Author: Tony Sorrentino
SilverStone Group believes it is important to keep you updated on the repeal/replace activity as it evolves. House Republicans on the Energy and Commerce Committee and the Ways and Means Committee issued a proposed reconciliation “bill” late in the evening on March 6. It will be marked up this week and voted on very soon. It is slightly different than the summary provided to you last week.
Since the election of President Trump, there has been widespread speculation on just what format the long-awaited “ACA Repeal and Replace” legislation might take. In that vein, we believe it might be helpful to review some high-level thoughts on the potential impact of the draft Republican Reconciliation Bill, for which the reviewing and scoring process should begin this week.
Please keep in mind that the Bill has not yet passed, and if it passes, it is highly unlikely that it will pass in its exact current format. Again, please keep in mind that these are high-level thoughts only:
In 2013, the agencies responsible for implementing the Affordable Care Act (ACA) issued a series of notices, FAQs and other guidance addressing how the ACA applies when an employer pays or reimburses employees for the cost of buying their own individual health insurance policies. The upshot of this guidance was that it became virtually impossible for employers to pay for individual health insurance premiums, either pre tax or post tax, without violating the ACA. On December 13, President Obama signed the 21st Century Cures Act, which created Qualified Small Employer Health Reimbursement Arrangements (QSEHRA). The primary motivation behind these new QSEHRAs is to create a mechanism that would allow for the reimbursement of individual health insurance premiums — but only for certain employers.
A new regulation will require some employers to make health plan design and administrative changes. While not all employers are subject to this requirement, those who are will need to review their plans and be aware of other obligations these rules impose.
The Department of Health and Human Services (“HHS”) Office for Civil Rights (“OCR”) has published a final rule implementing section 1557 of the Patient Protection and Affordable Care Act (“ACA”). This section of the ACA prohibits discrimination in health programs and activities on the basis of race, color, national origin, sex, age or disability. The proposed rule (applicable to a “covered entities”) broadly prohibits discrimination on the basis of sex in health programs, and includes significant requirements related to transgender individuals and the treatments for gender dysphoria.
The rule would generally become effective July 18, 2016, however, to the extent that a group health plan or insurance carrier needs to alter its benefit design to comply with these regulations, then such plan design provisions are applicable on the first day of the plan year beginning on or after January of 2017. (But see Federal Contractor rule effective date below).
In IRS Notice 2015-87, the agencies provided further clarification on the impact of the Affordable Care Act (ACA) group health plan market reform provisions on account-based plans and much needed guidance on the Section 4980H employer shared responsibility requirements. In many cases, common benefit design practices for employer credits and opt-outs must be revisited prior to the next annual enrollment.
As you may have recently read, the U.S. Department of Health and Human Services’ (HHS) Office for Civil Rights (OCR) has started “Phase 2” of its audit program. Like the Phase 1 audits, OCR intends to use the audits to examine compliance mechanisms, identify best practices and discover risks and vulnerabilities to enhance compliance with HIPAA’s Privacy, Security and Breach Notification Rules. Phase 2 will be primarily desk audits, although OCR will conduct some on-site audits. If an audit reveals serious compliance issues, OCR might also launch an investigation. So now is the time to look at HIPAA compliance for your health plan and take corrective action, if needed. Business associates should do the same, as they are also subject to Phase 2 audits.
In late 2015, the Equal Employment Opportunity Commission (EEOC) published Proposed Rules on the Genetic Information Nondiscrimination Act of 2008 (GINA). The Proposed Rules provide clarification about what incentives may be offered for spousal participation under employer-sponsored wellness programs without violating GINA. The Proposed Rules follow 2013’s Health Insurance Portability and Accountability Act (HIPAA) wellness rules and the EEOC’s proposed wellness rules under the Americans with Disabilities Act (ADA) from April 2015 and add yet another layer of complexity for employer-sponsored wellness programs.
The Affordable Care Act (ACA) anti-retaliation provisions have been in effect for several years, but have so far largely gone unnoticed. Now that employees can receive financial assistance through the Health Insurance Marketplace, employers should revisit these provisions and carefully structure their actions to limit potential exposure.
The Department of Health and Human Services (HHS) has proposed 2017 health plan out-of-pocket maximums of $7,150 for self-only coverage and $14,300 for family (other than self-only) coverage.