Employment Law Practice Exam

What is one of HIPAA's requirements regarding pre-existing condition exclusions in group health plans?

1. Exclusionary periods can last no longer than 6 months.

2. Exclusionary periods must be reduced by prior coverage under a group health plan within 63 days.

3. Certificates of creditable coverage document employees with pre-existing conditions.

4. Prior coverage under a group health plan does not include COBRA coverage.

The correct answer is: Exclusionary periods must be reduced by prior coverage under a group health plan within 63 days.

The requirement that exclusionary periods must be reduced by prior coverage under a group health plan within 63 days is aligned with the provisions established by HIPAA (Health Insurance Portability and Accountability Act). This rule is particularly important as it aims to prevent individuals from facing prolonged exclusionary periods for pre-existing conditions when they transition between health plans. Under HIPAA, if an individual has prior health coverage that was continuous for at least 12 months and there is a gap of fewer than 63 days before enrolling in a new group health plan, the length of any exclusion for a pre-existing condition in the new plan can be reduced by the period of prior coverage. This means that if someone had prior insurance that covered a condition, that duration is credited towards reducing the exclusion under the new plan. Thus, this provision is designed to enhance portability in health insurance and to minimize the burden of exclusionary periods on individuals with existing health issues. The other options do not accurately reflect HIPAA's requirements. The maximum length of exclusionary periods varies based on state laws and the specifics of the health plan, while certificates of creditable coverage are necessary for documenting prior coverage rather than directly relating to the exclusion periods. Lastly, COBRA coverage, which allows individuals to continue health