[Federal Register Volume 75, Number 123 (Monday, June 28, 2010)]
[Proposed Rules]
[Pages 37242-37243]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-15277]



  Federal Register / Vol. 75, No. 123 / Monday, June 28, 2010 / 
Proposed Rules  

[[Page 37242]]


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DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Part 54

[REG-120399-10]
RIN 1545-BJ57


Requirements for Group Health Plans and Health Insurance Issuers 
Under the Patient Protection and Affordable Care Act Relating to 
Preexisting Condition Exclusions, Lifetime and Annual Limits, 
Rescissions, and Patient Protections

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Notice of proposed rulemaking by cross-reference to temporary 
regulations.

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SUMMARY: Elsewhere in this issue of the Federal Register, the Treasury 
Department and the IRS are issuing temporary regulations under the 
Patient Protection and Affordable Care Act (the Affordable Care Act) 
relating to preexisting condition exclusions, lifetime and annual 
limits, rescissions, and patient protections. Those temporary 
regulations are being issued at the same time that the Employee 
Benefits Security Administration of the U.S. Department of Labor and 
the Office of Consumer Information and Insurance Oversight of the U.S. 
Department of Health and Human Services are issuing substantially 
similar interim final regulations under the Employee Retirement Income 
Security Act of 1974 and the Public Health Service Act. The temporary 
regulations provide guidance to employers, group health plans, and 
health insurance issuers providing group health insurance coverage. The 
text of those temporary regulations also serves as the text of these 
proposed regulations.

DATES: Written or electronic comments and requests for a public hearing 
must be received by September 27, 2010.

ADDRESSES: Send submissions to: CC:PA:LPD:PR (REG-120399-10), Room 
5205, Internal Revenue Service, P.O. Box 7604, Ben Franklin Station, 
Washington, DC 20044. Submissions may be hand-delivered to: 
CC:PA:LPD:PR (REG-120399-10), Courier's Desk, Internal Revenue Service, 
1111 Constitution Avenue, NW., Washington, DC 20224. Alternatively, 
taxpayers may submit comments electronically via the Federal 
eRulemaking Portal at http://www.regulations.gov (IRS REG-120399-10).

FOR FURTHER INFORMATION CONTACT: Concerning the regulations, Karen 
Levin at 202-622-6080; concerning submissions of comments, 
Oluwafunmilayo Taylor at 202-622-7180 (not toll-free numbers).

SUPPLEMENTARY INFORMATION:

Paperwork Reduction Act

    The collections of information contained in this notice of proposed 
rulemaking have been submitted to the Office of Management and Budget 
for review in accordance with the Paperwork Reduction Act of 1995 (44 
U.S.C. 3507(d)). Comments on the collection of information should be 
sent to the Office of Management and Budget, Attn: Desk Officer for the 
Department of the Treasury, Office of Information and Regulatory 
Affairs, Washington, DC 20503, with copies to the Internal Revenue 
Service, Attn: IRS Reports Clearance Officer, SE:W:CAR:MP:T:T:SP, 
Washington, DC 20224. Comments on the collection of information should 
be received by August 27, 2010. Comments are specifically requested 
concerning:
     Whether the proposed collection of information is 
necessary for the proper performance of the functions of the Internal 
Revenue Service, including whether the information will have practical 
utility;
     The accuracy of the estimated burdens associated with the 
proposed collection of information (see the preamble to the temporary 
regulations published elsewhere in this issue of the Federal Register);
     How to enhance the quality, utility, and clarity of the 
information to be collected;
     How to minimize the burden of complying with the proposed 
collection of information, including the application of automated 
collection techniques or other forms of information technology; and
     Estimates of capital or start-up costs and costs of 
operation, maintenance, and purchase of services to provide 
information.
    The collections of information are in Sec.  54.9815-2711T(e)(2), 
Sec.  54.9815-2712T(a)(1), and Sec.  54.9815-2719AT(a)(4) (see the 
temporary regulations published elsewhere in this issue of the Federal 
Register). The temporary regulations require that group health plans 
and group health insurance issuers: (1) Notify individuals otherwise 
eligible for coverage who have previously reached a lifetime limit that 
the lifetime limit no longer applies and of the right to enroll in the 
coverage; (2) notify any individual whose coverage the plan or issuer 
intends to rescind 30 days in advance of the rescission; and (3) for 
plans or health insurance coverage that require or provide for covered 
individuals to designate a primary care provider, notify individuals of 
their rights regarding such designation under section 2719A of the 
Public Health Service Act (which is incorporated by reference into 
section 9815 of the Code) and of the right to obtain obstetrical and 
gynecological services without a referral. The likely respondents are 
business or other for-profit institutions, and nonprofit institutions. 
Responses to these collections of information are mandatory.
    An agency may not conduct or sponsor, and a person is not required 
to respond to, a collection of information unless it displays a valid 
control number assigned by the Office of Management and Budget.
    Books or records relating to a collection of information must be 
retained as long as their contents may become material in the 
administration of any internal revenue law. Generally tax returns and 
tax return information are confidential, as required by 26 U.S.C. 6103.

Background

    The temporary regulations published elsewhere in this issue of the 
Federal Register add Sec. Sec.  54.9815-2704T, 54.9815-2711T, 54.9815-
2712T, and 54.9815-2719AT to the Miscellaneous Excise Tax Regulations. 
The proposed and temporary regulations are being published as part of a 
joint rulemaking with the Department of Labor and the Department of 
Health and Human Services (the joint rulemaking). The text of those 
temporary regulations also serves as the text of these proposed 
regulations. The preamble to the temporary regulations explains those 
temporary regulations and these proposed regulations.

Special Analyses

    It has been determined that this notice of proposed rulemaking is 
not a significant regulatory action as defined in Executive Order 
12866. Therefore, a regulatory assessment is not required. It has also 
been determined that section 553(b) of the Administrative Procedure Act 
(5 U.S.C. chapter 5) does not apply to this proposed regulation. It is 
hereby certified that the collections of information contained in this 
notice of proposed rulemaking will not have a significant impact on a 
substantial number of small entities. Accordingly, a regulatory 
flexibility analysis is not required.

[[Page 37243]]

    Section 54.9815-2711T(e) of the temporary regulations requires both 
group health insurance issuers and group health plans to notify 
individuals otherwise eligible for coverage who have previously reached 
a lifetime limit that the lifetime limit no longer applies and of the 
right to enroll in the coverage. Under the temporary regulations, if a 
health insurance issuer satisfies this notice obligation, it is 
satisfied not just for the issuer but also for the group health plan. 
For group health plans maintained by small entities, it is anticipated 
that the health insurance issuer will satisfy this notice obligation 
for both the plan and the issuer in almost all cases. For this reason, 
this information collection requirement will not impose a significant 
impact on a substantial number of small entities.
    Section 54.9815-2712T(a)(1) of the temporary regulations requires 
group health plans and group health insurance issuers to provide 30 
days advance notice to any individual whose coverage would be affected 
before the plan or issuer can rescind the coverage. If a health 
insurance issuer satisfies this notice obligation, it is satisfied not 
just for the issuer but also for the group health plan. For group 
health plans maintained by small entities, it is anticipated that the 
health insurance issuer will satisfy this notice obligation for both 
the plan and the issuer in almost all cases. For this reason, this 
information collection requirement will not impose a significant impact 
on a substantial number of small entities.
    Under Sec.  54.9815-2719AT(a)(4) of the temporary regulations, a 
group health plan or health insurance coverage that requires or 
provides for covered individuals to designate a primary care provider 
must notify individuals covered under the plan of their rights to 
choose any primary care provider in the plan's network who is available 
to accept the individual, to designate a pediatrician in the network 
for a child, and to obtain obstetrical and gynecological services 
without a referral. If a health insurance issuer satisfies this notice 
obligation, it is satisfied not just for the issuer but also for the 
group health plan. For group health plans maintained by small entities, 
it is anticipated that the health insurance issuer will satisfy this 
notice obligation for both the plan and the issuer in almost all cases. 
For this reason, this information collection requirement will not 
impose a significant impact on a substantial number of small entities.
    For further information and for analyses relating to the joint 
rulemaking, see the preamble to the joint rulemaking. Pursuant to 
section 7805(f) of the Internal Revenue Code, this regulation has been 
submitted to the Chief Counsel for Advocacy of the Small Business 
Administration for comment on its impact on small business.

Comments and Requests for a Public Hearing

    Before these proposed regulations are adopted as final regulations, 
consideration will be given to any written comments (a signed original 
and eight (8) copies) or electronic comments that are submitted timely 
to the IRS. Comments are specifically requested on the clarity of the 
proposed regulations and how they may be made easier to understand. All 
comments will be available for public inspection and copying. A public 
hearing may be scheduled if requested in writing by a person that 
timely submits written comments. If a public hearing is scheduled, 
notice of the date, time, and place for the hearing will be published 
in the Federal Register.

Drafting Information

    The principal author of these proposed regulations is Karen Levin, 
Office of the Division Counsel/Associate Chief Counsel (Tax Exempt and 
Government Entities), IRS. The proposed regulations, as well as the 
temporary regulations, have been developed in coordination with 
personnel from the U.S. Department of Labor and the U.S. Department of 
Health and Human Services.

List of Subjects in 26 CFR Part 54

    Excise taxes, Health care, Health insurance, Pensions, Reporting 
and recordkeeping requirements.

Proposed Amendments to the Regulations

    Accordingly, 26 CFR part 54 is proposed to be amended as follows:

PART 54--PENSION EXCISE TAXES

    Paragraph 1. The authority citation for part 54 is amended by 
adding entries in numerical order to read as follows:

    Authority:  26 U.S.C. 7805 * * *

    Section 54.9815-2704 also issued under 26 U.S.C. 9833.
    Section 54.9815-2711 also issued under 26 U.S.C. 9833.
    Section 54.9815-2712 also issued under 26 U.S.C. 9833. * * *
    Section 54.9815-2719A also issued under 26 U.S.C. 9833. * * *

    Par. 2. Section 54.9815-2704 is added to read as follows:


Sec.  54.9815-2704  Prohibition of preexisting condition exclusions.

    [The text of proposed Sec.  54.9815-2704 is the same as the text of 
Sec.  54.9815-2704T published elsewhere in this issue of the Federal 
Register].

    Par.3. Section 54.9815-2711 is added to read as follows:


Sec.  54.9815-2711  No lifetime or annual limits.

    [The text of proposed Sec.  54.9815-2711 is the same as the text of 
Sec.  54.9815-2711T published elsewhere in this issue of the Federal 
Register].
    Par. 4. Section 54.9815-2712 is added to read as follows:


Sec.  54.9815-2712  Rules regarding rescissions.

    [The text of proposed Sec.  54.9815-2712 is the same as the text of 
Sec.  54.9815-2712T published elsewhere in this issue of the Federal 
Register].
    Par. 5. Section 54.9815-2719A is added to read as follows:


Sec.  54.9815-2719A  Patient protections.

    [The text of proposed Sec.  54.9815-2719A is the same as the text 
of Sec.  54.9815-2719AT published elsewhere in this issue of the 
Federal Register].

Steven T. Miller,
Deputy Commissioner for Services and Enforcement.
[FR Doc. 2010-15277 Filed 6-22-10; 11:15 am]
BILLING CODE 4830-01-P