubert Humphrey Building not readily 

available persons without Federal government identification, commenters are encouraged 
7500 Security Boulevard, you intend deliver your comments the Baltimore address, please call (410) 7867195 advance schedule your arrival with one our staff members.   
Comments mailed the addresses indicated appropriate for hand courier delivery may delayed and received after the comment period. 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
Submission comments paperwork requirements. You may submit comments this documents paperwork requirements following the instructions the end the Collection Information Requirements section this document.
  Inspection Public Comments: All comments received before the close the comment period are available for viewing the public, including any personally identifiable confidential business information that included comment. post all comments received before the close the comment period the following website soon possible after they 
have been received:  http://www.regulations.gov.  Follow the search instructions that Web site view public comments.  
Comments received timely will also available for public inspection they are 
Follow the instructions for 

  Mail: CC:PA:LPD:PR (REG-120399-10), room Room 5205, Internal Revenue Service, P.O. Box 7604, Ben Franklin Station, Washington, 20044. 

 
Hand courier delivery: Monday through Friday between the hours a.m. and p.m. to: CC:PA:LPD:PR (REG-120399-10), Couriers Desk, Internal Revenue Service, 1111 Constitution Avenue, NW, Washington 20224. 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
All submissions the IRS will open public inspection and copying room Room 1621, 1111 Constitution Avenue, NW, Washington, from a.m. p.m. FOR FURTHER INFORMATION CONTACT: Amy Turner Beth Baum, Employee Benefits Security Administration, Department Labor, (202) 693-8335; Karen Levin, Internal Revenue Service, Department the Treasury, (202) 622-6080; Jim Mayhew, Office Consumer Information and Insurance Oversight, Department Health and Human Services, (410) 786-1565. CUSTOMER SERVICE INFORMATION: 
Individuals interested obtaining information from the Department Labor concerning employment-based health coverage laws may call the EBSA Toll-Free Hotline 1-866-444-EBSA (3272) visit the Department Labors website 
148, was enacted March 23, 2010; the Health Care and Education Reconciliation Act (the Reconciliation Act), Pub. 111-152, was enacted March 30, 2010.  The Affordable Care Act and the Reconciliation Act reorganize, amend, and add the provisions part title XXVII the Public Health Service Act (PHS Act) relating group health plans and health insurance issuers the group and individual markets.  The term group health plan includes both insured 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
and self-insured group health plans.1  The Affordable Care Act adds section 715(a)(1) the Employee Retirement Income Security Act (ERISA) and section 9815(a)(1) the Internal Revenue Code (the Code) incorporate the provisions part title XXVII the PHS Act into ERISA and the Code, and make them applicable group health plans, and health insurance issuers providing health insurance coverage connection with group health plans.  The PHS Act sections incorporated this reference are sections 2701 through 2728.  PHS Act sections 2701 through 2719A are substantially new, though they incorporate some provisions prior law. 
PHS Act sections 2722 through 2728 are sections prior law renumbered, with some, mostly minor, changes. 
Subtitles and title the Affordable Care Act amend the requirements title 
prevents the application requirement the Affordable Care Act.  Accordingly, State laws that impose health insurance issuers requirements that are stricter than the requirements imposed the Affordable Care Act will not superseded the Affordable Care Act. The term group health plan used title XXVII the PHS Act, part ERISA, and chapter 100 the Code, 
and distinct from the term health plan, used other provisions title the Affordable Care Act. The 
term health plan does not include self-insured group health plans. Code section 9815 incorporates the preemption provisions PHS Act section 2724. Prior the Affordable Care 
Act, there were express preemption provisions chapter 100 the Code. 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
The Departments Health and Human Services, Labor, and the Treasury (the Departments) are issuing regulations implementing the revised PHS Act sections 2701 through 2719A several phases.  The first publication this series was Request for Information relating the medical loss ratio provisions PHS Act section 2718, published the Federal Register April 14, 2010 (75 19297).  The second publication was interim final regulations implementing PHS Act section 2714 (requiring dependent coverage children age 26), published the 
Federal Register May 13, 2010 (75 27122).  The third publication was interim final regulations implementing section 1251 the Affordable Care Act (relating status grandfathered health plan), published the Federal Register June 17, 2010 (75 34538XXXXX). These interim final regulations are being published implement PHS Act 
health insurance coverage, for policy years beginning, applications denied, after September 23, 2010.3 The rest these provisions generally are effective for plan years (in the individual market, policy years) beginning after September 23, 2010, which six months after the March 23, 2010 date enactment the Affordable Care Act.  The implementation Section 1255 the Affordable Care Act. See also section 10103(e)-(f) the Affordable Care Act. 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
other provisions PHS Act sections 2701 through 2719A will addressed future regulations. 
II. Overview the Regulations PHS Act Section 2704, Prohibition Preexisting Condition Exclusions (26 CFR 54.98152704T, CFR 2590.715-2704, CFR 147.108)   
Section 1201 the Affordable Care Act adds new PHS Act section 2704, which amends the HIPAA4 rules relating preexisting condition exclusions provide that group 

Comment [b1]: OMB: For informational purposes: the Departments plan issue future guidance/regulations for 2014? 
Dept Response: While these rules are self-implementing for individuals over age 2014, this point time, intend amend the old preex rules for consistency with these rules for 2014. 
PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
was recommended received before that date.  Based this definition, PHS Act section 2704, added the Affordable Care Act, prohibits not just exclusion coverage specific benefits associated with preexisting condition the case enrollee, but complete exclusion from such plan coverage, that exclusion based preexisting condition.  
The protections the new PHS Act section 2704 generally apply for plan years (in the individual market, policy years) beginning after January 2014.   The Affordable Care Act provides, however, that these protections apply with respect enrollees under age for 

HIPAA regulations preexisting condition exclusions, which remain effect.6  (Other requirements Federal State law, however, may prohibit certain benefit exclusions.) See Examples and CFR 54.9801-3(a)(1)(ii), CFR 701-3(a)(1)(ii), CFR 146.111(a)(1)(ii). 
Comment [b2]: OMB: How would these rules treat the circumstances where individuals are charged extremely high premiums obtain coverage for preexisting conditions? 
Dept Response:  This rule does not address it; however, other provisions the PHS Act do. 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
Application grandfathered health plans. Under the statute and these interim final regulations, grandfathered health plan that group health plan group health insurance coverage must comply with the prohibition against preexisting condition exclusions; however, grandfathered health plan that individual health insurance coverage not required comply with PHS Act section 2704.  See CFR 54.9815-1251T, CFR 2590.715-1251, and CFR 
147.140 regarding status grandfathered health plan. PHS Act Section 2711, Lifetime and Annual Limits (26 CFR 54.9815-2711T, CFR 
2590.715-2711, CFR 147.126) 
Section 2711 the PHS Act, added the Affordable Care Act, and these interim final regulations generally prohibit group health plans and health insurance issuers offering 
annual limits also not apply Medical Savings Accounts (MSAs) under section 220 the Code and Health Savings Accounts (HSAs) under section 223 the Code.  Both MSAs and HSAs generally are not treated group health plans because the amounts available under the plans are available for both medical and non-medical expenses.7  Moreover, annual contributions Distributions from MSAs and HSAs that are not used for qualified medical expenses are included income and subject additional tax, under sections 220(f)(1), (4) and 223(f)(1), (4) the Code. 

Comment [b3]: OMB: the case stand-alone HRA that covers active employees, does the HRA have meet the restricted annual limit requirements Sec. 2711? so, please note here. 
Dept Response: See inserted language.   
PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution MSAs and HSAs are subject specific statutory provisions that require that the related medical benefitscontributions limited. 
Health Reimbursement Arrangements (HRAs) are another type account-based health plan and typically consist promise employer reimburse certain level medical expenses during the year certain amount with unused amounts available reimburse medical expenses future years.  See Notice 2002-45, 2002-28 IRB 93; Rev. Rul. 2002-41, 2002-28 IRB 75.  When HRAs are integrated with other coverage part group health plan and the other coverage alone would comply with the requirements PHS Act 
section 2711, the fact that benefits under the HRA itself are limited does not violate PHS Act section 2711 because the combined benefit satisfies the requirements.  Also, iIn the case the Affordable Care Act) for plan years (in the individual market, policy years) beginning before January 2014. Grandfathered individual market policies are exempted from this provision. addition, the statute provides that, with respect benefits that are not essential health benefits, plan issuer may impose annual lifetime per-individual dollar limits 

interim final regulations define essential health benefits cross-reference section 1302(b) 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution the Affordable Care Act8 and applicable regulations.  The Departments recognize that, 

issuance regulations defining essential health benefits, for purposes enforcement, the Section 1302(b) the Affordable Care Act defines essential health benefits include least the following general categories and the items and services covered within the categories: ambulatory patient services; emergency services; hospitalization; maternity and newborn care; mental health and substance use disorder services, including behavioral health treatment; prescription drugs; rehabilitative and habilitative services and devices; laboratory services; preventive and wellness services and chronic disease management; and pediatric services, including oral and vision care. 
Comment [b4]: OMB: cross referencing Sec. 1302 regarding annual limits essential health benefits, and allowing plans impose limits within the boundaries good faith, reasonable effort, the regulation appears allow some leeway plans continue imposing such limits even after the benefits Sec. 1302 are fully specified and defined subsequent regulation.  
Dept Response: See inserted language. 
OMB: What mechanisms exist ensure that plans comply with the current set patient protection regulations  including annual limits  once other regulations (such the definition annual limits) which they are contingent are defined? 
Dept Response: discussed this orally. 
OMB: Have the departments considered denying qualification for the exchange other measures enforcement for plans that not bring themselves into alignment when subsequent rules specify the current regulations? 
Dept Response: discussed this orally. 
Comment [b5]: OMB: Would like understand better how the Departments will enforce this provision prior publication definition for essential health benefits.  Could plan retroactively cited for violating section 2711 benefit places limit later determined essential health benefit? The rule could been seen imply that anything that later determined essential and was not treated such will cause the plan cited for violation the rules restricted annual limits. 
Dept Response: made some edits the language and discussed this orally. 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
The statute and these interim final regulations provide that for plan years (in the individual market, policy years) beginning before January 2014, group health plans and health insurance issuers offering group individual health insurance coverage may establish restricted annual limit the dollar value essential health benefits.  The statute provides that defining the term restricted annual limit, the Departments should ensure that access needed services made available with minimal impact premiums.  For detailed discussion the basis for determining restricted annual limits, see [insert
 relevant section the RIA] later this preamble. order mitigate the potential for premium increases for all plans and policies, while the same time ensuring access essential health benefits, these interim final regulations adopt 
 For plan policy years beginning after September 23, 2012 but before 
January 2014, million. these are minimums for plan years (in the individual market, policy years) beginning before 2014, plans issuers may always use higher annual limits impose limits.  Plans and policies with plan policy years that begin between September and December have more 
PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
than one plan policy year under which the million minimum annual limit available; however, plan policy generally may not impose annual limit for plan year beginning after December 31, 2013. 
The minimum annual limits for plan policy years beginning before 2014 apply individual-by-individual basis.  Thus, any overall annual dollar limit benefits applied families may not operate deny covered individual the minimum annual benefits for the plan year (in the individual market, policy year).  These interim final regulations clarify that, 

Comment [b6]: OMB: The allowance for HHS program permitting exceptions annual limit restrictions the case potentially higher premiums denials access appears allow for some scope for plans escape the purpose the regulation. Could HHS provide clarification how this program would define significant decrease access significant increase premiums that would trigger the aforementioned exceptions? Also, the Department planning issue regulations establish the program? 
Dept Response: Guidance will issued the future. not know what form this guidance will take, but will happy stay touch with OMB regarding this process. 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
Under Tthese interim final regulations, require that individuals who reached lifetime limit under plan health insurance coverage prior the applicability date these interim final regulations and are otherwise still eligible under the plan health insurance coverage are must provided with notice that the lifetime limit longer applies. such individuals are longer enrolled the plan health insurance coverage, these interim final regulations also provide enrollment (in the individual market, reinstatement) opportunity for such individuals. the individual market, this reinstatement opportunity does not apply individuals who reached their lifetime limits individual health insurance coverage the contract not renewed otherwise longer effect. would apply, however, family member who reached the lifetime limit family policy the individual market while other 
issuers offering group individual health insurance coverage, whether not the plan qualifies grandfathered health plan, for plan years (in the individual market, policy years) beginning after September 23, 2010.  The statute and these interim final regulations relating the prohibition annual limits, including the special rules regarding restricted annual limits for plan years beginning before January 2014, apply group health plans and group health insurance See CFR 54.9801-6(d), CFR 2590.701-6(d), and CFR 146.117(d). 
PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
coverage that qualify grandfathered health plan, but not apply grandfathered health 

 plan health insurance coverage that, March 23, 2010, did not impose overall annual lifetime limit the dollar value all benefits ceases grandfathered health plan the plan health insurance coverage imposes overall annual limit the dollar value benefits.  
 

health plans and health insurance issuers offering group individual health insurance coverage. Under the statute and these interim final regulations, group health plan, health insurance issuer offering group individual health insurance coverage, must not rescind coverage except 

Comment [b8]: OMB: Suggest providing additional clarity what the Departments would consider fraud and/or intentional misrepresentation. Additional clarity the reg text and/or examples could useful. 
Dept Response:  While not attempt define fraud these regulations, see inserted language. 
PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
federal floor and more protective individuals with respect the standard for rescission than the standard that might have previously existed under State insurance law Federal common law.  That is, under prior law, rescission may have been permissible individual made misrepresentation material fact, even the misrepresentation was not intentional made knowingly.  Under the new standard for rescissions set the PHS Act section 2712 and these interim final regulations, plans and issuers cannot rescind coverage unless individual was involved fraud made intentional misrepresentation material fact. 
This standard applies all rescissions, whether the group individual insurance market, andor whether insured self-insured coverage.  These rules also apply regardless any contestability period that may otherwise apply. 
association coverage, cessation association membership). Moreover, this new provision also builds existing HIPAA nondiscrimination protections for group health coverage ERISA section 702, Code section 9802, and PHS Act section 2705 (previously included PHS Act section 2702 prior the Affordable Care Acts amendments and reorganization PHS Act title XXVII).  The HIPAA nondiscrimination provisions generally provide that group health plans and group health insurance issuers may not set eligibility rules based factors such health 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
status and evidence insurability  including acts domestic violence disability.   They also provide limits the ability plans and issuers vary premiums and contributions based health status.  Starting January 2014, additional protections will apply the individual market, including guaranteed issue all products, nondiscrimination based health status, and preexisting condition exclusions.  These protections will reduce the likelihood rescissions. 
These interim final regulations also clarify that other requirements Federal State law may apply connection with rescission cancellation coverage beyond the standards 
established PHS Act section 2712, they are more protective individuals.  For example, State law applicable health insurance issuers were provide that rescissions are permitted only cases fraud, only within contestability period, which more protective 
rescind coverage entire employment-based group because the actions individual within the group, the standards these interim final regulations would apply. Second, these interim final regulations clarify that the rules PHS Act section 2712 apply representations made the individual person seeking coverage behalf the individual.  Thus, plan sponsor seeks coverage from issuer for entire employment-based group and makes representations, for example, regarding the prior claims experience the group, the standards 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
these interim final regulations would also apply. Finally, PHS Act section 2712 refers acts practices that constitute fraud.  These interim final regulations clarify that, the extent that omission constitutes fraud, that omission would permit the plan issuer rescind coverage under this section. example these interim final regulations illustrates the application the rule misstatements fact that are inadvertent. For purposes these interim final regulations, rescission cancellation discontinuance coverage that has retroactive effect.  For example, cancellation that treats policy void from the time the individuals groups enrollment rescission. addition, cancellation that voids benefits paid year before the cancellation also 
provisions for keeping coverage effect pending appeal.  The Departments expect issue guidance PHS Act section 2719 the very near future. addition setting new Federal floor standard for rescissions, 
PHS Act section 2712 adds new advance notice requirement when coverage rescinded where still permissible.  Specifically, the second sentence section 2712 provides that coverage may not cancelled unless prior notice provided, and then only permitted 
Comment [b9]: OMB: Suggest clarifying that this only applies the policy standard.  For instance, company rescinds coverage someone with pre-existing condition due untimely payment (by say, month) but the usual standard two months, then that still counts rescission because that constitutes unequal treatment. 
Dept Response: discussed this orally. 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
under PHS Act sections 2702(c)10 and 2742(b).  Under these interim final regulations, even prior notice provided, rescission only permitted cases fraud intentional misrepresentation material fact permitted under the cited provisions.  While this reference appears redundant, consistent with the first sentence. 
These interim final regulations provide that group health plan, health insurance issuer offering group health insurance coverage, must provide least calendar days advance notice individual before coverage may rescinded.
11regardless whether the rescission group individual coverage; whether, the case group coverage, the coverage insured self-insured, the rescission applies entire group only individual within the group. This 30-day period will provide individuals and 
provides new rights individuals who, for example, may have done their best complete what can sometimes long, complex enrollment questionnaires but may have made some errors, for The reference section 2702(c) appears incorrect.  After the amendments made the Affordable Care Act, PHS Act section 2702(c) addresses network requirements for guaranteed availability coverage. seems more likely that the intended cross-reference new PHS Act section 2703(b), relating nonrenewal coverage the group market, which corresponds the other cross-reference, PHS Act section 2742(b), nonrenewal coverage the individual market. Both these provisions contain the fraud and intentional misrepresentation material fact standard included the first sentence section 2712. order avoid confusion, these interim final regulations apply the fraud and misrepresentation standard found sections 2703(b) and 2742(b).11 Even though prior notice must provided the case rescission, applicable law may permit the rescission void coverage retroactively. 
PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
which the consequences were overly broad and unfair.  These interim final regulations provide initial guidance largely repeat the statutory standard for with respect the statutory restrictions rescission with few clarifications. the marketplace subvert these rules, the Departments may issue additional regulations 
Comment [b10]: OMB: there system place for the departments become aware this? Will there any oversight whether insurance plans decisions fraud and misrepresentation are overly broad? 
Dept Response: discussed this orally. 

apply with respect highly compensated individuals.  Highly compensated individuals are defined section 105(h). 
PHS Act section 2716 and these interim final regulations incorporate the substantive nondiscrimination requirements Code section 105(h) but not the tax sanctions. insured 
PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
group health plan failing comply with the nondiscrimination requirements Code section 105(h) subject the sanctions and remedies that generally apply for plan failing comply with the requirements chapter 100 the Code (generally, excise tax $100 per day per individual discriminated against for each day the plan does not comply with the requirement), part ERISA civil action enjoin noncompliant act practice for appropriate equitable relief), title XXVII the PHS Act (civil money penalties $100 per day per
dividual discriminated against for each day the plan does not comply with the requirement).  Thus, self-insured plan fails comply with Code section 105(h), highly compensated individuals lose tax benefit; insured group health plan fails comply with Code section 105(h), the plan subject civil action compel provide nondiscriminatory benefits and 
(69 78800), principal purpose establishing separate plans evade any requirement law, then the separate plans will considered single plan the extent necessary prevent the evasion.  The Departments expect finalize these rules soon. 
The final regulations under section 105(h) the Code,12 prohibiting discrimination favor highly compensated individuals under self-insured medical expense reimbursement CFR 1.105-11. 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
plans, were issued 1981. The Department the Treasury and the IRS request comments what additional guidance relating the application section 105(h) would helpful, especially applied insured group health plans. 
Application grandfathered health plans. The rules prohibiting discrimination favor highly compensated individuals insured group health plans not apply grandfathered health plans (but the rules Code section 105(h) continue apply self-insured plans). ED. PHS Act Section 2719A, Patient Protections (26 CFR 54.9815-2719AT, CFR 2590.715
 2719A, CFR 147.138) Section 2719A the PHS Act imposes, with respect group health plan, group individual health insurance coverage, set three requirements relating the choice health 
  These interim final choice health care professional are together and add notice requirement for those three requirements.  None these requirements apply grandfathered health plans.  Choice Health Care Professional The statute and these interim final regulations refer providers both terms their participation (participating provider) and terms network (in-network provider). both situations, the intent refer provider that has contractual relationship other arrangement with plan issuer. 
PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
The statute and these interim final regulations provide that group health plan, health insurance issuer offering group individual health insurance coverage, requires provides for designation participant, beneficiary, enrollee participating primary care provider, then the plan issuer must permit each participant, beneficiary, enrollee 

The statute and these interim final regulations also provide rules for group health plan, health insurance issuer offering group individual health insurance coverage, that provides coverage for obstetrical gynecological care and requires the designation in-network 

Comment [b11]: OMB: Given the decline primary care providers, suggest clarifying that would okay designate internist your primary provider? understand this practice common many areas. 
Dept Response: This suggestion require plans allow designation internist exceeds statutory authority.  Accordingly, this plan design issue. 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
primary care provider. such case, the plan issuer may not require authorization referral the plan, issuer, any person (including primary care provider) for female participant, beneficiary, enrollee who seeks obstetrical gynecological care provided in-network health care professional who specializes obstetrics gynecology.  The plan issuer must comply with the rules paragraph (a)(4) this section informing each participant (in the individual market, primary subscriber) that the plan may not require authorization referral for obstetrical gynecological care participating health care professional who specializes 
obstetrics gynecology.  Nothing these interim final regulations precludes the plan issuer from requiring in-network obstetrical gynecological provider otherwise adhere policies and procedures regarding referrals, prior authorization for treatments, and the provision 
physician. 
The general terms the plan coverage regarding exclusions coverage with respect obstetrical gynecological care are otherwise unaffected.  These interim final regulations not preclude the plan issuer from requiring that the obstetrical gynecological provider notify the primary care provider the plan issuer treatment decisions. 
When applicable, important that individuals enrolled plan health insurance coverage know their rights (1) choose primary care provider pediatrician when plan 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution issuer requires participants subscribers designate primary care physician; (2) obtain obstetrical gynecological care without prior authorization.  Accordingly, these interim final regulations require such plans and issuers provide notice participants (in the individual market, primary subscribers) these rights when applicable.  Model language provided these interim final regulations.  The notice must provided whenever the plan issuer provides participant with summary plan description other similar description benefits under the plan health insurance coverage, the individual market, provides primary 
subscriber with policy, certificate, contract health insurance.  Emergency Services plan health insurance coverage provides any benefits with respect emergency 
insurance coverage other than the exclusion coordination benefits, affiliation waiting period permitted under part ERISA, part title XXVII the PHS Act, chapter 100 the Code, applicable cost-sharing requirements.  For plan health insurance coverage with network providers that provides benefits for emergency services, the plan issuer may not impose any administrative requirement limitation benefits for out-of-network emergency 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
services that more restrictive than the requirements limitations that apply in-network emergency services.   
Additionally, for plan health insurance coverage with network, these interim final regulations provide rules for cost-sharing requirements for emergency services that are expressed copayment amount coinsurance rate, and other cost-sharing requirements.  Cost-sharing requirements expressed copayment amount coinsurance rate imposed for out-of-network emergency services cannot exceed the cost-sharing requirements that would imposed the 
services were provided in-network.  Out-of-network providers may, however, also balance bill patients for the difference between the providers charges and the amount collected from the plan issuer and from the patient the form copayment coinsurance amount.  Section plan issuer paid unreasonably low amount provider, even while limiting the coinsurance copayment associated with that amount in-network amounts. avoid the circumvention the protections PHS Act section 2719A, necessary that reasonable amount paid before patient becomes responsible for balance billing amount.  Thus, these interim final regulations require that reasonable amount paid for services some objective standard. establishing the reasonable amount that must paid, the Departments had 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
account for wide variation how plans and issuers determine both in-network and out-ofnetwork rates.  For example, for plan using capitation arrangement determine in-network payments providers, there in-network rate per service. Accordingly, these interim final regulations consider three amounts: the in-network rate, the out-of-network rate, and the Medicare rate.  Specifically, plan issuer satisfies the copayment and coinsurance limitations the statute provides benefits for out-of-network emergency services amount equal the greatest three possible amounts 

(1) The amount negotiated with in-network providers for the emergency service furnished; under capitation other similar payment arrangement), the first amount above disregarded, meaning that the greatest amount going either the out-of-network amount the Medicare amount.  Additionally, with respect determining the first amount, plan issuer has more than one negotiated amount with in-network providers for particular the date publication these interim final regulations, these rates are available the public http://www.cms.hhs.gov/MedicareAdvtgSpecRateStats/downloads/oon-payments.pdf. 
Comment [b12]: OMB: order avoid exceedingly high reimbursement for out-of-network emergency services, have the departments considered applying similar methods used No. 
(1) (the median reimbursement in-network providers) the calculation reimbursement amounts Nos. (2) (usual, customary, and reasonable charges) and (3) (Medicare reimbursement); i.e. applying some method (such taking the median certain percentile) avoid excessive outliers reimbursement one the other these categories? 
Dept Response: Items and always result one amount  there would not outliers here that would require median. 
PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 

emergency service, the amount the median these amounts, ranking them the number treating the amount negotiated with each providers with which the rates were negotiatedseparate amount determining the median.  Thus, for example, for given emergency service plan negotiated rate $100 with three providers, rate $125 with one provider, and rate $150 with one provider; the amounts taken into account determine the median would $100, $100, $100, $125, and $150; and the median would $100.  Following the commonly accepted definition median, there are even number amounts, the 

coinsurance, these interim final regulations include anti-abuse rule with respect such other cost-sharing requirements that the purpose limiting copayments and coinsurance for emergency services the in-network rate cannot thwarted manipulation these other 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
cost-sharing requirements.  Accordingly, any other cost-sharing requirement, such 

Comment [b13]: OMB: Suggest further clarifying the preamble how the anti-abuse provision functions, given the permissibility imposing other cost-sharing requirements such deductibles out pocket maximums. 
Dept Response: This discussed later the paragraph. 
deductible out-of-pocket maximum, may imposed with respect out-of-network emergency services only the cost-sharing requirement generally applies out-of-network benefits.  Specifically, deductible may imposed with respect out-of-network emergency 

Comment [b14]: OMB: Suggest adding sentence acknowledging possible impact inducing plans raise their out-of-network costs generally. 
Dept Response: discussed this orally. 

same consequences that could reasonably expected occur the absence immediate medical attention.  Under EMTALA regulations, the likelihood these consequences determined qualified hospital medical personnel, while under PHS Act section 2719A the standard whether prudent layperson, who possesses average knowledge health and 
PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
medicine, could reasonably expect the absence immediate medical attention result such consequences. 
Application grandfathered health plans. The statute and these interim final regulations relating certain patient protections not apply grandfathered health plans.  However, other 

public interest delay putting the provisions these interim final regulations place until full public notice and comment process was completed. noted above, numerous provisions the Affordable Care Act are applicable for plan years (in the individual market, policy years) 

Comment [b15]: OMB: Suggest that the agencies quote the relevant language demonstrating specific authority for bypassing the APA. 
Dept Response: The relevant language the first paragraph (immediately above). did not quote directly here because the language slightly different each the three statutes (although not any substantive way), and repeating three times would seem cumbersome and redundant. 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
beginning after September 23, 2010, six months after date enactment.  Had the Departments published notice proposed rulemaking, provided for 60-day comment period, and only then prepared final regulations, which would subject 60-day delay effective date, unlikely that would have been possible have final regulations effect before late September, when these requirements could effect for some plans policies.  YetMoreover, the requirements these regulations require significant lead time order implement.  For example, the case the requirement under PHS Act section 2711 prohibiting overall 
lifetime dollar limits, these interim final regulations require that enrollment period provided for individual whose coverage ended reason reaching lifetime limit later than the first day this requirement takes effect.  Preparations presumably would have made 
account establishing their premiums, and making other changes the designs plan policy benefits, and these premiums and plan policy changes would have receive necessary approvals advance the plan policy year question.   
Accordingly, order allow plans and health insurance coverage designed and implemented timely basis, regulations must published and available the public well advance the effective date the requirements the Affordable Care Act. not possible 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
have full notice and comment process and publish final regulations the brief time between enactment the Affordable Care Act and the date regulations are needed.  
The Secretaries further find that issuance proposed regulations would not sufficient because the provisions the Affordable Care Act protect significant rights plan participants and beneficiaries and individuals covered individual health insurance policies and essential that participants, beneficiaries, insureds, plan sponsors, and issuers have certainty about their rights and responsibilities.  
Proposed regulations are not binding and cannot provide the necessary certainty. contrast, the interim final regulations provide the public with opportunity for comment, but without delaying the effective date the regulations. 
For the foregoing reasons, the Departments have determined that impracticable and 
authority contained sections 7805 and 9833 the Code. 
The Department Labor interim final regulations are adopted pursuant the authority contained U.S.C. 1027, 1059, 1135, 1161-1168, 1169, 1181-1183, 1181 note, 1185, 1185a, 1185b, 1191, 1191a, 1191b, and 1191c; sec. 101(g), Pub. L.104-191, 110 Stat. 1936; sec. 401(b), Pub. 105-200, 112 Stat. 645 (42 U.S.C. 651 note); sec. 512(d), Pub. 110-343, 122 Stat. 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
3881; sec. 1001, 1201, and 1562(e), Pub. 111-148, 124 Stat. 119, amended Pub. 111152, 124 Stat. 1029; Secretary Labors Order 6-2009, 21524 (May 2009). 
The Department Health and Human Services interim final regulations are adopted pursuant the authority contained sections 2701 through 2763, 2791, and 2792 the PHS Act (42 USC 300gg through 300gg-63, 300gg-91, and 300gg-92), amended. 
List Subjects CFR Part CFR Parts 144, 146, and 147 

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Signed this _____ day _____, 2010. 
Phyllis Borzi Assistant Secretary 

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Approved:  _____________ 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution DEPARTMENT THE TREASURY Internal Revenue Service CFR Chapter Accordingly, CFR Parts and 602 are amended follows: PART 54--PENSION EXCISE TAXES 
Preexisting condition exclusion means limitation exclusion benefits (including denial coverage) based the fact that the condition was present before the effective date coverage (or coverage denied, the date the denial) under group health plan group 
PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
individual health insurance coverage (or other coverage provided Federally eligible individuals pursuant CFR Part 148), whether not any medical advice, diagnosis, care, treatment was recommended received before that day. preexisting condition exclusion includes any limitation exclusion benefits (including denial coverage) applicable 
(a) preexisting condition exclusions(1) general. group health plan, health insurance issuer offering group health insurance coverage, may not impose any preexisting 

condition exclusion (as defined  54.9801-2).  

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
(2)  Examples. The rules this paragraph (a) are illustrated the following examples 
(for additional examples illustrating the definition preexisting condition exclusion, see  
54.9801-3(a)(1)(ii)): 
Example (i) Facts. group health plan provides benefits solely through insurance policy offered Issuer the expiration the policy, the plan switches coverage policy offered Issuer  Ns policy excludes benefits for oral surgery required result traumatic injury the injury occurred before the effective date coverage under the policy. 
(ii)  Conclusion. this Example the exclusion benefits for oral surgery required result traumatic injury the injury occurred before the effective date coverage 
preexisting condition exclusion because operates exclude benefits for condition based the fact that the condition was present before the effective date coverage under the policy. 
Example (i) Facts. Individual applies for individual health insurance coverage with Issuer denies Cs application for coverage because pre-enrollment physical revealed that has type diabetes. 
(3) Applicability grandfathered health plans. See  54.9815-1251T for determining the 
application this section grandfathered health plans (providing that grandfathered health plan that group health plan group health insurance coverage must comply with the prohibition against preexisting condition exclusions). 
(4) Example. The rules this paragraph (b) are illustrated the following example: 
PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
Example. (i) Facts. Individual commences employment and enrolls and Fs 16-yearold child the group health plan maintained Fs employer, with first day coverage October 15, 2010.  Fs child had significant break coverage because lapse more than days without creditable coverage immediately prior enrolling the plan.  Fs child was treated for asthma within the six-month period prior the enrollment date and the plan imposes 12-month preexisting condition exclusion for coverage asthma.  The next plan year begins January 2011. 
(ii)  Conclusion. this Example, the plan year beginning January 2011 the first plan year the group health plan beginning after September 23, 2010.  Thus, beginning January 2011, because the child under years age, the plan cannot impose preexisting condition exclusion with respect the childs asthma regardless the fact that the preexisting condition exclusion was imposed the plan before the applicability date this provision. 

(c) Expiration date.  This section expires before [INSERT DATE YEARS 
AFTER DATE FILING FOR PUBLIC INSPECTION WITH FEDERAL REGISTER]. Section 54.9815-2711T added read follows: 
individual. 
(ii) Exception for health flexible spending arrangements. health flexible spending 
arrangement (as defined section 106(c)(2)) not subject the requirement paragraph 
(a)(2)(i) this section.
 (b) Construction(1) Permissible limits specific covered benefits.  The rules this 
section not prevent group health plan, health insurance issuer offering group health 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
insurance coverage, from placing annual lifetime dollar limits with respect any individual specific covered benefits that are not essential health benefits the extent that such limits are otherwise permitted under applicable Federal State law.  (The scope essential health benefits addressed paragraph (c) this section). 
(2) Condition-based exclusions. The rules this section not prevent group health plan, health insurance issuer offering group health insurance coverage, from excluding all benefits for condition. However, any benefits are provided for condition, then the 
requirements this section apply. Other requirements Federal State law may require coverage certain benefits. 
(c) Definition essential health benefits. The term essential health benefits means 
the amounts the following schedule: 
2011, $750,000. 
(ii) For plan year beginning after September 23, 2011 but before September 23, 2012, $1,250,000. 
(iii) For plan years beginning after September 23, 2012 but before January 2014, $2,000,000. 
PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
(2) 
 Only essential health benefits taken into account. determining whether individual has received benefits that meet exceed the applicable amount described paragraph (d)(1) this section, plan issuer must take into account only essential health benefits. 

(3) 
Authority the Secretary Health and Human Services defer effective date. For plan years beginning before January 2014, the Secretary Health and Human Services may establish program under which the effective date for the requirements paragraph (d)(1) 
this section relating annual limits may deferred (for such period specified the Secretary Health and Human Services) for group health plan health insurance coverage that has annual dollar limit benefits below the restricted annual limits provided under 

coverage ended reason reaching lifetime limit the dollar value all benefits for any individual (which, under this section, longer permissible); and 
(ii) Who becomes eligible (or required become eligible) for benefits not subject lifetime limit the dollar value all benefits under the group health plan group health insurance coverage the first day the first plan year beginning after September 23, 2010 reason the application this section. 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
(2) Notice and enrollment opportunity requirements--(i) individual described paragraph (e)(1) this section eligible for benefits (or required become eligible for benefits) under the group health plan  group health insurance coverage  described paragraph (e)(1) this section, the plan and the issuer are required give the individual written notice that the lifetime limit the dollar value all benefits longer applies and that the individual, covered, once again eligible for benefits under the plan.  Additionally, the individual not enrolled the plan health insurance coverage, enrolled individual 
eligible for but not enrolled any benefit package under the plan health insurance coverage, then the plan and issuer must also give such individual opportunity enroll that continues for least days (including written notice the opportunity enroll).  The notices and the case individual who enrolls under paragraph (e)(2) this section, coverage must take effect not later than the first day the first plan year beginning after September 23, 2010.  
(4) Treatment enrollees group health plan. Any individual enrolling group health plan pursuant paragraph (e)(2) this section must treated the individual were 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
special enrollee, provided under the rules 54.9801-6(d).  Accordingly, the individual (and, the individual would not participant once enrolled the plan, the participant through whom the individual otherwise eligible for coverage under the plan) must offered all the benefit packages available similarly situated individuals who did not lose coverage reason reaching lifetime limit the dollar value all benefits.  For this purpose, any difference benefits cost-sharing requirements constitutes different benefit package.  The individual also cannot required pay more for coverage than similarly situated individuals who did not lose 
coverage reason reaching lifetime limit the dollar value all benefits. 
(5) Examples. The rules this paragraph (e) are illustrated the following examples: Example (i) Facts. Employer maintains group health plan with calendar year 
days. 
Employer maintains group health plan with plan year beginning October and ending September 30.  Prior October 2010, the group health plan has lifetime limit the dollar value all benefits.  Individual employee and Individual Ds child, were enrolled family coverage under Zs group health plan for the plan year beginning October 2008. May 2009, incurred claim for benefits that exceeded the lifetime limit under Zs plan. dropped family coverage but remains employee and still eligible for coverage under Zs group health plan.   
(ii) Conclusion. this Example not later than October 2010, the plan must provide and opportunity enroll (including written notice opportunity enroll) that continues for least days, with enrollment effective not later than October 2010.   

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
Example (i) Facts. Same facts Example except that Zs plan had two benefit packages low-cost and high-cost option).  Instead dropping coverage, switched the low-cost benefit package option. 
(ii) 
Conclusion. this Example not later than October 2010, the plan must provide and opportunity enroll any benefit package available similarly situated individuals who enroll when first eligible. The plan would have provide and the opportunity enroll any benefit package available similarly situated individuals who enroll when first eligible, even had not switched the low-cost benefit package option. 

Example (i) Facts. Employer maintains group health plan with plan year beginning October and ending September 30.
  For the plan year beginning October 2009, has annual limit the dollar value all benefits $500,000.    

(ii) 
Conclusion. this Example must raise the annual limit the dollar value essential health benefits least $750,000 for the plan year beginning October 2010.  For the plan year beginning October 2011, must raise the annual limit least $1.25 million.  For the plan year beginning October 2012, must raise the annual limit least million.  

section grandfathered health plans (providing that the prohibitions lifetime and annual 
limits apply all grandfathered health plans that are group health plans and group health 
insurance coverage, including the special rules regarding restricted annual limits).  
(g)  Expiration date.  This section expires before [INSERT DATE YEARS 
AFTER DATE FILING FOR PUBLIC INSPECTION WITH FEDERAL REGISTER]. Section 54.9815-2712T added read follows: 
PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
 54.9815-2712T Rules regarding rescissions (temporary). 
(a)  Prohibition rescissions(1) group health plan, health insurance issuer offering group health insurance coverage, must not rescind coverage under the plan, under the policy, certificate, contract insurance, with respect individual (including group 
voids benefits paid year before the cancellation also rescission for this purpose. cancellation discontinuance coverage not rescission  
(i) The cancellation discontinuance coverage has only prospective effect; 

(ii) The cancellation discontinuance coverage effective retroactively the extent attributable failure timely pay required premiums contributions towards the cost coverage. 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
(3)  The rules this paragraph (a) are illustrated the following examples:
 Example (i) Facts. Individual seeks enrollment insured group health plan.  The plan terms permit rescission coverage with respect individual the individual engages fraud makes intentional misrepresentation material fact.  The plan requires complete questionnaire regarding As prior medical history, which affects setting the group rate the health insurance issuer.  The questionnaire complies with the other requirements this partchapter 100 and applicable regulations. The questionnaire includes the following question: Is there anything else relevant your health that should know? inadvertently fails list that visited psychologist two occasions, six years previously. later diagnosed with breast cancer and seeks benefits under the plan. around the same time, the issuer receives information about As visits the psychologist, which was not disclosed the questionnaire. 

(ii) Conclusion. this Example the plan cannot rescind As coverage because As failure disclose the visits the psychologist was inadvertent.  Therefore, was not fraudulent intentional misrepresentation material fact.   
Example (i) Facts. employer sponsors group health plan that provides coverage for employees who work least hours per week.  Individual has coverage under the plan 
The provisions this section apply for plan years beginning after September 23, 2010.  See  54.9815-1251T for determining the application this 
section grandfathered health plans (providing that the rules regarding rescissions and advance 
notice apply all grandfathered health plans). 
(d)  Expiration date.  This section expires before [INSERT DATE YEARS 
AFTER DATE FILING FOR PUBLIC INSPECTION WITH FEDERAL REGISTER]. 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution Section 54.9815-2716T added read follows: 
 54.9815-2716T Prohibiting discrimination favor highly compensated individuals (temporary). 
(a) general. group health plan (other than self-insured plan) must satisfy the requirements section 105(h)(2) (prohibiting discrimination favor highly compensated individuals under self-insured medical expense reimbursement plan eligibility participate and the benefits provided). 

(b) Rules and definitions. The provisions section 105(h) (and applicable regulations) described this paragraph (b) apply for purposes this section. 

(1) Nondiscrimination rules. The nondiscriminatory eligibility classification rules 
meaning given section 105(h)(5). 
The provisions this section apply for plan years beginning after September 23, 2010.  See  54.9815-1251T for determining the application this section grandfathered health plans (providing that the rules prohibiting discrimination favor highly compensated individuals insured group health plans not apply grandfathered health plans). 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
(d) Expiration date.  This section expires before [INSERT DATE YEARS AFTER DATE FILING FOR PUBLIC INSPECTION WITH FEDERAL REGISTER]. Section 54.9815-2719AT added read follows: 
 54.9815-2719AT Patient protections (temporary). 
(a) Choice health care professional  (1) Designation primary care provider(i) general. group health plan, health insurance issuer offering group health insurance coverage, requires provides for designation participant beneficiary participating primary care provider, then the plan issuer must permit each participant beneficiary designate any participating primary care provider who available accept the participant beneficiary. such case, the plan issuer must comply with the rules paragraph (a)(4) this Example, the plan has satisfied the requirements paragraph (a) this section. 
(2) Designation pediatrician primary care provider(i) general. group health 
plan health insurance issuer offering group health insurance coverage requires provides for the designation participating primary care provider for child participant beneficiary, the plan issuer must permit the participant beneficiary designate physician (allopathic osteopathic) who specializes pediatrics the childs primary care provider 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
the provider participates the network the plan issuer and available accept the child. such case, the plan issuer must comply with the rules paragraph (a)(4) this section informing each participant the terms the plan health insurance coverage regarding designation pediatrician the childs primary care provider. 
 (ii) Construction. Nothing paragraph (a)(2)(i) this section construed waive any exclusions coverage under the terms and conditions the plan health insurance coverage with respect coverage pediatric care. 
(iii) Examples. The rules this paragraph (a)(2) are illustrated the following 
examples: Example (i) Facts. group health plans HMO designates for each participant this Example the HMO has not violated the requirements this paragraph (a)(2) because the exclusion treatment for food allergies accordance with the 

(3) Patient access obstetrical and gynecological care(i) General rights(A) Direct 
access. group health plan health insurance issuer offering group health insurance coverage described paragraph (a)(3)(ii) this section may not require authorization referral the plan, issuer, any person (including primary care provider) the case female participant beneficiary who seeks coverage for obstetrical gynecological care provided 
PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
participating health care professional who specializes obstetrics gynecology. such case, the plan issuer must comply with the rules paragraph (a)(4) this section informing each participant that the plan may not require authorization referral for obstetrical gynecological care participating health care professional who specializes obstetrics gynecology.  The plan issuer may require such professional agree otherwise adhere the plans issuers policies and procedures, including procedures regarding referrals and obtaining prior authorization and providing services pursuant treatment plan (if any) 
issuer 

(A) Provides coverage for obstetrical gynecological care; and 
(B) Requires the designation participant beneficiary participating primary care provider. 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
 (iii) Construction.  Nothing paragraph (a)(3)(i) this section construed to 
(A) 
Waive any exclusions coverage under the terms and conditions the plan health insurance coverage with respect coverage obstetrical gynecological care; 

(B)
 Preclude the group health plan health insurance issuer involved from requiring that the obstetrical gynecological provider notify the primary care health care professional the plan issuer treatment decisions.

 (iv) Examples. The rules this paragraph (a)(3) are illustrated the following 
examples: 
Example (i) Facts. group health plan requires each participant designate physician serve the primary care provider for the participant and the participants family.   Participant female, requests gynecological exam with Physician in-network 
participating health care provider. Same facts Example except that the group health plan only 
(ii) Conclusion. this Example the group health plan has not violated the requirements this paragraph (a)(3) because has direct access without prior authorization.  The fact that the group health plan requires notification treatment decisions the designated primary care physician does not violate this paragraph (a)(3). 
Example (i) Facts. group health plan requires each participant designate physician serve the primary care provider for the participant and the participants family.  The group health plan requires prior authorization before providing benefits for uterine fibroid embolization.   
PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
(ii) Conclusion. this Example the plan requirement for prior authorization before providing benefits for uterine fibroid embolization does not violate the requirements this paragraph (a)(3) because, though the prior authorization requirement applies obstetrical services, does not restrict access any providers specializing obstetrics gynecology. 
(4) Notice right designate primary care provider(i) general. group health 
plan health insurance issuer requires the designation participant beneficiary 

requirement described paragraph (a)(4)(i) this section: 
(A) For plans and issuers that require allow for the designation primary care providers participants beneficiaries, insert: 

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Because [name Name group health plan health insurance issuer] generally [requires/allows] the designation primary care provider. yYou have the right designate any primary care provider who participates our network and who available accept you your family members.  [If the plan health insurance coverage designates primary care provider automatically, insert: Until you make this designation, [name group health plan health insurance issuer] designates one for you.]  For information how select primary care provider, and for list the participating primary care providers, contact the [plan administrator issuer] [insert contact information].  
(B) For plans and issuers that require allow for the designation primary care 
provider for child, add:  
For children, you may designate pediatrician the primary care provider. 
(C) For plans and issuers that provide coverage for obstetric gynecological care and require the designation participant beneficiary primary care provider, add: 
services (as defined paragraph (b)(4)(ii) this section) consistent with the rules this paragraph (b). 
(2) 
General rules. plan issuer subject the requirements this paragraph (b) must provide coverage for emergency services the following manner   

(i)
  Without the need for any prior authorization determination, even the emergency services are provided out-of-network basis; 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
(ii)  Without regard whether the health care provider furnishing the emergency services participating network provider with respect the services; 
(iii) the emergency services are provided out network, without imposing any administrative requirement limitation coverage that more restrictive than the requirements limitations that apply emergency services received from in-network providers;  
(iv) the emergency services are provided out network, complying with the cost-sharing requirements paragraph (b)(3) this section; and 

(v) 
 Without regard any other term condition the coverage, other than  

(A) 
The exclusion coordination benefits; 

(B) affiliation waiting period permitted under part ERISA, part title 

network cost sharing, the excess the amount the out-of-network provider charges over the amount the plan issuer required pay under this paragraph (b)(3)(i). group health plan health insurance issuer complies with the requirements this paragraph (b)(3) provides benefits with respect emergency service amount equal the greatest the three amounts specified paragraphs (b)(3)(i)(A), (b)(3)(i)(B), and (b)(3)(i)(C) this section (which are adjusted for in-network cost-sharing requirements). 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
(A) The amount negotiated with in-network providers for the emergency service furnished, excluding any in-network copayment coinsurance imposed with respect the participant beneficiary. there more than one amount negotiated with in-network providers for the emergency service, the amount described under this paragraph (b)(3)(i)(A) the median these amounts, counting single dollar amount more than once was negotiated with more than one provider, and excluding any in-network copayment coinsurance imposed with respect the participant beneficiary. determining the median described the preceding sentence, the amount negotiated with each in-network provider treated separate amount (even the same amount paid more than one provider). there per-service amount negotiated with in-network providers (such under capitation other similar 
generally pays percent the usual, customary, and reasonable amount for out-of-network services, the amount this paragraph (b)(3)(i)(B) for emergency service the total (that is, 100 percent) the usual, customary, and reasonable amount for the service, not reduced the percent coinsurance that would generally apply out-of-network services (but reduced the in-network copayment coinsurance that the individual would responsible for the emergency service had been provided in-network). 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
(C)
 The amount that would paid under Medicare (part part title XVIII the Social Security Act, U.S.C. 1395 seq.) for the emergency service, excluding any in-network copayment coinsurance imposed with respect the participant beneficiary. 

(ii)
  Other cost sharing. Any cost-sharing requirement other than copayment coinsurance requirement (such deductible out-of-pocket maximum) may imposed with respect emergency services provided out network the cost-sharing requirement generally applies out-of-network benefits. deductible may imposed with respect out-of-network emergency services only part deductible that generally applies out-of-network benefits. out-of-pocket maximum generally applies out-of-network benefits, that out-of-pocket maximum must apply out-of-network emergency services. 

emergency services without the need for any prior authorization determination.  This the result even the plan required that notified before the time receiving services the emergency department order receive reduction the coinsurance rate. 
Example (i) Facts. group health plan imposes $60 copayment emergency services without preauthorization, whether provided network out network. emergency services are preauthorized, the plan waives the copayment, even later determines the medical condition was not emergency medical condition. 
(ii) Conclusion. this Example requiring individual pay more for emergency services the individual does not obtain prior authorization, the plan violates the requirement that the plan cover emergency services without the need for any prior authorization 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
determination.  (By contrast, if, have the copayment waived, the plan merely required that notified rather than prior authorization, then the plan would not violate the requirement that the plan cover emergency services without the need for any prior authorization determination.) 
Example (i) Facts. group health plan covers individuals who receive emergency services with respect emergency medical condition from out-of-network provider.  The plan has agreements with in-network providers with respect certain emergency service.  Each provider has agreed provide the service for certain amount.  Among all the providers for the service: one has agreed accept $85, two have agreed accept $100, two have agreed accept $110, three have agreed accept $120, and one has agreed accept $150.  Under the agreement, the plan agrees pay the providers percent the agreed amount, with the individual receiving the service responsible for the remaining percent. 

(ii) Conclusion. this Example the values taken into account determining the median are $85, $100, $100, $110, $110, $120, $120, $120, and $150.  Therefore, the median amount among those agreed for the emergency service $110, and the amount under paragraph (b)(3)(i)(A) this section percent $110 ($88). 

(ii) 
Conclusion. this Example the plan responsible for paying $92.80, percent $116.  The median amount among those agreed for the emergency service $115 and the amount the plan would pay $92 (80 percent $115); the amount calculated using the same method the plan uses determine payments for out-of-network services $116 excluding the in-network percent coinsurance, $92.80; and the Medicare payment $80.  Thus, the greatest amount $92.80. The individual responsible for the remaining $32.20 charged the out-of-network provider. 

Example (i) Facts. Same facts Example Subsequently, the plan adds another 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
Example (i) Facts. Same facts Example The group health plan generally imposes $250 deductible for in-network health care.  With respect all health care provided out-ofnetwork providers, the plan imposes $500 deductible.  (Covered in-network claims are credited against the deductible.) The individual has incurred and submitted $260 covered claims prior receiving the emergency service out network. 
(ii) Conclusion. this Example the plan not responsible for paying anything with respect the emergency service furnished the out-of-network provider because the covered individual has not satisfied the higher deductible that applies generally all health care provided out network.  However, the amount the individual required pay credited against the deductible. 

 (4) Definitions. The definitions this paragraph (b)(4) govern applying the provisions this paragraph (b). 
(i) Emergency medical condition. The term emergency medical condition means 
medical condition manifesting itself acute symptoms sufficient severity (including severe 
The term emergency services means, with respect 
(A) medical screening examination (as required under section 1867 the Social 
Security Act, U.S.C. 1395dd) that within the capability the emergency department 
hospital, including ancillary services routinely available the emergency department evaluate 
such emergency medical condition, and 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
(B) Such further medical examination and treatment, the extent they are within the capabilities the staff and facilities available the hospital, are required under section 1867 the Social Security Act (42 U.S.C. 1395dd) stabilize the patient. 
(iii)  Stabilize. The term stabilize, with respect emergency medical condition (as 
apply grandfathered health plans).  
the table read follows: 602.101 OMB Control numbers. 

(b) 
CFR part section where      Current OMB identified and described       control No. 54.9815-2711T.................................................................................................1545- 
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54.9815-2712T.................................................................................................1545- 
54.9815-2719AT...............................................................................................1545- 

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DEPARTMENT LABOR 
Employee Benefits Security Administration CFR Chapter XXV CFR Part 2590 amended follows: 

individual health insurance coverage (or other coverage provided Federally eligible individuals pursuant CFR Part 148), whether not any medical advice, diagnosis, care, treatment was recommended received before that day. preexisting condition exclusion 
PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
includes any limitation exclusion benefits (including denial coverage) applicable individual result information relating individuals health status before the individuals effective date coverage (or coverage denied, the date the denial) under group health plan, group individual health insurance coverage (or other coverage provided 
The rules this paragraph (a) are illustrated the following examples (for additional examples illustrating the definition preexisting condition exclusion, see  

2590.701-3(a)(1)(ii) this Part): 
Example (i) Facts. group health plan provides benefits solely through insurance policy offered Issuer the expiration the policy, the plan switches coverage policy offered Issuer Ns policy excludes benefits for oral surgery required result traumatic injury the injury occurred before the effective date coverage under the policy. 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
(ii)  
Conclusion. this Example the exclusion benefits for oral surgery required result traumatic injury the injury occurred before the effective date coverage preexisting condition exclusion because operates exclude benefits for condition based the fact that the condition was present before the effective date coverage under the policy. 

Example (i) Facts. Individual applies for individual health insurance coverage with Issuer denies Cs application for coverage because pre-enrollment physical revealed that has type diabetes. 

(ii)
  Conclusion. See Example CFR 147.108(a)(2) for conclusion that Ms denial Cs application for coverage preexisting condition exclusion because denial application for coverage based the fact that condition was present before the date denial exclusion benefits based preexisting condition.   

(b) Applicability(1) General applicability date. Except provided paragraph 
(b)(2) this section, the requirements this section apply for plan years beginning after 
January 2014.   
The rules this paragraph (b) are illustrated the following example: 
Example. (i) Facts. Individual commences employment and enrolls and Fs 16-yearold child the group health plan maintained Fs employer, with first day coverage October 15, 2010.  Fs child had significant break coverage because lapse more than days without creditable coverage immediately prior enrolling the plan.  Fs child was treated for asthma within the six-month period prior the enrollment date and the plan imposes 12-month preexisting condition exclusion for coverage asthma.  The next plan year begins January 2011. 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
(ii)  Conclusion. this Example, the plan year beginning January 2011 the first plan year the group health plan beginning after September 23, 2010.  Thus, beginning January 2011, because the child under years age, the plan cannot impose preexisting condition exclusion with respect the childs asthma regardless the fact that the preexisting condition exclusion was imposed the plan before the applicability date this provision. Section 2590.715-2711 added subpart read follows: 
2590.715-2711 lifetime annual limits. 
(a) 
Prohibition(1) Lifetime limits. Except provided paragraph (b) this section, group health plan, health insurance issuer offering group health insurance coverage, may 
not establish any lifetime limit the dollar amount benefits for any individual. 

(2) Annual limits(i) General rule.  Except provided paragraphs (a)(2)(ii), (b), and 

(d) this section, group health plan, health insurance issuer offering group health 

insurance coverage, from placing annual lifetime dollar limits with respect any individual specific covered benefits that are not essential health benefits the extent that such limits are otherwise permitted under applicable Federal State law.  (The scope essential health benefits addressed paragraph (c) this section). 
(2) Condition-based exclusions. The rules this section not prevent group health plan, health insurance issuer offering group health insurance coverage, from excluding all 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
benefits for condition. However, any benefits are provided for condition, then the requirements this section apply. Other requirements Federal State law may require coverage certain benefits.  
(c) 
Definition essential health benefits. The term essential health benefits means essential health benefits under section 1302(b) the Patient Protection and Affordable Care Act and applicable regulations. 

(d) Restricted annual limits permissible prior 2014(1) general. With respect plan years beginning prior January 2014, group health plan, health insurance issuer offering group health insurance coverage, may establish, for any individual, annual limit the dollar amount benefits that are essential health benefits, provided the limit less than determining whether individual has received benefits that meet exceed the applicable amount described paragraph (d)(1) this section, plan issuer must take into account only essential health benefits.  
(3) Authority the Secretary Health and Human Services defer effective date. For plan years beginning before January 2014, the Secretary Health and Human Services may 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
establish program under which the effective date for the requirements paragraph (d)(1) this section relating annual limits may deferred (for such period specified the Secretary Health and Human Services) for group health plan health insurance coverage that has annual dollar limit benefits below the restricted annual limits provided under paragraph (d)(1) this section compliance with paragraph (d)(1) this section would result significant decrease access benefits under the plan health insurance coverage would significantly increase premiums for the plan health insurance coverage.   

(e) Transitional rules for individuals whose coverage benefits ended reason reaching lifetime limit(1) general. The relief provided the transitional rules this paragraph (e) applies with respect any individual 
paragraph (e)(1) this section eligible for benefits (or required become eligible for benefits) under the group health plan  group health insurance coverage  described paragraph (e)(1) this section, the plan and the issuer are required give the individual written notice that the lifetime limit the dollar value all benefits longer applies and that the individual, covered, once again eligible for benefits under the plan.  Additionally, the 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
individual not enrolled the plan health insurance coverage, enrolled individual eligible for but not enrolled any benefit package under the plan health insurance coverage, then the plan and issuer must also give such individual opportunity enroll that continues for least days (including written notice the opportunity enroll).  The notices and enrollment opportunity required under this paragraph (e)(2)(i) must provided beginning not later than the first day the first plan year beginning after September 23, 2010.   

(ii)  The notices required under paragraph (e)(2)(i) this section may provided employee behalf the employees dependent. addition, the notices may included with other enrollment materials that plan distributes employees, provided the statement prominent.  For either notice, notice satisfying the requirements this paragraph (e)(2) 
special enrollee, provided under the rules 2590.701-6(d) this Part.  Accordingly, the individual (and, the individual would not participant once enrolled the plan, the participant through whom the individual otherwise eligible for coverage under the plan) must offered all the benefit packages available similarly situated individuals who did not lose coverage reason reaching lifetime limit the dollar value all benefits.  For this purpose, any difference benefits cost-sharing requirements constitutes different benefit 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
package.  The individual also cannot required pay more for coverage than similarly situated 
individuals who did not lose coverage reason reaching lifetime limit the dollar value all benefits. 
(5) Examples. The rules this paragraph (e) are illustrated the following examples: 
Example (i) Facts.  Employer maintains group health plan with calendar year plan year.  The plan has single benefit package. For plan years beginning before September 23, 2010, the plan has lifetime limit the dollar value all benefits.  Individual employee was enrolled Ys group health plan the beginning the 2008 plan year. June 10, 2008,
 incurred claim for benefits that exceeded the lifetime limit under Ys plan and ceased enrolled the plan. still eligible for coverage under Ys group health plan (but prior January 2011, benefits would provided because the operation the lifetime limit). before January 2011, Ys group health plan gives written notice informing that the lifetime limit the dollar value all benefits longer applies, that individuals whose coverage ended reason reaching lifetime limit under the plan are eligible enroll the plan, and that individuals can request such enrollment through February 2011 with enrollment this Example not later than October 2010, the plan must provide and opportunity enroll (including written notice opportunity enroll) that continues for least days, with enrollment effective not later than October 2010.   
Example (i) Facts. Same facts Example except that Zs plan had two benefit packages low-cost and high-cost option).  Instead dropping coverage, switched the low-cost benefit package option. 
(ii) Conclusion. this Example not later than October 2010, the plan must provide and opportunity enroll any benefit package available similarly situated individuals who enroll when first eligible.  The plan would have provide and the 
opportunity enroll any benefit package available similarly situated individuals who enroll when first eligible, even had not switched the low-cost benefit package option. 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
Example (i) Facts.  Employer maintains group health plan with plan year beginning October and ending September 30.  For the plan year beginning October 2009, has annual limit the dollar value all benefits $500,000.    
(ii) 
Conclusion. this Example must raise the annual limit the dollar value essential health benefits least $750,000 for the plan year beginning October 2010.  For the plan year beginning October 2011, must raise the annual limit least $1.25 million.  For the plan year beginning October 2012, must raise the annual limit least million. may also impose restricted annual limit million for the plan year beginning October 2013. After the conclusion that plan year, cannot impose overall annual limit.  

Example (i) Facts. Same facts Example except that the annual limit for the plan year beginning October 2009 million and lowers the annual limit for the plan year beginning October 2010 $750,000.   

(ii) 
Conclusion. this Example complies with the requirements this paragraph (e).  However, Q's choice lower its annual limit means that under 2590.7151251(g)(1)(vi)(C), the group health plan will cease grandfathered health plan and will 

(a)  Prohibition rescissions(1) group health plan, health insurance issuer 
offering group health insurance coverage, must not rescind coverage under the plan, under the 
policy, certificate, contract insurance, with respect individual (including group which the individual belongs family coverage which the individual included) once the individual covered under the plan coverage, unless the individual (or person seeking coverage behalf the individual) performs act, practice, omission that constitutes 
PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
fraud, unless the individual makes intentional misrepresentation material fact, 
prohibited the terms the plan coverage. group health plan, health insurance issuer 
offering group health insurance coverage, must provide least days advance written notice 
each participant who would affected before coverage may rescinded under this paragraph 
(a)(1), regardless whether the coverage insured self-insured, whether the rescission 
applies entire group only individual within the group.  (The rules this paragraph 
(a)(1) apply regardless any contestability period that may otherwise apply.)   
Individual seeks enrollment insured group health plan.  The plan terms permit rescission coverage with respect individual the individual engages fraud makes intentional misrepresentation material fact.  The plan requires complete questionnaire regarding As prior medical history, which affects setting the group rate the health insurance issuer.  The questionnaire complies with the other requirements this pPart. The questionnaire includes the following question: Is there anything else relevant your health that should know? inadvertently fails list that visited psychologist two occasions, six years previously. later diagnosed with breast cancer and seeks benefits under the plan. around the same time, the issuer receives information about As visits the psychologist, which was not disclosed the questionnaire. 
Comment [b21]: OMB (original comment A65): 
Example IRS includes and applicable regulations here. these need consistent? 
Dept Response: made changes make these examples consistent. 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
(ii) 
Conclusion. this Example the plan cannot rescind As coverage because As failure disclose the visits the psychologist was inadvertent.  Therefore, was not fraudulent intentional misrepresentation material fact.   

Example (i) Facts. employer sponsors group health plan that provides coverage for employees who work least hours per week.  Individual has coverage under the plan full-time employee.  The employer reassigns part-time position. Under the terms the plan, longer eligible for coverage.  The plan mistakenly continues provide health coverage, collecting premiums from and paying claims submitted After routine audit, the plan discovers that longer works least hours per week.  The plan rescinds Bs coverage effective the date that changed from full-time employee part-time employee. 

(ii) Conclusion. this Example the plan cannot rescind Bs coverage because there was fraud intentional misrepresentation material fact.  The plan may cancel coverage for prospectively, subject other applicable Federal and State laws. 

(b)  Compliance with other requirements. group health plan (other than self-insured plan) must satisfy the 
requirements section 105(h)(2) the Internal Revenue Code (prohibiting discrimination 
favor highly compensated individuals under self-insured medical expense reimbursement 
plan eligibility participate and the benefits provided). 
(b) Rules and definitions. The provisions section 105(h) the Internal Revenue Code 
(and applicable regulations) described this paragraph (b) apply for purposes this section. 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
(1) 
Nondiscrimination rules. The nondiscriminatory eligibility classification rules section 105(h)(3) the Internal Revenue Code and the nondiscriminatory benefits rule section 105(h)(4) the Internal Revenue Code apply group health plan (other than self-insured plan) under this section the group health plan were self-insured medical expense reimbursement plan. 

(2) 
Controlled group rules. The controlled group rules and other related rules referenced section 105(h)(8) the Internal Revenue Code apply for purposes this sectio 

(3) 
Highly compensated individual defined. Highly compensated individual has the meaning given section 105(h)(5) the Internal Revenue Code. 

(c) Applicability date. The provisions this section apply for plan years 
general. coverage, requires provides for designation participant beneficiary participating primary care provider, then the plan issuer must permit each participant beneficiary designate any participating primary care provider who available accept the participant beneficiary. such case, the plan issuer must comply with the rules paragraph (a)(4) 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
this section informing each participant the terms the plan health insurance coverage 
regarding designation primary care provider. 
(ii)  Example. The rules this paragraph (a)(1) are illustrated the following example: 
Example. (i) Facts. group health plan requires individuals covered under the plan designate primary care provider.  The plan permits each individual designate any participating primary care provider participating the plans network who available accept the individual the individuals primary care provider. individual has not designated primary care provider, the plan designates one until one has been designated the individual. The plan provides notice that satisfies the requirements paragraph (a)(4) this section regarding the ability designate primary care provider. 

(ii)  Conclusion. this Example, the plan has satisfied the requirements paragraph (a) this section. 
(2) Designation pediatrician primary care provider(i) general. group health 
Nothing paragraph (a)(2)(i) this section construed 
waive any exclusions coverage under the terms and conditions the plan health insurance 
coverage with respect coverage pediatric care. 
(iii) Examples. The rules this paragraph (a)(2) are illustrated the following examples: 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
Example (i) Facts. group health plans HMO designates for each participant physician who specializes internal medicine serve the primary care provider for the participant and any beneficiaries.   Participant requests that Pediatrician designated the primary care provider for As child. participating provider the HMOs network. 
(ii) 
Conclusion. this Example the HMO must permit As designation the primary care provider for As child order comply with the requirements this paragraph (a)(2). 

Example (i) Facts. Same facts Example except that takes As child for treatment the childs severe peanut allergies. wishes refer As child allergist for treatment.  The HMO, however, does not provide coverage for treatment food allergies, nor does have allergist participating its network and therefore refuses authorize the referral. 

(ii) 
Conclusion. this Example the HMO has not violated the requirements this paragraph (a)(2) because the exclusion treatment for food allergies accordance with the terms As coverage. gynecological care participating health care professional who specializes obstetrics gynecology.  The plan issuer may require such professional agree otherwise adhere the plans issuers policies and procedures, including procedures regarding referrals and obtaining prior authorization and providing services pursuant treatment plan (if any) approved the plan issuer.  For purposes this paragraph (a)(3), health care professional who specializes obstetrics gynecology any individual (including person other than 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
physician) who authorized under applicable State law provide obstetrical gynecological care. 
(B) 
Obstetrical and gynecological care. group health plan health insurance issuer described paragraph (a)(3)(ii) this section must treat the provision obstetrical and gynecological care, and the ordering related obstetrical and gynecological items and services, pursuant the direct access described under paragraph (a)(3)(i)(A) this section, participating health care professional who specializes obstetrics gynecology the 
authorization the primary care provider. 

(ii) 
Application paragraph. group health plan health insurance issuer offering group health insurance coverage described this paragraph (a)(3) the plan issuer 

the obstetrical gynecological provider notify the primary care health care professional the 
 (iv) Examples. The rules this paragraph (a)(3) are illustrated the following 
examples: 
Example (i) Facts. group health plan requires each participant designate physician serve the primary care provider for the participant and the participants family.   Participant female, requests gynecological exam with Physician in-network 

PRELIMINARY DISCUSSION DRAFT 6.16.10 Not for Public Distribution 
physician specializing gynecological care.  The group health plan requires prior authorization from As designated primary care provider for the gynecological exam. 
(ii) 
Conclusion. this Example the group health plan has violated the requirements this paragraph (a)(3) because the plan requires prior authorization from As primary care provider prior obtaining gynecological services.   

Example (i) Facts. Same facts Example except that seeks gynecological services from out-of-network provider. 

(ii) 
Conclusion. this Example the group health plan has not violated the requirements this paragraph (a)(3) requiring prior authorization because not participatin