Health plans - Alabama

Summary of differences between federal and state regulations

Employee health plans are generally covered under the federal jurisdiction of the Employee Retirement Income Security Act (ERISA).

Federal ERISA plans generally do not have to comply with state laws. ERISA rules preempt or block state laws that relate to ERISA plans. State insurance laws, however, do apply.

However, states have a variety of laws that do affect employee health plans, and go beyond the requirements for federal. Some of the Alabama laws are listed here.

State

Contact

Alabama Department of Insurance

Regulations

Code of Alabama, Title 27 (Insurance)

http://alisondb.legislature.state.al.us/alison/codeofalabama/1975/coatoc.htm (Look for Chapter 27)

www.alabamaadministrativecode.state.al.us/docs/ins/index.html

Coverage issues

Alcoholism: Code of Alabama §27-20A

Plan sponsors may include benefits for expenses incurred in connection with the treatment of alcoholism when such treatment is prescribed by a duly licensed doctor of medicine. If offered, benefits must include inpatient or residential treatment, and outpatient treatment.

Mental health: Code of Alabama §27-54 et seq.

Group health benefit plans of employers with more than 50 employees must offer to provide, at a minimum, inpatient services, day treatment services, and outpatient services for each group health benefit plan shall offer to provide, at minimum, additional benefits for those suffering from a mental or nervous condition.

Benefits covered by licensed practitioners other than medical physicians

Mental health issues: Code of Alabama §27-1-18

Insurance companies are not required to include mental health services in a policy. However, if your group insurance policy provides for the reimbursement of health or health-related services — which includes mental health services — and such services are provided by a duly qualified psychiatrist or psychologist, the plan participant is entitled to reimbursement for services if those services are requested by the attending physician.

A duly qualified psychologist is one who:

• Is duly licensed or certified at the doctorate level in the state by the licensing board for psychologists of the state where the service is rendered,
• Has had at least two years post-doctoral, clinical experience in a recognized health setting, or
• Has met the standards of the National Register of Health Service Providers in Psychology which require two years post-doctoral, clinical experience.

Under the federal Mental Health Parity Act, health plans are not required to include mental health benefits in their benefits package. The Act only applies to those plans that do offer mental health benefits. The Act applies to employers with 51 or more employees

Dental issues: Code of Alabama §27-1-11

The terms “physician” and/or “doctor” shall include Dentists and Dental Hygienists licensed under and in accordance with Chapter 9 of Title 34 of the Code of Alabama.

§27-19A

Plan participants are allowed to choose their own provider; the policy must disclose that the benefit offered is limited to the least costly treatment and explain the standard upon which the payment of benefits or reimbursement for the cost of dental care services is based.

Vision issues: Code of Alabama §27-19-39

Whenever an insurance policy provides for reimbursement for any visual service in Alabama, the plan participant shall be entitled to reimbursement for such services, whether such services are performed by a duly licensed physician or by a duly licensed optometrist; whichever the insured selects. Duly licensed optometrists shall be entitled to participate in policies that provide visual services to the same extent as fully licensed physicians.

Code of Alabama §27-56-1 et seq. (Access to Eye Care Act)

Plans must include a provision for the payment to a licensed optometrist if the plan pays for the same service when provided by any other provider for such services.

Chiropractic issues: Code of Alabama §27-1-10

Any insurance policy providing for reimbursement or payment for health services performed by a medical doctor or physician or upon the certification of a medical doctor, surgeon, osteopath, or physician, shall also reimburse or pay for such health services performed by a chiropractor; provided, that the health services performed by the chiropractor are within the scope of his license and he is duly licensed by the state of Alabama.

The insured has the right to choose or select any practitioner or member of the healing arts of Alabama to perform such services.

Podiatrist issues: Code of Alabama §27-1-15

When a health insurance policy provides for the reimbursement or payment for services which are within the scope of a podiatrist’s professional license, the policy must include payment to a podiatrist who has performed such procedures.

Physician assistants: Code of Alabama §27-51-1

If your insurance policy provides for third-party payment or prepayment of health or medical expenses, it must include a provision for the payment to a supervising physician for necessary medical or surgical services that are provided by a licensed physician assistant practicing under the supervision of the physician, as long as the policy pays for the same care and treatment provided by a licensed physician or doctor of osteopathy.

Pharmacists: Code of Alabama §27-45-3

Employee benefit plans cannot prevent plan participants from selecting the pharmacy or pharmacist of their choice, or interfere with the selection, as long as the pharmacy or pharmacist is appropriately licensed. Benefit plans also cannot deny any pharmacy or pharmacist the right to participate as a contracting provider as long as the pharmacist is licensed to furnish pharmaceutical services.

Prescriptions: Code of Alabama §27-1-21

Health benefit plans must apply the same coinsurance, copayment, deductible, and quantity limit factors within the same employee group and other plan-sponsored group factors to all drug prescriptions filled by a pharmacy provider, whether by a retail provider or a mail service provider, The plan cannot not set a limit on the quantity of drugs which an enrollee may obtain at any one time with a prescription, unless the limit is applied uniformly to all pharmacy providers who comply with the same terms, conditions, services, and price as mail service providers.

Obstetricians/gynecologists: Code of Alabama §27-49-4

Health benefit plans shall allow obstetricians and gynecologists as primary care physicians. For women not using an obstetrician or gynecologist as their primary care physician, the plan cannot require, as a condition to the coverage, that an enrollee, subscriber, or insured first obtain a referral from another primary care physician.

Penalties:

Each willful violation is punishable as a misdemeanor, upon conviction, by a fine of not more than $1,000.00 or by imprisonment in the county jail, or by sentence to hard labor for the county, for a period not to exceed one year or by both such fine and imprisonment or hard labor in the discretion of the court. Each instance of violation shall be considered a separate offense.

Dependent coverage (Code of Alabama §27-19-38; Alabama Administrative Code, §482-1-115)

Group health insurance policies that provide coverage for a family member of the insured must also provide health insurance benefits to a newborn child of the insured from the moment of birth.

This coverage for newborns must cover injury or sickness including the necessary care and treatment of medically diagnosed congenital defects and birth abnormalities. The coverage need not, however, include benefits for routine well-baby care.

Discrimination (Code of Alabama §27-5-13)

Insurance companies are prohibited from denying coverage to applicants because the applicant has been diagnosed as having sickle-cell anemia.

Genetic testing (Code of Alabama §27-53-2)

Health plans may not require as a condition of insurability that a person take a genetic test to determine if the person has a predisposition for cancer. Nor can the plans use the results of a genetic test to determine insurability or to otherwise discriminate against the person in rates or benefits based on the genetic test results.

Small employer allocation program (Code of Alabama §27-52-20; §27-52.21; Alabama Administrative Code §482-1-116)

Alabama has a Small Employer Allocation Program, which:

• Promotes the availability of health insurance coverage to small employers regardless of their health status or claims experience,
• Prevents abusive rating practices and segmentation of the health insurance market based upon health risk,
• Spreads health insurance risk more broadly,
• Requires disclosure of rating practices to purchasers,
• Establishes rules regarding renewability of coverage,
• Limits use of preexisting conditions exclusions, and

Improves the overall fairness and efficiency of the small group health insurance market.

Federal

ContactEmployee Benefits Security Administration (EBSA)

Regulations 29 CFR chapter XXV (Parts 2509 – 2590)