Mar 23, 2011

Happy First Birthday Health Care Reform, and DOL Extends Enforcement Grace Period for Certain Claims Appeals Process Changes

PPACA’s First Birthday

One year ago today, the Patient Protection and Affordable Care Act (“PPACA”) was signed into law by President Obama. Since PPACA’s enactment, we have received a multitude of implementing regulations and other guidance from regulatory agencies addressing PPACA’s changes and how they affect employer group health plans. As a result, PPACA’s first year was full of uncertainty as to the impact of PPACA, as well as compliance challenges for employers sponsoring group health plans.

Over the past few months, there have been a variety of constitutional challenges to PPACA, initiated by state governments and other interested groups. It is likely that these challenges will undergo scrutiny by higher courts, perhaps even the U.S. Supreme Court, in the near future. In addition, Republicans in Congress have been actively pursuing repeal and/or revisions to PPACA, including delaying, reducing or eliminating funding requirements for the implementation of PPACA.

The majority of PPACA’s most significant changes – such as the individual mandate – become effective in 2014. We expect a significant amount of additional guidance to be released by federal agencies over the next few years. We will continue to monitor PPACA’s developments, including the constitutional challenges to the law, and advise you regarding these developments.

Extension of the Enforcement Grace Period for Certain Appeals Process Changes

As mentioned in a previous SGR Client Alert, Department of Labor (“DOL”) Technical Release 2010-02, which was released in September 2010, provided an enforcement grace period until July 1, 2011 for compliance with certain provisions of the claims appeals process changes under PPACA.

DOL Technical Release 2011-01 extends this enforcement grace period until plan years beginning on or after January 1, 2012. Specifically, DOL Technical Release 2011-01 provides this extended enforcement grace period with regard to the following claims appeals process changes under PPACA:

  • The 24-hour timeframe for making urgent care claims decisions;
  • The requirement to provide notices in a culturally and linguistically appropriate manner;
  • The expanded content requirement for notices, but only with respect to the requirement to disclose diagnosis and treatment codes in a notice of adverse benefit determination; and
  • The deemed exhaustion of the plan’s internal claims and appeals process if a plan fails to adhere to the claims appeals process changes.

This relief is intended to provide employers and administrators with more time to change their group health plan procedures and to modify their computer systems to comply with the claims appeals process changes required under PPACA.

For more information regarding PPACA, or the claims appeals process changes under PPACA, please contact your SGR Executive Compensation and Employee Benefits counsel.

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