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HIPAA Non-Discrimination Rules

The Departments of Health and Human Services (HHS), Labor and the Treasury issued final rules regarding the non-discrimination requirements under the Health Insurance Portability and Accountability Act in 1997. Although the regulations were to have gone into effect on March 9, 2001, a freeze by the Bush Administration delayed its implementation until July 1, 2001. While these rules broadly prohibit discrimination, certain allowances exist that permit health insurers to deny coverage to some individuals.

  1. General Prohibitions Against Discrimination

    • In general, the new regulations prevent health plans from discriminating against persons in the type or amount of benefits provided, or in the premiums imposed, based on health conditions. These health conditions include medical history, health status, genetic information, medical condition (either physical or mental), claims experience, disability, receipt of health care and evidence of insurability. Furthermore, the act made allowance for plans that had denied coverage based on these health conditions to be corrected.

    Pre-existing Conditions

    • The HIPAA non-discrimination act allows for exclusions and/or restrictions on health plans due to pre-existing conditions. However, these exclusions and/or restrictions must be applied equally to all similarly situated individuals (e.g., part-time employees, employees in a specific geographic location, or retired employees) and not directed at any one person or group of persons based on a health factor.

    Restrictions on Injuries

    • The act also allows health coverage for the treatment of an injury to be restricted or excluded on the basis of the source of the injury (such as skiing, horseback riding, motorbiking, etc.). However, the act clearly states that plans cannot exclude or restrict injuries or illnesses caused by domestic violence or a health condition. Even with these restrictions on injury sources, it is important to note that a health plan cannot completely deny coverage because of an individual's participation in certain high-risk activities.

    Minimum Benefits

    • Finally, the act stipulates that a health plan provider is not required to provide any standard benefits or minimum level of coverage. A health plan can offer any number of benefits and any level of coverage, so far as it is offered equally to similarly situated persons. As with the restriction of pre-existing conditions, the health plan cannot target any particular individuals or group of individuals based on a health factor. These cases would have to comply with criteria applied to similarly situated individuals and with other laws (such as the Americans with Disabilities Act)

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