Can health plans communicate about health-related products or services to enrollees that add value to, but are not part of, a plan of benefits?

Answer:

Yes. The provision of value-added items or services (VAIS) is a common practice, particularly for managed care organizations. Under the HIPAA Privacy Rule, communications may qualify under the marketing exception for a communication about a health plan’s plan of benefits, even if the VAIS are not considered plan benefits for the Adjusted Community Rate purposes. To qualify for this exclusion, however, the VAIS must meet two conditions. First, they must be health-related. Therefore, discounts offered by Medicare + Choice or other managed care organizations for eyeglasses may be considered part of the plan’s benefits, whereas discounts to attend movie theaters will not. Second, such items and services must demonstrably “add value” to the plan’s membership and not merely be a pass-through of a discount or item available to the public at large.

So, a Medicare + Choice or other managed care organization could offer its members a special discount opportunity for eyeglasses and contact lenses without obtaining authorizations if the discount were only available through membership in the managed care organization. However, such communications would need an authorization if the members would be able to obtain such discounts directly from the eyeglass store. Similarly, a Medicare + Choice or other managed care organization could offer its members a special discount opportunity for a prescription drug card benefit or for a health/fitness club membership, which is not available to consumers on the open market. On the other hand, a Medicare+Choice or other managed care organization would need an authorization to notify its members of a discount to a movie theater available only to its members.

Date Created: 12/20/2002