[Federal Register Volume 75, Number 221 (Wednesday, November 17, 2010)]
[Proposed Rules]
[Pages 70159-70160]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-28866]


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DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Part 54

[REG-118412-10]
RIN 1545-BJ50


Group Health Plans and Health Insurance Coverage Rules Relating 
to Status as a Grandfathered Health Plan Under the Patient Protection 
and Affordable Care Act

AGENCY: Internal Revenue Service (IRS), Treasury.

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

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SUMMARY: In the Rules and Regulations section of this issue in the 
Federal Register, the IRS is issuing temporary regulations regarding 
status as a grandfathered health plan under the provisions of the 
Patient Protection and Affordable Care Act (the Affordable Care Act) in 
connection with changes in policies, certificates, or contracts of 
insurance. The temporary regulations provide guidance to employers, 
group health plans, and health insurance issuers providing group health 
insurance coverage. The IRS is issuing the temporary regulations 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 with 
respect to group health plans and health insurance coverage offered in 
connection with a group health plan under the Employee Retirement 
Income Security Act of 1974 and the Public Health Service Act. The text 
of the temporary regulations being issued by the IRS serves as the text 
of these proposed regulations.

DATES: Written or electronic comments and requests for a public hearing 
must be received by December 17, 2010.

ADDRESSES: Send submissions to: CC:PA:LPD:PR (REG-118412-10), room 
5205, Internal Revenue Service, PO Box 7604, Ben Franklin Station, 
Washington, DC 20044. Submissions may be hand-delivered to: 
CC:PA:LPD:PR (REG-118412-10), 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-118412-10).

FOR FURTHER INFORMATION CONTACT: Concerning the regulations, Karen 
Levin at 202-622-6080; concerning submissions of comments or to request 
a hearing, Regina Johnson at 202-622-7180 (not toll-free numbers).

SUPPLEMENTARY INFORMATION:

Background

    The temporary regulations published elsewhere in this issue of the 
Federal Register amend Sec.  54.9815-1251T of the Miscellaneous Excise 
Tax Regulations. The proposed and temporary regulations are being 
published as part of a joint rulemaking with the

[[Page 70160]]

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 the 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 collection 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.
    The amendment to the temporary regulations adds a new third-party 
disclosure requirement so that it also applies to a group health plan 
that is changing health insurance coverage. The group health plan must 
provide to a succeeding or new health insurance issuer (and the 
succeeding or new health insurance issuer must require) documentation 
of plan terms (including benefits, cost sharing, employer 
contributions, and annual limits) under the prior health insurance 
coverage sufficient to make a determination whether a change described 
in Sec.  54.9815-1251T(g)(1) has occurred. The hour and cost burden 
associated with this requirement is de minimis, because group health 
plans can satisfy the requirement by providing a copy of the policy or 
summary plan description to the succeeding or new health insurance 
issuer. This is not a significant burden for any plan and thus will not 
have 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 this amendment to 
the proposed regulations, including the prospective effective date of 
the rule and how that affects plans with different plan years. 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 continues to read 
in part as follows:

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

    Par. 2. Section 54.9815-1251 as published on June 17, 2010, at 75 
FR 34571, is amended by revising paragraphs (a)(1), (a)(3)(ii), (f), 
and (g)(4) Example 9 to read as follows:


Sec.  54.9815-1251  Preservation of right to maintain existing 
coverage.

    (a) * * * (1) [The text of proposed Sec.  54.9815-1251(a)(1) is the 
same as the text of Sec.  54.9815-1251T(a)(1) published elsewhere in 
this issue of the Federal Register].
* * * * *
    (3) * * *
    (ii) [The text of proposed Sec.  54.9815-1251(a)(3)(ii) is the same 
as the text of Sec.  54.9815-1251T(a)(3)(ii) published elsewhere in 
this issue of the Federal Register].
* * * * *
    (f) [The text of proposed Sec.  54.9815-1251(f) is the same as the 
text of Sec.  54.9815-1251T(f) published elsewhere in this issue of the 
Federal Register].
    (g) * * *
    (4) * * *
    Example 9. [The text of proposed Sec.  54.9815-1251(g)(4) Example 9 
is the same as the text of Sec.  54.9815-1251T(g)(4) Example 9 
published elsewhere in this issue of the Federal Register].

Steven T. Miller,
Deputy Commissioner for Services and Enforcement.
[FR Doc. 2010-28866 Filed 11-15-10; 4:15 pm]
BILLING CODE 4830-01-P