Federal regulators will exempt an employer-sponsored health with plan with just one member who is a current employee, or no member who is a current employee, from group health market change requirements.

Officials discuss the issue in an answer to a frequently asked question posted by the Employee Benefits Security Administration (EBSA).

EBSA, an arm of the U.S. Department of Labor, has developed the answer, which implements part of the Affordable Care Act, the legislative package that includes the Patient Protection and Affordable Care Act (PPACA), together with officials at the U.S. Treasury Department and the U.S. Department of Health and Human Services (HHS).

The Health Insurance Portability and Accountability Act (HIPAA) of 1996 exempts groups with fewer than 2 participants who are current employees from group health plan provisions.

Officials were asked whether the same HIPAA statutory exemption will apply to Affordable Care Act provisions that are meant to improve the group market.

“Yes,” officials say.

The preamble to previously released interim final regulations states that the HIPAA exemption will apply to Affordable Care Act group market requirements, officials say.

“Accordingly, under the terms of these statutory provisions, group health plans that do not cover at least 2 employees who are current employees (such as plans in which only retirees participate) are exempt from the Affordable Care Act’s market reform requirements,” officials say.

- Allison Bell