Hunton Employment & Labor Perspectives

On May 14, 2020, the Department of Health and Human Services (HHS) issued a final rule stating that group health plans, including employer-sponsored health plans, are not required to count the value of drug manufacturer coupons toward participant deductibles and out-of-pocket maximums (the “Final Rule”).  The Final Rule, published in HHS's Notice of Benefit and Payment Parameters for 2021, allows group health plans to exclude the value of drug manufacturer coupons from participant annual cost-sharing amounts even where no medically appropriate generic drug is available.

For at least one more year, health plans, including employer-sponsored plans, will be able to exclude the value of drug manufacturer discounts from participant deductibles and out-of-pocket maximums, even where no medically appropriate generic drug is available.  The Department of Labor (DOL), Department of Health and Human Services (HHS), and the Department of Treasury (collectively, the "Departments") jointly issued a temporary non-enforcement pledge relating to these so-called "accumulator programs" as a result of an apparent catch-22 relating to high-deductible health plans (HDHPs) with health savings accounts (HSAs). 

On October 29, 2018, the Internal Revenue Service, Department of Labor and Department of Health and Human Services (the “Departments”) jointly released proposed regulations in response to President Trump’s executive order calling for an expansion of the ability of employers to offer health reimbursement arrangements (“HRAs”) to their employees and to allow HRAs to be used in conjunction with nongroup coverage.

The IRS recently updated the FAQs on its website regarding the employer mandate to provide some details on the process it will use to impose penalties for failure to provide coverage to “ACA full-time” employees (those working 30 or more hours per week) in accordance with Section 4980H of the Code (often referred to as the “employer mandate”).

On May 4, the House of Representatives passed the American Health Care Act, (AHCA), which is aimed at repealing and replacing portions of the Affordable Care Act (ACA). While many of the changes do not affect employer-sponsored coverage, there are several changes in the bill that are likely to be of interest to employers.

The IRS has issued final versions of Forms 1095-C and 1094-C as well as updated final instructions on completing these forms. While the instructions and forms remain similar to those used last year, there are a few key changes worth noting.

In general, the Forms 1094-C and 1095-C are used by “applicable large employers,” or “ALEs,” to report offers of coverage to their full-time employees (those working 30 or more hours per week) as required under the Affordable Care Act, as well as by self-insured plan sponsors to report individuals covered under their plans.

Earlier this year, the Department of Health and Human Services Office of Civil Rights published final rules implementing Section 1557 of the Affordable Care Act (ACA).  Section 1557 prohibits discrimination on the basis of race, color, national origin, sex, age or disability by healthcare providers and group health plans that receive federal financial assistance. The rules include restrictions on discrimination relating to gender identity, as well as requirements regarding accessibility for individuals with limited English and with disabilities.

The Affordable Care Act (ACA) requires the state and federal health care exchanges to notify employers if an employee has been determined to be eligible for a premium tax credit or cost-sharing reduction for exchange coverage. The notices are issued for those individuals who have been determined to be eligible for such a subsidy. As employers begin receiving notices, they should consider how best to track this information and whether it would be worthwhile to appeal the subsidy eligibility determinations where the information is incorrect.

The government has continued to issue a number of regulations and other guidance on the Patient Protection and Affordable Care Act (PPACA) and related health care laws, including the following:

• Final regulations on the use of “bona fide orientation periods” in coordination with waiting periods for health care coverage;
• IRS forms and instructions regarding reporting of health care coverage by health plans and large employers;
• Updated proposed rules on the required Summary of Benefits and Coverage;
• Guidance regarding use of “skinny plans”; and
• Preliminary guidance on ...

The IRS recently issued Notice 2015-16 addressing the excise tax on high cost employer-sponsored health coverage enacted under the Affordable Care Act. This tax, which is commonly referred to as the "Cadillac" tax, will take effect in 2018. While it does not provide definitive guidance on which employers can rely, the Notice does provide some useful insights as to the agency's intended approach regarding key aspects of the tax.

The IRS recently issued final versions of the new Forms 1094-B, 1095-B, 1094-C and 1095-C, along with related final Instructions.  These forms are for reporting of coverage in 2014, but are expected to be similar for reporting for 2015.

In December 2014, the government issued new proposed rules regarding the requirements for providing a summary of benefits and coverage (SBC). Simultaneous with the proposed rules, the government also published an updated SBC template and uniform glossary.

The Affordable Care Act required the Department of Health and Human Services (HHS) to establish a national health plan identifier (HPID) program under the HIPAA standard transactions rules. The resulting HHS rules generally require all HIPAA-covered entities, including self-insured plans with more than $5 million in annual claims, to obtain a HPID by November 5, 2014. Small self-insured health plans (i.e., those with annual claims of $5 million or less) will be required to obtain a HPID by November 5, 2015.

On June 25, the government issued final rules regarding the use of “bona fide employment-based orientation periods” in connection with the Affordable Care Act’s 90 day waiting period limits. These final rules largely track the proposed rules issued in February.

The government has continued to issue a number of regulations and other guidance on the Patient Protection and Affordable Care Act (PPACA) and related health care laws, including the following:

• The “employer mandate” that will take effect in 2015;
• IRS reporting requirements for health plans and large employers;
• The 90-day waiting period limits;
• Transitional reinsurance contributions required to be made by large employers;
• The Mental Health Parity and Addiction Equity Act; and
• Standard transactions under HIPAA.

IRS final regulations issued earlier this year provide guidance on compliance with the employer coverage mandate under the Affordable Care Act (ACA), including determining full-time status and offering coverage with minimum value. In addition, the government has also issued final and proposed regulations regarding 90-day waiting periods under the ACA.

While both sets of final rules largely follow the previously issued proposed rules, there are some key changes of note for employers.

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Even before passage of the Affordable Care Act (ACA), group health plan sponsors and administrators faced a significant array of notice and disclosure obligations.  Those obligations have only increased with passage of the ACA, and in many cases existing disclosure requirements have been revised.  For this reason, we are providing a table summarizing the principal notice and disclosure obligations currently applicable to group health plans, including those required under the ACA.  The first part of the table summarizes disclosure rules applicable to all welfare benefit plans ...