The University Record, June 25, 1997

HIPAA took effect June 1

From the Benefits Office

The Health Insurance Portability and Accountability Act of 1996 (HIPAA), signed by President Clinton Aug. 21, 1996, was designed to improve the availability and portability of health insurance coverage. This law provides important new protections for persons who move from one job to another, or for persons who have pre-existing medical conditions. On June 1, a portion of HIPAA took effect that requires employers to provide certificates to persons whose health insurance coverage ends.

To comply with the act, the Benefits Office provides a letter certifying periods of health insurance coverage to individuals and their dependents when coverage ends with the University, for whatever reason (among many others, termination of employment, divorce, or a dependent becomes ineligible).

Teresa Grace, benefits coordinator, explains: "If a person leaves the University and takes a job with another company, this certificate could be helpful to them. The new plan may choose to use the certificate to apply the length of time the person was covered under U-M health insurance against any waiting periods the new plan may have for pre-existing medical conditions. This could shorten the waiting period for health insurance coverage."

Individuals with a pre-existing medical condition may need to furnish the certificate:

(1) to a new employer, or to any other entity through which they are or become eligible to enroll in group health insurance coverage, or

(2) to a health insurance company, if the individual buys, directly from a health insurance provider, for himself or herself or family members, a health insurance policy that does not exclude coverage for pre-existing medical conditions.

Letters were mailed June 20 to 5,855 individuals whose U-M coverage ended between Oct. 1, 1996, and May 31, 1997. Certifications for individuals affected after May 31 will be mailed on a monthly basis.

If your or your dependent's health insurance coverage with the University ends, and you do not receive a certification within five or six weeks, contact the Benefits Office, 763-1214.