Enrollment

The term enrollment can apply to more than one concept in a health insurance environment. First, it can represent the number of members in a health maintenance organization (HMO) or other insurance plan. Open enrollment is the annual period during which members can choose between two or more plans that are offered by a health plan. It also applies to the period during which a federally qualified HMO must make its plan available, without restriction, to individuals who are not part of a group. A federally qualified HMO is one that meets federally stipulated provisions aimed at protecting consumers. It must provide a broad range of basic health services, assure financial solvency, and monitor the quality of their care.

Second, it can represent the number of members assigned to a physician or medical group providing care under contract with an HMO. The enrollment area, also known as the service area, is the geographic region within a designated radius of the primary medical group (PMG) selected by the subscriber. This area can vary in size by the specific HMO.

Last, it can represent the process by which the health plan signs up individuals or groups as subscribers. The waiting period is the length of time that an individual must wait to become eligible for benefits for a specific condition after overall coverage has begun. The termination date is the date on which the group contract expires or an individual is no longer eligible for benefits.

Government legislation has been enacted to protect enrollees from loss of benefits. The Consolidated Omnibus Budget Reconciliation Act (COBRA) of 1985 is a statute that requires employers sponsoring group health plans to offer continuation of coverage under the group plan to employees and their dependents who lost coverage secondary to a qualifying event. A qualifying event may be a decrease in work hours, death, divorce, and many different types of termination of employment.

The Health Insurance Portability and Accountability Act (HIPAA) of 1996 is another legislative attempt to safeguard individuals from loss of health insurance coverage. The original legislation was intended to protect people who are covered under a group policy. The intent was to waive the exclusion of pre-existing conditions from coverage when a current employee leaves and goes to another employer. An enrollee or an enrollee's dependent with an expensive chronic condition could not be excluded from coverage by the new plan. This legislation has gone well beyond its original intention of achieving portability and now also involves privacy issues.

Enrollment protection is the practice of HMOs to protect contracted medical groups against part or all losses incurred for physician services above a specified dollar amount while caring for the HMO enrollees. The insurance company or HMO purchases insurance from another company to protect it from losses incurred in the process of honoring the claims of its policyholders. This practice is also known as stop loss or reinsurance.