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Compliance Assistance Resources

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- Health Benefits Advisor for Employers

Determining Compliance with the Newborns' Act Provisions in Part 7 of ERISA

Newborns' Act Substantive Provisions - 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?

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 48/96-hour 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.