Key Takeaways

  • A certificate of creditable coverage (COCC) is proof from a prior insurer showing dates of coverage and termination, designed under HIPAA to help prevent gaps in insurance.
  • The COCC allowed employees switching jobs or insurers to avoid pre-existing condition exclusions if they had continuous prior coverage.
  • Insurers were required to provide the certificate automatically, but employees could also request one.
  • Federal rules under HIPAA often superseded state laws, though states could add their own requirements.
  • With the Affordable Care Act (ACA), pre-existing condition exclusions were banned in 2014, and the need for COCCs was eliminated.
  • Some insurers and employers may still issue COCC-like documents for administrative or proof-of-coverage purposes.

What Is a Certificate of Creditable Coverage?

A certificate of creditable coverage (COCC) is a document provided by your prior insurer that indicates your insurance has ended. The document itself includes your full name, effective dates of coverage, and the cancellation date. The COCC was created under the Health Insurance Portability and Accountability Act (HIPAA), which ensures that those who want to change health insurance carriers can do so without having a gap in medical insurance. Such a document applies when a person joins a new company and wishes to enroll in the employer-sponsored health insurance plan. Without HIPAA, those people enrolling in the new coverage may have to wait a period of time before enrolling, which would mean that the prior health insurance plan would end before the new one begins. However, under HIPAA laws, such gap is not allowed.

The specific provision set forth in the HIPAA laws provides that once you have been continuously insured for a period of at least 18 months, then there is no need to satisfy another waiting period before enrolling in a new healthcare plan. While many health plans require 18 months of continuous coverage, some healthcare policies provide only six months of continuous coverage. A gap in health insurance coverage of fewer than 60 days doesn’t place a risk on the “continuous coverage” rule; however, you should ensure that you maintain a short-term medical insurance plan if the gap is going to last for more than 60 days.

Purpose of the COCC Under HIPAA

The original purpose of the certificate of creditable coverage was to demonstrate that a person maintained continuous health insurance before enrolling in a new plan. This was critical under the Health Insurance Portability and Accountability Act (HIPAA), which allowed individuals to reduce or eliminate waiting periods for pre-existing conditions if they had proof of prior coverage. For example, if someone left one employer and joined another within 60 days, their COCC showed that they had not experienced a significant break in coverage, thereby ensuring they were not unfairly penalized when transitioning into the new health plan.

Benefits of the COCC

  • The COCC program is an automated program providing much less effort for insured individuals.
  • The certificate itself is generated automatically by all insurance companies within a couple of weeks after the coverage term ends.
  • If you don’t receive a certificate by mail within 30 days of termination, you’ll want to contact the insurance company and verify your mailing address.
  • Some health insurance companies are now delivering the certificate online or via e-mail, which is a much quicker method than mailing the documents.
  • If you are in between jobs, the certificate is available from the COBRA plan administrator or the administrator of a short-term medical insurance company, whichever type of coverage you choose to have while unemployed.
  • Keep in mind that not all health insurance companies provide such certificates. For example, supplemental, foreign, and international travel insurance plans don’t provide a COCC.
  • After you receive a COCC, you’ll want to immediately forward it to your new health insurance company, while also keeping a copy for your records.

How Certificates Were Issued

By law, health insurance providers were required to issue a certificate of creditable coverage automatically when coverage ended, when COBRA continuation expired, or upon request. These certificates typically included:

  • The individual’s name and any covered dependents.
  • The coverage start date and end date.
  • Information on whether COBRA coverage was elected.
  • A contact number for verification.

Employers and insurers usually sent the COCC within a few weeks of coverage ending, though individuals could request an additional copy at any time. Having a copy on hand was often essential for quickly enrolling in new coverage without delays.

Coverage for Pre-existing Conditions

A COCC is not useful for obtaining coverage if you have a pre-existing condition and the new health insurance company doesn’t provide coverage for the pre-existing condition, i.e. short-term medical insurance policy. In addition, you should be mindful that most of the lower priced health insurance policies do not provide for coverage of pre-existing conditions. In fact, a common misconception for most is that they can terminate one health insurance policy and easily obtain coverage under the new insurance policy. However, most health insurance providers have certain eligibility requirements that must be met, and those with prior health issues could be denied coverage. However, if the new health insurance coverage is an employer-sponsored policy, this would not be the case.

Impact on Families and Dependents

The certificate of creditable coverage was not limited to individual employees. Dependents, including spouses and children, also relied on COCCs when transitioning to new plans. For example, if a dependent child aged out of a parent’s plan but immediately sought individual or student coverage, their COCC could shorten or eliminate any exclusion periods for pre-existing conditions. In this way, COCCs served as a protection not only for workers changing jobs, but for entire families navigating different insurance options.

COCC Federal vs. State Laws

The federal law regarding COCC is different from that of state laws, which are implemented to address the underlying issues regarding takeover benefits and the eligibility requirements for obtaining health insurance. While the federal law trumps state laws if any conflicts in the rules arise, the states have complete control over health insurance plans within their jurisdiction. For example, some states do not recognize COCC from someone’s health insurance as a valid entry into a state-sponsored high-risk health insurance plan.

Administrative Burdens and Limitations

While the COCC served an important compliance function, it also created administrative challenges. Insurers and employers needed to generate, process, and deliver certificates promptly to avoid compliance issues. Some states required specific language or formats, further complicating the process. Additionally, many individuals were unaware of the certificate’s significance and discarded it, only to face problems when trying to prove prior coverage later. These practical difficulties were part of the reason federal regulators decided to eliminate the requirement once the ACA made pre-existing condition exclusions illegal.

Regulations Eliminating the COCC

A new regulation on Exchange and Insurance Market Standards for 2015 and Beyond published by the U.S. Department of Health and Human Services (HHS) confirms that certain states can terminate the issuance of the COCC and even allow those with pre-existing health conditions to obtain insurance more easily. Therefore, as of January 1, 2015, most health insurance plans no longer contain pre-existing conditions, particularly due to the implementation of the Patient Protection and Affordable Care Act (PPACA). The main purpose of providing the COCC was to protect employees who change to a new plan and need proof of prior coverage. With the regulation eliminating the COCC, it allows those employees to further reduce any waiting periods, health exclusions, and other pre-existing condition exclusions that could prevent those from obtaining health insurance with a different insurance carrier. With that being said, however, some health insurance policies still contain pre-existing condition exclusions that could prevent those falling into this category from obtaining coverage.

Do COCCs Still Matter Today?

Although the Affordable Care Act eliminated the formal need for a certificate of creditable coverage in 2014, some employers and insurers may still issue similar documents. These can serve as proof of insurance for administrative reasons, such as when individuals apply for certain government benefits, seek to verify COBRA eligibility, or resolve disputes over lapse in coverage. However, they no longer have any legal effect on pre-existing condition exclusions, since those exclusions are prohibited under current federal law.

Frequently Asked Questions

1. Do I still need a certificate of creditable coverage today?

No. Since 2014, the Affordable Care Act prohibits insurers from denying coverage for pre-existing conditions, eliminating the legal need for COCCs.

2. Who used to provide the COCC?

Health insurance companies and COBRA administrators were required to provide the certificate automatically when coverage ended or upon request.

3. Did COCCs apply to dependents?

Yes. Dependents such as spouses and children also received certificates to prove their prior coverage when moving to a new plan.

4. What information was included on a COCC?

The certificate listed the insured’s name, covered dependents, dates of coverage, termination date, and verification contacts.

5. Why were COCCs eliminated?

They became unnecessary once federal law guaranteed coverage regardless of pre-existing conditions, making prior proof of coverage irrelevant.

If you would like to learn more about the COCC or the federal or state rules that apply to you, you can post your legal need on UpCounsel’s marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.