Effective January 1, 2009, the School Employee Health Care Board (SEHCB) outlined four best practice standards, which are codified in Section 3306-2-03 of the Administrative Code. The fourth of these standards addresses dependent eligibility audits and requires all health plan sponsors offering health care plans to employees of a public school district to conduct periodic dependent eligibility audits and send the aggregate results of the audit to the SEHCB.
Dependent eligibility audits are designed to review the eligibility requirements of a health care plan and verify that all dependents currently receiving benefits under the health care plan are eligible to receive such benefits. Although the code does not specifically outline a procedure for conducting these audits, it is not uncommon for plans to ask employees to provide proof of eligibility through legal documentation (e.g., tax returns with financial information redacted, marriage licenses, and birth certificates, etc.)
We have received a number of questions from districts that have expressed concerns about the confidential nature of these verification documents. Since health care benefits are a voluntary benefit for employees, health plans have great latitude in determining their eligibility rules and the procedures they implement to enforce those rules. HIPAA likely does not cover these audits since individually identifiable health information is typically not requested. To address concerns about confidential information, districts can encourage their employees to black out personal income data, social security numbers, or other personal information that is not needed for purposes of the audit. Districts also should ensure the safe handling of confidential information throughout and after the audit process, including addressing document security and disposal with the health plan or third-party entity conducting the dependent eligibility audit.