Approaching Deadline for Health Plans To Obtain Health Plan Identifier Number

October 13, 2014
Harter Secrest & Emery LLP


On September 5, 2012, the U.S. Department of Health and Human Services (HHS) issued final regulations requiring health plans to obtain a unique Health Plan Identifier (an “HPID”) by November 5, 2014. Small health plans with annual claim payments under $5,000,000 have until November 5, 2015 to obtain an HPID.

The HPID mandate establishes a unique identifier for each health plan, with the intent to increase uniformity within HIPAA “standard transactions.” Standard transactions include requests for claims and encounter information, transmissions related to eligibility, authorizations and referrals, inquiries about claim status, and enrollment and disenrollment. The mandate applies to all health plans, even those that do not conduct standard transactions.

Implication for Plan Sponsors

The process to obtain an HPID is cumbersome and can take up to two weeks, so employers must act fast to determine whether they must obtain an HPID for their health plans, and if so, begin the application process as soon as possible to meet the November 5, 2014 deadline. The mandate applies if your health plan is a “Controlling Health Plan” (a “CHP”), defined under the regulations as a health plan that controls its own business activities, actions, or policies. The regulations also apply to entities with Subhealth Plans (an “SHP”), defined as health plans with business activities, actions, or policies directed by a controlling health plan.

CHPs are required to obtain an HPID. SHPs may obtain an HPID on their own or at the direction of a CHP, but are not required to obtain an HPID under the regulations. The “Controlling Health Plan/Subhealth Plan” distinction is mainly relevant to health insurance carriers. Most employers will not need to worry about the distinction and many employers will not need to obtain an HPID at all.

Fully-Insured Plans

If your health plan is fully-insured, you need not obtain an HPID. In the fully-insured context, the insurance carrier is the entity that controls the CHP. Therefore, the insurance carrier is responsible for obtaining an HPID for the plan.

Self-Insured Plans

If your health plan is a self-insured medical, prescription, dental, or vision plan, you need to obtain an HPID. In the self-insured context, the employer is the entity that controls the CHP or SHP. Thus, an employer that maintains a self-insured health plan will need to obtain an HPID even if a third party administrator (a “TPA”) conducts standard transactions on its behalf.

If your self-insured coverage consists solely of a Flexible Spending Account (FSA), a Health Reimbursement Account (HRA) that covers only deductibles or out-of-pocket costs, or a similar account-based plan, you will not be required to obtain an HPID. Relevant guidance has specifically exempted such plans from the HPID requirements. Note that if your HRA is paired with a self-insured group health plan, you would need to obtain an HPID for the underlying group health plan, even though one would not be required for the HRA.

HPID Application Process

Employers who are required to obtain an HPID should first determine whether they are already registered in the Center for Medicare and Medicaid Services’s (CMS) Health Insurance Oversight System (HIOS). We expect that most employers have not previously registered in the HIOS. Employers who have not previously registered in the HIOS will need to create a profile in the HIOS system before they can apply for an HPID. Once applicants begin to apply for an HPID in the HPOES system, they will be required to submit:

  • the organization (employer) name;
  • federal employer identification number (EIN/FEIN);
  • a description of the controlling health plan; and
  • the plan(s) payer identification number, if applicable.

For further details on the process, review CMS’s guide entitled A Quick Reference Guide to Obtaining a Controlling Health Plan HPID.

The HPID registration process is even more complicated for employers with more than one self-insured plan option. In unofficial guidance, CMS has suggested that an employer with multiple self-insured plans has the option of obtaining one HPID for all of its plans, or separate HPIDs for each plan. An employer that maintains a single self-insured group health plan (in other words, files a single Form 5500 for the plan) that has multiple coverage options (e.g., a “PPO” type option and an “EPO” type option for medical coverage and single self-insured options for dental and vision coverage) should only seek to obtain a single HPID for the plan. On the other hand, an employer that maintains a self-insured group health plan for active employees and a completely separate self-insured group health plan (for which it files a separate Form 5500 from the active plan Form 5500) should try to obtain a separate HPID for each of the plans, if possible.

TPAs can make HPID requests on behalf of self-insured plans in the HPOES system. Self-insured plan sponsors that want to involve their TPAs in the HPID process should take steps now to begin the application process, and those with multiple TPAs for a single CHP should also be sure to coordinate with their TPAs to ensure that only one HPID is obtained.

Should you have any questions regarding your health plan or compliance with the HPID mandate, please feel free to contact any member of our firm’s Employee Benefits and Executive Compensation Practice Area at (585) 232-6500.

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