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HHS Provides Enforcement Safe Harbor for Claim-Denial Notices by Governmental Plans
By: Jason Lacey

The Department of Health and Human Services (HHS) has issued an enforcement safe harbor relating to the content of benefit-claim denial notices issued by non-federal governmental health plans.

Under health care reform, all non-grandfathered group health plans are required to follow the DOL's rules and regulations regarding the content of notices of adverse benefit determinations. Among other things, those rules require providing (1) a statement about a participant's right to bring suit under ERISA, and (2) contact information for the federal Employee Benefits Security Administration (EBSA) or a state insurance department.

Non-federal governmental plans are not subject to ERISA, so participants do not have the right to sue under ERISA to seek recovery of benefits. In addition, participants in non-federal governmental plans are not provided services by the EBSA, because they do not have rights under ERISA. 

The enforcement safe harbor clarifies that non-federal governmental plans can exclude ERISA right-to-sue language and EBSA contact information from their benefit-denial notices and they will not be treated as violating the health-care-reform mandates. Contact information is not required to be provided for a state insurance department either, unless the plan actually uses an insurance policy issued by a carrier subject to regulation by a state insurance department.

There are some nuances to the safe harbor, so HHS's notice should be carefully reviewed by any non-federal governmental plan intending to rely on the safe harbor. But on the whole this should come as a welcome (and practical) clarification for affected plans.


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Don Berner, the Labor Law, OSHA, & Immigration Law Guy
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Boyd Byers, the General Employment Law Guy
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Jason Lacey, the Employee Benefits Guy
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