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EBSA Final Rules

Group Health Plans and Health Insurance Issuers: Rules Relating to Internal Claims and Appeals and External Review Processes; Correction   [7/26/2011]
[PDF]
Federal Register, Volume 76 Issue 143 (Tuesday, July 26, 2011)
[Federal Register Volume 76, Number 143 (Tuesday, July 26, 2011)]
[Rules and Regulations]
[Pages 44491-44493]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-18820]


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DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Part 54

[TD 9532]
RIN 1545-BK30

DEPARTMENT OF LABOR

Employee Benefits Security Administration

29 CFR Part 2590

RIN 1210-AB45

DEPARTMENT OF HEALTH AND HUMAN SERVICES

45 CFR Part 147

[CMS-9993-CN]
RIN 0938-AQ66


Group Health Plans and Health Insurance Issuers: Rules Relating 
to Internal Claims and Appeals and External Review Processes; 
Correction

AGENCIES: Internal Revenue Service, Department of the Treasury; 
Employee Benefits Security Administration, Department of Labor; Centers 
for Medicare & Medicaid Services, Department of Health and Human 
Services.

ACTION: Correction of amendment to interim final rules with request for 
comments.

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SUMMARY: This document corrects technical errors that appeared in the 
June 24, 2011 amendment to the interim final rules (76 FR 37208) 
entitled, ``Group Health Plans and Health Insurance Issuers: Rules 
Relating to Internal Claims and Appeals and External Review 
Processes.''

DATES: Effective Date: July 22, 2011.

FOR FURTHER INFORMATION CONTACT: Ellen Kuhn, Centers for Medicare & 
Medicaid Services, Department of Health and Human Services, at (301) 
492-4263; Amy Turner, Employee Benefits Security Administration, 
Department of Labor, at (202) 693-8335; or Karen Levin, Internal 
Revenue Service, Department of the Treasury, at (202) 622-6080.

SUPPLEMENTARY INFORMATION: 

I. Background

A. Introduction

    In FR Doc. 2011-15890 of June 24, 2011 (76 FR 37208), there were 
technical errors that are identified in the ``Summary of Errors'' 
section and corrected in the ``Correction of Errors'' section below. 
The provisions in this correction notice are effective as if they had 
been included in the June 24, 2011 interim final rule with request for 
comments entitled, ``Group Health Plans and Health Insurance Issuers: 
Rules Relating to Internal Claims and Appeals and External Review 
Processes.'' Accordingly, the corrections are effective July 22, 2011.

B. Regulations Overview

    On July 23, 2010, the Departments of Health and Human Services 
(HHS), Labor (DOL), and the Treasury (collectively, the Departments) 
issued interim final rules implementing section 2719 of the Public 
Health Service (PHS) Act (75 FR 43330) (July 2010 regulations), 
regarding internal claims and appeals and external review processes for 
group health plans and health insurance issuers offering coverage in 
the group and individual markets.\1\ The Departments issued an 
amendment to the interim final rules that was published in the Federal 
Register on June 24, 2011 (76 FR 37208) (June 2011 amendments). Below, 
we summarize the errors in the June 2011 amendments and describe the 
corrections we are making in this notice.
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    \1\ The requirements of PHS Act section 2719 and the July 2010 
regulations do not apply to health plans grandfathered under section 
1251 of the Affordable Care Act.
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II. Summary of Errors

A. Error in the Preamble

    In the FOR FURTHER INFORMATION CONTACT section of the June 2011 
amendments (page 37208), we listed an incorrect telephone number for 
Ellen Kuhn, Centers for Medicare & Medicaid Services, Department of 
Health and Human Services. We are correcting the telephone number.

[[Page 44492]]

B. Errors in the Regulations Text

    In the June 2011 amendments (page 37231), we inadvertently made a 
typographical error in the DOL regulations text that could cause 
confusion. The text pertains to the effective date of the suspension of 
the general rule defining the scope of what is appealable in external 
review. We are correcting this typographical error. We note that the 
regulation text for HHS and the Department of the Treasury were correct 
and therefore are unchanged.
    In the joint preamble to the June 2011 amendments (pages 37209 
through 37215), we explain that the July 2010 regulations established 
requirements for group health plans and health insurance issuers 
offering both individual and group health coverage and that the June 
2011 amendments were modifying those requirements. However, the 
regulations text in the June 2011 amendments only reflected the changes 
to the group market provisions, which appear in all three Departments' 
regulations (pages 37228 through 37229; 37230 through 37231; and 37232 
through 37233). Requirements that apply to the individual market only 
appear in HHS regulations, and conforming amendments to those 
requirements were inadvertently omitted from the regulation text of the 
June 2011 amendments. In the regulations text at 45 CFR 147.136, HHS is 
correcting this technical error. Specifically, we are reorganizing 
Sec.  147.136(b)(3)(ii) and adding language to clarify that these 
amendments apply to health insurance issuers offering individual health 
coverage. These changes relate to internal claims and appeals processes 
requirements for individual health insurance issuers in the HHS 
regulations text. We note that the regulations text for the DOL and the 
Department of the Treasury were correct and therefore are unchanged.

III. Waiver of Proposed Rulemaking and Waiver of the Delay in Effective 
Date

    Under the Administrative Procedure Act (APA) (5 U.S.C. 551 et 
seq.), while a general notice of proposed rulemaking and an opportunity 
for public comment is generally required before the promulgation of 
regulations, this is not required when an agency, for good cause, finds 
that notice and public comment are impracticable, unnecessary, or 
contrary to the public interest, and incorporates a statement of the 
reasons for that finding in the notice.
    The APA also generally requires that a final rule be effective no 
sooner than 30 days after the date of publication in the Federal 
Register. This 30-day delay in effective date can be waived, however, 
if an agency finds good cause why the effective date should not be 
delayed, and the agency incorporates a statement of the findings and 
its reasons in the rule issued.
    This document merely corrects technical errors made in the June 
2011 amendments published in the Federal Register on June 24, 2011 (76 
FR 37208), which will be effective on July 22, 2011. The corrections 
contained in this document are consistent with and do not make 
substantive changes to the policies adopted in the June 2011 
amendments. The preamble to the June 2011 amendments correctly refers 
to and discusses the substance of the sections affected by this 
technical correction. Therefore, we find for good cause that it is 
unnecessary and would be contrary to the public interest to undertake 
further notice and comment procedures to incorporate these corrections. 
Furthermore, we note that the June 2011 amendments were published, for 
good cause, as interim final rules, and that all the reasons stated in 
the June 2011 amendments for waiving notice and comment procedures with 
respect to the June 2011 amendments are applicable to this correction 
notice.
    We are also waiving the 30-day delay in effective date for these 
corrections. We believe that it is in the public interest to ensure 
that the June 2011 amendments setting forth requirements for group 
health plans and health insurance issuers relating to internal claims 
and appeals and external review processes accurately states our 
policies as of the date they take effect. Therefore, we find that 
delaying the effective date of these corrections beyond the effective 
date of the June 2011 amendments would be contrary to the public 
interest. In doing so, we find good cause to waive the 30-day delay in 
the effective date.

IV. Correction of Errors

    In FR Doc. 2011-15890 of June 24, 2011 (76 FR 37208), make the 
following corrections:

A. Correction to the Preamble

    On page 37208, in the third column, under the FOR FURTHER 
INFORMATION CONTACT section, the telephone number ``(301) 492-4100'' 
for Ellen Kuhn, Centers for Medicare & Medicaid Services, Department of 
Health and Human Services, is corrected to read ``(301) 492-4263.''

B. Correction to the Regulations Text

29 CFR 2590.715-2719 [Corrected]
    1. On page 37231, in the third column, in paragraph (d)(1)(ii), the 
phrase ``with respect to claims for which external review has not been 
initiated before the effective date of this paragraph (d)(1) (September 
20, 2011),'' is corrected to read ``with respect to claims for which 
external review has not been initiated before September 20, 2011,''.
45 CFR 147.136 [Corrected]
    2. On page 37232, in the third column, after the amendatory 
instruction 3. and before the phrase ``The revisions and additions read 
as follows'', add the following amendatory instructions to read as 
follows:
    ``4. Revising paragraphs (b)(3)(ii)(B), (b)(3)(ii)(E)(1), and 
(b)(3)(ii)(F).''
    ``5. Redesignating paragraphs (b)(3)(ii)(E)(2), (b)(3)(ii)(E)(3), 
and (b)(3)(ii)(E)(4), as (b)(3)(ii)(E)(3), (b)(3)(ii)(E)(4), and 
(b)(3)(ii)(E)(5), respectively.''
    ``6. Adding a new paragraph (b)(3)(ii)(E)(2).''
    3. On page 37233, in the second column, after the five asterisks 
``* * * * *'' and before the paragraph ``(c) * * *,'' add the 
following:
    (b) * * *
    (3) * * *
    (ii) * * *
    (B) Expedited notification of benefit determinations involving 
urgent care. The requirements of 29 CFR 2560.503-1(f)(2)(i) (which 
generally provide, among other things, in the case of urgent care 
claims for notification of the issuer's benefit determination (whether 
adverse or not) as soon as possible, taking into account the medical 
exigencies, but not later than 72 hours after receipt of the claim) 
continue to apply to the issuer. For purposes of this paragraph 
(b)(3)(ii)(B), a claim involving urgent care has the meaning given in 
29 CFR 2560.503-1(m)(1), as determined by the attending provider, and 
the issuer shall defer to such determination of the attending provider.
* * * * *
    (E) * * *
    (1) The issuer 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 name of the health care provider, the claim amount 
(if applicable), and a statement describing the availability, upon 
request, of the diagnosis code and its corresponding meaning, and the

[[Page 44493]]

treatment code and its corresponding meaning).
    (2) The issuer must provide to participants and beneficiaries, as 
soon as practicable, upon request, the diagnosis code and its 
corresponding meaning, and the treatment code and its corresponding 
meaning, associated with any adverse benefit determination or final 
internal adverse benefit determination. The issuer must not consider a 
request for such diagnosis and treatment information, in itself, to be 
a request for an internal appeal under this paragraph (b) or an 
external review under paragraphs (c) and (d) of this section.
* * * * *
    (F) Deemed exhaustion of internal claims and appeals processes--(1) 
In the case of an issuer that fails to adhere to all the requirements 
of this paragraph (b)(3) with respect to a claim, the claimant is 
deemed to have exhausted the internal claims and appeals process of 
this paragraph (b), except as provided in paragraph (b)(3)(ii)(F)(2) of 
this section. Accordingly, the claimant may initiate an external review 
under paragraph (c) or (d) of this section, as applicable. The claimant 
is also entitled to pursue any available remedies under State law, as 
applicable, on the basis that the issuer has failed to provide a 
reasonable internal claims and appeals process that would yield a 
decision on the merits of the claim.
    (2) Notwithstanding paragraph (b)(3)(ii)(F)(1) of this section, the 
internal claims and appeals process of this paragraph (b) will not be 
deemed exhausted based on de minimis violations that do not cause, and 
are not likely to cause, prejudice or harm to the claimant so long as 
the issuer demonstrates that the violation was for good cause or due to 
matters beyond the control of the issuer and that the violation 
occurred in the context of an ongoing, good faith exchange of 
information between the issuer and the claimant. This exception is not 
available if the violation is part of a pattern or practice of 
violations by the issuer. The claimant may request a written 
explanation of the violation from the issuer, and the 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 of this 
paragraph (b) to be deemed exhausted. If an external reviewer or a 
court rejects the claimant's request for immediate review under 
paragraph (b)(3)(ii)(F)(1) of this section on the basis that the issuer 
met the standards for the exception under this paragraph 
(b)(3)(ii)(F)(2), the claimant has the right to resubmit and pursue the 
internal appeal of the claim. In such a case, within a reasonable time 
after the external reviewer or court rejects the claim for immediate 
review (not to exceed 10 days), the issuer shall provide the claimant 
with notice of the opportunity to resubmit and pursue the internal 
appeal of the claim. Time periods for re-filing the claim shall begin 
to run upon claimant's receipt of such notice.

    Signed this 15th day of July 2011.
Diane O. Williams,
Federal Register Liaison, Internal Revenue Service, Department of the 
Treasury.
    Signed this 20th day of July 2011.
Daniel J. Maguire,
Director, Office of Health Plan Standards and Compliance Assistance, 
Employee Benefits Security Administration, Department of Labor.
    Signed this 20th day of July 2011.
Dawn Smalls,
Executive Secretary to the Department, Department of Health and Human 
Services.
[FR Doc. 2011-18820 Filed 7-22-11; 4:15 pm]
BILLING CODE 4820-01-P