Historically, health plans have been identified in Health Insurance Portability and Accountability Act (“HIPAA”) standard transactions by a variety of identifiers and these identifiers have different formats, both alphanumeric and numeric. Covered health care providers have expressed frustration with a number of problems related to the lack of a standard identifier including, for example; rejected transactions due to insurance identification errors, difficulty in determining patient eligibility, and challenges resulting from errors in identifying the correct health plan during claims processing. To increase standardization in HIPAA standard transactions and to eliminate the need for multiple identifiers, the Department of Health and Human Services (“HHS”) has adopted a standard for national unique health plan identifier numbers. Pursuant to this standard, health plans will be assigned a 10-digit numeric Health Plan Identifier (“HPID”).

For purposes of HPID, there are two classes of health plans: (1) a controlling health plan (“CHP”); and (2) a subhealth plan (“SHP”). A CHP is required to obtain an HPID. A CHP is a health plan that (1) controls its own business activities, actions, or policies; or (2) is controlled by an entity that is not a health plan. Most employer sponsored health plans will meet the definition of a CHP and will need to obtain an HPID. If the health plan is fully insured, an employer should consult with its insurance carrier as it is likely the insurance carrier will apply for the HPID. A SHP is not required to obtain an HPID but could obtain an HPID at the direction of its CHP or on its own initiative. A SHP is a health plan whose business activities are directed by a CHP.

A national enumeration system assigns unique HPIDs to eligible health plans through an online application process. This enumeration system is named the Health Plan and Other Entity Enumeration System (“HPOES”). To obtain an HPID, an entity will need to go through the HPOES. The HPOES is housed within the Centers for Medicare & Medicaid Services’ (“CMS”) Health Insurance Oversight System (“HIOS”). Users will access HIOS through the CMS Enterprise Portal at http://portal.cms.gov . Large health plans must obtain an HPID by November 5, 2014. Small health plans, those with annual receipts of $5 million or less, have an additional year to obtain an HPID as their deadline is November 5, 2015. All health plans, regardless of size, must use the HPID in standard transactions by the full implementation date of November 7, 2016.

Please consult your attorney on these issues or contact Christine Zoccola or Jim Hamilton at Bose McKinney & Evans for additional information.