What changes did health reform make to the small-plan exemption to the HIPAA portability rules?
A515. Health reform eliminated the exemption contained in the Public Health Service Act (the provision with the widest application). It also amended ERISA and the IRC to add health reform provisions by a very broad provision. Recent guidance indicates that the amendment of ERISA and IRC relates to newly added provisions, not to the removal of this exemption. Thus, according to regulatory guidance, the exemption has only been eliminated in plans subject to the Public Health Service Act (e.g. insured plans, and non-federal governmental plans). The regulatory guidance indicated that the HHS (which enforces the Public Health Service Act) will not enforce this change on retiree only plans. However, other entities, including state insurance commissions or individual participants are not bound by this regulation and may attempt to enforce HIPAA portability rules.
