Posted by: Altura Benefits in Insurance
Utah health insurance law is a complex labyrinth of federal and state legislation but, as a Utah business, you need to adhere to these requirements. Generally, the law requires group health plans to cover certain “essential” benefits and lets employees continue coverage in particular circumstances (“continuation requirements”). There are other requirements for self-insurance, HIPAA, and workers’ comp. This guide helps you navigate the complexity of health insurance legislation in Utah.
Surprisingly, no state law requires employers to provide group health insurance to employees. (But an overwhelming number of employers in Utah do.) If you offer group health insurance, federal laws kick in that require you to cover certain essential benefits.
The Patient Protection and Affordable Care Act (ACA), also called ObamaCare, became effective in 2010. There are lots of stipulations in the act, but the following is the most important one for employers:
Group health insurance plans must provide essential health benefits to employees.
The keyword here is “essential.” The ACA defines essential benefits as the following:
The federal government has determined these benefits as essential, but different states interpret these benefits differently.
Here in Utah, these benefits are set out in a benchmark plan. This plan determines the specific services that fall under all the essential benefits.
In addition to the benefits listed above, group plans in Utah need to provide the following services:
NOTE: Large Employers face a penalty of $2,570 if 95 percent of employees (and their dependents) are not offered minimum essential coverage. The federal government calls this the “Employer Shared Responsibility” penalty.
If you offer group health insurance, you need to comply with legislation that governs continuation rights, which allows employees to continue group coverage in specific circumstances.
The Consolidated Omnibus Budget Reconciliation Act (COBRA) is the federal legislation that ensures employees/dependents maintain coverage when, for example, they move from one job to another (employers don’t need to pay for an employees’ group insurance premium if that employee elects COBRA).
COBRA is a federal law that governs groups with 20 or more employees, Utah mini-COBRA laws govern groups with less than 20 employees. In Utah, the following provisions apply:
Most employers in Utah offer one of the following three health plans:
Preferred Provider Organization (PPO) health plans are the most common among Utah employers. For maximum benefits, employees on this plan can receive medical care from healthcare providers on the insurer’s list of “preferred providers.”
Health Maintenance Organization (HMO) plans provide employees with various services through a network of selected healthcare providers. An employee on this plan usually sees a primary care physician in the first instance, who then refers the employee to a specialist if necessary.
Indemnity plans let employees visit a healthcare provider of their choice. These plans provide employees with greater flexibility but generally cost more. As a result, some employees pay for services up-front.
The essential benefits and continuation rights listed above pertain to group plans provided by insurance companies. Federal legislation dictates that states can’t regulate self-insured plans (where business owners pay healthcare claims themselves and facilitate claims through a third party).
Employees can enroll in the group plan during the group’s Open Enrollment Period(OEP) or if they are granted a Special Enrollment Period(SEP). The group’s OEP is determined when setting up the group’s benefit plan. SEP’s apply on an individual basis and are typically granted if the employee has lost their coverage due to a job change, family member, 26th birthday, or has recently gained eligibility to the group plan.
Business owners in Utah have a responsibility to collect required documents from employees for health insurance. The purpose of this documentation is two-fold: To facilitate enrollment and improve compliance.
Although not a specific federal or state regulation, employers should provide legal notices to employees to better communicate health insurance procedures and policies. These legal notices might include:
Although health insurance and workers’ compensation are two different concepts, you could be liable for an employee’s out-of-pocket expenses after an injury/accident (as per Utah law). Workers’ compensation insurance provides a safeguard in such an event and could prevent a long and expensive lawsuit. Workers’ comp is something to consider when managing compliance.
The Health Insurance Portability and Accountability Act of 1996 (HIPAA) is an all-encompassing piece of legislation that safeguards electronic health information (medical records, Social Security numbers, and the like). HIPAA is meant to:
All insurance providers have to adhere to HIPAA or face hefty penalties. But employers are bound by the same rules. Business owners who collect, store, and share employees’ health information with third parties (even insurers) must keep this information safe and secure.
Much of HIPAA applies to all the states, and there’s nothing Utah-specific. However, a good resource can be the Utah Health Information Network (UHIN), a not-for-profit that helps employers manage electronic health information.
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