The Health Insurance Portability and Accountability Act of 1996 (HIPAA) requires group health plans to permit an employee or an employee's spouse or child to enroll in the plan outside of the plan's normal open enrollment period under certain circumstances. The plan must provide notice of those special enrollment rights to all benefits-eligible employees.

An employer must provide the HIPAA special enrollment notice if it sponsors any group health plan subject to HIPAA, except retiree only plans and HIPAA-excepted benefits like standalone dental, vision and accident coverage. There is no exception for governmental plans.

The HIPAA special enrollment notice must be provided to all employees offered the opportunity to enroll—that is, all benefits-eligible employees—including those who previously declined coverage.

The HIPAA special enrollment regulations include model language:

“If you are declining enrollment for yourself or your dependents (including your spouse) because of other health insurance or group health plan coverage, you may be able to enroll yourself and your dependents in this plan if you or your dependents lose eligibility for that other coverage (or if the employer stopped contributing towards your or your dependents' other coverage). However, you must request enrollment within [insert “30 days” or any longer period that applies under the plan] after your or your dependents' other coverage ends (or after the employer stops contributing toward the other coverage). In addition, if you have a new dependent as a result of marriage, birth, adoption, or placement for adoption, you may be able to enroll yourself and your dependents. However, you must request enrollment within [insert “30 days” or any longer period that applies under the plan] after the marriage, birth, adoption, or placement for adoption. To request special enrollment or obtain more information, contact [insert the name, title, telephone number, and any additional contact information of the appropriate plan representative].”

In addition, if the plan requires that employees disclose that the reason for declining enrollment is the existence of other coverage, the HIPAA special enrollment notice must inform the employee of the requirement to provide the statement of the reason for declining coverage and the consequences of a failure to provide the statement. If any procedures are required to take advantage of special enrollment other than contacting the person or entity listed in the notice, then such procedures must be described.

The HIPAA special enrollment notice must be provided each time an employee is offered the opportunity to enroll in a group health plan, and it must be provided at or before that time, not after. The convention is to provide a HIPAA special enrollment notice both during open enrollment and during the new hire process. Including in the HIPAA special enrollment notice in the plan's summary plan description (SPD) is, by itself, not sufficient because SPDs frequently are not distributed until some time after open enrollment, and they are usually never given to employees who do not enroll.

The HIPAA special enrollment notice must be provided in a manner reasonably calculated to ensure delivery to employees entitled to receive it, which is DOL-speak for US Mail, courier, hand delivery or electronic delivery under the DOL's electronic delivery safe harbor rules.