Form M-1 Form M-1 Report for Multiple Employer Welfare Arrangements (MEWAs

U.S. Department of Labor

Employee Benefits Security Administration
Room N5511
200 Constitution Avenue, NW
Washington, DC 20210
P-450

Form M-1

Report for Multiple Employer Welfare
Arrangements (MEWAs)
and Certain Entities Claiming Exception (ECEs)
This package contains the following
form and related instructions:
Form M-1
Instructions
Self-Compliance Tool

Package Form M-1

If you have additional questions about the Form M-1 filing requirement or the ERISA health
coverage requirements, there’s help for you.

Form M-1 Filing Requirement
(1)

For questions on completing the Form M-1, contact the Employee Benefits Security
Administration’s (EBSA’s) Form M-1 help desk at 202-693-8360.

(2)

For inquiries regarding electronic filing capability, contact the EBSA computer help desk at
202-693-8600.

(3)

For inquiries regarding the Form M-1 filing requirement, contact the Office of Health Plan
Standards and Compliance Assistance at 202-693-8335.

ERISA Health Coverage Requirements
(1)

For questions about ERISA’s health coverage requirements, contact EBSA electronically at
www.askebsa.dol.gov or by calling toll-free 1-866-444-3272.

(2)

Information including regulations, frequently asked questions, compliance assistance
materials, and other guidance regarding the requirements related to the group market reforms
added to ERISA by the Patient Protection and Affordable Care Act of 2010 can be found at
www.dol.gov/ebsa/healthreform.

(3)

EBSA’s Health Benefits Education Campaign offers compliance assistance
seminars across the country addressing a wide variety of health care issues,
including HIPAA, MHPAEA, the group market reform provisions of the Affordable Care Act,
and COBRA. For information on upcoming compliance assistance seminars,
go to www.dol.gov/ebsa/hbec.html.

The Department of Labor’s EBSA has many helpful compliance assistance publications on ERISA’s
health benefits requirements, including:
•

MEWAs: Multiple Employer Welfare Arrangements under the Employee Retirement Income
Security Act: A Guide to Federal and State Regulation

•

Health Benefits Coverage Under Federal Law

•

An Employer’s Guide to Group Health Continuation Coverage Under COBRA

EBSA also has many publications to assist participants and beneficiaries. EBSA’s publications are
available on the Internet at www.dol.gov/ebsa, by contacting EBSA electronically at
www.askebsa.dol.gov or by calling toll-free 1-866-444-3272.

2015
Form M-1

Report for Multiple Employer Welfare
Arrangements (MEWAs) and Certain
Entities Claiming Exception (ECEs)

MEWA-ECE Form

This filing is required to be filed under section 101(g) of the
Employee Retirement Income Security Act of 1974, as amended
by the Patient Protection and Affordable Care Act.

This Form is Open to
Public Inspection

PART I

OMB No. 1210-0116
Department of Labor
Employee Benefits
Security Administration

PURPOSE OF FILING

Complete as applicable:
C Identify the type of entity:
(1)
 A Plan MEWA
(2)
 A Non-Plan MEWA
(3)
 An Entity Claiming Exception (ECE)

PL
E

A Identify the type of filing:
(1)
 Annual Report:
 Calendar Year; or
 Fiscal Year beginning
and ending
(2)
 Registration
(3)
 Origination
(4)
 Special Filing

D Enter the most recent date the MEWA or ECE filed the
Form M-1:
 Check the box if this is the first filing or enter the date below.

B Check here if this is a final report 
Check here if this is an amended report 
Check here if this is a request for an extension 

PART II
1a

CUSTODIAL & FINANCIAL INFORMATION

Name and address of the MEWA or ECE

1b Telephone number of the MEWA or ECE
1c

Employer Identification Number (EIN)

SA
M

1d Plan Number (PN)

2a

3a

4a

5a

6a

Name and address of the administrator of the MEWA or ECE

Name and address of the entity or entities sponsoring the MEWA or ECE

2b Telephone number of the administrator
2c EIN
2d E-mail address of the administrator
3b Telephone number of the sponsor
3c EIN

Name and address of the agent for service of process or registered agent 4b Telephone number of such person

Name and address of each member of the Board, officer, trustee, or
custodian of the MEWA or ECE

Name and address of all promoters and/or agents responsible for
marketing the MEWA or ECE

4c

E-mail address of such person

5b Telephone number of each such person
5c

E-mail address of such person

6b Telephone number of each promoter or agent
6c

E-mail address of such person

6d EIN of each promoter or agent

Page 2

Form M-1

7a

Name and address of any person, financial institution(s), or other entity
holding assets for the MEWA or ECE

7b Telephone Number of person financial institution
or entity

8a

Name and address of any actuary(ies) providing services to the MEWA
or ECE

8b Telephone number of each actuary
8c

E-mail address of each actuary

8d EIN of each actuary
9a

If the MEWA or ECE has a contract with a third party administrator (TPA)
the name and address of the third party administrator(s)

9b Telephone number of each TPA
E-mail address of each TPA

PL
E

9c

9d EIN of each TPA

10a Name and address of any person or entity that has authority or control
over the MEWA’s or ECE’s assets or over assets paid to the entity by
plans or employers for the provision of benefits

10b Telephone number of each such person or entity
10c E-mail address of such person or entity
10d EIN of each such person or entity

11a Name and address of any person or entity that has discretionary
authority, control, or responsibility with respect to the administration of
the MEWA or ECE or any benefit program offered by it

11b Telephone number of each such person or entity
11c E-mail address of such person or entity

SA
M

11d EIN of each such person or entity

12a Names and addresses of the MEWAs or ECEs that merged

13

12b Telephone number of the entities
12c EINs
12d PNs

Do you have an opinion from an actuary assessing the MEWA’s or ECE’s actuarial soundness, including the adequacy of
contribution rates?
 Yes  No

14a Are you, your entity, and/or its officers, directors, and employees covered by fiduciary liability policies? Please identify the carrier
that issued the fiduciary liability policy(ies) in the space provided.
 Yes  No

14b Are the fiduciaries of each of the plans whose participants are receiving benefits from the entity covered by a fiduciary liability
policy?
 Yes  No
15

Are all assets in the possession of the MEWA or ECE maintained consistent with section 403 of ERISA and 29 CFR 2550.403a-1
and 2550.403b-1?
 Yes  No If no, please explain.

16a Within the past five years, has any litigation, investigation, or other enforcement proceeding (including any administrative proceeding)
regarding any MEWA, ECE, or Group Health Plan been instituted by a Federal or State agency against the MEWA or ECE, a trustee,
or a director, owner, partner, senior manager, or officer of the sponsoring entity? If yes, please identify each litigation or enforcement
proceeding to include (if applicable): (1) the case number, (2) the date, (3) the nature of the proceedings, (4) the court, (5) all
parties (for example, plaintiffs and defendants or petitioners and respondents), and (6) the disposition.
 Yes  No

16b Have any of the persons or entities listed in this Part II ever been the subject of any criminal or civil investigation or action involving
dishonesty or breach of trust or been convicted of a felony?
 Yes  No If yes, please explain.
16c Have any cease and desist orders been issued by a Federal or State agency against any persons or entities listed in this
Part II?
 Yes  No
If yes, please list the issuing entities and the year in which each order was issued.

Page 3

Form M-1
17

Complete the following chart:

17a
Enter all
States
where the
MEWA
or ECE is
operating.

18

17b
17c
Is coverage State
provided?
registration
number.

17d
Name of
state agent
or entity for
service of
process.

17e
Is the entity
a licensed
health
insurer in
this State?

17f
If yes to
17e, enter
NAIC
number.

17g
If no to
17e, is the
entity fully
insured?

17h
If yes to
17g, enter
name
and NAIC
number of
insurer.

17i
Does the
entity
purchase
stop loss
coverage?

17j
If yes to
17i, enter
the name
and NAIC
number of
insurer.

Of the States identified in box 17a, identify those States in which the entity conducted 20 percent or more of its business (based
on the number of participants receiving coverage for medical care).

PART III
20

21

PL
E

19 Total number of participants covered under the entity as of the last day of the year to be reported. (For Registration, Origination, or
Special Filing, report current information as of the date of the filing). ..............................................................................

INFORMATION FOR COMPLIANCE WITH PART 7 OF ERISA

If you answered yes to box 16a, in reference to any State or Federal litigation or enforcement proceeding
(including any administrative proceeding), check yes below if the allegation concerns a provision under
part 7 of ERISA, a corresponding provision under the Internal Revenue Code or Public Health Service Act,
a breach of any duty under Title I of ERISA if the underlying violation relates to a requirement under part 7
of ERISA, or a breach of a contractual obligation if the contract provision relates to a requirement under
part 7 of ERISA. ............................................................................................................................................

 Yes  No

Is this a filing for which compliance with part 7 can be evaluated?
(Note: The Self-Compliance Tool at http://www.dol.gov/ebsa/healthlawschecksheets.html may be
helpful in answering Boxes 21a-21f.) If “yes,” complete the following. ..........................................................

 Yes  No

 Yes

 No  N/A

21b Is the coverage provided by the MEWA or ECE in compliance with the Mental Health Parity Act
of 1996 and the Mental Health Parity and Addiction Equity Act of 2008 and the Department’s
regulations issued thereunder?.........................................................................................................

 Yes

 No  N/A

21c Is the coverage provided by the MEWA or ECE in compliance with the Newborns’ and Mothers’
Health Protection Act of 1996 and the Department’s regulations issued thereunder?......................

 Yes

 No  N/A

21d Is the coverage provided by the MEWA or ECE in compliance with the Women’s Health and
Cancer Rights Act of 1998?...............................................................................................................

 Yes

 No  N/A

21e Is the coverage provided by the MEWA or ECE in compliance with Michelle’s Law?........................

 Yes

 No  N/A

21f Is the coverage provided by the MEWA or ECE in compliance with the Patient Protection and
Affordable Care Act of 2010 and the Department’s regulations issued thereunder that are
applicable as of the date signed at the bottom of this form?.............................................................

 Yes

 No  N/A

SA
M

21a Is the coverage provided by the MEWA or ECE in compliance with the portability and
nondiscrimination provisions of the Health Insurance Portability and Accountability Act of 1996,
including Title I of the Genetic Information Nondiscrimination Act of 2008, and the Department of
Labor’s (Department’s) regulations issued thereunder?....................................................................

ATTACHMENTS
SIGNATURE

Under penalty of perjury and other penalties set forth in the instructions, I declare that I have examined this report, including any
accompanying attachments, and to the best of my knowledge and belief, it is true and correct. Under penalty of perjury and other
penalties set forth in the instructions, I also declare that, unless this is an extension request, this report is complete.
Signature of Administrator:
Address of Administrator:
Date:

Department of Labor
Employee Benefits Security Administration

Instructions for Form M-1
Report for Multiple Employer Welfare Arrangements (MEWAs) and Certain
Entities Claiming Exception (ECEs)
About the Form M-1
The Form M-1 is used to report information concerning a
multiple employer welfare arrangement (MEWA) and any
entity claiming exception (ECE). Reporting is required
pursuant to ERISA section 101(g), 104(a), 505 and 734
of the Employee Retirement Income Security Act of 1974
(ERISA), as amended, and 29 CFR 2520.101-2 and 103-1.
You must file the Form M-1 electronically. You cannot
file a paper Form M-1 by mail or other delivery service.
Your Form M-1 will be initially screened electronically so it
is in the filer’s best interest that the responses accurately
reflect the circumstances they were designed to report.
For more information, see the instructions for Electronic
Filing Requirement and the Form M-1 filing system at
www.askebsa.dol.gov/mewa.
The Department of Labor, EBSA, is committed to working
together with administrators to help them comply with
this filing requirement. If you have any questions (such as
whether you are required to file this report) or if you need
any assistance in completing this report, please call the
EBSA Form M-1 help desk at 202-693-8360.

with the Secretary prior to operating in a State. In
addition to the Form M-1 annual report requirement,
now MEWAs must file the Form M-1 30 days prior to
operating in any State or within 30 days of knowingly
expanding operations into an additional State,
experiencing a merger, a participant increase of 50
percent or more, or a material change.
• ECE origination and special filings. In addition
to the annual reports, ECEs now must file 30 days
prior to operating in any State or within 30 days of
knowingly expanding operations in an additional State,
experiencing a merger, a participant increase of 50
percent or more, or a material change. ECEs must only
file when such events occur for the first three years
after an “origination,” which is limited to when the ECE
first begins operating in a State, experiences a merger
or has a participant increase of 50 percent or more.
ECEs that move into an additional State or experience a
material change will not be required to file outside of the
three year window.

Table of Contents
Changes to Note
• The Form M-1 is substantively different from previous
years and now requires filers to include custodial and
financial information relating to the MEWA or ECE. Also,
the new rules impose stricter, 30-day filing deadlines
for MEWA registration and ECE origination and
special filing events. Depending on the type of event
experienced, the MEWA or ECE must file the Form M-1
either 30 days prior to or within 30 days of the event.
• All MEWAs that are employee welfare benefit plans
are now subject to the Form 5500 annual report. For
more information on the Form 5500 you can access
www.efast.dol.gov or call toll-free at 1-866-463-3278.
• Electronic Filing Only. The Form M-1 must be filed
electronically. Printed copies of the Form M-1 will no
longer be made available. Detailed information on
electronic filing is available at www.askebsa.dol.gov/
mewa. For inquiries regarding electronic filing capability,
contact the EBSA computer help desk at 202-693-8600.
• MEWA registration. The Patient Protection and
Affordable Care Act (“Affordable Care Act”) amended
section 101(g) of ERISA requiring MEWAs to register

SECTION 1: Who Must File......................................... 2
General Rules........................................................... 2
Exceptions to the Filing Requirements...................... 2
SECTION 2: When to File............................................ 3
Annual Report General Rule..................................... 3
Annual Report Exception for 2012 Filings................. 3
Registration, Origination or Special Filings............... 3
Material Change........................................................ 4
Extensions of Time.................................................... 4
Section 3: Electronic Filing......................................... 4
How to File................................................................ 4
Amended Report....................................................... 4
Final Report.............................................................. 4
Attaching Additional Pages....................................... 4
Penalties.................................................................... 4
Signature and Date................................................... 4
SECTION 4: Line-by-Line Instructions....................... 5
Part I – Purpose of Filing.......................................... 5
Part II – Custodial & Financial Information................ 5
Part III– Information for Compliance
with Part 7 of ERISA............................................. 8
Paperwork Reduction Act Notice............................. 10

SECTION 1: Who Must File
General Rules
The administrator of a MEWA must file this report
regardless of whether the entity is a group health plan.
The administrator of an ECE must file this report during the
first three years after the ECE is originated.
A MEWA is an employee welfare benefit plan or other
arrangement that is established or maintained for the
purpose of offering or providing medical care to the
employees of two or more employers (including one or
more self-employed individuals), or to their beneficiaries,
except that the term does not include any such plan or
other arrangement that is established or maintained under
or pursuant to one or more agreements that the Secretary
finds to be collective bargaining agreements, by a rural
electric cooperative, or by a rural telephone cooperative
association. See ERISA section 3(40). (Note: Many States
regulate entities as MEWAs using their own State definition
of the term. Whether or not an entity meets a State’s
definition of a MEWA for purposes of regulation under
State law is a matter of State law.)
An entity claiming exception or “ECE” is an entity that
claims it is not a MEWA on the basis that the entity
is established or maintained pursuant to one or more
agreements that the Secretary finds to be collective
bargaining agreements within the meaning of section 3(40)
(A)(i) of ERISA and 29 CFR 2510.3–40.
For more information on MEWAs, visit EBSA’s Web
site at www.dol.gov/ebsa or call the EBSA toll-free
hotline at 1-866-444-3272 and ask for the booklet entitled
MEWAs: Multiple Employer Welfare Arrangements under
the Employee Retirement Income Security Act (ERISA):
A Guide to Federal and State Regulation. For information
on State MEWA regulation, contact your State Insurance
Department.
Exceptions to the Filing Requirements
In no event is reporting required by the administrator of
a MEWA or ECE if the MEWA or ECE meets any of the
following conditions:
(1) It is licensed or authorized to operate as a health
insurance issuer in every State in which it offers or
provides coverage for medical care to employees. The
term “health insurance issuer” or “issuer” is defined,
in pertinent part, in §2590.701-2 of the Department’s
regulations as “an insurance company, insurance
service, or insurance organization (including an
HMO) that is required to be licensed to engage in the
business of insurance in a State and that is subject to
State law which regulates insurance . . . . Such term
does not include a group health plan.”
(2) It provides coverage that consists solely of excepted
benefits, which are not subject to part 7 of ERISA.

(However, if the MEWA or ECE provides coverage that
consists both of excepted benefits and other benefits
for medical care that are not excepted benefits, the
administrator of the MEWA or ECE is required to file
the Form M-1.)
(3) It is a group health plan that is not subject to ERISA,
including a governmental plan, church plan, or plan
maintained only for the purpose of complying with
workers’ compensation laws within the meaning
of sections 4(b)(1), 4(b)(2), or 4(b)(3) of ERISA,
respectively. In general, a group health plan means
an employee welfare benefit plan to the extent
that the plan provides medical care to employees
(including both current and former employees) or
their dependents (as defined under the terms of the
plan) directly or through insurance, reimbursement,
or otherwise. See ERISA section 733(a) and 29 CFR
2590.701-2.
(4) It provides coverage only through group health plans
that are not covered by ERISA, including governmental
plans, church plans, and plans maintained only for the
purpose of complying with workers’ compensation laws
within the meaning of sections 4(b)(1), 4(b)(2), or 4(b)
(3) of ERISA, respectively (or other arrangements not
subject to ERISA, such as health insurance coverage
offered to individuals other than in connection with
a group health plan, known as individual market
coverage).
In addition, in no event is reporting required by the
administrator of an entity that meets the definition of a
MEWA or ECE because one or more of the following is
true:
(1) It provides coverage to the employees of two or more
trades or businesses that share a common control
interest of at least 25 percent at any time during the
plan year, applying principles similar to the principles
applied under section 414(c) of the Internal Revenue
Code.
(2) It provides coverage to the employees of two or more
employers due to a change in control of businesses
(such as a merger or acquisition) that occurs for a
purpose other than avoiding Form M-1 filing and is
temporary in nature (i.e., it does not extend beyond the
end of the plan year following the plan year in which
the change in control occurs).
(3) It provides coverage to persons (excluding spouses
and dependents) who are not employees or former
employees of the plan sponsor, such as nonemployee
members of the board of directors or independent
contractors, and the number of such persons who
are not employees or former employees does not
exceed one percent of the total number of employees
or former employees covered under the arrangement,
determined as of the last day of the year to be
reported or determined as of the 60th day following the
date the MEWA or ECE began operating in a manner
such that a filing is required pursuant to 29 CFR
2590.101-2(e)(1)(i), (2), or (3).

Page 2

SECTION 2: When to File

(5) The MEWA experiences a material change as defined
by these instructions.

Annual Report General Rule
For purposes of these instructions, an “annual report”
refers to the annual Form M-1 filing required of all MEWAs
and certain ECEs. The annual report must be filed no
later than March 1 following any calendar year for which
a filing is required (unless March 1 is a Saturday, Sunday,
or Federal holiday, in which case the form must be filed
no later than the next business day). Filing the Form M-1
annual report, does not satisfy the requirement under
ERISA section 104 and 29 CFR 2520.103-1 to file an
annual report (Form 5500 series).

Event 1 requires a registration filing 30 days prior to the
event, while events 2-5 require a registration filing within
30 days of the event occurring. A MEWA may be required
to register more than once in a calendar year.

The administrator of an ECE must file an annual report
if the ECE was last originated at any time within 3
years before the annual filing due date. An ECE may be
originated more than once.
No annual report is required if, between October 1
and December 31, the MEWA or ECE experiences an
origination, special filing, or registration event and makes a
subsequent, timely filing.
The administrator of a MEWA or ECE that is required to
file must file the annual report using the previous calendar
year’s information. (For example, for a filing due by March
1, 2016, calendar year 2015 information should be used.)
However, the administrator of a MEWA or ECE may report
using fiscal year information if the administrator of the
MEWA or ECE has at least 6 continuous months of fiscal
year information to report. (Thus, for example, for a filing
that is due by March 1, 2016, fiscal year 2015 information
may be used if the administrator has at least 6 continuous
months of fiscal year 2015 information to report.)
Registration, Origination, or Special Filings
Additional filings are necessary when a MEWA or ECE
experiences certain events, beginning on or after July 1,
2013.
A MEWA must file a Form M-1 pursuant to §2520.101-2
of the Department’s regulations when any of the following
registration events occur:
(1) The MEWA first begins operating with regard to the
employees of two or more employers (including one
or more self-employed individuals);
(2) The MEWA begins knowingly operating in any
additional State;
(3) The MEWA begins operating following a merger with
another MEWA;
(4) The number of employees receiving coverage for
medical care under the MEWA is at least 50 percent
greater than the number of such employees on the last
day of the previous calendar year; or

A MEWA that is required to make a registration filing
must use the most recently updated Form M-1 that is
available to do so. (For example, a registration filing due
by November 1, 2016 would use the 2015 Form M-1.)
An ECE must file a Form M-1 pursuant to §2520.101-2 of
the Department’s regulations when any of the following
origination events occur:
(1) The ECE first begins operating with regard to the
employees of two or more employers (including one or
more self-employed individuals);
(2) The ECE begins operating following a merger with
another ECE (unless all of the ECEs that participate
in the merger previously were last originated at least
three years prior to the merger); and,
(3) The number of employees receiving coverage for
medical care under the ECE is at least 50 percent
greater than the number of such employees on the
last day of the previous calendar year (unless the
increase is due to a merger with another ECE under
which all ECEs that participate in the merger were last
originated at least three years prior to the merger).
Event 1 requires an origination event filing 30 days prior
to the event, while events 2 and 3 require a filing within 30
days of the event occurring.
An ECE that is required to make an origination filing must
use the most recently updated Form M-1 that is available
to do so. (For example, an origination filing due by
November 1, 2016 would use the 2015 Form M-1.)
An ECE must also file a Form M-1 when any of the
following special filing events occur within the three-year
filing period following an origination event:
(1) The ECE begins knowingly operating in any additional
State; or
(2) The ECE experiences a material change as defined by
these instructions.
Special event filings are due within 30 days of the event
occurring. An ECE may be required to file the Form M-1
more than once in a calendar year.
An ECE that is required to make a special filing must use
the most recently updated Form M-1 that is available to do
so. (For example, a special filing due by November 1, 2016
would use the 2015 Form M-1.)

Page 3

Material Change
If any of the custodial or financial information reported
on Part II of this Form M-1 changes, such change is
considered a material change and requires the MEWA or
ECE to submit a new Form M-1 filing. Note, ECEs must
only file when a material change occurs during the threeyear filing period following an origination event. A material
change will not restart the calculation of that period.
Extensions of Time
A one-time extension of time to file will automatically be
granted if the administrator of the MEWA or ECE requests
an extension. To request an extension, the administrator
must: (1) check box B(3) in Part I, and complete the rest
of Part I as it applies to the MEWA or ECE; (2) complete
boxes 1a-d, 2a-d, and 3a-c in Part II; (3) electronically
sign, date, and provide the administrator’s name at the
end of the form; and (4) electronically file this request
for extension no later than the normal due date for the
Form M-1. In such a case, the administrator will have an
additional 60 days to file a completed Form M-1. A copy
of this request for extension must be attached to the
completed Form M-1 when filed.

Section 3: Electronic Filing
How to File
The Form M-1 must be filed electronically with the
Department of Labor by going to www.askebsa.dol.gov/
mewa.
Your entries must be in the proper format in order for the
electronic system to process your filing. For example,
if a question requires you to enter a numerical account
number, you cannot enter a word. To reduce the possibility
of correspondence and penalties:
Complete all lines on the Form M-1 unless otherwise
specified.
Do not enter “N/A” or “Not Applicable” on the Form M-1
unless specifically permitted. “Yes” or “No” questions on
the Form M-1 cannot be left blank, unless specifically
permitted. Answer either “Yes” or “No,” but not both.
Do not enter social security numbers in response to
questions asking for an employer identification number
(EIN). Because of privacy concerns, the inclusion of
a social security number on the Form M-1 or on an
attachment that is open to public inspection may result in
the rejection of the filing.
Amended Report
To correct errors and/or omissions on a previously filed
Form M-1, submit a completed Form M-1 indicating the
filing is an amended report in Part I, Item B(2).

Final Report
If the administrator of a MEWA or ECE does not intend
to file a Form M-1 next year, the filing should be the final
report. For example, if this is the third filing following
an origination for an ECE, or if a MEWA has ceased
operations, the administrator should indicate this is the
final report in Part I, Item B(1).
Attaching Additional Pages
If additional pages are necessary to provide the required
information, attachments may be uploaded to your
electronic filing using the “Attachments” tab. Instructions
are provided on the filing website.
Penalties
ERISA section 502(c)(5) and 29 CFR 2560.502c-5
provides for a civil penalty for failure to file a Form M-1,
failure to file a complete Form M-1, and late Form M-1
filings. In the event of no filing, an incomplete filing, or a
late filing, a penalty may apply of up to $1,100 a day for
each day that the administrator of the MEWA fails or
refuses to file a complete report (or a higher amount if
adjusted pursuant to the Federal Civil Penalties Inflation
Adjustment Act of 1990, as amended by the Debt
Collection Improvement Act of 1996).
ERISA section 521(a) authorizes the Secretary of Labor
to issue an ex parte cease and desist order if it appears
to the Secretary that the alleged conduct of a MEWA is
fraudulent, or creates an immediate danger to the public
safety or welfare, or is causing or can reasonably be
expected to cause significant, imminent, and irreparable
public injury. ERISA section 521(e) authorizes the
Secretary to issue a summary seizure order if it appears
that a MEWA is in a financially hazardous condition.
In addition, certain other penalties may apply.
Signature and Date
For purposes of Title I of ERISA, the administrator is
required to file the Form M-1. The administrator or, if the
administrator is an entity, a person authorized to sign on
behalf of the administrator must electronically sign the
Form M-1 and submit it to the electronic filing system. If the
administrator does not electronically sign a filing, the filing
status will indicate that there is an error with your filing.
To obtain an electronic signature, go to www.askebsa.
dol.gov/mewa and register as a signer. You will be
provided with a User ID and Password. Both the User ID
and Password are needed to sign the Form M-1.
Electronic signatures on annual returns/reports filed
are governed by the applicable statutory and regulatory
requirements.
The system will prevent the submission of any filing that
does not include all required information. A completed
filing will generate a receipt confirmation code. The
administrator must keep a copy of the receipt as well as
any attachments on file as part of its records as required
by section 107 of ERISA.

Page 4

Note: Even after submission, your filing may be subject
to further, detailed review by DOL and may be deemed
deficient based upon this review. See Penalties section.
Detailed information on electronic filing is available at
www.askebsa.dol.gov/mewa. If you have questions about
using or completing the Form M-1, please contact the
Form M-1 Help Desk at 202-693-8360.

SECTION 4: Line-by-Line Instructions
Important: “Yes/No” questions must be marked “Yes” or
“No,” but not both. “N/A” is not an acceptable response
unless expressly permitted in the instructions to that line.
Note: For purposes of the Form M-1, an “annual report” is
the annual filing made by all MEWAs by March 1 and for
ECEs, the annual filing made by March 1 for the first three
years after an origination.
Part I – Purpose of Filing
Item A: Check the appropriate box indicating whether this
filing is an annual report, registration, origination, or special
filing. If it is an annual report, check the appropriate
box indicating whether calendar year or fiscal year
information is being used to complete the form. If fiscal
year information is being used, specify the month, day and
year corresponding to the information. If it is a registration,
origination, or special filing, check the appropriate box (or
boxes) indicating the reason (or reasons) for the filing.
Item B: Check the appropriate box identifying if the report
is a final report, an amended report, or a request for
extension. If this is not an amended report, final report, or
request for extension, skip to Item C.
Item C: Check the appropriate box identifying whether the
filing entity is a plan MEWA (a MEWA within the meaning
of ERISA section 3(40) that is also an employee welfare
benefit plan within the meaning of ERISA section 3(3)), a
non-plan MEWA or an ECE.
Item D: Enter the date of the most recent MEWA or ECE
Form M-1 filing. Indicate in the check box if this is the
MEWA or ECE’s first time filing a Form M-1.
Part II – Custodial & Financial Information
Box 1a and 1b: Enter the name, address, and
telephone number of the MEWA or ECE.
Box 1c: Enter any EIN used by the MEWA or ECE in
reporting to the Department of Labor or the Internal
Revenue Service. An EIN is a nine-digit employer
identification number (for example, 00-1234567) that has
been assigned by the IRS. Entities that do not have an
EIN should apply for one on Form SS-4, Application for
Employer Identification Number, as soon as possible.
You can obtain Form SS-4 by calling 1-800-829-4933 or
at the IRS Web site at www.irs.gov. EBSA does NOT
issue EINs. If the MEWA or ECE does not have any EINs
associated with it, leave Box 1c blank.

Box 1d: Enter any plan number used by the MEWA
or ECE. A plan number or “PN” is a three-digit number
assigned to a plan or other entity by an employer or plan
administrator. For plans or other entities providing welfare
benefits, the first plan number should be number 501 and
additional plans should be numbered consecutively. For
MEWAs or ECEs that file a Form 5500 Annual Return/
Report of Employee Benefit Plan (Form 5500), the
same PN should be used for the Form M-1. (For more
information on the Form 5500 you can access www.efast.
dol.gov or call toll-free at 1-866-463-3278.) If the MEWA
or ECE does not have any PNs associated with it, leave
Box 1d blank.
For Boxes 1c and 1d, list only EINs and PNs used by the
MEWA or ECE itself and not those used by group health
plans or employers that purchase coverage through the
MEWA or ECE.
Box 2a and 2b: Enter the name, address, and telephone
number of the administrator of the MEWA or ECE. The
term “administrator” is defined in §2520.101-2 of the
Department’s regulations as:
(1) The person specifically so designated by the terms
of the instrument under which the MEWA or ECE is
operated;
(2) If the MEWA or ECE is a group health plan and the
administrator is not so designated, the plan sponsor
(as defined in section 3(16)(B) of ERISA); or
(3) In the case of a MEWA or ECE for which an
administrator is not designated and a plan sponsor
cannot be identified, jointly and severally, the person
or persons actually responsible (whether or not so
designated under the terms of the instrument under
which the MEWA or ECE is operated) for the control,
disposition, or management of the cash or property
received by or contributed to the MEWA or ECE,
irrespective of whether such control, disposition, or
management is exercised directly by such person or
persons or indirectly through an agent, custodian, or
trustee designated by such person or persons.
Box 2c: Enter any EIN used by the administrator in
reporting to the Department of Labor or the Internal
Revenue Service. For this purpose, use only an EIN
associated with the administrator as a separate entity. Do
not use any EIN associated with the MEWA or ECE itself.
Box 2d: Enter the e-mail address of the administrator of
the MEWA or ECE.
Boxes 3a through 3c: Enter the name, address, and
telephone number of the entity or entities sponsoring
the MEWA or ECE, and any EIN used by the sponsor
in reporting to the Department of Labor or the Internal
Revenue Service. For purposes of the Form M-1, the
sponsor is either:
(1) the plan sponsor as defined in ERISA section 3(16)(B)
if the MEWA or ECE is a group health plan; or
(2) the entity that establishes or maintains the MEWA or
ECE if the MEWA or ECE is not a group health plan.

Page 5

For this purpose, use only an EIN associated with the
sponsor. Do not use any EIN associated with the MEWA or
ECE itself. If the filing entity does not have a sponsor, leave
Boxes 3a through 3c blank and skip to Box 4a.
Boxes 4a through 4c: Enter the name, address,
telephone number, and e-mail address of the agent
for service of process or registered agent on behalf of
the MEWA or ECE. An agent for service of process or
registered agent is a person appointed by the MEWA or
ECE to receive legal notices on behalf of the MEWA or
ECE.
Boxes 5a through 5c: Enter the name, address,
telephone number, and email address of each member of
the Board of Directors, as well as each officer, trustee, or
custodian of the MEWA or ECE. You may attach additional
pages if necessary to provide all required information on
each board member. If the filing entity does not have a
Board of Directors or officer, trustee or custodian, leave
Boxes 5a through 5c blank and skip to Box 6a.
Boxes 6a through 6d: Enter the name, address,
telephone number, and email address of each promoter or
agent responsible for marketing the MEWA or ECE, and
any EIN used by such in reporting to the Department of
Labor or the Internal Revenue Service. For this purpose,
use only an EIN associated with the promoter or agent.
Do not use any EIN associated with the MEWA or ECE
itself. If there is no such promoter or agent, leave Boxes 6a
through 6d blank and skip to Box 7a.
Boxes 7a through 7b: Enter the name, address, and
telephone number of each person, financial institution(s),
or other entity holding assets for the MEWA or ECE.
Boxes 8a through 8c: Enter the name, address,
telephone number, and e-mail address of each actuary
or actuaries providing services to the MEWA or ECE.
An actuary is a professional who examines risk and is in
charge of evaluating the likelihood of future events. An
actuary should be an associate or fellow of the Society
of Actuaries and a member of the American Academy of
Actuaries and be able to judge the actuarial soundness of
the arrangement. Boxes 8a through 8c are mandatory if
you answer “Yes” to Box 13.
Box 8d: Enter any EIN used by the actuary in reporting to
the Department of Labor or the Internal Revenue Service.
For this purpose, use only an EIN associated with the
actuary. Do not use any EIN associated with the MEWA or
ECE itself. If there is no actuary, leave Boxes 8a through
8d blank and skip to Box 9a.
Boxes 9a through 9d: Enter the name, address,
telephone number, and e-mail address of each third party
administrator (TPA) providing services to the MEWA
or ECE, and any EIN used by such in reporting to the
Department of Labor or the Internal Revenue Service. For
this purpose, use only an EIN associated with the TPA. Do
not use any EIN associated with the MEWA or ECE itself. If
there is no such TPA, leave Boxes 9a through 9d blank and
skip to Box 10a.

Boxes 10a through 10d: Enter the name, address,
telephone number, and email address of each person or
entity that has authority or control of the MEWA’s or ECE’s
assets, or of assets paid by plans or employers to the
MEWA or ECE, and any EIN used by such in reporting to
the Department of Labor or the Internal Revenue Service.
For this purpose, use only an EIN associated with the
person or entity. Do not use any EIN associated with the
MEWA or ECE itself.
Boxes 11a through 11d: Enter the name, address,
telephone number, and email address of each person
or entity that has discretionary authority, control or
responsibility with respect to the administration of the
MEWA or ECE, and any EIN used by such in reporting to
the Department of Labor or the Internal Revenue Service.
For this purpose, use only an EIN associated with the
person or entity. Do not use any EIN associated with the
MEWA or ECE itself.
Boxes 12a through 12d: Enter the names, address, and
telephone number of the MEWAs or ECEs who were
involved in a merger with the filing entity, any EIN used by
such entity (or entities) in reporting to the Department of
Labor or Internal Revenue Service, and any PN assigned
to the plans or entities involved. If no merger has occurred,
skip to Box 13.
Boxes 13 through 16c: Answer “yes” or “no” to the
questions in this section. If your response requires
additional explanation, identify the necessary information
and attach pages as needed.
Box 13: With respect to Box 13, check “yes” or “no” as
applicable. For this purpose, only check “yes” if the opinion
is in writing and current within the last year. If you mark
“yes,” you must also complete Boxes 8a through 8c.
Boxes 14a and 14b: With respect to Boxes 14a and 14b,
check “yes” or “no” as applicable. If “yes,” provide the name
of the issuer in the space provided.
Box 15: With respect to Box 15, check “yes” or “no” as
applicable. If you answer “no,” include an explanation in the
space provided or attach additional documents.
Boxes 16a through 16c: With respect to Boxes 16a
through 16c, check “yes” or “no” as applicable.
If you check “yes” to Box 16a, you must identify each
proceeding and attach pages as needed to include (1)
the case number, (2) the case date, (3) the nature of the
proceedings, (4) the court, (5) all parties (for example,
plaintiffs and defendants or petitioners and respondents),
and (6) the disposition. For this purpose, include only
audits and investigations that result in corrective action.
If you check “yes” to Box 16b, provide additional
explanation as appropriate.
If you check “yes” to Box 16c, list the issuing entities and
the year in which each order was issued.

Page 6

Boxes 17a through 17j: Complete the chart with the
information that is current as of the date of filing, except
for an annual report, which must reflect the information
that is current as of the last day of the previous calendar
year or fiscal year. See “Annual Report” paragraph in
Section 2. When completing the chart, complete Box 17a
first. Then for each row, complete Boxes 17b through 17j
as it applies to the State listed in Box 17a.
Box 17a. Enter all States in which the MEWA or ECE
provides benefits for medical coverage. For this purpose,
list the State(s) where the employers (of the employees
receiving coverage) are domiciled. State means State
within the meaning of 29 CFR 2590.701–2. Indicate if a
State was not included on previous M-1 filings by
checking the “New State?” Box.
For example, consider MEWA A is located in State A
and provides coverage to the employees of an Employer
B located in State B. Employer B has employees located
in State A, State B, and State C. In this example, MEWA
A would report State B in Box 17a. However, State A and
State C would not be listed because it is not a State
where an Employer with employees receiving coverage
from a MEWA is domiciled.
Box 17b. For each State listed in Box 17a, specify
whether or not coverage is provided in that State.
Box 17c. For each State listed in Box 17a, specify the
State registration number for the MEWA or ECE.
Box 17d. For each State listed in Box 17a, state the
name of the agent or entity for service of process in that
State.
Box 17e. For each State listed in Box 17a, respond
“yes” or “no” to whether the entity is licensed or otherwise
authorized to operate as a health insurance issuer in each
State listed in that row. For more information on whether
an entity that is a licensed or registered MEWA or ECE in
a State meets the definition of a health insurance issuer in
that State, contact the State Insurance Department.
Box 17f. For each “yes” answer in Box 17e, enter the
National Association of Insurance Commissioners (NAIC)
number.
Box 17g. For each “no” answer in Box 17e, specify
whether the MEWA or ECE is fully insured through one or
more health insurance issuers in each State.
Box 17h. For each “yes” answer in Box 17g, enter the
name of the insurer and its NAIC number (if available). If
there is more than one insurer, enter all insurers and their
NAIC numbers (if available).
Box 17i. In each State listed in Box 17a, specify whether
the MEWA or ECE has purchased any stop-loss coverage.
For this purpose, stop-loss coverage includes any
coverage defined by the State as stop-loss coverage. Stoploss coverage also includes any financial reimbursement
instrument that is related to liability for the payment of
health claims by the MEWA or ECE, including reinsurance
and excess loss insurance.
Box 17j. For each “yes” answer in Box 17i, enter the
name of the stop-loss insurer and its NAIC number (if
available). If there is more than one stop-loss insurer, enter
all stop-loss insurers and their NAIC numbers (if available).

Box 18: Of the States identified in Box 17a, identify all
States in which the MEWA or ECE conducted 20 percent
or more of its business (based on the number of
participants receiving coverage for medical care under the
MEWA or ECE).
For example, consider a MEWA that offers or provides
coverage to the employees of six employers. Two
employers are located in State X and 70 participants
in the MEWA receive coverage through these two
employers. Three employers are located in State Y and 30
participants in the MEWA receive coverage through these
three employers. Finally, one employer is located in State
Z and 200 participants in the MEWA receive coverage
through this employer. In this example, the administrator of
the MEWA should specify State X and State Z under Box
18 because the MEWA conducts 23 1/3 percent of its
business in State X (70/300 = 23 1/3 percent) and 66 2/3
percent of its business in State Z (200/300 = 66 2/3
percent). However, the administrator should not specify
State Y because the MEWA conducts only 10 percent of its
business in State Y (30/300 = 10 percent). Complete Box
18 with information that is current as of the date of filing,
except for an annual report, which may reflect the
information that is current as of the last day of the previous
calendar year or fiscal year.
Box 19: Identify the total number of participants covered
under the MEWA or ECE. For more information on
determining the number of participants, see the
Department of Labor’s regulations at 29 CFR 2510.3-3(d).
The description of ‘‘participant’’ in the instructions below is
only for purposes of this Box.
An individual becomes a participant covered under a
MEWA or ECE on the earliest of:
•
•

•

the date designated by the MEWA or ECE as the date
on which the individual begins participation in the
MEWA or ECE;
the date on which the individual becomes eligible
under the MEWA or ECE for a benefit subject only to
occurrence of the contingency for which the benefit is
provided; or
the date on which the individual makes a contribution to
the MEWA or ECE, whether voluntary or mandatory.

See 29 CFR 2510.3-3(d)(1). This includes former
employees who are receiving group health continuation
coverage benefits pursuant to Part 6 of ERISA and who
are covered by the MEWA or ECE. Covered dependents
are not counted as participants. A child who is an
“alternate recipient” entitled to health benefits under a
qualified medical child support order (QMCSO) should not
be counted as a participant . An individual is not a
participant covered under a MEWA or ECE on the earliest
date on which the individual (a) is ineligible
to receive any benefit under the MEWA or ECE even if
the contingency for which such benefit is provided should
occur, and (b) is not designated by the MEWA or ECE as a
participant. See 29 CFR 2510.3-3(d)(2).
If the report is a registration, origination, or special filing,
complete this item with information that is current as of
the date of the filing. Otherwise, complete this item with
information that is current as of the last day of the year to
be reported. (See Section 2 on Annual Report General
Rule.)

Page 7

Part III– Information for Compliance with
Part 7 of ERISA
Background Information on Part 7 of ERISA:
The Health Insurance Portability and Accountability Act
of 1996 (Pub. L. 104–191) (HIPAA) amended ERISA to
provide for, among other things, improved portability and
continuity of health insurance coverage. The Mental Health
Parity Act of 1996 (Pub. L. 104– 204, as amended by Pub.
L. 107–116 and Pub. L. 107–147) (MHPA) amended ERISA
to provide parity in the application of annual and lifetime
dollar limits for certain mental health benefits with such
dollar limits on medical and surgical benefits. The Paul
Wellstone and Pete Domenici Mental Health Parity and
Addiction Equity Act of 2008 (Pub. L. 110-343) (MHPAEA)
amended ERISA by expanding the MHPA rules to provide
benefits for substance use disorders, as well as added
new rules for parity in financial requirements and treatment
limitations. The Newborns’ and Mothers’ Health Protection
Act of 1996 (Pub. L. 104–204) (Newborns’ Act) amended
ERISA to provide new protections for mothers and their
newborn children with regard to the length of hospital stays
in connection with childbirth. The Women’s Health and
Cancer Rights Act of 1998 (Pub. L. 105–277) (WHCRA)
amended ERISA to provide individuals new rights for
reconstructive surgery in connection with a mastectomy.
The Genetic Information Nondiscrimination Act of 2008
(Pub. L. 110-233) (GINA) amended ERISA to prohibit the
use of genetic information to adjust group premiums or
contributions, prohibit the collection of genetic information,
and prohibit requesting individuals to undergo genetic
testing. Michelle’s Law (Pub. L. 110-381) amended ERISA
to prohibit group health plans and issuers from terminating
coverage for a dependent child, whose enrollment in
the plan requires student status at a postsecondary
educational institution, if the student status is lost as a
result of a medically necessary leave of absence. The
Patient Protection and Affordable Care Act (Pub. L. 111148) (the Affordable Care Act) amended ERISA to provide
a wide range of protections for participants of group health
plans. All of the foregoing provisions are set forth in part 7
of subtitle B of title I of ERISA (part 7).
The Department of Labor has published informal guidance
in its publication, Health Benefits Coverage Under Federal
Law. This publication provides assistance in understanding
the HIPAA portability, HIPAA nondiscrimination, CHIPRA,
GINA, WHCRA, and Newborns’ Act requirements.
Information on the Affordable Care Act is available on
EBSA’s website at www.dol.gov/ebsa/healthreform.
Additionally, the website will be updated when any new
information or guidance relevant to part 7 of ERISA is
made available. A Self-Compliance Tool, which may
be used to help assess an entity’s compliance with
part 7 of ERISA, is available at http://www.dol.gov/
ebsa/healthlawschecksheets.html. This tool provides
information guidance with respect to all the provisions
listed above.
General Information Regarding the Applicability of
Part 7: In general, the foregoing provisions apply to group
health plans and health insurance issuers in connection
with a group health plan.

Many MEWAs and ECEs are group health plans or health
insurance issuers. However, even if a MEWA or ECE is
neither a group health plan nor a health insurance issuer,
if the MEWA or ECE offers or provides benefits for medical
care through one or more group health plans, the coverage
is required to comply with part 7 of ERISA and the MEWA
or ECE is required to complete Boxes 20 through 21f.
Part 7 of ERISA does not apply to any group health plan
or group health insurance issuer in relation to its provision
of excepted benefits. Certain benefits that are generally
not health coverage are excepted in all circumstances.
These benefits are: coverage only for accidents (including
accidental death and dismemberment), disability income
insurance, liability insurance (including general liability
insurance and automobile liability insurance), coverage
issued as a supplement to liability insurance, workers’
compensation or similar insurance, automobile medical
payment insurance, credit-only insurance (for example,
mortgage insurance), and coverage for on-site medical
clinics.
Other benefits that generally are health coverage are
excepted if certain conditions are met. Specifically, limited
scope dental benefits, limited scope vision benefits, and
long-term care benefits are excepted if they are provided
under a separate policy, certificate, or contract of insurance,
or are otherwise not an integral part of the group health
plan. Benefits provided under a health flexible spending
arrangement may also qualify as excepted benefits if
certain requirements are met. For more information on
limited excepted benefits, see the Department of Labor’s
regulations at 29 CFR 2590.732(c)(3).
In addition, noncoordinated benefits may be excepted
benefits. The term “noncoordinated benefits” refers to
coverage for a specified disease or illness (such as
cancer-only coverage) or hospital indemnity or other fixed
dollar indemnity insurance (such as insurance that pays
$100/day for a hospital stay as its only insurance benefit),
if three conditions are met. First, the benefits must be
provided under a separate policy, certificate, or contract
of insurance. Second, there can be no coordination
between the provision of these benefits and an exclusion
of benefits under a group health plan maintained by the
same plan sponsor. Third, benefits must be paid without
regard to whether benefits are provided with respect to
the same event under a group health plan maintained by
the same plan sponsor. For more information on these
noncoordinated excepted benefits, see the Department of
Labor’s regulations at 29 CFR 2590.732(c)(4).
Finally, supplemental benefits may be excepted if
certain conditions are met. Specifically, the benefits are
excepted only if they are provided under a separate policy,
certificate or contract of insurance, and the benefits are
Medicare supplemental (commonly known as “Medigap”
or “MedSupp”) policies, TRICARE supplements, or
supplements to certain employer group health plans.
Such supplemental coverage cannot duplicate primary
coverage and must be specifically designed to fill gaps in
primary coverage, coinsurance, or deductibles. For more
information on supplemental excepted benefits, see the
Department of Labor’s Field Assistance Bulletin 2007-04.

Page 8

Note that retiree coverage under a group health plan that
coordinates with Medicare may serve a supplemental
function similar to that of a Medigap policy. However,
such employer-provided retiree “wrap around” benefits
are not excepted benefits (because they are expressly
excluded from the definition of a Medicare supplemental
policy in section 1882(g)(1) of the Social Security Act).
For more information on supplemental excepted benefits,
see the Department of Labor’s regulations at 29 CFR
2590.732(c)(5).
Relation to Other Laws: States may, under certain
circumstances, impose stricter laws with respect to health
insurance issuers. Generally, questions concerning
State laws should be directed to that State’s Insurance
Department.
For More Information: Guidance material and additional
compliance assistance information that may be helpful in
understanding the requirements listed above is available in
publications, fact sheets, and frequently asked questions
available on EBSA’s website at www.dol.gov/ebsa.
Interested persons may also call and speak to a benefits
advisor about these laws using the EBSA toll-free hotline
at 1-866-444-3272.
Box 20: With respect to Box 20, check “yes” or “no” as
applicable. Check “yes” if you answered “yes” in Box 16a
and such litigation or enforcement proceeding was related
to a provision under part 7 of ERISA.
Box 21: In general, if you are the administrator of a
MEWA or ECE that is a group health plan or health
insurance issuer or a MEWA or ECE that provides
benefits for medical care to employees through one or
more group health plans, you must answer “yes” to Box
21 and then proceed to Boxes 21a-21f. For purposes of
determining if a MEWA or ECE is in compliance with these
provisions, the administrator should check the relevant
statutory provisions implementing regulations. In addition,
the Self-Compliance Tool at http://www.dol.gov/ebsa/
healthlawschecksheets.html may be helpful in answering
Boxes 21a through 21f. For MEWAs or ECEs who are not
yet providing benefits and so are unable to evaluate their
compliance with part 7 as of the date the Form M-1 is filed,
check “no” and proceed to the signature.
Box 21a: The HIPAA portability requirements added
sections 701, 702, and 703 of ERISA. Title I of GINA
amended section 702 of ERISA.
General Applicability. In general, you must answer
“yes” or “no” to this question if you are the administrator
of a MEWA or ECE that is a group health plan or health
insurance issuer or a MEWA or ECE that provides benefits
for medical care to employees through one or more group
health plans.
Exceptions. You may answer “N/A” if either of the
following paragraphs apply:
(1) The MEWA or ECE is a small health plan (as
described in section 732(a) of ERISA and
§2590.732(b) of the Department’s regulations)
(2) The MEWA or ECE offers coverage only to small group
health plans (as described in section 732(a) of ERISA
and §2590.732(b) of the Department’s regulations).

Box 21b: MHPA added section 712 of ERISA. MHPAEA
amended section 712 of ERISA.
General Applicability. In general, you must answer
“yes” or “no” to this question if you are the administrator
of a MEWA or ECE that is a group health plan or health
insurance issuer or a MEWA or ECE that provides benefits
for medical care to employees through one or more group
health plans.
Exceptions. You may answer “N/A” if any of the following
paragraphs apply:
(1) The MEWA or ECE is a small group health plan
(as described in section 732(a) of ERISA and
§2590.732(b) of the Department’s regulations).
(2) The MEWA or ECE offers coverage only to small group
health plans (as described in section 732(a) of ERISA
and §2590.732(b) of the Department’s regulations).
(3) The MEWA or ECE does not provide both medical/
surgical benefits and mental health benefits.
(4) The MEWA or ECE offers or provides coverage only to
small employers (as described in the small employer
exemption contained in section 712(c)(1) of ERISA
and §2590.712(e) of the Department’s regulations).
(5) The coverage has satisfied the requirements for the
increased cost exemption (described in section 712(c)
of ERISA and §2590.712(f) of the Department’s
regulations).
Box 21c: The Newborns’ Act added section 711 of ERISA.
General Applicability. In general, you must answer
“yes” or “no” to this question if you are the administrator
of a MEWA or ECE that is a group health plan or health
insurance issuer or a MEWA or ECE that provides benefits
for medical care to employees through one or more group
health plans.
Exceptions. You may answer “N/A” if either of the
following paragraphs apply:
(1) The MEWA or ECE does not provide benefits for
hospital lengths of stay in connection with childbirth.
(2) The MEWA or ECE is subject to State law regulating
such coverage, instead of the Federal Newborns’
Act requirements, in all States identified in Box 17a,
in accordance with section 711(f) of ERISA and
§2590.711(e) of the Department’s regulations.
Box 21d: WHCRA added section 713 of ERISA.
General Applicability. In general, you must answer
“yes” or “no” to this question if you are the administrator
of a MEWA or ECE that is a group health plan or health
insurance issuer or a MEWA or ECE that provides benefits
for medical care to employees through one or more group
health plans.
Exceptions. You may answer “N/A” if any of the following
paragraphs apply:
(1) The MEWA or ECE is a small health plan (as
described in section 732(a) of ERISA and
§2590.732(b) of the Department’s regulations).
(2) The MEWA or ECE offers coverage only to small group
health plans (as described in section 732(a) of ERISA
and §2590.732(b) of the Department’s regulations).
(3) The MEWA or ECE does not provide medical/ surgical
benefits with respect to a mastectomy.

Page 9

Box 21e: Michelle’s Law added section 714 of ERISA.
General Applicability. In general, you must answer
“yes” or “no” to this question if you are the administrator
of a MEWA or ECE that is a group health plan or health
insurance issuer or a MEWA or ECE that provides benefits
for medical care to employees through one or more group
health plans.
Exceptions. You may answer “N/A” if any of the following
paragraphs apply:
(1) The MEWA or ECE is a small health plan (as
described in section 732(a) of ERISA and
§2590.732(b) of the Department’s regulations).
(2) The MEWA or ECE offers coverage only to small group
health plans (as described in section 732(a) of ERISA
and §2590.732(b) of the Department’s regulations).
(3) The MEWA or ECE does not provide coverage to
dependents.
Box 21f: The Affordable Care Act amends section 715 of
ERISA to incorporate, by reference, changes to the PHS
Act.
General Applicability. In general, you must answer
“yes” or “no” to this question if you are the administrator
of a MEWA or ECE that is a group health plan or health
insurance issuer or a MEWA or ECE that provides benefits
for medical care to employees through one or more group
health plans.
Exceptions. You may answer “N/A” if any of the following
paragraphs apply:
(1) The MEWA or ECE is a small health plan (as
described in section 732(a) of ERISA and
§2590.732(b) of the Department’s regulations).
(2) The MEWA or ECE offers coverage only to small group
health plans (as described in section 732(a) of ERISA
and §2590.732(b) of the Department’s regulations).

Paperwork Reduction Act Notice
We ask for the information on this form to carry out the
law as specified in ERISA. You are required to give us the
information. We need it to determine whether the MEWA is
operating according to law. You are not required to respond
to this collection of information unless it displays a current,
valid OMB control number. The average time needed to
complete and file the form is estimated below. These times
will vary depending on individual circumstances.
Learning about the law or the form: 2 hrs.
Preparing the form: 1 hr. and 20 min. - 2 hrs. and 35 min.
Please send comments regarding the burden estimate
or any other aspect of this collection of information,
including suggestions for reducing this burden, to the
U.S. Department of Labor, Office of Policy and Research,
Attention: PRA Official, 200 Constitution Avenue, N.W.,
Room N-5711, Washington, DC 20210 and reference
OMB Control Number 1210-0116.

Page 10

Self-Compliance Tool for Part 7 of ERISA:
Health Care-Related Provisions
INTRODUCTION
This self-compliance tool is intended to help group
health plans, plan sponsors, plan administrators,
health insurance issuers, and other parties determine
whether a group health plan is in compliance with
some of the provisions of Part 7 of ERISA.

This self-compliance tool is not meant to be
considered legal advice. Rather, it is intended to give
the user a basic understanding of Part 7 of ERISA
to better carry out plan-related responsibilities. It
provides a summary of the statute, recent regulations
and other guidance issued by the Department.

The requirements described in this Part 7 tool
generally apply to group health plans and group
health insurance issuers. However, references in
this tool generally are limited to “group health
plans” or “plans” for convenience. In addition, these
provisions generally do not apply to retiree-only or
excepted benefits plans (See 29 CFR 2590.732).

In addition, some of the provisions discussed involve
issues for which rules have not yet been finalized.
Proposed rules, interim final rules, and transition
periods generally are noted. Periodically check the
Department of Labor’s Website (dol.gov/ebsa) under
Laws & Regulations for publication of final rules.

Cumulative List of Self-Compliance Tool Questions for Health Care-Related
Statutes Added to Part 7 of ERISA
I. Determining Compliance with the HIPAA Provisions in Part 7 of ERISA
If you answer “No” to any of the questions below, the group health plan
is in violation of the HIPAA provisions in Part 7 of ERISA.
YES

The Health Insurance Portability and Accountability Act (HIPAA) includes
provisions of Federal law governing health coverage portability, health information
privacy, administrative simplification, medical savings accounts, and long-term
care insurance. The Department of Labor is responsible for the law’s portability and
nondiscrimination requirements.
HIPAA’s portability provisions affect group health plan coverage in the following
ways:
u Provide certain individuals special enrollment rights in group health coverage
when specific events occur, e.g., birth of a child (regardless of any open season)
(see SECTION A), and
u Prohibit discrimination in group health plan eligibility, benefits, and premiums
based on specific health factors (see SECTIONS B-C).
1

NO

N/A

YES
While HIPAA previously provided for limits with respect to preexisting condition
exclusions, new protections under the Affordable Care Act now prohibit the
imposition of preexisting condition exclusions for plan years beginning on or
after January 1, 2014. For plan years beginning on or after January 1, 2014,
plans are no longer required to issue the general notice of preexisting condition
exclusion or individual notice of period of preexisting condition exclusion.
HIPAA certificates of creditable coverage must be provided through the end
of 2014 (December 31, 2014) so that individuals who may need to offset a
preexisting condition exclusion under a non-calendar year plan would still have
access to a certificate of creditable coverage through the end of 2014. See 29 CFR
2590.701-3, 5; 29 CFR 2590.715-2704 (a).
SECTION A – Compliance with the Special Enrollment Provisions
Group health plans must allow individuals (who are otherwise eligible) to enroll
upon certain specified events, regardless of any late enrollment provisions, if
enrollment is requested within 30 days (or 60 days in the case of the special
enrollment rights added by the Children’s Health Insurance Program
Reauthorization Act of 2009 (CHIPRA), discussed in Question 3) of the event.
The plan must provide for special enrollment, as follows:
Question 1 – Special enrollment upon loss of other coverage
Does the plan provide full special enrollment rights upon loss of other
coverage? ................................................................................................................
u A plan must permit loss-of-coverage special enrollment upon: (1) loss of
eligibility for group health plan coverage or health insurance coverage; and
(2) termination of employer contributions toward group health plan coverage.
See ERISA section 701(f)(1); 29 CFR 2590.701-6(a).
u When a current employee loses eligibility for coverage, the plan must permit
the employee and any dependents to special enroll. See 29 CFR 2590.7016(a)(2)(i).
u When a dependent of a current employee loses eligibility for coverage, the
plan must permit the dependent and the employee to special enroll. See 29
CFR 2590.701-6(a)(2)(ii).
Examples: Examples of reasons for loss of eligibility include: legal separation,
divorce, death of an employee, termination or reduction in the number of hours
of employment - voluntary or involuntary (with or without electing COBRA),
exhaustion of COBRA, reduction in hours, “aging out” under other parent’s
coverage, or moving out of an HMO’s service area. Loss of eligibility for
coverage does not include loss due to the individual’s failure to pay premiums or
termination of coverage for cause - such as for fraud. See 29 CFR 2590.701-6(a)
(3)(i).
u When employer contributions toward an employee’s or dependent’s coverage
terminates, the plan must permit special enrollment, even if the employee or
2

NO

N/A

YES
dependent did not lose eligibility for coverage. See 29 CFR 2590.701-6(a)
(3)(ii).
u Plans must allow an employee a period of at least 30 days to request
enrollment. See 29 CFR 2590.701-6(a)(4)(i).
u Coverage must become effective no later than the first day of the first
month following a completed request for enrollment. See 29 CFR
2590.701-6(a)(4)(ii).
Tip: Ensure that the plan permits special enrollment upon all of the loss of
coverage events described above.
Question 2 – Dependent special enrollment
Does the plan provide full special enrollment rights to individuals upon
marriage, birth, adoption, and placement for adoption? ...............................
u Plans must generally permit current employees to enroll upon marriage and
upon birth, adoption, or placement for adoption of a dependent child. See
ERISA section 701(f)(2); 29 CFR 2590.701-6(b)(2).
u Plans must generally permit a participant’s spouse and new dependents
to enroll upon marriage, birth, adoption, and placement for adoption. See
ERISA section 701(f)(2); 29 CFR 2590.701-6(b)(2).
u Plans must allow an individual a period of at least 30 days to request
enrollment. See 29 CFR 2590.701-6(b)(3)(i).
u In the case of marriage, coverage must become effective no later than the
first day of the month following a completed request for enrollment. See 29
CFR 2590.701-6(b)(3)(iii)(A).
u In the case of birth, adoption, or placement for adoption, coverage must
become effective as of the date of the birth, adoption, or placement for
adoption. See 29 CFR 2590.701-6(b)(3)(iii)(B).
Tips: Remember to allow all eligible employees, spouses, and new dependents
to enroll upon these events. Also, ensure that the effective date of coverage
complies with HIPAA, keeping in mind that some effective dates of coverage
are retroactive.
Question 3 – Special enrollment rights provided through CHIPRA
Does the plan provide full special enrollment rights as required under
CHIPRA? ...........................................................................................................
Under the following conditions a group health plan must allow an employee
or dependent (who is otherwise eligible) to enroll, regardless of any late
enrollment provisions, if enrollment is requested within 60 days:

3

NO

N/A

YES
u When an employee or dependent’s Medicaid or CHIP coverage is terminated.
When an employee or dependent is covered under a Medicaid plan under title
XIX of the Social Security Act or under a State Children’s Health Insurance
Plan (CHIP) under title XXI of the Social Security Act and coverage of the
employee or dependent is terminated as a result of loss of eligibility, a group
health plan must allow special enrollment. The employee or dependent must
request special enrollment within 60 days after the date of termination of
Medicaid or CHIP coverage. See ERISA section 701(f)(3).
u Upon Eligibility for Employment Assistance under Medicaid or CHIP. When
an employee or dependent becomes eligible for premium assistance, with
respect to coverage under the group health plan or health insurance coverage
under a Medicaid plan or State CHIP plan, the group health plan must
allow special enrollment. The employee or dependent must request special
enrollment within 60 days after the employee or dependent is determined to
be eligible for assistance. See ERISA section 701(f)(3).
Note: In addition, employers that maintain a group health plan in a state with a
CHIP or Medicaid program that provides for premium assistance for group health
plan coverage must provide a written notice (referred to as the Employer CHIP
Notice) to each employee to inform them of possible opportunities available
in the state in which they reside for premium assistance for health coverage of
employees or dependents. A model notice is available at dol.gov/ebsa/newsroom/
fschip.html.
Question 4 – Treatment of special enrollees
Does the plan treat special enrollees the same as individuals who enroll when
first eligible, for purposes of eligibility for benefit packages and premiums?
u If an individual requests enrollment while the individual is entitled to special
enrollment, the individual is a special enrollee, even if the request for
enrollment coincides with a late enrollment opportunity under the plan. See
29 CFR 2590.701-6(d)(1).
u Special enrollees must be offered the same benefit packages available to
similarly situated individuals who enroll when first eligible. (Any difference
in benefits or cost-sharing requirements for different individuals constitutes a
different benefit package.) In addition, a special enrollee cannot be required
to pay more for coverage than a similarly situated individual who enrolls in
the same coverage when first eligible. See 29 CFR 2590.701-6(d)(2).
Question 5 – Notice of special enrollment rights
Does the plan provide timely and adequate notices of special enrollment
rights? ......................................................................................................................
u On or before the time an employee is offered the opportunity to enroll in
the plan, the plan must provide the employee with a description of special
enrollment rights.

4

NO

N/A

YES
Tip: Ensure that the special enrollment notice is provided at or before the time
an employee is initially offered the opportunity to enroll in the plan. This may
mean breaking it off from the SPD. The plan can include its special enrollment
notice in the SPD if the SPD is provided at or before the initial enrollment
opportunity (for example, as part of the application materials). If not, the special
enrollment notice must be provided separately to be timely. A model notice is
provided in the Model Disclosures on page 138.
SECTION B – Compliance with the HIPAA Nondiscrimination Provisions
Overview.
HIPAA prohibits group health plans and health insurance issuers from
discriminating against individuals in eligibility and continued eligibility for
benefits and in individual premium or contribution rates based on health factors.
These health factors include: health status, medical condition (including both
physical and mental illnesses), claims experience, receipt of health care, medical
history, genetic information, evidence of insurability (including conditions
arising out of acts of domestic violence and participation in activities such as
motorcycling, snowmobiling, all-terrain vehicle riding, horseback riding, skiing,
and other similar activities), and disability. See ERISA section 702; 29 CFR
2590.702.
Similarly Situated Individuals. It is important to recognize that the
nondiscrimination rules prohibit discrimination within a group of similarly
situated individuals. Under 29 CFR 2590.702(d), plans may treat distinct
groups of similarly situated individuals differently, if the distinctions between
or among the groups are not based on a health factor. If distinguishing among
groups of participants, plans and issuers must base distinctions on bona fide
employment-based classifications consistent with the employer’s usual business
practice. Whether an employment-based classification is bona fide is based
on relevant facts and circumstances, such as whether the employer uses the
classification for purposes independent of qualification for health coverage. Bona
fide employment-based classifications might include: full-time versus part-time
employee status; different geographic location; membership in a collective
bargaining unit; date of hire or length of service; or differing occupations. In
addition, plans may treat participants and beneficiaries as two separate groups
of similarly situated individuals. Plans may also distinguish among beneficiaries.
Distinctions among groups of beneficiaries may be based on bona fide
employment-based classifications of the participant through whom the
beneficiary is receiving coverage, relationship to the participant (such as spouse
or dependent), marital status, age of dependent children, or any other factor that
is not a health factor. However, see section 2714 of the PHS Act, as amended by
the Affordable Care Act and incorporated into section 715 of ERISA, for rules on
defining dependents under the plan. (For information regarding the Affordable
Care Act, please visit our Website at dol.gov/ebsa/healthreform).
Exception for benign discrimination: The nondiscrimination rules do not
prohibit a plan from establishing more favorable rules for eligibility or premium
rates for individuals with an adverse health factor, such as a disability. See 29
CFR 2590.702(g).
5

NO

N/A

YES
Check to see that the plan complies with HIPAA’s nondiscrimination provisions
as follows:
Question 6 – Nondiscrimination in eligibility
Does the plan allow individuals eligibility and continued eligibility under the
plan regardless of any adverse health factor? .....................................................
u Examples of plan provisions that violate ERISA section 702(a) because they
discriminate in eligibility based on a health factor include:
v Plan provisions that require “evidence of insurability,” such as passing a
physical exam, providing a certification of good health, or demonstrating
good health through answers to a health care questionnaire in order to
enroll. See 29 CFR 2590.702(b)(1).
u Also, note that it may be permissible for plans to require individuals to
complete physical exams or health care questionnaires for purposes other
than for determining eligibility to enroll in the plan, such as for determining
an appropriate blended, aggregate group rate for providing coverage to the
plan as a whole. See 29 CFR 2590.702(b)(1)(iii) Example 1.
Tip: Eliminate plan provisions that deny individuals eligibility or continued
eligibility under the plan based on a health factor, even if such provisions apply
only to late enrollees.
Question 7 – Nondiscrimination in benefits
Does the plan uniformly provide benefits to participants and beneficiaries,
without directing any benefit restrictions at individual participants and
beneficiaries based on a health factor? ................................................................
u Benefits provided must be uniformly available and any benefit restrictions
must be applied uniformly to all similarly situated individuals and cannot
be directed at any individual participants or beneficiaries based on a health
factor. If benefit exclusions or limitations are applied only to certain
individuals based on a health factor, this would violate ERISA section 702(a)
and 29 CFR 2590.702(b)(2).
u Examples of plan provisions that may be permissible under ERISA section
702(a) include:
v Limits or exclusions for certain types of treatments or drugs,
v Limitations based on medical necessity or experimental treatment, and
v Cost-sharing,
if the limit applies uniformly to all similarly situated individuals and is not
directed at individual participants or beneficiaries based on a health factor.
However, other provisions of law, such as the Affordable Care Act, may prohibit
some of these limitations (such as PHS Act section 2713, requiring plans and
issuers to provide coverage for, and not impose cost-sharing requirements with

6

NO

N/A

YES
respect to, certain recommended preventive services. (For information regarding
the Affordable Care Act, please visit our Website at dol.gov/ebsa/healthreform).
Question 8 – Source-of-injury restrictions
If the plan imposes a source-of-injury restriction, does it comply with the
HIPAA nondiscrimination provisions? ................................................................
u Plans may exclude benefits for the treatment of certain injuries based on the
source of that injury, except that plans may not exclude benefits otherwise
provided for treatment of an injury if the injury results from an act of
domestic violence or a medical condition. See 29 CFR 2590.702(b)(2)(iii).
An example of a permissible source-of-injury exclusion would include:
v A plan provision that provides benefits for head injuries generally, but
excludes benefits for head injuries sustained while participating in
bungee jumping.
u An impermissible source-of-injury exclusion would include:
v A plan provision that generally provides coverage for medical/surgical
benefits, including hospital stays that are medically necessary, but
excludes benefits for self-inflicted injuries or attempted suicide. This is
impermissible because the plan provision excludes benefits for treatment
of injuries that may result from a medical condition (depression).
u If the plan does not impose a source-of-injury restriction, check “N/A” and
skip to Question 9.
Question 9 – Nondiscrimination in premiums or contributions
Does the plan comply with HIPAA’s nondiscrimination rules regarding
individual premium or contribution rates? .........................................................
u Under ERISA section 702(b) and 29 CFR 2590.702(c), plans may not require
an individual to pay a premium or contribution that is greater than a premium
or contribution for a similarly situated individual enrolled in the plan on the
basis of any health factor. For example, it would be impermissible for a plan
to require certain full-time employees to pay a higher premium than other
full-time employees based on their prior claims experience.
u Nonetheless, the nondiscrimination rules do not prohibit a plan from
providing a reward based on adherence to a wellness program. See ERISA
section 702(b)(2)(B); PHS Act section 2705. Final rules for wellness
programs were published on June 6, 2013 at 29 CFR 2590.702 and 29
CFR 2590.715-2705. (These rules were issued through authority under
the Affordable Care Act (PHS section 2705) and under the HIPAA
nondiscrimination provisions. These rules apply to both grandfathered and
nongrandfathered group health plans.)

7

NO

N/A

YES
To help evaluate whether this exception is available, refer to SECTION C on
page 70. Once you have completed SECTION C, return to this page to continue
with Question 10, below.
Question 10 – List billing
Is there compliance with the list billing provisions? ...........................................
u Under 29 CFR 2590.702(c)(2)(ii), plans and issuers may not charge or quote
an employer a different premium for an individual in a group of similarly
situated individuals based on a health factor. This practice is commonly
referred to as list billing. If an issuer is list billing an employer and the plan is
passing the separate and different rates on to the individual participants and
beneficiaries, both the plan and the issuer are violating the prohibition against
discrimination in premium rates. This does not prevent plans and issuers
from taking the health factors of each individual into account in establishing
a blended/aggregate rate for providing coverage to the plan.
Note: Plans and issuers are not permitted to adjust premium or contribution rates
based on genetic information of one or more individuals in the group. For more
information on discrimination based on genetic information, refer to SECTION
V. Note also that, under the Affordable Care Act, certain premium rating
requirements apply to health insurance coverage in the small group market. Visit
HealthCare.gov for more information.
Question 11 – Nonconfinement clauses
Is the plan free of any nonconfinement clauses? .................................................
u Typically, a nonconfinement clause will deny or delay eligibility for some
or all benefits if an individual is confined to a hospital or other health
care institution. Sometimes nonconfinement clauses also deny or delay
eligibility if an individual cannot perform ordinary life activities. Often a
nonconfinement clause is imposed only with respect to dependents, but they
sometimes are also imposed with respect to employees. 29 CFR 2590.702(e)
(1) explains that these nonconfinement clauses violate ERISA sections 702(a)
(if the clause delays or denies eligibility) and 702(b) (if the clause raises
individual premiums).
Tip: Delete all nonconfinement clauses.
Question 12 – Actively-at-work clauses
Is the plan free of any impermissible actively-at-work clauses?.........................
u Typically, actively-at-work provisions delay eligibility for benefits based on
an individual being absent from work. 29 CFR 2590.702(e)(2) explains that
actively-at-work provisions generally violate ERISA sections 702(a) (if the
clause delays or denies eligibility) and 702(b) (if the clause raises individual
premiums or contributions), unless absence from work due to a health factor
is treated, for purposes of the plan, as if the individual is at work.

8

NO

N/A

YES
Nonetheless, an exception provides that a plan may establish a rule for
eligibility that requires an individual to begin work for the employer
sponsoring the plan before eligibility commences. Further, plans may
establish rules for eligibility or set any individual’s premium or contribution
rate in accordance with the rules relating to similarly situated individuals
in 29 CFR 2590.702(d). For example, a plan that treats full-time and parttime employees differently for other employment-based purposes, such as
eligibility for other employee benefits, may distinguish in rules for eligibility
under the plan between full-time and part-time employees.
Tip: Carefully examine any actively-at-work provision to ensure consistency
with HIPAA.
SECTION C – Compliance with the Wellness Program Provisions
Use the following questions to help determine whether the plan offers a program
of health promotion or disease prevention that is required to comply with
the Department’s final wellness program regulations and, if so, whether the
program is in compliance with the regulations. See final regulations issued by
the Departments on June 6, 2013 at 29 CFR 2590.702 and 29 CFR 2590.7152705. These regulations use joint authority under HIPAA and the ACA and
apply for plan years beginning on or after January 1, 2014, however regulations
under HIPAA’s nondiscrimination provisions relating to wellness programs
were applicable for plan years prior to the applicability of these final wellness
program rules. The requirements relating to wellness programs apply to both
grandfathered and non-grandfathered group health plans (See further discussion
of grandfather status under the ACA section VII, A of this tool).
Question 13 – Does the plan have a wellness program? .....................................
u A wide range of wellness programs exist to promote health and prevent
disease. However, these programs are not always labeled “wellness
programs.” Examples include: a program that reduces individuals’ costsharing for complying with a preventive care plan; a diagnostic testing
program for health problems; and rewards for attending educational classes,
following healthy lifestyle recommendations, or meeting certain biometric
targets (such as weight, cholesterol, nicotine use, or blood pressure targets).
Tip: Ignore the labels – wellness programs can be called many things. Other
common names include: disease management programs, smoking cessation
programs, and case management programs.
Question 14 – Is the wellness program part of a group health plan? ................
u The wellness program is only subject to Part 7 of ERISA if it is part of a
group health plan. If the employer operates the wellness program separate
from the group health plan, the program may be regulated by other laws, but
it is not subject to the group health plan rules discussed here.

9

NO

N/A

YES

NO

N/A

Example: An employer institutes a policy that any employee who smokes will
be fired. Here, the anti-smoking policy is not part of the group health plan, so the
wellness program rules do not apply. (But see 29 CFR 2590.702, which clarifies
that compliance with the HIPAA nondiscrimination rules, including the wellness
program rules, is not determinative of compliance with any other provision of
ERISA or any other State or Federal law, such as the Americans with Disabilities
Act.)
Question 15 – Does the program discriminate based on a health factor (i.e., is
it a health-contingent program)?...........................................................................
u A program discriminates based on a health factor if it requires an individual
to meet a standard related to a health factor in order to obtain a reward (or
requires an individual to undertake more than a similarly situated individual
based on a health factor in order to obtain the same reward). A reward can be
in the form of a discount or rebate of a premium or contribution, a waiver of
all or part of a cost-sharing mechanism (such as deductibles, copayments, or
coinsurance), an additional benefit, or any other financial or other incentive.
A reward can also be the avoidance of a penalty (such as the absence of a
surcharge, or other financial or nonfinancial disincentive).
u If none of the conditions for obtaining a reward is based on an individual
satisfying a standard that is related to a health factor (or if a wellness
program does not provide a reward), the wellness program is a participatory
wellness program. See 29 CFR 2590.702 (f)(1)(ii).
Example 1: Plan participants who have a cholesterol level under 200 will
receive a premium reduction of 30 percent. In this Example 1, the plan requires
individuals to meet a standard related to a health factor in order to obtain a
reward.
Example 2: A plan requires all eligible employees to complete a health risk
assessment to enroll in the plan. Employee answers are fed into a computer
that identifies risk factors and sends educational information to the employee’s
home address. In this Example 2, the requirement to complete the assessment
does not, itself, discriminate based on a health factor. However, if the plan used
individuals’ specific health information to discriminate in individual eligibility,
benefits, or premiums, there would be discrimination based on a health factor.
Tip: Participatory wellness programs are permissible, provided the program is
made available to all similarly situated individuals, regardless of health status.
If you answered “No” to ANY of the above questions 13-15, STOP. The plan is not subject to the HIPAA
wellness rules. If you are completing this section as part of a review of your plan, please continue to SECTION
D.

10

YES

NO

N/A

Question 16 – If the program discriminates based on a health factor, is the
program saved by the benign discrimination provisions? .................................
u The Department’s regulations at 29 CFR 2590.702(g) permit discrimination
in favor of an individual based on a health factor.
Example: A plan grants participants who have diabetes a waiver of the plan’s
annual deductible if they enroll in a disease management program that consists
of attending educational classes and following their doctor’s recommendations
regarding exercise and medication. This is benign discrimination because the
program is offering a reward to individuals based on an adverse health factor.
Tip: The benign discrimination exception is NOT available if the plan asks
diabetics to meet a standard related to a health factor (such as maintaining
a certain body mass index (BMI)) in order to get a reward. In this case, an
intervening discrimination is introduced and the plan cannot rely solely on the
benign discrimination exception.
If you answered “Yes” to this question, STOP. There does not appear to be a violation of the wellness program
rules. If you are completing this section as part of a review of your plan, please continue to SECTION D.
If you answered “No” to this question, proceed to Questions 17 and 18. The health-contingent wellness
program must meet the 5 criteria.
Question 17— Within the health-contingent wellness program category, is
the program an activity-only program?................................................................
u An activity-only wellness program is a type of health-contingent wellness
program that requires an individual to perform or complete an activity
related to a health factor in order to obtain a reward but does not require
the individual to attain or maintain a specific health outcome. See 29 CFR
2590.702 (f)(1)(iv).
v Examples include walking, diet or exercise programs.
If you answered “Yes” to this question, proceed to Question 19.
If you answered “No” to this question, proceed to Question 18.
Question 18— Within the health-contingent wellness program category, is
the program an outcome-based program?............................................................
u An outcome-based wellness program is a type of health-contingent wellness
program that requires an individual to attain or maintain a specific health
outcome (such as not smoking or attaining certain results on biometric
screenings) in order to obtain a reward. See 29 CFR 2590.702 (f)(1)(iv).

11

YES
Question 19—Is the health-contingent program in compliance with the five
requirements?..............................................................................................................
A. Is the amount of the reward offered under the plan limited to 30 percent
(or 50 percent for programs designed to prevent or reduce tobacco use)
of the applicable cost of coverage? (29 CFR 2590.702 (f)(3)(ii) and 29
CFR 2590.702(f)(4)(ii)).....................................................................................
If only employees are eligible to participate, the amount of the reward must
not exceed 30 percent (or 50 percent) of the cost of employee-only coverage
under the plan. If employees and any class of dependents are eligible to
participate, the reward must not exceed 30 percent of the cost of coverage in
which an employee and any dependents are enrolled.
The 30 percent (or 50 percent) limitation on the amount of the reward
applies to all of a plan’s wellness programs that require individuals to meet a
standard related to a health factor.
Example: If the plan has two wellness programs with standards related to a
health factor, a 20 percent reward for meeting a BMI target and a 10 percent
reward for meeting a cholesterol target, it would meet the maximum limit on
the total reward available, which is 30 percent. If instead, the program offered
a 20 percent reward for meeting a body mass index target, a 10 percent reward
for meeting a cholesterol target, and a 10 percent reward for completing a health
risk assessment (regardless of any individual’s specific health information),
the rewards would not need to be adjusted because the 10 percent reward for
completing the health risk assessment does not require individuals to meet a
standard related to a health factor.
B. Is the plan reasonably designed to promote health or prevent disease?
(29 CFR 2590.702(f)(2)(iii) and 29 CFR 2590.702(f)(4)(iii)).........................
The program must be reasonably designed to promote health or prevent
disease. The program should have a reasonable chance of improving the
health of or preventing disease in participating individuals, not be overly
burdensome, not be a subterfuge for discriminating based on a health
factor, and not be highly suspect in the method chosen to promote health
or prevent disease. This determination is based on all the relevant facts and
circumstances.
C. Are individuals who are eligible to participate given a chance to qualify
at least once per year? (29 CFR 2590.702(f)(3)(i) and 29 CFR 2590.702(f)
(4)(i))..................................................................................................................

12

NO

N/A

YES
D. Is the reward available to all similarly situated individuals? Does the
program offer a reasonable alternative standard? (29 CFR 2590.702(f)
(3)(iv) and 29 CFR 2590.702(f)(4)(iv))............................................................
The wellness program rules require that the reward be available to all
similarly situated individuals. A component of meeting this criterion is
that the program must have a reasonable alternative standard (or waiver
of the otherwise applicable standard) that is furnished by the plan upon a
participant’s request.
Activity-only programs
u A reasonable alternative standard must be available for obtaining the reward
for any individual for whom, for that period, it is unreasonably difficult
due to a medical condition to satisfy the otherwise applicable standard or
medically inadvisable to attempt to satisfy the otherwise applicable standard.
See 29 CFR 2590.702(f)(3)(iv)(A)(1)
u If reasonable under the circumstances, a plan or issuer may seek verification,
such as a statement from an individual’s personal physician, that a health
factor makes it unreasonably difficult for the individual to satisfy, or
medically inadvisable for the individual to attempt to satisfy, the otherwise
applicable standard. See 29 CFR 2590.702(f)(3)(iv)(A)(2)
Outcome-based wellness programs
u The reasonable alternative standard must be available to any individual
who does not meet the initial standard based on the measurement, test, or
screening. See 29 CFR 2590.702(f)(4)(iv)(A)
u Plans may not seek verification, such as a statement from an individual’s
personal physician, that a health factor makes it unreasonably difficult for the
individual to satisfy, or medically inadvisable for the individual to attempt to
satisfy the standard. See 29 CFR 2590.702(f)(4)(iv)(E)
E. Does the plan disclose the availability of a reasonable alternative
standard in all plan materials describing the program? (29 CFR
2590.702(f)(3)(v)) .............................................................................................
The plan or issuer must disclose the availability of a reasonable alternative
standard in all plan materials describing the program and in any disclosure
that an individual did not satisfy an initial outcome-based standard. If plan
materials merely mention that the program is available, without describing its
terms, this disclosure is not required.
Tip: The disclosure does not have to say what the reasonable alternative standard
is in advance. The plan can individually tailor the standard for each individual, on
a case-by-case basis.

13

NO

N/A

YES

NO

N/A

The following sample language can be used to satisfy this requirement: “If it is
unreasonably difficult due to a medical condition for you to achieve the standards
for the reward under this program, or if it is medically inadvisable for you to
attempt to achieve the standards for the reward under this program, call us at
[insert telephone number] and we will work with you to develop another way to
qualify for the reward.”
Note: This section highlights the five requirements for a health-contingent
program and briefly describes the separate requirements for an activity-only
program and an outcome-based program. For more information on the five
requirements and differences between the activity-only and outcome-based
programs, please visit our Website at dol.gov/ebsa/healthreform.

Taking into consideration whether the health-contingent wellness program is activity-only or outcome-based:
If you answered “Yes” to all of the 5 questions on wellness program criteria, there does not appear to be a
violation of the HIPAA wellness program rules.
If you answered “No” to any of the 5 questions on wellness program criteria, the plan has a wellness program
compliance issue. Specifically,
Violation of the general benefit discrimination rule (29 CFR 2590.702(b)(2)(i), 29 CFR 2590.7152705(a)) – If the wellness program varies benefits, including cost-sharing mechanisms (such as deductible,
copayment, or coinsurance) based on whether an individual meets a standard related to a health factor and the
program does not satisfy the requirements of 29 CFR 2590.702(f), the plan is impermissibly discriminating in
benefits based on a health factor. The wellness program exception at 29 CFR 2590.702(b)(2)(ii) is not satisfied
and the plan is in violation of 29 CFR 2590.702(b)(2)(i) and 29 CFR 2590.715-2705(a).
Violation of general premium discrimination rule (29 CFR 2590.702(c)(1), 29 CFR 2590.715-2705(a)) –
If the wellness program varies the amount of premium or contribution it requires similarly situated individuals
to pay based on whether an individual meets a standard related to a health factor and the program does not
satisfy the requirements of 29 CFR 2590.702(f), the plan is impermissibly discriminating in premiums based
on a health factor. The wellness program exception at 29 CFR 2590.702(c)(3) is not satisfied and the plan is in
violation of 29 CFR 2590.702(c)(1) and 29 CFR 2590.715.2705(a).

14

YES
SECTION D – Compliance with the MEWA or Multiemployer Plan
Guaranteed Renewability Provisions
If the plan is a multiple employer welfare arrangement (MEWA) or a
multiemployer plan, it is required to provide guaranteed renewability of coverage
in accordance with ERISA section 703. If the plan is a MEWA or multiemployer
plan, it must meet the criteria described in Question 20. If the plan is not a
MEWA or multiemployer plan, check “N/A” and go to Part II of this
self-compliance tool. ................................................................................................
Question 20 – Multiemployer plan and MEWA guaranteed renewability
If the plan is a multiemployer plan, or a MEWA, does the plan provide
guaranteed renewability? ......................................................................................
u Group health plans that are multiemployer plans or MEWAs may not deny an
employer continued access to the same or different coverage, other than:
v For nonpayment of contributions;
v For fraud or other intentional misrepresentation by the employer;
v For noncompliance with material plan provisions;
v Because the plan is ceasing to offer coverage in a geographic area;
v In the case of a plan that offers benefits through a network plan, there
is no longer any individual enrolled through the employer who lives,
resides, or works in the service area of the network plan and the plan
applies this paragraph uniformly without regard to the claims experience
of employers or any health-related factor in relation to such individuals
or dependents; or
v For failure to meet the terms of an applicable collective bargaining
agreement, to renew a collective bargaining or other agreement requiring
or authorizing contributions to the plan, or to employ employees covered
by such agreement.
See ERISA section 703.
**Note: The Public Health Service (PHS) Act contains guaranteed renewability
requirements for issuers.

15

NO

N/A

II. Determining Compliance with the Mental Health Parity Act (MHPA) and
Mental Health Parity and Addiction Equity Act (MHPAEA) Provisions in Part 7 of ERISA
(together, the mental health parity provisions)
If you answer “No” to any of the questions below, the group health plan is in violation of the mental health
parity provisions in Part 7 of ERISA.
YES

Introduction
If the plan provides either mental health or substance use disorder benefits, in
addition to medical/surgical benefits, the plan may be subject to the mental health
parity provisions in Part 7 of ERISA. Retiree-only plans, and those offering
excepted benefits, are generally not subject to the mental health parity provisions
under part 7 of ERISA. See 29 CFR 2590.732 for further discussion. (Note: if
under an arrangement(s) to provide medical care by an employer or employee
organization, any participant or beneficiary can simultaneously receive coverage for
medical/surgical benefits and mental health or substance use disorder benefits, the
mental health parity requirements apply separately with respect to each combination
of medical/surgical benefits and mental health/substance use disorder benefits and
all such combinations are considered to be a single group health plan. See 29 CFR
2590.712(e).) If this is the case, answer Questions 21-28.
If the plan does not provide mental health or substance use disorder benefits, check
“N/A” here and skip to Part III of this checklist. Also, the plan may be exempt from
the mental health parity provisions under the small employer (50 employees or
fewer) exception or the increased cost exception. (To be eligible for the increased
cost exception, the plan must have filed a notice with EBSA and notified participants
and beneficiaries.) Unless a plan is exempt as previously described, the requirements
of MHPAEA generally apply to both grandfathered and non-grandfathered group
health plans13, as defined under the Affordable Care Act. Note that the Department
of Health and Human Services’ final rule regarding essential health benefits (EHB)
requires health insurance issuers offering non-grandfathered health insurance
coverage in the small group market through an Affordable Health Insurance
Exchange (Marketplace) or outside of a Marketplace to comply with MHPAEA in
order to satisfy the requirement to provide EHB.
In addition, under MHPAEA, if a plan or issuer provides mental health or substance
use disorder benefits in any classification described in the MHPAEA final regulation,
mental health or substance use disorder benefits must be provided in every
classification in which medical/surgical benefits are provided. Under the Affordable
Care Act, PHSA section 2713, non-grandfathered group health plans are required
to provide certain preventive services with no cost-sharing, which includes, among

13

Mental health and substance use disorder benefits are defined under the terms of the plan, in accordance
with applicable Federal and State law. Any condition or disorder defined by the plan as being or as not being
a mental health condition or substance use disorder must be defined in a manner consistent with generally
recognized independent standards of current medical practice (e.g., the most current version of the DSM or
ICD or State guidelines).

16

NO

N/A

YES
other things, alcohol misuse screening and counseling, depression screening,
and tobacco use screening. However, the Departments clarified that nothing in
MHPAEA requires a group health plan that provides mental health or substance
use disorder benefits only to the extent required under PHSA section 2713,
to provide additional mental health or substance use disorder benefits in any
classification.14
If the plan is exempt, check “N/A” here and skip to Part III of this checklist. .......
SECTION A. Lifetime and Annual Limits
Question 21 – Does the plan comply with the mental health parity
requirements regarding lifetime dollar limits on mental health/substance use
disorder benefits? ...................................................................................................
u A plan generally may not impose a lifetime dollar limit on mental health/
substance use disorder benefits that is lower than the lifetime dollar limit
imposed on medical/ surgical benefits. See 29 CFR 2590.712(b). (Only
limits on what the plan would pay are taken into account, as contrasted with
limits on what an individual may be charged.)
Note: These provisions are affected by section 2711 of the Public Health Service
Act, as amended by the Patient Protection and Affordable Care Act. Specifically,
PHS Act section 2711 generally prohibits lifetime and annual dollar limits on
essential health benefits (EHB), which includes mental health and substance
use disorder services. Accordingly, for mental health and substance use disorder
benefits that are EHB, plans cannot impose lifetime limits. For mental health and
substance use disorder benefits that are not EHB, parity requirements regarding
aggregate lifetime dollar limits apply. (For information regarding the Affordable
Care Act, please visit our Website at dol.gov/ebsa/healthreform).
Question 22 – Does the plan comply with the mental health parity
requirements regarding annual dollar limits on mental health/substance use
disorder benefits? ...................................................................................................
u A plan generally may not impose an annual dollar limit on mental health/
substance use disorder benefits that is lower than the annual dollar limit
imposed on medical/surgical benefits. See 29 CFR 2590.712(b). (Again, only
limits on what the plan would pay are taken into account, as contrasted with
limits on what an individual may be charged.)
Tip: There is a different rule for cumulative limits other than aggregate lifetime
or annual dollar limits discussed later in this checklist at Question 26. A plan
may impose annual out-of-pocket dollar limits on participants and beneficiaries if
done in accordance with the rule regarding cumulative limits.

14

See 29 CFR 2590.712(e)(3)(i)

17

NO

N/A

YES
Note: These provisions are affected by section 2711 of the Public Health Service
Act, as amended by the Patient Protection and Affordable Care Act. Specifically,
PHS Act section 2711 generally prohibits annual dollar limits on essential health
benefits, which includes mental health and substance use disorder services.
Accordingly, the parity requirements regarding annual dollar limits only apply to the
provision of mental health and substance use disorder benefits that are not Essential
Health Benefits. Note also that for plan years beginning in 2015, the annual
limitation on an individual’s maximum out-of-pocket (MOOP) costs in effect under
ACA is $6,600 for self-only coverage and $13,200 for coverage other than self-only
coverage. See ACA Implementation FAQ Part XXI at dol.gov/ebsa/faqs/faq-aca21.
html.
(For information regarding the Affordable Care Act, please visit our Website at
dol.gov/ebsa/healthreform).
SECTION B. Financial Requirements and Quantitative Treatment Limitations
Question 23 – Does the plan comply with the mental health parity
requirements for parity in financial requirements and quantitative treatment
limitations? ..................................................................................................................
u A plan may not impose a financial requirement or quantitative treatment
limitation applicable to mental health/substance use disorder benefits in any
classification that is more restrictive than the predominant financial requirement
or quantitative treatment limitation of that type that is applied to substantially all
medical/surgical benefits in the same classification. See 29 CFR 2590.712(c)(2).
v Types of financial requirements include deductibles, copayments,
coinsurance, and out-of-pocket maximums. See 29 CFR 2590.712(c)(1)(ii).
v Types of quantitative treatment limitations include annual, episode, and
lifetime day and visit limits, for example, number of treatments, visits, or
days of coverage. See 29 CFR 2590.712(c)(1)(ii).
u The six classifications* of benefits are:
1) inpatient, in-network;
2) inpatient, out-of-network;
3) outpatient, in-network;
4) outpatient, out-of-network;
5) emergency care; and
6) prescription drugs.
See 29 CFR 2590.712(c)(2)(ii).
u Under the plan, any financial requirement or quantitative treatment limitation
that applies to mental health/substance use disorder benefits within a particular
classification cannot be more restrictive than the predominant requirement or
limitation that applies to substantially all medical/surgical benefits within the
same classification. See 29 CFR 2590.712(c)(2).
*See page 81 for special rules related to classifications.

18

NO

N/A

YES

NO

N/A

Detailed steps for applying these rules are set forth below:
u To determine compliance, each type of financial requirement or quantitative
treatment limitation within a coverage unit15 must be analyzed separately
within each classification. See 29 CFR 2590.712(c)(2)(i). If a plan applies
different levels of a financial requirement or quantitative treatment limitation
to different coverage units in a classification of medical/surgical benefits (for
example, a $15 copayment for self-only and a $20 copayment for family
coverage), the predominant level is determined separately for each coverage
unit. See 29 CFR 2590.712(c)(3)(ii).
u Step One: First determine if a particular type of financial requirement or
quantitative treatment limitation applies to substantially all medical/surgical
benefits in the relevant classification of benefits.
v Generally, a financial requirement or quantitative treatment limitation
is considered to apply to substantially all medical/surgical benefits
if it applies to at least two-thirds of the medical/surgical benefits in
the classification. See 29 CFR 2590.712(c)(3)(i)(A). This two-thirds
calculation is generally based on the dollar amount of plan payments
expected to be paid for the plan year. See 29 CFR 2590.712(c)(3)(i)(C).
(Any reasonable method can be used for this calculation. See 29 CFR
2590.712(c)(3)(i)(E).)
Step
Two: If the type of financial requirement or quantitative treatment
u
limitation applies to at least two-thirds of medical/surgical benefits in that
classification, then determine the predominant level of that type of financial
requirement or quantitative treatment limitation that applies to medical/
surgical benefits subject to that type of financial requirement or quantitative
treatment limitation in that classification of benefits. (Note: If the type of
financial requirement or quantitative treatment limitation does not apply to
at least two-thirds of medical/surgical benefits in that classification, it cannot
apply to mental health/substance use disorder benefits in that classification.)
v Generally, the predominant level will apply to more than one-half
of the medical/surgical benefits in that classification subject to the
financial requirement or quantitative treatment limitation. See 29 CFR
2590.712(c)(3)(i)(B)(1). If there is no single level that applies to more
than one-half of medical/surgical benefits in the classification, the plan
can combine levels until the combination of levels applies to more than
one-half of medical/surgical benefits subject to the financial requirement
or quantitative treatment limitation in the classification. The least
restrictive level within the combination is considered the predominant
level.16 See 29 CFR 2590.712(c)(3)(i)(B)(2).

Coverage unit refers to the way in which a plan groups individuals for purposes of determining benefits, or premiums or
contributions, for example, self-only, family, and employee plus spouse. See 29 CFR 2590.712(c)(1)(iv).
16
For a simpler method of compliance, a plan may treat the least restrictive level of financial requirement or treatment limitation
applied to medical/surgical benefits as predominant.
15

19

YES
*Note: Special rules related to classifications
1. Special rule for outpatient sub-classifications:
u For purposes of determining parity for outpatient benefits (in-network and
out-of network), a plan or issuer may divide its benefits furnished on an
outpatient basis into two sub-classifications: (1) office visits and (2) all
other outpatient items and services, for purposes of applying the financial
requirement and treatment limitation rules.
u After the sub-classifications are established, the plan or issuer may not
impose any financial requirement or quantitative treatment limitation on
mental health/substance use disorder benefits in any sub-classification (i.e.,
office visits or non-office visits) that is more restrictive than the predominant
financial requirement or treatment limitation that applies to substantially all
medical/surgical benefits in the sub-classification using the methodology set
forth in the final rules.
u Other than as explicitly permitted under the final rules, sub-classifications
are not permitted when applying the financial requirement and treatment
limitation rules under MHPAEA. Accordingly, separate sub-classifications
for generalists and specialists are not permitted. (See Question 24 for more
information regarding specialists and generalists.)
2. Special rule for prescription drug benefits:
u There is a special rule for multi-tiered prescription drug benefits. A plan
complies with the mental health parity provisions if the plan applies different
levels of financial requirements to different tiers of prescription drug benefits
based on reasonable factors and without regard to whether a drug is generally
prescribed for medical/surgical or mental health/substance use disorder
benefits. Reasonable factors include cost, efficacy, generic versus brand
name, and mail order versus pharmacy pick-up. See 29 CFR 2590.712(c)(3)
(iii).
3. Special rule for multiple network tiers:
u There is a special rule for multiple network tiers. If a plan provides
benefits through multiple tiers of in-network providers (such as in-network
preferred and in-network participating providers), the plan may divide
its benefits furnished on an in-network basis into sub-classifications that
reflect network tiers, if the tiering is based on reasonable factors (such as
quality, performance, and market standards) and without regard to whether a
provider provides services with respect to medical/surgical benefits or mental
health or substance use disorder benefits. After the sub-classifications are
established, the plan or issuer may not impose any financial requirement or
treatment limitation on mental health or substance use disorder benefits in
any sub-classification that is more restrictive than the predominant financial
requirement or treatment limitation that applies to substantially all medical/
surgical benefits in the sub-classification.

20

NO

N/A

YES
Tips: Ensure that the plan does not impose cost-sharing requirements or
quantitative treatment limitations that are applicable only to mental health/
substance use disorder benefits.
Ensure that with respect to conducting the predominant/substantially all test,
the analysis must be done with respect to the dollar amount of all plan payments
expected to be paid for the relevant plan year. Basing the analysis on an insurer’s
entire overall book of business for the year or book of business in a specific
region or State is not a permissible analysis for demonstrating compliance with
MHPAEA.
Question 24 – If the plan imposes a higher, specialist financial requirement,
such as a copay, on mental health/substance use disorder benefits, can the
plan demonstrate that the specialist level of the financial requirement is the
predominant level that applies to substantially all medical/surgical benefits
within the classification? ........................................................................................
u The six classifications outlined in Question 23 are the only classifications
that may be used when determining the predominant financial requirements
or quantitative treatment limitations that apply to substantially all medical/
surgical benefits. See 29 CFR 2590.712(c)(2)(ii). A plan may not use a
separate sub-classification under these classifications for generalists and
specialists. See preamble language at 75 FR 5413.
Tip: A plan may still be able to impose the specialist level of a financial
requirement or quantitative treatment limitation if it is the predominant level that
applies to substantially all medical/surgical benefits within a classification. For
example, if the specialist level of copay is the predominant level of copay that
applies to substantially all medical/surgical benefits in the outpatient, in-network
classification, the plan may apply the specialist level copay to mental health/
substance use disorder benefits in the outpatient, in-network classification. See 29
CFR 2590.712(c)(3).
SECTION C. Coverage in all Classifications
Question 25 – Does the plan comply with the mental health parity
requirements for coverage in all classifications? .................................................
u If a plan provides mental health/substance use disorder benefits in any
classification of benefits (the classifications are listed in Question 23),
mental health/substance use disorder benefits must be provided in every
classification in which medical/surgical benefits are provided. See 29 CFR
2590.712(c)(2)(ii)(A).
v In determining the classification in which a particular benefit belongs, a
plan must apply the same standards to medical/surgical benefits and to
mental health/substance use disorder benefits. See 29 CFR 2590.712(c)
(2)(ii)(A). This rule also applies to intermediate services provided under
the plan or coverage. Plans must assign covered intermediate mental
health and substance use disorder benefits (such as residential treatment,
partial hospitalization and intensive outpatient treatment) to the
21

NO

N/A

YES
existing six classifications in the same way that they assign comparable
intermediate medical/surgical benefits to these classifications. For
example, if a plan classifies skilled nursing and rehabilitation hospitals
for medical/surgical benefits as inpatient benefits, it must classify
residential treatment facilities for mental health and substance use
disorder benefits as inpatient benefits. If a plan treats home health care
as an outpatient benefit, then any covered intensive outpatient mental
health/substance use disorder services and partial hospitalization must
be considered outpatient benefits as well. A plan must also comply with
MHPAEA’s NQTL rules, discussed in the following section, in assigning
any benefits to a particular classification. See 29 CFR 2590.712(c)(4).
Tips:
u If the plan does not contract with a network of providers, all benefits are outof-network. If a plan that has no network imposes a financial requirement or
treatment limitation on inpatient or outpatient benefits, the plan is imposing
the requirement or limitation within classifications (inpatient, out-of-network
or outpatient, out-of-network), and the rules for parity will be applied
separately for the different classifications. See 29 CFR 2590.712(c)(2)(ii)(C),
Example 1.
u If a plan covers the full range of medical/surgical benefits (in all
classifications, both in-network and out-of-network), beware of exclusions on
out-of-network mental health and substance use disorder benefits.
The plan must ensure that all combinations of benefits comport with parity.
Note: As explained in the Introduction to this section, nothing in MHPAEA
requires a non-grandfathered group health plan that provides mental health or
substance use disorder benefits only to the extent required under PHSA section
2713, to provide additional mental health or substance use disorder benefits in
any classification.
SECTION D. Cumulative Financial Requirements and Treatment
Limitations
Question 26 – Does the plan comply with the mental health parity provisions
on cumulative financial requirements or cumulative quantitative treatment
limitations? .............................................................................................................
u A plan may not apply any cumulative financial requirement or cumulative
quantitative treatment limitation for mental health/substance use disorder
benefits in a classification that accumulates separately from any established
for medical/surgical benefits in the same classification. See 29 CFR
2590.712(c)(3)(v).
v Cumulative financial requirements are financial requirements that
determine whether or to what extent benefits are provided based on
accumulated amounts and include deductibles and out-of-pocket
maximums (but do not include aggregate lifetime or annual dollar limits
because these two terms are excluded from the meaning of financial
22

NO

N/A

YES
requirements). See 29 CFR 2590.712(a).
v Cumulative quantitative treatment limitations are treatment limitations
that determine whether or to what extent benefits are provided based on
accumulated amounts, such as annual or lifetime day or visit limits. See
29 CFR 2590.712(a).
u For example, a plan may not impose an annual $250 deductible on all
medical/surgical benefits and a separate $250 deductible on all mental health/
substance use disorder benefits.
SECTION E. Nonquantitative Treatment Limitations
Question 27 – Does the plan comply with the mental health parity provisions
for parity within nonquantitative treatment limitations?...................................
u Nonquantitative treatment limitations (NQTLs) include:
v Medical management standards limiting or excluding benefits based on
medical necessity or medical appropriateness, or based on whether the
treatment is experimental or investigative;
v Formulary design for prescription drugs;
v For plans with multiple network tiers (such as preferred providers and
participating providers), network tier design;
v Standards for provider admission to participate in a network, including
reimbursement rates;
v Plan methods for determining usual, customary, and reasonable charges;
v Refusal to pay for higher-cost therapies until it can be shown that a
lower-cost therapy is not effective (also known as fail-first policies or
step therapy protocols);
v Exclusions based on failure to complete a course of treatment; and
v Restrictions based on geographic location, facility type, provider
specialty, and other criteria that limit the scope or duration of benefits for
services provided under the plan or coverage.
This is an illustrative, nonexhaustive list. See 29 CFR 2590.712(c)(4)(ii).
General rules:
u A plan may not impose an NQTL with respect to mental health/substance
use disorder benefits in any classification (such as inpatient, out-ofnetwork) unless, under the terms of the plan (as written and in operation),
any processes, strategies, evidentiary standards, or other factors used in
applying the NQTL to mental health/substance use disorder benefits in the
classification are comparable to and applied no more stringently than the
processes, strategies, evidentiary standards or other factors used in applying
the NQTL with respect to medical/surgical benefits in the classification. See
29 CFR 2590.712(c)(4)(i).
u A group health plan may consider a wide array of factors in designing
medical management techniques for both mental health/substance use
disorder benefits and medical/surgical benefits, such as cost of treatment;

23

NO

N/A

YES
high cost growth; variability in cost and quality; elasticity of demand;
provider discretion in determining diagnosis, or type or length of treatment;
clinical efficacy of any proposed treatment or service; licensing and
accreditation of providers; and claim types with a high percentage of fraud.
Based on application of these or other factors in a comparable fashion, an
NQTL, such as prior authorization, may be required for some (but not all)
mental health/substance use disorder benefits, as well as for some medical/
surgical benefits, but not for others. See 29 CFR 2590.712(c)(4), Example 8.
Examples: The Departments have published several examples that help illustrate
how the MHPAEA regulations apply to some common plan NQTLs, including:
1) The penalty for failure to obtain preauthorization is more punitive with
respect to mental health/substance use disorder benefits than with respect
to medical/surgical benefits. See 2590.712(c)(4)(iii), Example 3.
2) The plan uses an employee assistance program as a gatekeeper to
obtaining mental health or substance use disorder benefits. See
2590.712(c)(4)(iii), Example 6.
3) Utilization management practices that differ among different plan
benefits. See 29 CFR 2590.712(c)(4)(iii), Example 8.
Tips: Do not focus on results. Look at the underlying processes and
strategies used in applying NQTLs (such as utilization review (UR) and
standards for network admission). Are there arbitrary or discriminatory
differences in how the plan is applying those processes and strategies to medical/
surgical benefits versus mental health/substance use disorder benefits?
A plan or issuer that limits eligibility for mental health and substance use disorder
benefits until after benefits under an EAP are exhausted has established an
NQTL subject to the parity requirements. If no comparable requirement applies
to medical/surgical benefits such a requirement could not be applied to mental
health or substance use disorder benefits.
Questions You Might Ask:
1) What classification of benefits is being analyzed? Does the plan clearly
define which benefits are treated as medical/surgical and which benefits
are treated as mental health/substance use disorder under the plan. Are
benefits (such as non-hospital inpatient and partial hospitalization)
assigned to classifications using a comparable methodology across
medical/surgical benefits and mental health/substance use disorder
benefits?
2) What is the type and description of any NQTL being applied and is it
applied in parity?
3) Overall explanation of how each NQTL is applied with respect to
medical/surgical benefits and mental health and substance use disorder
benefits. (Note: this includes requirements that both the participant
and provider may be subject to pursuant to the NQTL). If only certain
benefits are subject to an NQTL, such as meeting a fail first protocol or
requiring preauthorization, how were the specific medical/surgical and
24

NO

N/A

YES
mental health or substance use disorder benefits subject to the NQTL
determined? To the extent medical guidelines are relied upon, is there
a process for determining variation/application of the guidelines that is
comparable with respect to both medical/surgical and mental health or
substance use disorder benefits?
4) Even if benefits are subject to the same NQTL, does the plan impose
stricter penalties for noncompliance with respect to mental health and
substance use disorder benefits (for example, reducing benefits to 50%
of eligible expenses for failure to obtain prior authorization for mental
health and substance use disorder benefits, vs. 20% for medical/surgical
benefits)?
5) If utilization review is conducted by different entities/individuals
for medical/surgical and mental health or substance use disorder
benefits provided under the plan, what processes are in place to ensure
comparability in the standards used for UR and comparability in the
independence and qualifications of the individuals performing UR?
6) Has the plan documented its analysis that its NQTL processes and
strategies (such as UR) are comparable across medical/surgical and
mental health/substance use disorder benefits?
Tip: Plans should keep records documenting NQTL processes and how they are
being applied to both medical/surgical as well as mental health and substance use
disorder benefits to ensure they can demonstrate compliance with the law. Such
records may also be helpful to plans in responding to inquiries from participants
and beneficiaries regarding benefits under the plan. See a more detailed
discussion of disclosure requirements in the following section.
Illustrations. Set forth below are additional illustrations of how a plan may have
differences in nonquantitative treatment limitations:
NQTLs that may still comply with the Departments’ regulations, based on the
facts and circumstances involved:
u Plan X covers neuropsychological testing but only for certain conditions.
In such situations, look to see whether the exclusion is based on evidence
addressing for example, clinical efficacy of such testing for different
conditions and the degree to which such testing is used for educational
purposes with regard to different conditions. Does the plan rely on
criteria and evidence from comparable sources with respect to medical/
surgical and mental health conditions? Does the plan have documentation
indicating the criteria used and evidence supporting the plan’s determination
of the diagnoses for which they will cover this service and the rationale
for excluding certain diagnoses? The result may be that the plan covers
neuropsychological testing for some medical/surgical or mental health
conditions, but not for all. This outcome may be permissible to the extent the
plan has based the exclusion on clinical efficacy and/or other factors if done
in a comparable manner and applies the NQTL in a comparable manner.

25

NO

N/A

YES
u Plan Y uses diagnosis related group (DRG) codes in their standard utilization
review process to actively manage hospitalization utilization. For all
non-DRG hospitalizations (whether due to an underlying medical/surgical
condition or a mental health or substance use disorder condition), the plan
requires precertification for hospital admission and incremental concurrent
review. The precertification and concurrent review processes review unique
clinical presentation, condition severity, expected course of recovery,
quality and efficiency. The evidentiary standards and other factors used in
the development of the concurrent review process are comparable across
medical/surgical benefits and mental health/substance use disorder benefits,
and are well documented. These evidentiary standards and other factors are
available to participants and beneficiaries free of charge upon request. In this
example, it appears that, under the terms of the plan as written and in practice,
the processes, strategies, evidentiary standards, and other factors considered
by the plan in implementing its precertification and concurrent review of
hospitalizations is comparable and applied no more stringently with respect
to mental health and substance use disorder benefits than those applied with
respect to medical/surgical benefits.
u Plan Z classifies care in skilled nursing facilities or rehabilitation hospitals as
inpatient benefits and likewise treats any covered care in residential treatment
facilities for mental health or substance use disorders as an inpatient benefit.
In addition, the plan treats home health care as an outpatient benefit and,
likewise treats intensive outpatient and partial hospitalization for mental health
or substance use disorder services as outpatient benefits. In this example, the
plan assigns covered intermediate mental health and substance use disorder
benefits to the six classifications in the same way that it assigns comparable
intermediate medical/surgical benefits.
u Master’s degree training and state licensing requirements often vary among
provider types. Plan Z consistently applies its standard that any provider must
meet whatever is the most stringent licensing requirement standard related
to supervised clinical experience requirements in order to participate in the
network. Therefore, Plan Z requires master’s-level therapists to have postdegree, supervised clinical experience in order to join their provider network.
There is no parallel requirement for master’s-level general medical providers
because their licensing does require supervised clinical experience. In addition,
the plan does not require post-degree, supervised clinical experience for
psychiatrists or PhD level psychologists since their licensing already requires
supervised training. The requirement that master’s-level therapists must have
supervised clinical experience to join the network is permissible, as the plan
consistently applies the same standard to all providers even though it may have
a disparate impact on certain mental health providers.

26

NO

N/A

YES
SECTION F.

Disclosure Requirements

Question 28 – Does the plan comply with the mental health parity disclosure
requirements? .........................................................................................................
u The plan administrator (or the health insurance issuer) must make available
the criteria for medical necessity determinations made under a group health
plan with respect to mental health/substance use disorder benefits (or health
insurance coverage offered in connection with the plan with respect to such
benefits) to any current or potential participant, beneficiary, or contracting
provider upon request. See 29 CFR 2590.712(d)(1).
u The plan administrator (or health insurance issuer) must make available
the reason for any denial under a group health plan (or health insurance
coverage) of reimbursement or payment for services with respect to mental
health/substance use disorder benefits to any participant or beneficiary in a
form and manner consistent with the rules in 29 CFR 2560.503-1 (the DOL
claims procedure rule) and 29 CFR 2590.715-2719. (internal claims and
appeals and external review processes).
u Pursuant to the internal claims and appeals and external review rules under
the Affordable Care Act, applicable to all non-grandfathered group health
plans, claims related to medical judgment (including mental health/substance
use disorder) are eligible for external review. The internal claims and appeals
rules include the right of claimants (or their authorized representative) to be
provided upon request and free of charge, reasonable access to and copies of
all documents, records, and other information relevant to the claimant’s claim
for benefits. This includes documents with information about the processes,
strategies, evidentiary standards, and other factors used to apply an NQTL
with respect to medical/surgical benefits and mental health/substance use
disorder benefits under the plan. See 29 CFR 2590.712(d)(3).
u If coverage is denied based on medical necessity, medical necessity criteria
for the mental health/substance use disorder benefits at issue and for medical/
surgical benefits in the same classification must be provided within 30 days
of the request to the participant, beneficiary, or provider or other individual if
acting as an authorized representative of the beneficiary or participant. See
29 CFR 2520.104b-1; 29 CFR 2590.712(d)(1).
Make Showing Compliance Simple!
Documents or Plan Instruments Participants and Beneficiaries or DOL may
request:
Participants and beneficiaries may request documents and plan instruments
regarding whether the plan is providing benefits in accordance with MHPAEA
and copies must be furnished within 30 days of request. This may include
documentation that illustrates how the health plan has determined that any
financial requirement, quantitative treatment limitation, or nonquantitative
treatment limitation is in compliance with MHPAEA. For example, participants
and beneficiaries may ask for:
27

NO

N/A

YES
u An analysis showing that the plan meets the predominant/substantially
all test. The plan may need to provide information regarding the amount
of medical/surgical claims subject to a certain type of QTL, such as a copayment, in the prior year in a classification or its basis for calculating claims
expected to be subject to a certain type of QTL in the current plan year in a
classification, for purposes of determining the plan’s compliance with the
predominant/substantially all test.
u A description of an applicable requirement or limitation, such as
preauthorization or concurrent review, that the plan has authorized for mental
health/substance use disorder services and medical/surgical benefits within
the relevant classification (in- or out-of-network, in- or outpatient). These
might include references to specific plan documents, for example provisions
as stated on specified pages of the SPD, or other underlying guidelines or
criteria not included in the SPD that the Plan has consulted or relied upon;
u Information regarding factors, such as cost or recommended standards of
care, that are relied upon by a plan for determining which medical/surgical
or mental health or substance use disorder benefits are subject to a specific
requirement or limitation. These might include references to specific related
factors or guidelines, such as applicable utilization review criteria;
u A description of the applicable requirement or limitation that the plan
believes have been used in any given mental health/substance use
disorder service adverse benefit determination (ABD) within the relevant
classification;
u Medical necessity guidelines relied upon for in and out-of-network medical/
surgical and mental health and substance use disorder benefits.
Tips:
Participants, beneficiaries and contracting providers may request information to
determine whether benefits under a plan are being provided in parity even in the
absence of any specific adverse benefit determination.
Plans may need to work with insurance carriers providing coverage on behalf
of an insured group health plan or with third party administrators administering
the plan to ensure that such service providers either directly or in coordination
with the plan are providing participants and beneficiaries any documents or
information to which they are entitled.
If a plan uses mental health and substance use disorder vendors and carveout service providers, the plan must ensure that all combinations of benefits
comport with parity, therefore vendors and carve out providers should provide
documentation of the necessary information to the Plan to ensure that all
combination of benefits comport with parity.
Note: Compliance with the disclosure requirements of MHPAEA is not
determinative of compliance with any other provision or other applicable Federal
or State law. Be sure that the Plan, in addition to these disclosure requirements, is
disclosing information relevant to medical/surgical, mental health, and substance
use disorder benefits as required pursuant to other applicable provisions of law.

28

NO

N/A

III. Determining Compliance with the Newborns’ Act Provisions in Part 7 of ERISA
If you answer “No” to any of the questions below, the group health plan is
in violation of the Newborns’ Act provisions in Part 7 of ERISA.
YES

SECTION A – Newborns’ Act Substantive Provisions
The substantive provisions of the Newborns’ Act apply only to certain plans, as
follows:
If the plan does not provide benefits for hospital stays in connection with
childbirth, check “N/A” and go to Part IV of this self-compliance tool. (Note:
Under the Pregnancy Discrimination Act, most plans are required to cover
maternity benefits.)
Special applicability rule for insured coverage that provides benefits for hospital
stays in connection with childbirth:
If the plan provides benefits for hospital stays in connection with childbirth, the
plan is insured, and the coverage is in Wisconsin and several U.S. territories, it
appears that the Federal Newborns’ Act applies to the plan. If this is the case,
answer the questions in SECTION A and SECTION B. If the plan provides
benefits for hospital stays in connection with childbirth and is insured, whether
the plan is subject to the Newborns’ Act depends on State law. Based on a
recent preliminary review of State laws, if the coverage is in any other state or
the District of Columbia, it appears that State law applies in lieu of the Federal
Newborns’ Act. If this is the case, check “N/A” and skip to SECTION B.
Self-insured coverage that provides benefits for hospital stays in connection
with childbirth: If the plan provides benefits for hospital stays in connection with
childbirth and is self-insured, the Federal Newborns’ Act applies. Answer the
questions in SECTION A and SECTION B.
Question 29 – General 48/96-hour stay rule
Does the plan comply with the general 48/96-hour rule? .........................................
u Plans generally may not restrict benefits for a hospital length of stay in
connection with childbirth to less than 48 hours in the case of a vaginal delivery
(See ERISA section 711(a)(1)(A)(i)), or less than 96 hours in the case of a
cesarean section (See ERISA section 711(a)(1)(A)(ii)).
u Therefore, a plan cannot deny a mother or her newborn benefits within a 48/96hour stay based on medical necessity. (A plan may require a mother to notify the
plan of a pregnancy to obtain more favorable cost-sharing for the hospital stay.
This second type of plan provision is permissible under the Newborns’ Act if the
cost-sharing is consistent throughout the 48/96-hour stay.)

29

NO

N/A

YES
u An attending provider may, however, decide, in consultation with the mother,
to discharge the mother or newborn earlier.
Question 30 – Provider must not be required to obtain authorization
from plan
Plans may not require providers to obtain authorization from the plan to
prescribe a 48/96-hour stay. Does the plan comply with this rule?.....................
u Plans may not require that a provider (such as a doctor) obtain authorization
from the plan to prescribe a 48/96-hour stay. See ERISA section 711(a)(1)(B);
29 CFR 2590.711(a)(4).
Tips: Watch for plan preauthorization requirements that are too broad. For
example, a plan may have a provision requiring preauthorization for all hospital
stays. Providers cannot be required to obtain preauthorization from the plan
in order for the plan to cover a 48-hour (or 96-hour) stay in connection with
childbirth. Therefore, in this example, the plan must add clarifying language to
indicate that the general preauthorization requirement does not apply to 48/96hour hospital stays in connection with childbirth. (Conversely, plans generally
may require participants or beneficiaries to give notice of a pregnancy or hospital
admission in connection with childbirth in order to obtain, for example, more
favorable cost-sharing.) Nonetheless, the Newborns’ Act does not prevent plans
and issuers from requiring providers to obtain authorization for any portion of a
hospital stay that exceeds 48 (or 96) hours.
Question 31 – Incentives/penalties to mothers or providers
Does the plan comply with the Newborns’ Act by avoiding impermissible
incentives or penalties with respect to mothers or attending providers?.............
u Penalties to attending providers to discourage 48/96-hour stays violate ERISA
section 711(b)(3) and 29 CFR 2590.711(b)(3)(i).
u Incentives to attending providers to encourage early discharges violate ERISA
section 711(b)(4) and 29 CFR 2590.711(b)(3)(ii).
u Penalties imposed on mothers to discourage 48/96-hour stays violate ERISA
section 711(b)(1) and 29 CFR 2590.711(b)(1)(i)(A).
u Incentives to mothers to encourage early discharges violate ERISA section
711(b)(2) and 29 CFR 2590.711(b)(1)(i)(B).
v An example of this would be if the plan waived the mother’s copayment
or deductible if the mother or newborn leaves within 24 hours.
u Benefits and cost-sharing may not be less favorable for the latter portion of
any 48/96-hour hospital stay. In this case less favorable benefits would violate
ERISA section 711(b)(5) and 29 CFR 2590.711(b)(2) and less favorable costsharing would violate ERISA section 711(c)(3) and 29 CFR 2590.711(c)(3).

30

NO

N/A

YES
SECTION B – Disclosure Provisions
Group health plans that provide benefits for hospital stays in connection with
childbirth are required to make certain disclosures, as follows:
Question 32 – Disclosure with respect to hospital lengths of stay in
connection with childbirth
Does the plan comply with the notice provisions relating to hospital stays in
connection with childbirth?....................................................................................
u Group health plans that provide benefits for hospital stays in connection with
childbirth are required to make certain disclosures. Specifically, the group
health plan’s SPD must include a statement describing any requirements
under Federal or State law applicable to the plan, and any health insurance
coverage offered under the plan, relating to hospital length of stay in
connection with childbirth for the mother or newborn child. See the SPD
content regulations at 29 CFR 2520.102-3(u).
Tip: Whether the plan is insured or self-insured, and whether the Federal Newborns’ Act provisions or State law provisions apply to the coverage, the plan
must provide a notice describing any requirements relating to hospital length
of stays in connection with childbirth. A model notice is provided in the Model
Disclosures on page 140.

31

NO

N/A

IV. Determining Compliance with the WHCRA Provisions in Part 7 of ERISA
If you answer “No” to any of the questions below, the group health plan is
in violation of the WHCRA provisions in Part 7 of ERISA.
YES

WHCRA applies only to plans that offer benefits with respect to a mastectomy. If
the plan does not offer these benefits, check “N/A” and go to Part V of this selfcompliance tool..............................................................................................................
If the plan does offer benefits with respect to a mastectomy, answer
Questions 33-36.
Question 33 – Four required coverages under WHCRA
Does the plan provide the four coverages required by WHCRA? .........................
u In the case of a participant or beneficiary who is receiving benefits in connection
with a mastectomy, the plan shall provide coverage for the following benefits for
individuals who elect them:
v All stages of reconstruction of the breast on which the mastectomy has been
performed;
v Surgery and reconstruction of the other breast to produce a symmetrical
appearance;
v Prostheses; and
v Treatment of physical complications of mastectomy, including lymphedema,
in a manner determined in consultation with the attending provider and the
patient. See ERISA section 713(a).
u These required coverages can be subject to annual deductibles and coinsurance
provisions if consistent with those established for other medical/surgical benefits
under the plan or coverage.
Tip: Plans that cover benefits for mastectomies cannot categorically exclude
benefits for reconstructive surgery or certain post-mastectomy services. In addition,
time limits for seeking treatment may run afoul of the general requirement to provide
the four required coverages.
Question 34 – Incentive provisions
Does the plan comply with WHCRA by not providing impermissible incentives
or penalties with respect to patients or attending providers? .................................
u A plan may not deny a patient eligibility to enroll or renew coverage solely to
avoid WHCRA’s requirements under ERISA section 713(c)(1).
u In addition, under ERISA section 713(c)(2), a plan may not penalize or offer
incentives to an attending provider to induce the provider to furnish care in a
manner inconsistent with WHCRA.

32

NO

N/A

YES
Question 35 – Enrollment notice
Does the plan provide adequate and timely enrollment notices as required by
WHCRA? ...............................................................................................................
u Upon enrollment, a plan must provide a notice describing the benefits
required under WHCRA. See ERISA section 713(a).
u The enrollment notice must describe the benefits that WHCRA requires the
group health plan to cover, specifically:
v All stages of reconstruction of the breast on which the mastectomy was
performed,
v Surgery and reconstruction of the other breast to produce a symmetrical
appearance,
v Prostheses, and
v Physical complications resulting from mastectomy (including lymphedema).
u The enrollment notice must describe any deductibles and coinsurance
limitations applicable to such coverage. (Note: Under WHCRA, coverage
of the required benefits may be subject only to deductibles and coinsurance
limitations consistent with those established for other medical/surgical
benefits under the plan or coverage.)
Tip: A model notice is provided in the Model Disclosures on page 141.
Question 36 – Annual notice
Does the plan provide adequate and timely annual notices as required by
WHCRA? ...............................................................................................................
u Plans must provide notices describing the benefits required under WHCRA
once each year. See ERISA section 713(a).
u To satisfy this requirement, the plan may redistribute the WHCRA enrollment
notice or the plan may use a simplified disclosure that:
v Provides notice of the availability of benefits under the plan for
reconstructive surgery, surgery to achieve symmetry between the breasts,
prostheses, and physical complications resulting from mastectomy
(including lymphedema); and
v Contact information (e.g., telephone number) for obtaining a detailed
description of WHCRA benefits available under the plan.
Tip: The WHCRA annual notice can be provided in the SPD if the plan
distributes SPDs annually. If not, the plan should break off the annual notice into
a separate disclosure. A model notice is provided in the Model Disclosures on
page 142.

33

NO

N/A

V. Determining Compliance with the GINA Provisions in Part 7 of ERISA
If you answer “No” to any of the questions below, the group health plan is
in violation of the GINA provisions in Part 7 of ERISA.
YES

Unlike HIPAA, the GINA provisions generally do apply to very small health plans
(plans with less than two participants who are current employees), including retireeonly health plans.
Definitions (for all defined terms under GINA, see 29 CFR 2590.702-1(a)):
Genetic information means, with respect to an individual, information about the
individual’s genetic tests, the genetic tests of family members of the individual, the
manifestation (see definition below) of a disease or disorder in family members of
the individual or any request for or receipt of genetic services or participation in
clinical research which includes genetic services by the individual or any family
member of the individual.
u Genetic information includes, with respect to a pregnant woman or family
member of the pregnant woman, genetic information of any fetus carried by the
pregnant woman.
u Genetic information includes, with respect to an individual who is utilizing an
assisted reproductive technology, genetic information of any embryo legally held
by the individual or family member.
u Genetic information does NOT include information about the sex or age of any
individual.
Family member means, with respect to an individual, a dependent of the individual
or any person who is a first-degree, second-degree, third-degree, or fourth-degree
relative of the individual or a dependent of the individual. Relatives of affinity
(such as by marriage or adoption) are treated the same as relatives by consanguinity
(that is, relatives who share a common biological ancestor). Relatives by less than
full consanguinity (such as half-siblings, who share only one parent) are treated
the same as relatives by full consanguinity (such as siblings who share both
parents). Therefore, family members include parents, spouses, siblings, children,
grandparents, grandchildren, aunts, uncles, nephews, nieces, great-grandparents,
great-grandchildren, great aunts, great uncles, first cousins, great-great grandparents,
great-great grandchildren, and children of first cousins.
Manifestation means, with respect to a disease, disorder, or pathological condition,
that an individual has been or could reasonably be diagnosed with the disease,
disorder, or pathological condition by a health care professional with appropriate
training and expertise in the field of medicine involved. A disease, disorder, or
pathological condition is not manifested if a diagnosis is based principally on genetic
information.

34

NO

N/A

YES
Genetic services means a genetic test, genetic counseling (including obtaining,
interpreting, or assessing genetic information) or genetic education.
Genetic test means an analysis of human DNA, RNA, chromosomes, proteins,
or metabolites, if the analysis detects genotypes, mutations, or chromosomal
changes.
A genetic test does NOT include an analysis of proteins or metabolites that is
directly related to a manifested disease, disorder, or pathological condition. For
example, a test to determine whether an individual has a BRCA1 or BRCA2,
genetic variants associated with a significantly increased risk for breast cancer, is
a genetic test. An HIV test, complete blood count, cholesterol test, liver function
test, or test for the presence of alcohol or drugs is not a genetic test.
Question 37 – Does the plan comply with GINA’s prohibition against groupbased discrimination based on genetic information? .........................................
u A group health plan cannot adjust premium or contribution amounts for the
plan, or any similarly situated individuals under the plan, on the basis of
genetic information. See 29 CFR 2590.702-1(b)(1).
Nothing
limits a plan from increasing the premium for the group health plan
u
or for a group of similarly situated individuals under the plan based on the
manifestation of a disease or disorder of an individual enrolled in the plan.
However, the manifestation of the disease in one individual cannot be used
as genetic information about other group members to further increase the
premium for a group health plan or a group of similarly situated individuals
under the plan. See 29 CFR 2590.702-1(b)(2).
Question 38 – Does the plan comply with GINA’s limitation on
requesting or requiring genetic testing? ..............................................................
u A group health plan generally must not request or require an individual
or family member of the individual to undergo a genetic test. See 29 CFR
2590.702-1(c)(1).
u Exceptions:
v A health care professional who is providing health care services to an
individual can request that the individual undergo a genetic test. See 29
CFR 2590.702-1(c)(2).
v A plan can obtain and use the results of a genetic test for making a
determination regarding payment. However, the plan is permitted to
request only the minimum amount of information necessary to make the
determination. See 29 CFR 2590.702-1(c)(4).
v Exception for research: a plan or issuer may request, but not require,
that a participant or beneficiary undergo a genetic test if the request
is pursuant to research and several conditions are met. See 29 CFR
2590.702-1(c)(5).

35

NO

N/A

YES
Question 39 – Does the plan comply with GINA’s prohibition on collection of
genetic information, prior to or in connection with enrollment?........................
u A plan cannot collect genetic information prior to an individual’s effective
date of coverage under that plan or coverage, nor in connection with the rules
for eligibility that apply to that individual. See 29 CFR 2590.702-1(d)(2)(i).
u Whether or not an individual’s information is collected prior to that
individual’s effective date of coverage is determined at the time of collection.
u Exception for incidental collection:
v If a plan obtains genetic information incidental to the collection of other
information concerning any individual, the collection is not a violation,
as long as the collection is not for underwriting purposes. See 29 CFR
2590.702-1(d)(2)(ii)(A).
v However, the incidental collection exception does not apply in
connection with any collection where it is reasonable to anticipate that
health information would be received, unless the collection explicitly
states that genetic information should not be provided. See 29 CFR
2590.702-1(d)(2)(ii)(B).
Question 40 – Does the plan comply with GINA’s prohibition on
collection of genetic information, for underwriting purposes? ............................
u A plan cannot request, require, or purchase (“collect”) genetic information
for underwriting purposes. See 29 CFR 2590.702-1(d)(1)(i).
u Underwriting purposes means, with respect to any group health plan:
v Rules for determination of eligibility (including enrollment and
continued eligibility) for benefits under the plan or coverage (including
changes in deductibles or other cost-sharing mechanisms in return for
activities such as completing a health risk assessment or participating in
a wellness program);
v The computation of premium or contribution amounts under the
plan or coverage (including discounts, rebates, payments in kind, or
other premium differential mechanisms in return for activities such
as completing a health risk assessment or participating in a wellness
program);
v The application of any preexisting condition exclusion under the plan or
coverage; and
v Other activities related to the creation, renewal, or replacement of a
contract of health insurance or health benefits. See 29 CFR 2590.7021(d)(1)(ii).
u Exception for medical appropriateness (only if an individual seeks a benefit
under the plan):
v If an individual seeks a benefit under a plan, the plan may limit or
exclude the benefit based on whether the benefit is medically appropriate
and the determination of whether the benefit is medically appropriate is
not for underwriting purposes.

36

NO

N/A

YES

NO

v If a plan conditions a benefit on medical appropriateness, and medical
appropriateness depends on the genetic information of an individual, the
plan can condition the benefit on genetic information. A plan or issuer
is permitted to request only the minimum amount of genetic information
necessary to determine medical appropriateness. See 29 CFR 2590.7021(d) (1)(iii) and (e).

If you answered “Yes” to ALL of the above questions, there does not appear to be a violation of the GINA
regulations.

37

N/A

VI. Compliance with Michelle’s Law
If you answer “No” to any of the questions below, the group health plan is
in violation of the Michelle’s Law provisions in Part 7 of ERISA.
YES

**Note: Under the Affordable Care Act group health plans and issuers are
generally required to provide dependent coverage to age 26 regardless of
student status of the dependent. Nonetheless, under some circumstances, such
as a plan that provides dependent coverage beyond age 26, Michelle’s Law
provisions may apply.
Question 41 – Does the plan comply with the Michelle’s Law requirement not
to terminate coverage of dependent students on medically necessary leave of
absence? ........................................................................................................................
Medically necessary leave of absence means with respect to a dependent child
in connection with a group health plan or health insurance coverage offered in
connection with a group health plan, a leave of absence from or other change in
enrollment status in a postsecondary educational institution that begins while the
child is suffering from a serious illness or injury; is medically necessary; and causes
the child to lose student status for purposes of coverage under the terms of the plan
or coverage.
A dependent child is a beneficiary who is a dependent child under the terms of
the plan or coverage, of a participant or beneficiary under the plan or coverage
and who was enrolled in the plan or coverage on the basis of being a student at
a postsecondary educational institution immediately before the first day of the
medically necessary leave of absence involved.
u A group health plan or issuer shall not terminate coverage of a dependent child
due to a medically necessary leave of absence that causes the child to lose
student status before the date that is the earlier of:
v the date that is one year after the first day of the medically necessary leave
of absence; or
v the date on which such coverage would otherwise terminate under the terms
of the plan or health insurance coverage. See ERISA section 714(b).
Tip: The group health plan or issuer can require receipt of written certification by a
treating physician of the dependent child which states that the dependent child
is suffering from a serious illness or injury and that the leave of absence (or other
change of enrollment) is medically necessary.

38

NO

N/A

YES
Question 42 – Does the plan comply with Michelle’s Law’s notice
requirement? ..........................................................................................................
u A group health plan or issuer must include with any notice regarding a
requirement for certification of student status for coverage, a description
of the Michelle’s law provision for continued coverage during medically
necessary leaves of absence. See ERISA section 714(c).

39

NO

N/A

VII. Determining Compliance with the Affordable Care Act Provisions in Part 7 of ERISA
The Affordable Care Act was signed into law by the President on March 23, 2010. Amendments to the
Affordable Care Act made through the Health Care Education and Reconciliation Act (Reconciliation
Act) were signed into law on March 30, 2010. Generally, the Affordable Care Act’s market reform
provisions amend title XXVII of the Public Health Service Act (PHS Act), which is administered
by the Department of Health and Human Services. The Affordable Care Act also creates section
715 of the Employee Retirement Income Security Act (ERISA), administered by the Department of
Labor, Employee Benefits Security Administration, and section 9815 of the Internal Revenue Code,
administered by the Department of Treasury (the Treasury) and the Internal Revenue Service (IRS),
to incorporate the market reform provisions of the PHS Act into ERISA and the Code, and make them
applicable to group health plans and health insurance issuers providing group health insurance
coverage. Under section 1251 of the Affordable Care Act, grandfathered health plans are required to
comply with some, but not all, of the market reform provisions. In addition, these provisions do not
apply to retiree-only or excepted benefits plans (See ERISA Section 732). The Departments of Labor,
HHS, and the Treasury have been issuing guidance on an ongoing basis since May 2010.
Note, that the Affordable Care Act, PHSA Section 2705 included requirements relating to wellness
programs. The Departments issued final regulations June 6, 2013 at 29 CFR 2590.702 and 29 CFR
2590.715-2705 using joint authority under HIPAA and the ACA. These requirements relating to
wellness programs are discussed in the HIPAA section of this tool at I (C).
See EBSA’s Website: dol.gov/ebsa/healthreform/ for the most up-to-date guidance.
This compliance aid will be updated in the future to further address additional requirements as they
become applicable, as enforcement grace periods expire, or as the Departments issue additional
guidance.

40

YES
SECTION A. Determining Grandfather Status Under the Affordable Care
Act Provisions in Part 7 of ERISA
Note: The grandfathered status of a plan will affect whether a plan must comply
with certain provisions of the Affordable Care Act (ACA). There are also special
rules for collectively bargained plans. See also the rules at 29 CFR 2590.7151251(f).
Grandfathered status is intended to allow people to keep their coverage as it
existed on March 23, 2010, while giving plans some flexibility to make “normal”
changes while retaining grandfathered status. Restrictions and requirements
on grandfathered health plan coverage provides individuals’ protection from
significant reductions in coverage, provides for coverage to include numerous
protections implemented through the Affordable Care Act, and allows employers
the flexibility to manage costs.
The analysis for determining grandfathered status applies separately to each
benefit package or option. Accordingly, grandfathered status might be retained
for some benefit packages or options and relinquished for others. By contrast, if
an employer relinquished grandfathered status for self-only, family, or any other
tier within a benefits package, it would relinquish grandfathered status for the
entire package. See 29 CFR 2590.715-1251(a)(1)(i).
If the plan is not claiming grandfathered status, proceed to SECTION B.
If the answer is “yes” to questions 43 and 44 below the group health plan
may be a grandfathered health plan.
Question 43 – Did the plan exist with at least one individual enrolled on
March 23, 2010?......................................................................................................
u A grandfathered group health plan must have been in existence with an
enrolled individual on March 23, 2010. Any plan that does not meet this
requirement is not in grandfathered status. See 29 CFR 2590.715-1251(a)(1)
(i).
Question 44 – Has the plan continuously covered someone (not necessarily
the same person) since March 23, 2010? ..............................................................
u A group health plan will not relinquish its grandfathered status merely
because one or more (or all) individuals enrolled on March 23, 2010, cease to
be covered. However, a grandfathered health plan must continuously cover
someone (not necessarily the same person) since March 23, 2010, to maintain
its status. See 29 CFR 2590.715-1251(a)(1)(i).
If the answers to questions 43 and 44 were “yes”, complete questions 4553. If the answer is “no” to either question 43 or 44, the group health plan
cannot claim grandfathered status; proceed to SECTION B.

41

NO

N/A

YES
Tip: Provided changes are made without exceeding the other standards that
cause a plan to relinquish grandfathered status, changes that generally will not
cause plans to relinquish grandfathered status include changes to: premiums;
to comply with Federal or State legal requirements; to voluntarily comply with
provisions of the Affordable Care Act; third party administrators; network plan’s
provider network; and to a prescription drug formulary.
Question 45 – Has the plan eliminated all or substantially all benefits to
diagnose or treat a particular condition? .............................................................
u For the purpose of determining grandfathered status, the elimination of
benefits for any necessary element to diagnose or treat a condition is
considered the elimination of all or substantially all benefits to diagnose or
treat a particular condition. See 29 CFR 2590.715-1251(g)(1)(i).
Question 46 – Has the plan increased a percentage cost-sharing requirement
(such as an individual’s coinsurance)? .................................................................
u Any increase measured from March 23, 2010, in a percentage cost-sharing
requirement causes a plan to relinquish grandfathered status. See 29 CFR
2590.715-1251(g)(1)(ii).
Question 47 – Has the plan increased a fixed-amount cost-sharing
requirement other than a copayment (such as a deductible or out-of-pocket
limit) such that the total percentage increase measured from March 23, 2010
exceeds the maximum percentage increase? .......................................................
u The maximum percentage increase is medical inflation, expressed as a
percentage, plus 15 percentage points. See 29 CFR 2590.715-1251(g)(3)(ii).
Medical inflation is the increase since March 2010, in the overall medical
care component of the Consumer Price Index for All Urban Consumers
(CPI-U) (unadjusted) published by the Department of Labor using the 19821984 base of 100. See 29 CFR 2590.715-1251(g)(3)(i).
Question 48 – Has the plan increased a fixed-amount copayment such
that the increase measured from March 23, 2010 exceeds the greater of:
the maximum percentage increase, or an amount equal to $5 plus medical
inflation? .................................................................................................................
u The maximum percentage increase is medical inflation, expressed as a
percentage, plus 15 percentage points. See 29 CFR 2590.715-1251(g)(3)(ii).
Medical inflation is the increase since March 2010 in the overall medical care
component of the Consumer Price Index for All Urban Consumers (CPI-U)
(unadjusted) published by the Department of Labor using the 1982-1984 base
of 100. See 29 CFR 2590.715-1251(g)(3)(i).

42

NO

N/A

YES
Question 49 – Has there been a decrease in the contribution rate by the
employer (or employee organization) towards the cost of any tier of coverage
for any class of similarly situated individuals by more than 5 percentage
points below the contribution rate for the coverage period that includes
March 23, 2010? .....................................................................................................
u If the contribution rate is based on a formula, was there a decrease in the
contribution rate by more than 5 percentage points below the contribution
rate for the coverage period that includes March 23, 2010? See 29 CFR
2590.715-1251(g)(1)(v)(B).
Tip: If a group health plan modifies the tiers of coverage it had on March 23,
2010 (for example, from self-only and family to a multi-tiered structure of selfonly, self-plus-one, self-plus-two, and self-plus-three-or-more), the employer
contribution for any new tier would be tested by comparison to the contribution
rate for the corresponding tier on March 23, 2010. If the plan adds one or more
new coverage tiers without eliminating or modifying any previous tiers and those
new coverage tiers cover classes of individuals that were not covered previously
under the plan, the new tiers would not be analyzed under the standards of
paragraph (g)(1). See DOL FAQs About the Affordable Care Act Implementation
Part II, question 3 at dol.gov/ebsa/faqs/faq-aca2.html.
In cases of a multiemployer plan that has either a fixed-dollar employee
contribution or no employee contribution towards the cost of coverage, if the
employer’s contribution rate changes, provided any changes in the coverage
terms would not otherwise cause the plan to cease to be grandfathered and
there continues to be no employee contribution or no increase in the fixeddollar employee contribution towards the cost of coverage, the change of
the employer’s contribution rate will not, in and of itself, cause a plan that is
otherwise a grandfathered health plan to relinquish grandfathered status. See
DOL FAQs About the Affordable Care Act Implementation Part I, question 4 at
dol.gov/ebsa/faqs/faq-aca.html.
Question 50 – Has the plan added or decreased an overall annual limit on
benefits? ..................................................................................................................
u A plan will relinquish its grandfathered status if it:
v Adds an overall annual limit on the dollar value of all benefits when it
did not previously impose an overall annual limit (See 29 CFR 2590.7151251(g)(1)(vi)(A));
v Previously imposed an overall lifetime limit on the dollar value of
benefits (but no overall annual limit) and adopts an overall annual limit
at a dollar value that is lower than the dollar value of the lifetime limit on
March 23, 2010 (See 29 CFR 2590.715-1251(g)(1)(vi)(B)); or
v Decreases the dollar value of the overall annual limit that was in place on
March 23, 2010 (See 29 CFR 2590.715-1251(g)(1)(vi)(C)).

43

NO

N/A

YES
Note: For plan years beginning on or after January 1, 2014, a plan may not
establish, for any individual, an annual limit on the dollar amount of benefits that
are essential health benefits. See 29 CFR 2590.715-2711(b)(1).
If the answer to any of questions 45-50 was “yes”, the plan is NOT a
grandfathered plan, proceed to SECTION B.
Question 51 – Did the plan change issuers after March 23, 2010? ....................
If the answer to question 51 is “yes”, if the group health plan changed issuers
after March 23, 2010, and the change in issuer was effective on or after
November 15, 2010, the plan will continue to be a grandfathered plan provided
no other changes that would relinquish grandfathered status are made. See 29
CFR 2590.715-1251(a)(1)(ii), as amended. Proceed to question 53.
If a group health plan changed issuers after March 23, 2010, and the change
was effective prior to November 15, 2010, the plan will have relinquished
grandfather status. The plan is not a grandfathered plan; proceed to
SECTION B.
Tip: The operative date is the effective date of the new contract, not the date
the new contract was entered into. Special rules apply for collectively bargained
plans. See 29 CFR 2590.715-1251(f) for collectively bargained plans.
Question 52 – Did the plan change from self-insured to fully-insured after
March 23, 2010? .....................................................................................................
If the group health plan was self-insured and changed to fully insured after March
23, 2010, and the change was effective on or after November 15, 2010, the plan
will continue to be a grandfathered plan provided no other changes are made that
would relinquish grandfathered status. See 29 CFR 2590.715-1251(a)(1)(ii), as
amended. Proceed to question 53.
If a group health plan was self-insured and changed to fully-insured after
March 23, 2010, and the change was effective prior to November 15, 2010,
the plan will have relinquished grandfathered status. The plan is not a
grandfathered plan; proceed to SECTION B.
If Questions 51 and 52 are not applicable to the group health plan, continue
to Question 54 to continue the grandfather status analysis.

44

NO

N/A

YES
Question 53 – If the group health plan changed issuers (including a plan
that was self-insured and changed to fully insured) and has maintained
grandfathered status, did the plan provide documentation to the new issuer
of the plan terms under the prior health coverage sufficient to determine
whether any other change was made that would relinquish grandfathered
status? ......................................................................................................................
u To maintain status as a grandfathered health plan, the plan must provide to
the new issuer (and the new issuer must require) documentation of plan terms
(including benefits, cost sharing, employer contributions, and annual limits)
under the prior health coverage sufficient to determine whether any other
change is being made that would relinquish grandfathered status. See 29
CFR 2590.715-1251(a)(3)(ii), as amended.
Question 54 – Does the plan include a statement that it believes it is a
grandfathered health plan in any plan materials provided to participants
and beneficiaries that describe the benefits provided under the plan? .............
u To maintain status as a grandfathered group health plan, the plan must
include a statement, in any plan materials provided to a participant or
beneficiary describing the benefits under the plan, that the plan believes it
is a grandfathered health plan within the meaning of section 1251 of the
Affordable Care Act and must provide contact information for questions and
complaints. Model language is available. See 29 CFR 2590.715-1251(a)(2).
For all plans that, based on questions 43 through 54, have not relinquished
grandfathered status, complete question 55.
Question 55 – Is the plan maintaining records documenting the terms of the
plan in connection with the coverage in effect on March 23, 2010, and are
these records made available upon request?........................................................
u To maintain status as a grandfathered group health plan the plan must
maintain records documenting the terms of the plan in connection with the
coverage that was in effect on March 23, 2010, and any other documents
necessary to verify, explain, or clarify its status as a grandfathered health
plan. These records must be maintained for as long as the plan takes the
position that it is grandfathered, and must be available for examination upon
request. See 29 CFR 2590.715-1251(a)(3)(i)(A) & (i)(B), as amended.

45

NO

N/A

YES
SECTION B. Determining Compliance with the Affordable Care Act Extension
of Dependent Coverage of Children to Age 26 Provisions in Part 7 of ERISA
Note: This provision is applicable for plan years beginning on or after Sept. 23,
2010. This provision applies to both grandfathered and non-grandfathered group
health plans.
Question 56 – Does the plan provide coverage for dependent
children?......................................................................................................................
If the answer to this question is no, proceed to SECTION C. These provisions are
only applicable to group health plans that provide coverage to dependent children. If
the answer is “yes”, proceed to question 57.
If the answer to the question below is “yes”, the plan is in compliance with the
rules regarding Dependent Coverage to Age 26.
Question 57 – Does the plan make dependent coverage available for children to
age 26? ................................................................................................................
Plans and issuers cannot deny or restrict dependent coverage for a child who is under
age 26 other than in terms of a relationship between a child and the participant.
Thus, plans and issuers cannot deny or restrict dependent coverage for a child who
is under age 26 based on the presence or absence of financial dependency upon or
residency with the participant or any other person, student status, employment or any
combination of these factors. In addition, plans and issuers cannot limit dependent
coverage based on whether the child under age 26 is married. The Affordable Care
Act and implementing regulations do not require plans to cover children of children.
See 29 CFR 2590.715-2714(b) & (c).
The terms of the plan or coverage cannot vary based on age, except for children who
are age 26 or older. See 29 CFR 2590.715-2714(d).
Tip: A plan or issuer does not fail to satisfy the requirements regarding Dependent
Coverage to Age 26 because the plan limits health coverage for children until the
child turns 26 to only those children who are described in section 152(f)(1) of the
Code (That section of the Code defines children to include only sons, daughters,
stepchildren, adopted children (including children placed for adoption), and foster
children.). For an individual not described in Code section 152(f)(1), such as a
grandchild or niece, a plan may impose additional conditions on eligibility for
health coverage, such as a condition that the individual be a dependent for income
tax purposes. See DOL FAQs About the Affordable Care Act Implementation Part I,
question 14 at dol.gov/ebsa/faqs/faq-aca.html.

46

NO

N/A

YES
SECTION C. Determining Compliance with the Affordable Care Act
Rescission Provisions in Part 7 of ERISA
Note: This provision is applicable for plan years beginning on or after Sept. 23,
2010. This provision applies to both grandfathered and non-grandfathered group
health plans.
A rescission is a cancellation or discontinuance of coverage that has retroactive
effect; this includes a cancellation that treats a policy as void from the time of
the group’s enrollment or a cancellation that voids benefits paid up to one year
before the cancellation. A rescission is not the cancellation or discontinuance of
coverage that has only a prospective effect; or the cancellation or discontinuance
of coverage if effective retroactively to the extent it is based on a failure to timely
pay required premiums or contributions towards the cost of coverage. See
29 CFR 2590.715-2712(a)(2).
If the answer to the question below is “yes” the plan is in compliance with
the rules regarding rescission of coverage.
Question 58 – Does the plan only rescind coverage for instances where
an act, practice, or omission that constitutes fraud, or an intentional
misrepresentation of material fact has occurred? ...............................................
u A group health plan, or health insurance issuer offering group health
insurance coverage, must not rescind coverage with respect to an individual
(including a group to which the individual belongs, or family coverage
in which the individual is included) once the individual is covered under
the plan or coverage, unless the individual (or a person seeking coverage
on behalf of the individual) performs an act, practice, or omission that
constitutes fraud, or makes an intentional misrepresentation of material fact,
as prohibited by the terms of the plan or coverage. See 29 CFR 2590.7152712(a)(1).
Tip: Some employers’ human resource departments may reconcile lists of
eligible individuals with their plan or issuer via data feed only once per month.
If a plan covers only active employees (subject to the COBRA continuation
coverage provisions) and an employee pays no premiums for coverage after
termination of employment, the Departments do not consider the retroactive
elimination of coverage back to the date of termination of employment, due
to delay in administrative record-keeping, to be a rescission. Similarly, if a
plan does not cover ex-spouses (subject to the COBRA continuation coverage
provisions) and the plan is not notified of a divorce and the full COBRA premium
is not paid by the employee or ex-spouse for coverage, the Departments do
not consider a plan’s termination of coverage retroactive to the divorce to be
a rescission of coverage. (Of course, in such situations COBRA may require
coverage to be offered for up to 36 months if the COBRA applicable premium is
paid by the qualified beneficiary.) See DOL FAQs About the Affordable Care Act
Implementation Part II, question 7 at dol.gov/ebsa/faqs/faq-aca2.html.

47

NO

N/A

YES
SECTION D. Determining Compliance with the Affordable Care Act
Prohibitions on Lifetime Limits and Restrictions on Annual Limits in Part 7
of ERISA
Note: This provision is applicable for plan years beginning on or after Sept. 23,
2010. This provision applies to both grandfathered and non-grandfathered group
health plans.
The restrictions on annual limits do not apply to health flexible spending
arrangements (FSAs), medical savings accounts (MSAs), or health savings
accounts (HSAs). In the case of health reimbursement accounts (HRAs) that
are integrated with other group health plan coverage which complies with the
prohibitions on lifetime and annual limits, the fact that benefits under the HRA
by itself are limited does not violate these rules. Stand-alone HRAs limited to
retirees only are not subject to these rules. (For more information about the
application of the market reforms and other provisions of the Affordable Care Act
to HRAs, health FSAs, and certain other employer healthcare arrangements, see
Technical Release 2013-03, available at dol.gov/ebsa/newsroom/tr13-03.html.
1. Lifetime Limits
If the answer to the question below is “yes” the plan is in compliance with
the rules regarding prohibitions on lifetime limits.
Question 59 – Does the plan comply with the Affordable Care Act’s
prohibition on lifetime limits?................................................................................
u A group health plan or issuer may not establish any lifetime limit on the
dollar amount of benefits for any individual. This prohibition applies for
plan years beginning on or after September 23, 2010. See 29 CFR 2590.7152711(a)(1).
Tip: These rules do not prevent a plan or issuer from placing lifetime dollar
limits with respect to any individual on specific covered benefits that are not
essential health benefits (to the extent this is permissible under applicable Federal
and State law). See 29 CFR 2590.715-2711(b)(1).
Note: “Essential health benefits” refers to essential benefits under Section
1302(b) of the Affordable Care Act and applicable regulations (issued by HHS)
including the Frequently Asked Question on Essential Health Benefits Bulletin.
For plan years beginning before the issuance of regulations defining “essential
health benefits,” for purposes of enforcement, the Departments will take into
account good faith efforts to comply with a reasonable interpretation of the term
“essential health benefits.” For this purpose, a plan or issuer must apply the
definition of essential health benefits consistently. See Preamble to Interim
Final Regulations, at 75 FR 37188, 37191.

48

NO

N/A

YES
2. Annual Limits
If the answer to the question below is “yes” the plan is in compliance with
the rules regarding prohibitions/restrictions on annual limits.
Question 60 – Does the plan comply with the Affordable Care Act’s
prohibition on annual limits?.................................................................................
For plan years beginning on or after January 1, 2014, a plan may not establish,
for any individual, an annual limit on the dollar amount of benefits that are
essential health benefits.
Tip: These rules do not prevent a plan or issuer from placing annual dollar limits
with respect to any individual on specific covered benefits that are not essential
health benefits (to the extent this is permissible under applicable Federal and
State law). See 29 CFR 2590.715-2711(b)(1).
SECTION E. Determining Compliance with the Affordable Care Act
Prohibition on Preexisting Condition Exclusions
This provision applies to both grandfathered and non-grandfathered group health
plans.
The definition of preexisting condition exclusion includes any limitation
or exclusion of benefits (including a denial of coverage) applicable to an
individual as a result of information relating to an individual’s health status
before the individual’s effective date of coverage (or if coverage is denied, the
date of denial), such as a condition identified as a result of a pre-enrollment
questionnaire or a physical examination given to the individual, or a review of
medical records relating to the pre-enrollment period. See 29 CFR 2590.701-2.
If the answer to the following question is “yes” the plan is in compliance
with the prohibition on preexisting condition exclusions.
Question 61 – Does the plan comply with the Affordable Care Act by not
imposing a preexisting condition exclusion? .......................................................
u For plan years beginning on or after January 1, 2014, group health plans may
not impose any preexisting condition exclusions. See 29 CFR 2590.7152704(a)(1).
Tip: Some preexisting condition exclusions are clearly designated as such in
the plan documents. Others are not. Check for hidden preexisting condition
exclusion provisions. A hidden preexisting condition exclusion is not designated
as a preexisting condition exclusion, but restricts benefits based on when a
condition arose in relation to the effective date of coverage.

49

NO

N/A

YES
Example: A plan excludes coverage for cosmetic surgery unless the surgery
is required by reason of an accidental injury occurring after the effective date
of coverage. This plan provision operates as a preexisting condition exclusion
because only people who were injured while covered under the plan receive
benefits for treatment. People who were injured while they had no coverage (or
while they had prior coverage) do not receive benefits for treatment. Accordingly,
this plan provision limits benefits relating to a condition because the condition
was present before the effective date of coverage, and is considered a preexisting
condition exclusion.
SECTION F- Compliance with the 90-day Waiting Period Limitation
Provision
Use the following questions to help determine whether the group health plan
complies with the Departments’ 90-day waiting period limitation regulations.
See final regulations issued by the Departments on February 24, 2014 at 29 CFR
2590.715-2708.
Note: PHS Act section 2708, as added by the Affordable Care Act and
incorporated into section 715 of ERISA, prohibits the application of any waiting
period that exceeds 90 days. Plans are not required to have a waiting period, and
the provision does not require plan sponsors to offer coverage to any particular
employee or class of employees. This provision applies to grandfathered health
plans and non-grandfathered plans.
Question 62- Does the plan apply a waiting period that exceeds 90-days? .......
u A waiting period is defined as the period that must pass before coverage for
an individual who is otherwise eligible to enroll under the terms of a group
health plan can become effective. See ERISA section 701(b)(4); 29 CFR
2590.715-2708(b)
u Being eligible for coverage under the terms of the plan generally means
having met the plan’s substantive eligibility conditions (such as, for example,
being in an eligible job classification, achieving job-related licensure
requirements specified in the plan’s terms, or satisfying a reasonable
and bona fide employment-based orientation period). See 29 CFR 2590715.2708(c)(1).
Variable Hour Employees:
u If a plan conditions eligibility on an employee regularly having a specified
number of hours of service per period (or working full-time), and it cannot be
determined that a newly hired employee is reasonably expected to regularly
work that number of hours per period (or work full-time), the plan may
take a reasonable period of time, not to exceed 12 months and beginning
on any date between the employee’s start date and the first day of the first
calendar month following the employee’s start date, to determine whether
the employee meets the plan’s eligibility condition. See 29 CFR 2590.7152708(c)(3)(i).

50

NO

N/A

YES
Tip: Except in cases in which a waiting period that exceeds 90 days is imposed
in addition to a measurement period, the time period for determining whether
an employee meets the plan’s eligibility condition will not be considered to be
designed to avoid compliance with the 90-day waiting period limitation if the
coverage is made effective no later than 13 months from the employee’s start
date, plus any time remaining until the first day of the next calendar month.
Cumulative Hours of Service Requirements:
u If a plan conditions eligibility on an employee having completed a number of
cumulative hours of service, the eligibility condition is not considered to be
designed to avoid compliance with the 90-day waiting period limitation if the
cumulative hours-of-service requirement does not exceed 1,200 hours. The
plan’s waiting period must begin once the new employee satisfies the plan’s
cumulative hours-of-service requirement. See 29 CFR 2590.715-2708(c)(3)
(ii).
Limitation on Orientation Periods
To the extent that an orientation period is not used as a subterfuge for the
passage of time, or designed to avoid compliance with the 90-day waiting period
limitation, an orientation period is permitted only if it does not exceed one
month. One month is determined by adding one calendar month and subtracting
one calendar day, measured from an employee’s start date in a position that is
otherwise eligible for coverage. See 29 CFR 2590.715-2708 (c)(3)(iii).
Tip: It is not permissible under the 90-day rule to delay coverage until the first
day of the month following completion of a 90-day waiting period. See 29 CFR
2590.715-2708 (e).
If you answered “Yes” to the above question under SECTION F, the plan
violates PHS Act Section 2708.
SECTION G. Determining Compliance with the Affordable Care Act
Provisions Regarding the provision of the Summary of Benefits and
Coverage (SBC) and Uniform Glossary
Note: These provisions do apply to grandfathered health plans.
The Affordable Care Act provides for new disclosure tools, the Summary of
Benefits and Coverage (SBC) and Uniform Glossary, to help consumers better
compare coverage options available to them in both the individual and group
health insurance coverage markets. Generally, group health plans and health
insurance issuers are required to provide the SBC and Uniform Glossary free of
charge. The Departments published a final rule setting forth the requirements for
who must provide and who is entitled to receive an SBC and Uniform
Glossary, when these documents must be provided, the content required in the
documents, and the form and manner of how the documents can be provided. In
addition, the Departments published a notice that sets forth the required template
for the SBC and Uniform Glossary documents along with instructions and sample

51

NO

N/A

YES
language for completing the template. These documents are available on the EBSA
Website at: dol.gov/ebsa/healthreform/. The SBC and Uniform Glossary must
be provided in a culturally and linguistically appropriate manner. The rules for
determining whether a language other than English must be made available are the
same as the rules for Internal Claims and Appeals and External Review, discussed
in SECTION J of this compliance aid. HHS has made available translated
versions of the template and glossary in the potentially required languages at:
cciio.cms.gov/resources/other/index.html.
Transitional Relief Providing Flexibility and Emphasizing Good Faith
Progress Towards Compliance
The Department is working together with employers and issuers to assist them in
coming into compliance with these requirements. Specifically, in the instructions
for completing the SBC, the Department stated that to the extent a plan’s terms
do not reasonably correspond to the template and instructions, the template
should be completed in a manner that is as consistent with the instructions as
reasonably as possible, while still accurately reflecting the plan’s terms. See
Instructions Guide for Group Coverage, page 1 General Instructions. In addition,
compliance assistance is a high priority for the Departments. Implementation
will be marked by an emphasis on assisting (rather than imposing penalties on)
plans and issuers that are working diligently and in good faith to understand and
come into compliance with the new law. During the first year of applicability, 17
the Departments did not impose penalties on plans and issuers that were working
diligently and in good faith to comply. The Departments are extending the
previously-issued enforcement and transition relief until further guidance is issued.
The Departments will continue to work with stakeholders over time to achieve
maximum uniformity for consumers and certainty for the regulated community.
See ACA Implementation FAQ Part XIX, Q8.
The questions below focus on provision of the SBC by group health plans
to participants and beneficiaries. The final regulations also require health
insurance issuers to provide the SBC to group health plan sponsors and
participants and beneficiaries. More information on these requirements can
be found at dol.gov/ebsa/healthreform.
The following questions have been developed to assist in determining
compliance with the rules regarding the Summary of Benefits and Coverage
and Uniform Glossary.

The term “first year of applicability” refers to SBCs and uniform glossaries provided with
respect to
to coverage
coverage beginning
beginning before
before January
January 1,
1, 2014.
2014.
respect

 17
17

52

NO

N/A

YES
Question 63 – Does the plan provide an SBC, as required? ................................
In Connection with Enrollment
When providing the SBC to participants and beneficiaries, group health plans and
issuers must provide the SBC with respect to each benefit package offered for
which they are eligible (See 29 CFR 2590.715-2715(a)(1)(ii)(A)) as part of any
written application materials distributed by the plan or issuer for enrollment. If
no written application materials are distributed for enrollment, the SBC must be
provided no later than the first date a participant is eligible to enroll in coverage
for themselves or any beneficiaries. See 29 CFR 2590.715-2715(a)(1)(ii)(B).
For this purpose, written application materials include any forms or requests for
information, in paper form or through a Website or email, that must be completed
for enrollment. See ACA Implementation FAQ Part VIII, Q9.
Tips: The requirement to provide an SBC by both a health insurance issuer and a
group health plan to participants and beneficiaries can be satisfied for both entities
as long as one entity provides the required SBC within the required timeframes.
See 29 CFR 2590.715-2715(a)(1)(iii)(A).
If a participant and any beneficiaries are known to reside at the same address, a
single SBC provided to that address will satisfy the obligation to provide for all
individuals at the address. Under this circumstance, the obligation will also be
satisfied if the SBC is furnished to the participant in electronic form. However
if a beneficiary’s last known address is different than the participant’s address, a
separate SBC must be mailed to the beneficiary’s address. See 29 CFR 2590.7152715(a)(1)(iii)(B) and ACA Implementation FAQ Part VIII, Q10.
Group health plans are permitted to integrate the SBC with other summary
materials, such as the SPD, as long as the SBC is intact and prominently displayed
at the beginning of the materials (for example, immediately after the table of
contents in an SPD) and all of the timing requirements are met. See 77 FR 8707.
The Departments generally allow electronic delivery of the SBC and Uniform
Glossary where appropriate. For participants and beneficiaries who are already
enrolled in coverage under a group health plan, an SBC may be provided
electronically if the requirements of the Department of Labor’s electronic
safe harbor are met. See ACA Implementation FAQ Part VIII, Q10 citing the
Department of Labor’s disclosure regulation at 29 CFR 2520.104b-1. For
participants and beneficiaries who are eligible but not enrolled for coverage, the
SBC may be provided electronically if the format is readily accessible; the SBC
is provided in paper form upon request; and if the electronic form is an Internet
posting, the plan or issuer timely notifies the individual that the documents are
available in paper form upon request. See 29 CFR 2590.715-2715(a)(3). An SBC
may be provided electronically to participants and beneficiaries in connection
with their online enrollment or online renewal of coverage under the plan. SBCs

53

NO

N/A

YES

NO

may also be provided electronically to participants and beneficiaries who request
an SBC online. In either instance, a paper copy must be provided upon request.
See ACA Implementation FAQ Part IX, Q1.
Question 64 – Does the plan make available the Uniform Glossary, as
required? .................................................................................................................
u The Uniform Glossary includes statutorily required terms, as well as multiple
additional terms recommended by the NAIC. The Uniform Glossary is
available on the DOL Website at dol.gov/ebsa/healthreform/. The Uniform
Glossary may not be modified by plans or issuers. See 29 CFR 2590.7152715(c)(3); 77 FR 8708.
u The final rule requires group health plans and issuers to make the Uniform
Glossary available upon request, in either paper or electronic form (as
requested), within seven business days. See 29 CFR 2590.715-2715(c)(4).
This requirement may be satisfied by providing an internet address where an
individual may review and obtain the Uniform Glossary as well as a contact
phone number to obtain a paper copy of the Uniform Glossary. See 29 CFR
2590.715-2715(a)(2)(i)(L).
If you are completing this section as part of a review of a grandfathered health plan, STOP here. The
following sections address provisions that do not apply to grandfathered health plans.
SECTION H. Determining Compliance with the Patient Protection
Provisions of the Affordable Care Act in Part 7 of ERISA
Note: This provision is applicable for plan years beginning on or after Sept. 23,
2010. This provision does not apply to grandfathered health plans.
1. Choice of Healthcare Professional
A plan or issuer that requires or provides for a participant or beneficiary to
designate a participating primary care provider must permit each participant or
beneficiary to designate any participating primary care provider who is available
to accept the participant or beneficiary. With respect to a child, the plan or
issuer must permit the designation of a physician who specializes in pediatrics
as a child’s primary care provider, if the provider participates in the network of
the plan or issuer and is available to accept the child. See 29 CFR 2590.7152719A(a)(1) & (a)(2).
A group health plan or issuer that provides obstetrical or gynecological (OB/
GYN) care and requires the designation of an in-network primary care provider,
may not require authorization or referral by the plan, issuer, or any person
(including a primary care provider) for a female participant or beneficiary
who seeks coverage for OB/GYN care provided by a participating health care
professional who specializes in obstetrics and gynecology. (This includes any
individual authorized under State law to provide OB/GYN care, including a
person other than a physician). See 29 CFR 2590.715-2719A(a)(3).

54

N/A

YES
Question 65 – Does the plan require or provide for designation
of a participating primary care provider by any participant or
beneficiary?.................................................................................................................
If the answer is ‘no’, enter ‘N/A’ for the following questions and proceed to
Question 72.
If the answer to ALL of the questions below is “yes” the plan is in
compliance with the choice of healthcare professional provisions of the rules
regarding patient protections.
Question 66 – Does the plan permit each participant or beneficiary to
designate any participating primary care provider who is available to accept
the participant or beneficiary? .............................................................................
u If a group health plan, or a health insurance issuer offering group health
insurance coverage, requires or provides for designation by a participant or
beneficiary of a participating primary care provider, then the plan or issuer
must permit each participant or beneficiary to designate any participating
primary care provider who is available to accept the participant or
beneficiary. See 29 CFR 2590.715-2719A(a)(1)(i).
Question 67 – Does the plan provide a notice informing each participant of
the terms of the plan or health insurance coverage regarding designation of
a primary care provider? .....................................................................................
u If a group health plan or health insurance issuer requires the designation by a
participant or beneficiary of a primary care provider, the plan or issuer must
provide a notice informing each participant of the terms of the plan or health
insurance coverage regarding designation of a primary care provider that any
participating primary care provider who is available to accept the participant
or beneficiary can be designated. See 29 CFR 2590.715-2719A(a)(4)(i)(A).
Tip: This notice must be provided any time the plan provides a participant with
an SPD or other similar description of benefits under the plan. See 29 CFR
2590.715-2719A(a)(4)(ii).
Question 68 – With respect to a child, does the plan permit the participant
or beneficiary to designate a physician who specializes in pediatrics as the
child’s primary care provider if the provider participates in the network of
the plan or issuer and is available to accept the child? .....................................
u If a group health plan, or a health insurance issuer offering group health
insurance coverage, requires or provides for the designation of a participating
primary care provider for a child by a participant or beneficiary, the plan or
issuer must permit the participant or beneficiary to designate a physician
(allopathic or osteopathic) who specializes in pediatrics as the child’s primary
care provider if the provider participates in the network of the plan or issuer
and is available to accept the child. See 29 CFR 2590.715-2719A(a)(2)(i).
55

NO

N/A

YES
Question 69 – With respect to a child, does the plan provide a notice
informing each participant of the terms of the plan or health insurance
coverage regarding designation of a primary care provider and the right to
designate any participating physician who specializes in pediatrics as the
primary care provider? .........................................................................................
u If a group health plan or health insurance issuer requires the designation
by a participant or beneficiary of a primary care provider, the plan or issuer
must provide a notice informing each participant of the terms of the plan or
health insurance coverage regarding designation of a primary care provider
with respect to a child, that any participating physician who specializes
in pediatrics can be designated as the primary care provider. See 29 CFR
2590.715-2719A(a)(4)(i)(B).
Tip: This notice must be provided any time the plan provides a participant with
an SPD or other similar description of benefits under the plan. See 29 CFR
2590.715-2719A(a)(4)(ii).
Question 70 – Does the plan provide coverage for OB/GYN care provided
by a participating health care professional who specializes in obstetrics
or gynecology for a female participant or beneficiary without requiring
authorization or referral by the plan, issuer, or any person (including a
primary care provider)? ........................................................................................
u For purposes of this provision, a health care professional who specializes in
obstetrics or gynecology is any individual (including a person other than a
physician) who is authorized under applicable State law to provide obstetrical
or gynecological care. The plan or issuer may require such a professional to
agree to otherwise adhere to the plan’s or issuer’s policies and procedures,
including procedures regarding referrals and obtaining prior authorization
and providing services pursuant to a treatment plan (if any) approved by the
plan or issuer. See 29 CFR 2590.715-2719A(a)(3)(i)(A).
u A plan or issuer must treat the provision of OB/GYN care, and the ordering
of related OB/ GYN items and services, by a participating health care
professional who specializes in obstetrics or gynecology as the authorization
of the primary care provider. See 29 CFR 2590.715-2719A(a)(3)(i)(B).
Question 71 – Does the plan provide a notice informing each participant of
the terms of the plan or coverage regarding designation of a primary care
provider and that the plan may not require authorization or referral for
obstetrical or gynecological care by a participating health care professional
who specializes in obstetrics or gynecology? .......................................................
u If a group health plan or health insurance issuer requires the designation by a
participant or beneficiary of a primary care provider, the plan or issuer must
provide a notice informing each participant of the terms of the plan or health
insurance coverage regarding designation of a primary care provider that the
plan may not require authorization or referral for obstetrical or gynecological
56

NO

N/A

YES
care by a participating health care professional who specializes in obstetrics
or gynecology. See 29 CFR 2590.715-2719A(a)(4)(i)(C).
Tip: This notice must be provided anytime the plan provides a participant with
an SPD or other similar description of benefits under the plan. See 29 CFR
2590.715-2719A(a)(4)(ii).
2. Coverage of Emergency Services
Question 72 – Does the plan provide any benefits with respect to services in
an emergency department of a hospital? .............................................................
If the answer is ‘no,’ enter ‘N/A’ for the following questions and proceed to
SECTION I.
Note: Small group insured plans are required to cover essential health benefits,
which include emergency services.
If the answer to ALL of the questions below is “yes” the plan is in
compliance with the coverage of emergency services provisions of the rules
regarding patient protections.
Question 73 – Does the plan provide coverage of emergency services without
the need for any prior authorization determination, even if the emergency
services are provided on an out-of-network basis?.............................................
u A plan or issuer subject to the requirements of this section must provide
coverage for emergency services without the need for any prior authorization
determination, even if the emergency services are provided on an out-ofnetwork basis. See 29 CFR 2590.715-2719A(b)(2)(i).
Question 74 – Does the plan provide coverage of emergency services
without regard to whether the health care provider furnishing the
emergency services is a participating network provider with respect to the
services?.......................................................................................................................
u A plan or issuer subject to the requirements of this section must provide
coverage for emergency services without regard to whether the health
care provider furnishing the emergency services is a participating network
provider with respect to the services. See 29 CFR 2590.715-2719A(b)(2)(ii).
Question 75 – Does the plan provide coverage of emergency services
provided out-of-network without imposing any administrative requirement
or limitation on coverage that is more restrictive than the requirements that
apply to emergency services provided in-network? ............................................
u If the emergency services are provided out-of-network, the plan must provide
the emergency services without imposing any administrative requirement
or limitation on coverage that is more restrictive than the requirements
57

NO

N/A

YES
or limitations that apply to emergency services received from in-network
providers. See 29 CFR 2590.715-2719A(b)(2)(iii).
Question 76 – When providing emergency services out-of-network, does the
plan impose cost-sharing requirements that comply with the requirements of
the interim final regulations? ................................................................................
u Any cost-sharing requirement expressed as a copayment amount or
coinsurance rate imposed with respect to a participant or beneficiary for outof-network emergency services cannot exceed the cost-sharing requirement
imposed with respect to a participant or beneficiary if the services were
provided in-network. However, a participant or beneficiary may be required
to pay, in addition to the in-network cost sharing, the excess of the amount
the out-of-network provider charges over the amount the plan or issuer is
required to pay under this section. See 29 CFR 2590.715-2719A(b)(3)(i).
u A plan or issuer complies with the requirements if it provides benefits with
respect to an emergency service in an amount equal to the greatest of the
following three amounts (which are adjusted for in-network cost-sharing
requirements):
(A) The amount negotiated with in-network providers for the emergency
service furnished, excluding any in-network copayment or coinsurance
imposed. (See 29 CFR 2590.715-2719A(b)(3)(i)(A) for more detailed
information, including how to determine this amount if there is more
than one amount negotiated with in-network providers for the emergency
service.)
(B) The amount for the emergency service calculated using the same
method the plan generally uses to determine payments for out-ofnetwork services (such as the usual, customary, and reasonable amount),
excluding any in-network copayment or coinsurance imposed. See 29
CFR 2590.715-2719A(b)(3)(i)(B).
(C) The amount that would be paid under Medicare for the emergency
service, excluding any in-network copayment or coinsurance imposed.
See 29 CFR 2590.715-2719A(b)(3)(i)(C).
Tip: Any other cost-sharing requirement, such as a deductible or out-of-pocket
maximum, may be imposed with respect to out-of-network emergency services
only if the cost-sharing requirement generally applies to out-of-network benefits.
See 29 CFR 2590.715-2719A(b)(3)(ii).

58

NO

N/A

YES
Question 77 – Does the plan provide coverage of emergency services without
regard to any other term or condition of the coverage, other than the
exclusion or coordination of benefits, a permissible affiliation or waiting
period, or applicable cost-sharing requirements? ..............................................
u A plan or issuer subject to the requirements of this section must provide
coverage for emergency services without regard to any other term or
condition of the coverage, other than the exclusion or coordination of
benefits, an affiliation or waiting period permitted under part 7 of ERISA,
part A of title XXVII of the PHS Act, or chapter 100 of the Internal Revenue
Code, or applicable cost sharing. See 29 CFR 2590.715-2719A(b)(2)(v).
SECTION I. Determining Compliance with the Affordable Care Act
Coverage of Preventive Services Provisions in Part 7 of ERISA
Note: This provision is applicable for plan years beginning on or after Sept. 23,
2010. This provision does not apply to grandfathered health plans.
Group health plans and health insurance issuers must provide coverage for, and
must not impose cost-sharing requirements with respect to, certain recommended
preventive services. Nothing prevents plans or issuers from providing coverage
for preventive items and services in addition to the recommended preventive
services required under these regulations. See 29 CFR 2590.715-2713(a)(1) & (a)
(5).
A complete list of recommendations and guidelines that include services that
are required to be covered under these interim final regulations can be found
at HealthCare.gov/center/regulations/prevention.html. Any changes to or new
recommendations and guidelines will be noted at this site. Plans must cover any
new recommended service within one year after the date the recommendation or
guidance is issued. Therefore, by visiting the site once per year, plans and issuers
will have straightforward access to all the information necessary to determine any
additional items and services that must be covered without cost-sharing and any
items or services that are no longer required to be covered.
If the answer to ALL of the questions below is “yes” the plan is in
compliance with the rules regarding preventive services.
Question 78 – Does the plan provide coverage without imposing any costsharing requirements for evidence-based items or services that have in effect
a rating of A or B in the current recommendations of the United States
Preventive Services Task Force? ...........................................................................
u Plans and issuers must provide coverage for evidence-based items or services
that have in effect a rating of A or B in the current recommendations of the
United States Preventive Services Task Force. See 29 CFR 2590.715-2713(a)
(1)(i).

59

NO

N/A

YES
Note: Recommendations of the United States Preventive Services Task Force
regarding breast cancer screening, mammography, and prevention issued in or
around November 2009 are not considered to be current.
Question 79 – Does the plan provide coverage without imposing any
cost-sharing requirements for immunizations for routine use in children,
adolescents, and adults that have in effect a recommendation from the
Advisory Committee on Immunization Practices of the Centers for Disease
Control and Prevention?.........................................................................................
u For the purpose of this section, a recommendation from the Advisory
Committee on Immunization Practices of the Centers for Disease Control and
Prevention is considered in effect after it has been adopted by the Director
of the Centers for Disease Control and Prevention, and a recommendation is
considered to be for routine use if it is listed on the Immunization Schedules
of the Centers for Disease Control and Prevention. See 29 CFR 2590.7152713(a)(1)(ii).
Question 80 – With respect to infants, children, and adolescents, does the
plan provide coverage without imposing any cost-sharing requirements
for evidence-informed preventive care and screenings provided for in
comprehensive guidelines supported by the Health Resources and Services
Administration?..........................................................................................................
u With respect to infants, children, and adolescents, a plan or issuer must
provide coverage for evidence-informed preventive care and screenings
provided for in comprehensive guidelines supported by the Health Resources
and Services Administration. See 29 CFR 2590.715-2713(a)(1)(iii).
Question 81 – With respect to women, does the plan provide coverage
without imposing any cost-sharing requirements for evidence-informed
preventive care and screenings provided for in comprehensive guidelines
supported by the Health Resources and Services Administration? ..................
u A complete list of guidelines that are required to be covered can be found at:
hrsa.gov/womensguidelines/. (Note: there is a limited exception for certain
employers regarding coverage for certain women’s preventive services; see
dol.gov/ebsa/healthreform for updated guidance).
u With respect to women, a plan or issuer must provide coverage for evidenceinformed preventive care and screenings provided for in comprehensive
guidelines supported by the Health Resources and Services Administration.
See 29 CFR 2590.715-2713(a)(1)(iv).

60

NO

N/A

YES
Question 82 – Does the plan provide coverage for office visits without
imposing cost sharing requirements when recommended preventive services
are not billed separately from an office visit and is the primary purpose of
the office visit? ........................................................................................................
u If a recommended preventive service or item is not billed separately (or is not
tracked as individual encounter data separately) from an office visit and the
primary purpose of the office visit is the delivery of such a service or item,
then a plan or issuer may not impose cost-sharing requirements with respect
to the office visit. See 29 CFR 2590.715-2713(a)(2)(ii).
Tip: If a recommended preventive service is billed separately from an office
visit, or if the recommended preventive service is not billed separately and the
primary purpose of the office visit is not delivery of the recommended preventive
service, then a plan or issuer may impose cost-sharing with respect to the office
visit. See 29 CFR 2590.715-2713(a)(2)(i) & (iii).
Additional tips:
u Plans and issuers that have a network of providers are not required to provide
coverage for and may impose cost-sharing requirements for recommended
preventive services delivered by an out-of-network provider. See 29 CFR
2590.715-2713(a)(3).
u Plans and issuers may use reasonable medical management techniques
to determine the frequency, method, treatment, or setting for the
recommended preventive services to the extent these are not specified in the
recommendations or guidelines. See 29 CFR 2590.715-2713(a)(4).
u Plans and issuers can impose cost-sharing for a treatment that is not a
recommended preventive service under these regulations, even if the
treatment resulted from a recommended preventive service. See 29 CFR
2590.715-2713(a)(5) and ACA Implementation FAQs Part XII Q5.
SECTION J. Determining Compliance with the Affordable Care Act
Provisions Regarding Internal Claims and Appeals and External Review in
Part 7 of ERISA
The internal claims and appeals and external review provisions of Part 7 of
ERISA do not apply to grandfathered health plans.
Note: There have been several phases of guidance issued regarding the internal
claims and appeals and external review provisions under the Affordable Care
Act. More information about the requirements regarding internal claims and
appeals and external review processes under ERISA is available at dol.gov/ebsa.

61

NO

N/A

YES
1. Internal Claims and Appeals
Under the Affordable Care Act group health plans and health insurance issuers
offering group health insurance coverage were required to implement an
effective internal claims and appeals process for plan years beginning on or after
September 23, 2010. In general, the interim final regulations require plans and
issuers to comply with the DOL claims procedure rule under 29 CFR 2560.5031 and impose specific additional requirements and include some clarifications
(referred to as the “additional standards” for internal claims and appeals). In
addition to meeting the following requirements, the plan is required to comply
with all of the requirements of the DOL claims procedure rule under 29 CFR
2560.503-1.
The following questions have been developed to assist in determining
compliance with the additional standards for internal claims and appeals
processes and is not intended to determine compliance with the DOL claims
procedure rule.
Question 83 – Does the plan provide internal claims and appeals processes
with respect to rescissions of coverage? ...............................................................
u Under the DOL claims procedure rule, adverse benefit determinations
eligible for internal claims and appeals processes generally include denial,
reduction, or termination of, or a failure to provide or make a payment (in
whole or in part) for a benefit (including a denial, reduction, termination, or
failure to make a payment based on the imposition of a preexisting condition
exclusion, a source of injury exclusion, or other limitation on covered
benefits). See 29 CFR 2560.503-1(m)(4).
u The Department’s regulations broaden the DOL claims procedure rule’s
definition of “adverse benefit determination” to include rescissions of
coverage. Therefore, rescissions of coverage are also eligible for internal
claims and appeals processes, whether or not the rescission has an adverse
effect on any particular benefit at the time of an appeal. See 29 CFR
2590.715-2719(a)(2)(i); 29 CFR 2560.503-1.
u This provision is applicable for plan years beginning on or after September
23, 2010. See 29 CFR 2590.715-2719(g).
Question 84 – Does the plan provide claimants with any new or additional
evidence or rationale considered in connection with a claim? ...........................
u The Department’s regulations clarify that plans or issuers must provide
to claimants, free of charge, any new or additional evidence considered,
relied upon, or generated by (or at the direction of) the plan or issuer in
connection with a claim. This evidence must be provided as soon as possible
and sufficiently in advance of the date on which the notice of final internal

62

NO

N/A

YES
adverse benefit determination is required to be provided in order to give the
claimant a reasonable opportunity to respond prior to that date. Similarly,
before a plan or issuer can issue a final internal adverse benefit determination
based on a new or additional rationale, the claimant must be provided, free
of charge, with the rationale. This rationale must be provided as soon as
possible and sufficiently in advance of the date on which the notice of final
internal adverse benefit determination is required to be provided in order to
give the claimant a reasonable opportunity to respond prior to that date. See
29 CFR 2590.715-2719(b)(2)(ii)(C).
u This provision is applicable for plan years beginning on or after September
23, 2010. See 29 CFR 2590.715-2719(g).
Question 85 – Does the plan ensure that claims and appeals are adjudicated
in a manner that maintains independence and impartiality of decision
making? ...................................................................................................................
u The Department’s regulations clarify that plans or issuers must ensure
that all claims and appeals are adjudicated in a manner designed to ensure
the independence and impartiality of the persons involved in making the
decision. Accordingly, decisions regarding hiring, compensation, termination,
promotion, or other similar matters with respect to any individual (such as
a claims adjudicator or medical expert) must not be made based upon the
likelihood or perceived likelihood that the individual will support or tend to
support a denial of benefits. See 29 CFR 2590.715-2719(b)(2)(ii)(D).
u This provision is applicable for plan years beginning on or after September
23, 2010. See 29 CFR 2590.715-2719(g).
Question 86 – Complete the following questions to ensure that the plan
complies with the additional content requirements for any notice of adverse
benefit determination or final internal adverse benefit determination:
86a. Does the plan or issuer ensure that any notice of adverse benefit
determination or final internal adverse benefit determination includes
information sufficient to identify the claim involved? .......................................
u The Department’s regulations provide that plans and issuers must ensure that
any notice of adverse benefit determination or final internal adverse benefit
determination includes information sufficient to identify the claim involved
including the date of service, the health care provider, and the claim amount
(if applicable), and a statement describing the availability, upon request, of
the diagnosis code and its corresponding meaning, and the treatment code,
and its corresponding meaning. See 29 CFR 2590.715-2719(b)(2)(ii)(E)(1).
This provision is applicable for plan years beginning on or after July 1, 2011.
See T.R. 2011-01 at dol.gov/ebsa/newsroom/tr11-01.html.

63

NO

N/A

YES
u Plans or issuers must also provide to participants and beneficiaries, as soon
as practicable, upon request, the diagnosis and treatment codes (and their
meanings), associated with any adverse benefit determination or final internal
adverse benefit determination. The plan or issuer must not consider a request
for such diagnosis and treatment information, in itself, to be a request for an
internal appeal or external review. See 29 CFR 2590.715-2719(b)(2)(ii)(E)
(1), as amended. This provision is applicable for plan years beginning on or
after January 1, 2012. See T.R. 2011-01 at dol.gov/ebsa/newsroom/tr11-01.
html.
86b. Does the plan or issuer ensure that any notice of adverse benefit
determination or final internal adverse benefit determination includes an
adequate description of the reasons for the adverse benefit determination or
final internal adverse benefit determination? ......................................................
u The Department’s regulations provide that plans and issuers must ensure
that the reasons for the adverse benefit determination or final internal
adverse benefit determination includes the denial code and its corresponding
meaning, as well as a description of the standard that was used in denying the
claim. In the case of a notice of final internal adverse benefit determination,
this description must include a discussion of the decision. See 29 CFR
2590.715-2719(b)(2)(ii)(E)(3).
u This provision is applicable for plan years beginning on or after July 1, 2011.
See T.R. 2011-01 at dol.gov/ebsa/newsroom/tr11-01.html.
86c. Does the plan or issuer ensure that any notice of adverse benefit
determination or final internal adverse benefit determination includes
a description of available internal appeals and external review
processes?....................................................................................................................
u The Department’s regulations provide that plans and issuers must provide
a description of available internal appeals and external review processes,
including information regarding how to initiate an appeal. See 29 CFR
2590.715-2719(b)(2)(ii)(E)(4).
u This provision is applicable for plan years beginning on or after July 1, 2011.
See T.R. 2011-01 at dol.gov/ebsa/newsroom/tr11-01.html.
86d. Does the plan or issuer ensure that any notice of adverse benefit
determination or final internal adverse benefit determination disclose the
availability of, and contact information for, any applicable office of health
insurance consumer assistance or ombudsman established under PHS Act
section 2793?............................................................................................................
u The Department’s regulations provide that plans and issuers must disclose
the availability of, and contact information for, any applicable office of
health insurance consumer assistance or ombudsman established under PHS
Act section 2793 to assist enrollees with the internal claims and appeals and
external review processes. See 29 CFR 2590.715-2719(b)(2)(ii)(E)(5).
64

NO

N/A

YES
u An updated list of the State Consumer Assistance Programs is available on the
Department of Labor Website at dol.gov/ebsa/capupdatelist.doc.
u These provisions are applicable for plan years beginning on or after July 1,
2011. See T.R. 2011-01 at dol.gov/ebsa/newsroom/tr11-01.html.
Question 87 – Does the plan defer to the attending provider as to whether
a claim involves urgent care and provide notice regarding such urgent care
claim as required?....................................................................................................
u As under 29 CFR 2560.503-1(f)(2)(i), plans or issuers must notify a claimant
of a benefit determination (whether adverse or not) with respect to a claim
involving urgent care as soon as possible, taking into account the medical
exigencies, but not later than 72 hours after the receipt of the claim by the plan
or issuer. 29 CFR 2590.715-2719(b)(2)(ii)(B), as amended.
u The determination as to whether a claim involves urgent care is determined by
the attending provider and the plan or issuer must defer to such determination.
See 29 CFR 2590.715-2719(b)(2)(ii)(B), as amended.
u This provision is applicable for plan years beginning on or after January 1,
2012. See T.R. 2011-01 at dol.gov/ebsa/newsroom/tr11-01.html.
Question 88 – Does the plan comply with the requirements regarding deemed
exhaustion of internal claims and appeals processes? ..........................................
u In the case of a plan or issuer that fails to adhere to all the requirements of
the Interim Final Rules relating to the Internal Claims and Appeals process
with respect to a claim, the claimant is deemed to have exhausted the internal
claims and appeals process. The internal claims and appeals process will
not be deemed exhausted as long as the violation was: de minimus, does not
cause, and is not likely to cause, prejudice or harm to the claimant, attributable
to good cause or due to matters beyond the control of the plan or issuer, in
the context of an ongoing, good faith exchange of information between the
plan and the claimant, and is not reflective of a pattern or practice of noncompliance. See 29 CFR 2590.715-2719(b)(2)(ii)(F), as amended.
u In the event that the claimant requests a written explanation of the violation,
the plan or issuer must provide such explanation within 10 days, including a
specific description of its bases, if any, for asserting that the violation should
not cause the internal claims and appeals process to be deemed exhausted. See
29 CFR 2590.715-2719(b)(2)(ii)(F), as amended.
u In the case that the external review rejects the claimant’s immediate review,
the plan must provide the claimant notice of the opportunity to resubmit and
pursue the internal appeal of the claim. This notice must be sent within a
reasonable time after the external reviewer rejects the claim for immediate
review, not later than 10 days. See 29 CFR 2590.715-2719(b)(2)(ii)(F), as
amended.
65

NO

N/A

YES
u These provisions are applicable for plan years beginning on or after January
1, 2012. See T.R. 2011-01 at dol.gov/ebsa/newsroom/tr11-01.html.
Question 89 – Does the plan provide culturally and linguistically appropriate
notices in a county that meets the applicable threshold?....................................
u The Department’s regulations provide that plans and issuers must provide
relevant notices in a culturally and linguistically appropriate manner.
u The Department’s regulations establish a single threshold with respect to the
percentage of people who are literate only in the same non-English language
for both the group and individual markets. With respect to plans and issuers,
the threshold percentage is set at 10 percent or more of the population
residing in the claimant’s county, as determined based on American
Community Survey (ACS) data published by the United States Census
Bureau. The list of counties determined to meet the threshold is available at
cms.gov/CCIIO/Resources/Fact-Sheets-and-FAQs/Downloads/2013-clasdata.pdf. This list will be updated annually. See 29 CFR 2590.715-2719(e)
(3), as amended.
If the answer to this question is “Yes,” proceed to question 90. If the answer
is “No,” proceed to the next section.
Question 90 – Does the plan provide notices in a culturally and linguistically
appropriate manner with respect to internal claims and appeals processes?
u To meet this requirement the plan or issuer must:
v include a one-sentence statement in the relevant non-English language
about the availability of language services on each notice sent to an
address in a county that meets the threshold;
v provide, upon request, a notice in any applicable non-English language;
and
v provide a customer assistance process (such as a telephone hotline)
with oral language services in the non-English language and provide
written notices in the non-English language upon request. See 29 CFR
2590.715-2719(e), as amended.
u The translated statements are available at dol.gov/ebsa/IABDModelNotice2.
doc.
These provisions are applicable for plan years beginning on or after January 1,
2012. See T.R. 2011-01 at dol.gov/ebsa/newsroom/tr11-01.html.

66

NO

N/A

YES
2. External Review
Plans and issuers must comply with either a State external review process or
the Federal external review process. The external review provisions of Part 7 of
ERISA do not apply to grandfathered health plans.
The following questions have been developed to assist in determining
compliance with the rules regarding the external review processes.
Question 91 – Is the plan subject to the requirements of a State external
review process or the HHS-Administered Federal External Review
Process? ...................................................................................................................
u Non-grandfathered, self-insured group health plans subject to ERISA and the
Code:
v Generally follow requirements of the private accredited IRO process
(established by TR 2010-01, modified by TR 2011-02).
u Non-grandfathered, insured coverage:
v Generally, issuers must follow the State process if the external review
process meets either the NAIC-Similar or NAIC-Parallel process as
determined by HHS.
v However, issuers in States without a conforming State process and selfinsured non-federal governmental plans may either:
− Utilize the private accredited IRO process (established by TR 201001, and modified by TR 2011-02); or
− Utilize the HHS-Administered Federal External Review Process.
Background information regarding external review processes for insured
plans:
u For insured coverage, HHS has determined which State external review
processes meet the minimum requirements to apply to issuers in those States.
See cms.gov/CCIIO/Resources/Files/external_appeals.html.
If you answered “Yes” to Question 91 above, STOP. The plan is not subject
to the DOL Private Accredited IRO process. If you answered “No” to
Question 91 above, continue to Question 92.

67

NO

N/A

YES
Question 92 – DOL Private Accredited IRO process: Does the plan provide
external review for the required scope of adverse benefit determinations? .....
Under the Department’s regulations the scope of the Federal external review
process applies to:
u An adverse benefit determination, including a final internal adverse benefit
determination, by a plan or issuer that involves medical judgment, including
but not limited to those based on the plan’s or issuer’s requirements for
medical necessity, appropriateness, health care setting, level of care, or
effectiveness of a covered benefit; or its determination that a treatment is
experimental or investigational; and
u A rescission of coverage (regardless of whether or not the rescission has any
effect on any particular benefit at that time). See 29 CFR 2590.715-2719(d)
(1)(ii), as amended.
u An adverse benefit determination that relates to a participant’s or
beneficiary’s failure to meet the requirements for eligibility under the
terms of a group health plan (i.e., worker classification or similar issue) is
not within the scope of the Federal external review process. See 29 CFR
2590.715-2719(d)(1)(i), as amended.
Question 93 – DOL Private Accredited IRO process: Does the plan provide
an effective external review process? ...................................................................
u Self-insured coverage subject to ERISA and the Code may either comply
with the standards of the private accredited IRO process or voluntarily
comply with a State external review process if the State allows access.
u If the plan is complying with the private accredited IRO process, ensure the
plan complies with all of the standards articulated in TR 2011-02 including:
v Providing effective written notice of external review
v Providing limits related to filing fees
v Providing claimant at least 4 months to file for external review
v Requiring that IROs must be accredited
v Requiring that IROs may not have conflicts of interest that influence
independence
v Providing that IRO decisions are binding on the insurer and the claimant
v Requiring IROs to maintain written records for at least three years
u Department of Labor clarified in TR 2011-02 that to be eligible for a safe
harbor from enforcement from the Department of Labor and the IRS (as
previously set forth in sub-regulatory guidance issued in ACA FAQs Part 1
on September 20, 2010), self-insured plans will be required to contract with
at least three IROs by July 1, 2012.
See TR 2010-01 at dol.gov/ebsa/pdf/ACATechnicalRelease2010-01.pdf, and TR2011-02 at dol.gov/ebsa/newsroom/tr11-02.html.

68

NO

N/A