PRA_Form_14029_REG-125592-10_(2719)[SS]

SUPPORTING STATEMENT
1. CIRCUMSTANCES NECESSITATING COLLECTION OF INFORMATION
Section 2719 of the Public Health Service Act, incorporated into Code section 9815 by section 1563(f) of the Patient
Protection and Affordable Care Act, Public Law 111-148, requires group health plans and issuers of group health
insurance coverage, in connection with internal appeals of claims denials, to provide claimants free of charge with any
evidence relied upon in deciding the appeal that was not relied on in making the initial denial of the claim.

2. USE OF DATA
This is a third party disclosure requirement. Individuals appealing a denial of a claim should be able to respond to any
new evidence the plan or issuer relies on in the appeal, and this disclosure requirement is essential so that the
claimant knows of the new evidence.

3. USE OF IMPROVED INFORMATION TECHNOLOGY TO REDUCE BURDEN
Plans and issuers may satisfy this disclosure requirement by electronic means if they comply with applicable electronic
disclosure requirements.

4. EFFORTS TO IDENTIFY DUPLICATION
The regulations provide that the satisfaction of this obligation by either the plan or the issuer satisfies the obligation for
both parties.

5. METHODS TO MINIMIZE BURDEN ON SMALL BUSINESSES OR OTHER SMALL ENTITIES
The regulations provide that disclosure by either the plan or the issuer will satisfy the obligation for both parties
responsible for the disclsoure. Most small businesses maintaining a group health plan provide benefits through health
insurance coverage. In such a case, it is expected that the issuer of the health insurance coverage will satisfy the
disclosure obligation on behalf of both the plan and the issuer.

6. CONSEQUENCES OF LESS FREQUENT COLLECTION ON FEDERAL PROGRAMS OR
POLICY ACTIVITIES
Not applicable -- occasional third-party disclosure requirement.

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Department of the Treasury–Internal Revenue Service

7. SPECIAL CIRCUMSTANCES REQUIRING DATA COLLECTION TO BE INCONSISTENT
WITH GUIDELINES IN 5 CFR 1320.5(d)(2)
Not applicable.

8. CONSULTATION WITH INDIVIDUALS OUTSIDE OF THE AGENCY ON AVAILABILITY
OF DATA, FREQUENCY OF COLLECTION, CLARITY OF INSTRUCTIONS AND FORMS,
AND DATA ELEMENTS
We will publish a notice in the Federal Register in the near future to solicit public comments on this regulation.

9. EXPLANATION OF DECISION TO PROVIDE ANY PAYMENT OR GIFT TO RESPONDENTS
Not applicable.

10. ASSURANCE OF CONFIDENTIALITY OF RESPONSES
Generally, tax returns and tax return information are confidential as required by 26 USC 6103.

11. JUSTIFICATION OF SENSITIVE QUESTIONS
Not applicable.

12. ESTIMATED BURDEN OF INFORMATION COLLECTION
The Departments estimate that approximately 93 percent of large benefit and all small benefit plans administer claims
use a third-party provider, or roughly 5 percent of covered individuals. In-house administration burdens are accounted
for as hours. Based on the foregoing, total burden hours are estimated at 300 hours (50% to DOL and 50% to IRS).

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Department of the Treasury–Internal Revenue Service

13. ESTIMATED TOTAL ANNUAL COST BURDEN TO RESPONDENTS
Estimates of captial or start-up costs of operation, maintenance, and purchase of services are not available at this time.

14. ESTIMATED ANNUALIZED COST TO THE FEDERAL GOVERNMENT
Not applicable -- third party disclosure.

15. REASONS FOR CHANGE IN BURDEN
New ICR.

16. PLANS FOR TABULATION, STATISTICAL ANALYSIS AND PUBLICATION
Not applicable.

17. REASONS WHY DISPLAYING THE OMB EXPIRATION DATE IS INAPPROPRIATE
We believe that displaying the OMB expiration date is inappropriate because it could cause confusion by leading
taxpayers to believe that the regulations sunset as of the expiration date. Taxpayers are not likely to be aware that the
Service inteneds to request renewal of the OMB approval and obtain a new expiration date before the old one expires.

18. EXCEPTIONS TO THE CERTIFICATION STATEMENT ON OMB PRA SUBMISSION FORM
Not applicable.

19. REASON FOR EMERGENCY SUBMISSION
New statute with imminent applicability.

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Department of the Treasury–Internal Revenue Service

Supporting Statement for Paperwork Reduction Act Submissions
General Instructions

• requiring respondents to submit more than
an original and two copies of any document;

A Supporting Statement, including the text of
the notice to the public required by 5 CFR
1320.5(a)(i)(iv) and its actual or estimated date
of publication in the Federal Register, must
accompany each request for approval of a
collection of information. The Supporting
Statement must be prepared in the format
described below, and must contain the
information specified in Section A below. If an
item is not applicable, provide a brief
explanation. When item 15 of the PRA
Submission form is checked “Yes”, Section B of
the Supporting Statement must be completed.
OMB reserves the right to require the
submission of additional information with
respect to any request for approval.

Specific Instructions
A. Justification
1. Explain the circumstances that make the
collection of information necessary. Identify
any legal or administrative requirements that
necessitate the collection. Attach a copy of
the appropriate section of each statute and
regulation mandating or authorizing the
collection of information.
2. Indicate how, by whom, and for what
purpose the information is to be used.
Except for a new collection, indicate the
actual use the agency has made of the
information received from the current
collection.
3. Describe whether, and to what extent, the
collection of information involves the use of
automated, electronic, or mechanical, or
other technological collection techniques or
other forms of information technology, e.g.,
permitting electronic submission of
responses, and the basis for the decision for
adopting this means of collection. Also
describe any consideration of using
information technology to reduce burden.
4. Describe efforts to identify duplication.
Show specifically why any similar
information already available cannot be
used or modified for use for the purposes
described in item 2 above.
5. If the collection of information impacts small
businesses or other small entities (Item 5 of
the PRA Submission form), describe any
methods used to minimize burden.
6. Describe the consequence to Federal
program or policy activities if the collection
is not conducted or is conducted less
frequently, as well as any technical or legal
obstacles to reducing burden.
7. Explain any special circumstances that
would cause an information collection to be
conducted in a manner:

• requiring respondents to report information
to the agency more often than quarterly;

• requiring respondents to prepare a written
response to a collection;

• requiring respondents to retain records,
other than health, medical, government
contract, grant-in-aid, or tax records, for
more than three years;

• in connection with a statistical survey, that
is not designed to produce valid and reliable
results that can be generalized to the
universe of study;

• requiring the use of a statistical data
classification that has not been reviewed
and approved by OMB;

• that includes a pledge of confidentiality
that is not supported by authority
established in statute or regulation, that is
not supported by disclosure and data
security policies that are consistent with the
pledge, or which unnecessarily impedes
sharing of data with other agencies for
compatible confidential use; or
• requiring respondents to submit
proprietary trade secrets, or other
confidential information unless the agency
can demonstrate that it has instituted
procedures to protect the information’s
confidentiality to the extent permitted by law.
8. If applicable, provide a copy and identify the
date and page number of publication in the
Federal Register of the agency’s notice,
required by 5 CFR 1320.8(d) soliciting
comments on the information collection prior
to submission to OMB. Summarize public
comments received in response to that
notice and describe actions taken by the
agency in response to these comments.
Specifically address comments received on
cost and hour burden.
Describe efforts to consult with persons
outside the agency to obtain their views on
the availability of data, frequency of
collection, the clarity of instructions and
recordkeeping, disclosure, or reporting
format (if any), and on the data elements to
be recorded, disclosed, or reported.
Consultation with representatives of those
from whom information is to be obtained or
those who must compile records should
occur at least once every 3 years – even if
the collection of information activity is the
same as in prior periods. There may be
circumstances that may preclude
consultation in a specific situation. These
circumstances should be explained.
9. Explain any decision to provide any
payment or gift to respondents, other than
re-enumeration of contractors or grantees.
10. Describe any assurance of confidentiality
provided to respondents and the basis for
the assurance in statute, regulation, or
agency policy.
11. Provide additional justification for any
questions of a sensitive nature, such as
sexual behavior and attitudes, religious
beliefs, and other matters that are

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commonly considered private. This
justification should include the reasons why
the agency considers the questions
necessary, the specific uses to be made of
the information, the explanation to be given
to persons from whom the information is
requested, and any steps to be taken to
obtain their consent.
12. Provide estimates of the hour burden of the
collection of information. The statement
should:

• Indicate the number of respondents,
frequency of response, annual hour burden,
and an explanation of how the burden was
estimated. Unless directed to do so,
agencies should not conduct special
surveys to obtain information on which to
base hour burden estimates. Consultation
with a sample (fewer than 10) of potential
respondents is desirable. If the hour burden
on respondents is expected to vary widely
because of differences in activity, size, or
complexity, show the range of estimated
hour burden, and explain the reasons for
the variance. Generally, estimates should
not include burden hours for customary and
usual business practices.
• If this request for approval covers more
than one form, provide separate hour
burden estimates for each form and
aggregate the hour burdens in item 14 of
the PRA Submission form.
• Provide estimates of annualized cost to
respondents for the hour burdens for
collections of information, identifying and
using appropriate wage rate categories. The
cost of contracting out or paying outside
parties for information collection activities
should not be included here. Instead, this
cost should be included in item 13.
13. Provide an estimate for the total annual
cost burden to respondents or recordkeepers resulting from the collection of
information. (Do not include the cost of any
hour burden shown in items 12 and 14).

• The cost estimate should be split into two
components: (a) a total capital and start-up
cost component (annualized over its
expected useful life) and (b) a total
operation and maintenance and purchase
of services component. The estimates
should take into account costs associated
with generating, maintaining, and disclosing
or providing the information. Include
descriptions of methods used to estimate
major cost factors including system and
technology acquisition, expected useful life
of capital equipment, the discount rate(s),
and the time period over which costs will be
incurred. Capital and start-up costs include,
among other items, preparations for
collecting information such as purchasing
computers and software; monitoring,
sampling, drilling and testing equipment;
and record storage facilities.

• If cost estimates are expected to vary
widely, agencies should present ranges of
cost burdens and explain the reasons for
the variance. The cost of purchasing or

Department of the Treasury–Internal Revenue Service

contracting out information collections
services should be a part of this cost burden
estimate. In developing cost burden
estimates, agencies may consult with a
sample of respondents (fewer than 10),
utilize the 60-day pre-OMB submission
public comment process and use existing
economic or regulatory impact analysis
associated with the rulemaking containing
the information collection, as appropriate.

• Generally, estimates should not include
purchases of equipment or services, or
portions thereof, made: (1) prior to October
1, 1995, (2) to achieve regulatory
compliance with requirements not
associated with the information collection,
(3) for reasons other than to provide
information or keep records for the
government, or (4) as part of customary and
usual business or private practices.
14. Provide estimates of annualized costs to
the Federal government. Also, provide a
description of the methods used to estimate
cost, which should include quantification of
hours, operational expenses (such as
equipment, overhead, printing, and support
staff), and any other expense that would not
have been incurred without this collection of
information. Agencies may also aggregate
cost estimates from Items 12, 13, and 14 in
a single table.
15. Explain the reasons for any program
changes or adjustments reported in Items
13 or 14 of the PRA Submission Form.
16. For collections of information whose results
will be published, outline plans for tabulation
and publication. Address any complex
analytical techniques that will be used.
Provide the time schedule for the entire
project, including beginning and ending
dates of the collection of information,
completion of report, publication dates, and
other actions.
17. If seeking approval to not display the
expiration date for OMB approval of the
information collection, explain the reasons
that display would be inappropriate.

universe as a whole and for each of the
strata in the proposed sample. Indicate
expected response rates for the collections
as a whole. If the collection had been
conducted previously, include the actual
response rate achieved during the last
collection.
2. Describe the procedures for the collection of
information including:

• Statistical methodology for stratification
and sample selection,

• Estimation procedure,
• Degree of accuracy needed for the purpose
described in the justification,

• Unusual problems requiring specialized
sampling procedures, and
• Any use of periodic (less frequent than
annual) data collection cycles to reduce
burden.
3. Describe methods to maximize response
rates and to deal with issues of nonresponse. The accuracy and reliability of
information collected must be shown to be
adequate for intended uses. For collections
based on sampling, a special justification
must be provided for any collection that will
not yield “reliable” data that can be
generalized to the universe studied.
4. Describe any tests of procedures or methods
to be undertaken. Testing is encouraged as
an effective means of refining collections of
information to minimize burden and improve
utility. Tests must be approved if they call for
answers to identical questions from 10 or
more respondents. A proposed test or set of
tests may be submitted for approval
separately or in combination with the main
collection of information.
5. Provide the name and telephone number of
individuals consulted on statistical aspects
of the design and the name of the agency
unit, contractor(s), grantee(s), or other
person(s) who will actually collect and/or
analyze the information for the agency.

18. Explain each exception to the certification
statement identified in Item 19, Certification
for Paperwork Reduction Act Submissions,''
of the PRA Submission Form.
B. Collection of Information Employing
Statistical Methods
The agency should be prepared to justify its
decision not to use statistical methods in any
case where such methods might reduce burden
or improve accuracy of results. When Item 17
on the PRA Submission Form is checked,
“Yes,” the following documentation should be
included in the Supporting Statement to the
extent that it applies to the methods proposed:
1. Describe (including a numerical estimate)
the potential respondent universe and any
sampling or other respondent selection
methods to be used. Data on the number of
entities (e.g., establishments, State and
local government units, households, or
persons) in the universe covered by the
collection and in the corresponding sample
are to be provided in tabular form for the

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Department of the Treasury–Internal Revenue Service