Skip to content
  • Home
  • Services
    • Audit & Attest
      • Financial Statement Audits
      • Employee Benefit Plans
      • Attestation Engagements
      • Compilations & Review
      • SOC
      • Agreed-Upon Procedures
    • Advisory
      • Transaction Advisory Services
      • Cybersecurity, Technology Risk, Privacy
      • High Net Worth Services
      • Forensic Services
      • Litigation Services
      • Management Consulting
      • Technology Services
      • Valuation Services
    • Business & Tax
      • Corporate Income Tax
      • Individual Income Tax
      • International Tax
      • State and Local Tax Compliance and Tax Minimization Services
      • Tax Planning
    • T&C Family Office Group
  • Industries
    • Construction & Real Estate
    • Healthcare
    • Manufacturing & Distribution
    • Nonprofit Organizations
    • Private Equity Firms
    • Privately-held Companies
    • Technology & Energy
  • Firm
    • Overview
    • Our People
    • Our Community
    • Templeton Group
      • PracticePro 365
      • T&C Family Office Group
      • Templeton Investigative Services
  • Careers
    • Experienced
    • Students
    • Benefits
  • News
  • Pay My Bill
  • Home
  • Services
    • Audit & Attest
      • Financial Statement Audits
      • Employee Benefit Plans
      • Attestation Engagements
      • Compilations & Review
      • SOC
      • Agreed-Upon Procedures
    • Advisory
      • Transaction Advisory Services
      • Cybersecurity, Technology Risk, Privacy
      • High Net Worth Services
      • Forensic Services
      • Litigation Services
      • Management Consulting
      • Technology Services
      • Valuation Services
    • Business & Tax
      • Corporate Income Tax
      • Individual Income Tax
      • International Tax
      • State and Local Tax Compliance and Tax Minimization Services
      • Tax Planning
    • T&C Family Office Group
  • Industries
    • Construction & Real Estate
    • Healthcare
    • Manufacturing & Distribution
    • Nonprofit Organizations
    • Private Equity Firms
    • Privately-held Companies
    • Technology & Energy
  • Firm
    • Overview
    • Our People
    • Our Community
    • Templeton Group
      • PracticePro 365
      • T&C Family Office Group
      • Templeton Investigative Services
  • Careers
    • Experienced
    • Students
    • Benefits
  • News
  • Pay My Bill
CONTACT US

Employers with health care plans should keep HIPAA risks in mind

  • Audit & Attest, Blog, Employee Benefit Plan

If your organization sponsors a health care plan for its employees, you’re probably focused on ensuring it’s robust enough to satisfy participants and impress job candidates — all while trying to control the costs involved.

Totally understandable. But don’t lose sight of your obligations under the Health Insurance Portability and Accountability Act (HIPAA). Among the law’s primary requirements is for plan sponsors to formally notify all persons from whom medical information is collected, whether directly or indirectly, of their rights to privacy.

How often should you update?

Generally, plan sponsors fulfill their notification obligation by distributing a “Notice of Privacy Practices,” which is sometimes alternatively referred to as a “Notice of Information Practices.” But a question that often arises is: How often should you update this document?

The good news is you don’t need to update a notice according to an annual deadline or the like. However, the most current notice must accurately describe:

  • Your plan’s uses and disclosures of protected health information (PHI),
  • Participants’ HIPAA rights, and
  • The plan’s legal duties with respect to PHI.

Thus, you must promptly revise the notice whenever there’s a “material” change to any of the information or privacy practices stated therein. Except when required by law, material changes to a plan can’t be implemented until they’re reflected in the notice.

HIPAA regulations don’t define when a change is material. Historically, many employers have looked to the preamble to the 2000 HIPAA Privacy Rule. In it, the U.S. Department of Health and Human Services (HHS) encouraged covered entities to refer to other notice laws to understand the concept of materiality. One example given was how material changes are typically defined for Summary Plan Descriptions under the Employee Retirement Income Security Act. Also, HHS considered changes made by the 2013 HIPAA Omnibus Rule, a significant update to the law, to be material and required updated notices at that time.

Evaluate amendments to the HIPAA rules carefully when they occur to determine whether they’re material and require changes to your plan and notice. Revisions to plan operations, such as new procedures for giving someone access to PHI in a designated record, could require an updated notice as well.

How soon must you distribute?

Let’s say there’s a material change to your plan and notice. You might wonder, as many employers have, how soon must you issue an update?

HIPAA rules establish deadlines by which your plan must distribute updated notices that incorporate material changes. The requirements vary depending on whether your plan maintains a website.

If your plan has a website, you can — and, in fact, must — satisfy the requirement to distribute an updated notice by posting it on the plan website by the effective date of the material change. You need to then provide a hard copy of the updated notice, or information about the material change and how to obtain the revised notice, in the plan’s next annual mailing to participants.

If your plan doesn’t have its own dedicated website, you must furnish the revised notice — or information about the material change and how to obtain the revised notice — to participants within 60 days after the revision.

Note: Mailing a hard copy is always required unless a participant has consented to receiving electronic notices only.

Manageable risk

Suffice to say, there’s no such thing as sponsoring a health care plan in today’s employment environment without incurring HIPAA compliance risks. Fortunately, these risks are manageable with clearly worded policies and rigorously followed procedures. Contact us for help identifying and managing the costs, as well as the tax impact, associated with your organization’s fringe benefits.

© 2024

Categories
  • Agribusiness
  • Assurance, Advisory & Review
  • Audit & Attest
  • Blog
  • Business and Tax
  • Business Consulting & Corporate Compliance
  • Corporate Income Tax
  • Current Opportunities
  • Cybersecurity, Technology Risk, Privacy
  • Employee Benefit Plan
  • Employee Benefit Plans / 401(k)
  • Healthcare
  • High Net Worth Individuals
  • High Net Worth Services
  • Individual Income Tax
  • Industries
  • Manufacturing & Distribution
  • Newsletter Articles
  • Newsletters
  • Nonprofit
  • Press Releases
  • Privately Held Companies
  • Professional Services
  • Real Estate & Construction
  • Retail
  • Services
  • Specialty Tax Services
  • State and Local Tax Complianc
  • T&C Family Office Group
  • Tax Planning
  • Tax Planning & Compliance
  • Technology
  • Uncategorized
  • Valuation Services
  • Valuation Services

SHARE THIS ON:

RELATED POSTS

An overview of plan documents and SPDs for employers

Most employer-sponsored retirement and welfare benefit plans are subject to the federal Employee Retirement Income Security Act (ERISA). These include health insurance coverage and qualified

Read More »

An employee stock ownership plan can be a versatile business exit and estate planning tool

As a closely held business owner, a substantial amount of your wealth likely is tied to the business. Of course, you want to retain as

Read More »

6 ways to make your nonprofit’s board meetings more productive

If your not-for-profit’s board members frequently miss meetings, show little enthusiasm for their roles or resign before their terms are up, board meetings may be

Read More »

Contact Us

WEST PALM BEACH
Esperante Building
222 Lakeview Avenue
Suite 1200
West Palm Beach, FL 33401
(561) 798-9988
Fax: (561) 798-4053

FORT LAUDERDALE
The Main
201 East Las Olas Boulevard
Suite 1650
Fort Lauderdale, FL 33301
(954) 333-0001
Fax: (954) 765-0719

Twitter Facebook Instagram Youtube Linkedin
© 2025 Templeton & Company. All Rights Reserved. Website by Weber & Co.
Services
  • Audit & Attest
  • Advisory
  • Business & Tax
  • T&C Family Office Group
  • Pay My Bill
  • Audit & Attest
  • Advisory
  • Business & Tax
  • T&C Family Office Group
  • Pay My Bill
Industries
  • Construction & Real Estate
  • Healthcare
  • Manufacturing & Distribution
  • Nonprofit Organizations
  • Private Equity Firms
  • Privately-held Companies
  • Technology & Energy
  • Construction & Real Estate
  • Healthcare
  • Manufacturing & Distribution
  • Nonprofit Organizations
  • Private Equity Firms
  • Privately-held Companies
  • Technology & Energy
Firm
  • Overview
  • Our People
  • Our Community
  • Templeton Group
  • Terms & Conditions
  • Overview
  • Our People
  • Our Community
  • Templeton Group
  • Terms & Conditions
Careers
  • Experienced
  • Students
  • Benefits
  • Experienced
  • Students
  • Benefits