Federal HMO Act

[Guest ALittleHelpNeeded]

If an employer offers both an HMO option and a PPO option to one group of employees, does the employer than have to offer the HMO option to all other employees?

[Guest gdburns]

It depends. Are they all classifed similarly? What are the differences between these sets of employees?

Why does the employer want to offer different choices? If there are enough other employees, it might be more economical to include them in the existing choices. OR having a larger number of employees might get better premium rates or cause better claims experience.

In any case, offering an option does not mean that there will be any or sufficient enrollees. There are many other things that should be considered.

[Guest ALittleHelpNeeded]

My question is whether offering an HMO benefit to one group of employees and not to another group of employee violates any provision of the Federal HMO Act? I fail to see how any of your questions are responsive to that inquiry. They are clearly relevant to benefit cost considerations, but that is not my question.

[Guest ALittleHelpNeeded]

In case you are wondering the language I am trying to interpret, the cite is 42 CFR 417.150 et seq.

[leevena]

You can offer different groups of employees different benefits as you described, as long as these "different groups" are viewed as legal. For example, union/non-union, full-time/part-time, 2 different divisions of a company, etc.

As for the Federal HMO act, I do not believe it is relevant. (In fact, I don't even know if it is still around) This law essentially required employers to offer a federally qualified HMO to their employees. There were some caveats, such as the HMO was required to deliver a written notification some 6 mos prior to renewal; the HMO had to have a similar employer contribution % or level, and some other things.

[Guest ALittleHelpNeeded]

You can offer different groups of employees different benefits as you described, as long as these "different groups" are viewed as legal. For example, union/non-union, full-time/part-time, 2 different divisions of a company, etc.

As for the Federal HMO act, I do not believe it is relevant. (In fact, I don't even know if it is still around) This law essentially required employers to offer a federally qualified HMO to their employees. There were some caveats, such as the HMO was required to deliver a written notification some 6 mos prior to renewal; the HMO had to have a similar employer contribution % or level, and some other things.

It is still around and believe it applies to any federally qualified HMO. The requirement that you mention is no longer in the regulations. However, I would suggest that you check out the cite I mentioned. This is the first time I have looked at this and I assumed the answer you just provided was the correct answer. However, I am not so sure now. For your information, the employees have a different worksite (same city), but otherwise they work for the same employer.

[Guest gdburns]

"offering an HMO benefit to one group of employees and not to another group of employee " has nothing to do with the Federal HMO Act. Since it was obvious that you were looking at the wriong law, I addressed the questions that should have been asked. That is probably why you failed to see.

The Federal HMO Act is what created HMOs. It has nothing to do with employers and employee benefits programs.

42CFR417.150 etc seq has no relevance to the Federal HMO Act as far as employers and employee benefits are concerned. However it is relevant to the issue that you raised but your Original Post did not mention 42CFR, did it?

If you feel that classifications are no longer in the Regs, that is your prerogative, but, since there have been few changes in the Regs in decades, I suggest that you take another look, or at least cite which Regs were changed.

An employer does not have to offer benefits. But if an employer so chooses, then certain rules will apply. Those rules vary and depend on number of employees, qualification requirements and what is being offered.

For example 42CFR applies only if the employer has more than 25 employees and in some cases 50 employees. 42CFR might only apply if a federally qualified HMO is used, So What happens if the HMO is not federally qualified? 42CFR only applies to eligible employees who meet the employer's qualification requirements.

42CFR417.150 Definitions uses the term Eligible employee and shows that eligiblity (qualification) for participation is set by the employer. This is just 1 of the reasons why I question your allegation that Regs regarding classification no longer exist. But maybe you know something that others do not yet know.