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5500 Preparer's Manual for 2012 Plan Years
The premier resource in the field of Form 5500 preparation, 5500 Preparer's Manual will help you handle the required annual Form 5500 filings for both pension benefits and welfare benefit plans.
The IRS, the Employee Benefits Security Administration (EBSA), and the Department of Health and Human Services have issued final rules implementing the nondiscrimination provisions of the Health Insurance Portability and Accountability Act (HIPAA). The final regulations will be effective for plan years beginning on or after July 1, 2007. The final rules generally follow the interim rules and provide additional guidance. (The preamble to the interim rules, issued in 2001, is at CCH Pension Plan Guide ¶24,805S.)
HIPAA's nondiscrimination provisions generally prohibit a group health plan or group health insurance issuer from denying an individual eligibility for benefits based on a health factor and from charging an individual a higher premium than a similarly situated individual based on a health factor. Under the interim rules and the final regulations, a plan or issuer is not required to provide coverage for any particular benefit to any group of similarly situated individuals. However, benefits provided must be uniformly available to all similarly situated individuals. Likewise, any restriction on a benefit or benefits must apply uniformly to all similarly situated individuals and must not be directed at individual participants or beneficiaries based on any health factor of the participants or beneficiaries.
The final regulations address the application of the nondiscrimination rules to health reimbursement arrangements (HRAs). The regulations include an example in which the carry forward of unused employer-provided medical care reimbursement amounts to later years does not violate the HIPAA nondiscrimination requirements, even though the maximum reimbursement amount for a year varies among employees within the same group of similarly situated individuals based on prior claims experience. In the example, an employer sponsors a group health plan under which medical care expenses are reimbursed up to an annual maximum amount. The maximum reimbursement amount with respect to an employee for a year is a uniform amount multiplied by the number of years the employee has participated in the plan, reduced by the total reimbursements for prior years. Because employees who have participated in the plan for the same length of time are eligible for the same total benefit over that length of time, the example concludes that the arrangement does not violate the HIPAA nondiscrimination requirements.
The regulations' preamble notes that the Equal Employment Opportunity Commission (EEOC) asked the departments to clarify that certain plan practices or provisions permitted under the benefits paragraphs of the interim rules may violate the Americans with Disabilities Act (ADA) or Title VII of the Civil Rights Act of 1964. Specifically, the 2001 interim rules allow plans to exclude or limit benefits for certain types of conditions or treatments. The final regulations retain the interim rules' paragraph (ERISA Reg. §2590.702(h)) that states that compliance with the HIPAA nondiscrimination rules is not determinative of compliance with any other provision of ERISA, or any other state or federal law, including the ADA.
A separate, but related, set of final regulations have been issued by the IRS that provide guidance under Code Sec. 9802(c) relating to the exception to the HIPAA nondiscrimination rules for certain grand-fathered church plans. These regulations generally affect sponsors of and participants in certain self-funded church plans. The guidance provides plan sponsors and plan administrators with the information necessary to comply with the law and does not differ substantially from the proposed regulations. These final regulations also apply for plan years beginning on or after July 1, 2007.
For more information on this and related topics, consult the CCH Pension Plan Guide.
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