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Blogs Employee Benefits

  1. New DOL Guidance on FMLA Leave for Mental Health Conditions

    System Administrator – Mon, 13 Jun 2022 15:00:00 GMT – 0
    In connection with Mental Health Awareness Month, the Department of Labor (DOL) has sought to assist employers in better understanding how to comply with the Family Medical Leave Act (FMLA) regarding mental health conditions. On May 25, 2022, the DOL issued new guidance and FAQs on requirements for providing FMLA leave to employees to address their own mental health conditions or to care for a covered family member with a mental health condition. (Click here for Quick Basics on FMLA)
     

    Leave for Mental Health Conditions under FMLA

    Eligible employees may take FMLA leave for their own serious health condition or to care for a spouse, child, or parent because of a serious health condition. The guidance confirms that a mental health condition can constitute a “serious health condition” if the condition requires either:
     
    • Inpatient Care: A serious mental health condition that requires inpatient care includes a situation in which the individual stays overnight in a hospital or other medical care facility. Examples include rehabilitation centers for drug addiction and treatment centers for individuals with eating disorders.
    • Continuing Treatment by a Healthcare Provider: Mental health conditions that require continuing treatment by a health care provider include:
      • Conditions that incapacitate an individual for more than three (3) consecutive days and require ongoing medical treatment.
      • Chronic conditions that cause occasional periods when the individual is incapacitated and requires treatment by a health care provider at least twice a year.

    Ongoing medical treatment for a mental health condition can be multiple appointments with a health care provider or a single appointment and follow-up care. Examples of such treatment include behavioral therapy, prescription medications, or rehabilitation counseling. Examples include anxiety, depression, and dissociative disorders.
     

    Leave Documentation Guidelines

    Employers may require an employee to submit a certification from a health care provider to support the need for FMLA leave. The information provided on the certification must be sufficient to support the need for leave, but a diagnosis is not required.
     

    Employee or Family Member

    Eligible employees can take FMLA leave to care for their own serious mental health condition or to care for a covered family member with a serious mental health condition. For example, the FAQs explain that an eligible employee would be entitled to FMLA leave to attend a family counseling session for a spouse who is in an inpatient treatment program for substance abuse or to assist a parent receiving medical treatment for depression with day-to-day activities.
     

    Caring for a Covered Military Servicemember or Veteran

    The FMLA also provides eligible employees with up to 26 workweeks of military caregiver leave in a single 12-month period to care for a covered servicemember and certain veterans with a serious injury or illness. An employee may be an eligible military caregiver if they are the spouse, son, daughter, parent, or next of kin of the servicemember. Eligible employees may take military caregiver leave under the FMLA for a covered service member or veteran with a serious mental health condition when the condition (1) was incurred or aggravated in the line of duty and (2) makes them unfit to perform their military duties. Although the mental health condition must be incurred or aggravated in the line of duty, it does not have to manifest itself before the service member leaves active duty for the employee to use FMLA leave. Examples include caring for a veteran whose mental health condition, such as post-traumatic stress disorder, traumatic brain injury, or depression, manifested after the individual became a veteran but is related to their military service.
     

    Confidentiality

    The FMLA requires employers to keep employee medical records confidential and maintain them in separate files from more routine personnel files. However, supervisors and managers may be informed of an employee’s need to be away from work or if an employee needs work duty restrictions or accommodations.
     

    Protection from Retaliation

    Employers are prohibited from interfering with, restraining, or denying the exercise of, or the attempt to exercise, any FMLA right. Examples include refusing to authorize FMLA leave or disclosing or threatening to disclose information about an employee’s or an employee’s family member’s mental health condition to discourage them from taking FMLA leave.
     

    A Word of Caution

    Employers should be reminded not to discourage taking FMLA leave. An employer can run afoul of the FMLA rules if the employer “denies or interferes with FMLA benefits to which an employee is entitled resulting in harm to the employee.” 

    A recent case from the Seventh Circuit Court of Appeals (Ziccarelli v. Dart et al.) highlights how employers can be vulnerable to the “interferes with” standard. Importantly, the FMLA does not require an actual denial of FMLA benefits for a violation to occur. Instead, an employer violates an employee’s FMLA rights when it denies, interferes with, or restrains the employee’s exercise or attempt to exercise such rights. Following is a quick overview of the case:

    FMLA Request: During the current leave year, an employee has used more than 300 hours of leave and, at his doctor’s recommendation, asks his employer for an additional 8 weeks of leave for treatment of his serious health condition. Specifically, the employee asks the employer about the possibility of using his available FMLA leave as well as his sick leave and other employer-provided leave benefits. 

    Employer Response: In response, the employer’s representative states that the employee has taken a significant amount of FMLA leave and tells him not to take any more FMLA leave, or he will be disciplined. Based on this conversation, the employee decides not to take any more leave and, instead, chooses to retire. The employee then files a complaint alleging that the employer interfered with his rights under the FMLA. 

    Examples of prohibited interference or restraint include refusals to grant or accept proper requests for FMLA leave, burdensome FMLA approval processes, informing an employee with FMLA leave available that missing additional time will have consequences, and other actions that discourage employees from requesting FMLA leave. Concerning Mr. Ziccarelli, the court concluded that he had more than a month of FMLA leave available at the time he requested FMLA leave from his employer and, therefore, the alleged statement that Mr. Ziccarelli would be disciplined if he took any more FMLA leave was sufficient to support an FMLA interference claim and allow the matter to proceed to trial.
     

    Quick Basics on FMLA for Reference

    Employees are eligible for FMLA benefits if they work for a covered employer for at least 12 months, have at least 1,250 hours of service for the employer during the 12 months before the leave, and work at a location where the employer has at least 50 employees within 75 miles.

    Covered employers include private employers if they employed 50 or more employees in 20 or more workweeks in the current or preceding calendar year. Public agencies, including local, state, or Federal government agencies, and public and private elementary and secondary schools are FMLA-covered employers regardless of the number of employees they employ.

    FMLA requires employers to:
     
    • Provide 12 work weeks of FMLA leave each year,
    • Continue an employee’s group health benefits under the same conditions as if the employee had not taken leave, and
    • Restore the employee to the same or virtually identical position at the end of the leave period.

    FMLA may be unpaid or may be used at the same time as employer-provided paid leave.
     

    Link to Guidance

    https://www.dol.gov/agencies/whd/fact-sheets/28o-mental-health
    • Compliance
    • Employee Benefits
  2. Implementing a Medical Travel Benefit

    System Administrator – Wed, 11 May 2022 15:00:00 GMT – 0
    Following the leaked draft opinion from the Supreme Court of the United States last week, a number of employers have asked about the best practices and considerations for implementing a medical travel reimbursement benefit for employees who find it necessary to access healthcare in another region.

    Medical travel benefits to support or even incentivize care in other locations are not necessarily new. Beyond politics, some employers have already implemented programs to drive care towards centers of excellence for certain high-cost or complex conditions.
     

    Taxation and Eligible Expenses

    IRS Publication 502 defines medical care that is tax-deductible. For individuals, such expenses would only be tax-deductible to the extent they exceed 7.5% of Adjusted Gross Income (AGI). However, these definitions are also relied upon to define eligible medical care that can be provided on a tax-deductible basis through employer plans. The following types of medically-related travel expenses are considered eligible:
     
    1. Transportation: amounts paid for transportation to another city to receive medical treatment are eligible. The expenses must be primarily for, and essential to, receiving medical care. This includes:
       
      • Bus, taxi, train, or plane fares
      • Mileage reimbursement for driving a personally owned car
      • Car services, such as taxis, Uber, Lyft, or another similar rideshare service
      • Transportation expenses of a parent who must accompany a child who needs medical care
      • Transportation expenses of a nurse or other person who can give injections, medications, or other treatment required by a patient who is traveling to get medical care and is unable to travel alone. Note that expenses for a friend, family member, or other non-medically trained support person would not be eligible.

         
    2. Lodging: the cost of lodging while away from home receiving medical care if all of the following requirements are met:
       
      • The lodging is primarily for, and essential to, medical care.
      • The medical care is provided by a doctor in a licensed hospital or in a medical care facility related to, or the equivalent of, a licensed hospital.
      • The lodging isn't lavish or extravagant under the circumstances.
      • There is no significant element of personal pleasure, recreation, or vacation in the travel away from home.

    The maximum amount for lodging is $50 per person per night. For example, if a parent is traveling with a child, up to $100 per night would be considered as an eligible medical expense for lodging.

    Note that you can include lodging for an eligible caregiver traveling with the person receiving the medical care; however, the same rules apply for defining an eligible travel partner as outlined above for transportation expenses.
     
    1. Car expenses: costs associated with driving to receive medically necessary treatment are eligible. The IRS authorizes a standard medical mileage rate on an annual basis. The rate for 2022 is $0.18 per mile. Parking fees and tolls are also eligible.
    The IRS also authorizes a significantly more complex methodology that allows for actual expenses for operating your car for the medical treatment. This includes calculating the actual out-of-pocket costs, such as the cost of gas, oil, parking, and tolls when you use a car for medical reasons. Items such as depreciation, insurance, general repair, or maintenance expenses are not eligible. This method also requires detailed logging of all mileage and expenses. Therefore, most people elect to use the simple medical mileage rate.
     

    Not Eligible Expenses

    Excluded expenses include:
     
    1. Meals (other than meals provided through inpatient care)
    2. Childcare expenses/babysitting
    3. Extending an otherwise-medical trip for vacation or personal enjoyment
    4. Expenses for a caregiver or travel companion other than the following two cases:
      • A parent accompanying a child under age 18
      • A qualified caregiver who can administer medication (such as a nurse)
         

    Strategy

    There are two paths that employers can take when establishing a medical travel Health Reimbursement Account (HRA). The two options are outlined below along with the basic pros and cons for each method:

    Option #1: Integrated HRA
    An Integrated HRA is one that is integrated with the health plan. This type of medical travel benefit would be available to all employees and dependents who are enrolled on the employer’s medical plan.
     
    • Pro: Employers may elect any reimbursement maximum, with no limit.
    • Con: Only employees who are actively enrolled on the health plan may be provided the medical travel benefit. In addition, only dependents that are actively enrolled on the health plan would be eligible under the plan. 

    Option #2: Standalone HRA (Excepted Benefit HRA, or EBHRA)
    Alternatively, a Standalone HRA is one that may be offered to ALL employees, independent of whether they are covered under the employer’s group health plan.
     
    • Pro: Employers may offer the benefit to a wider set of employees and eligible dependents (including those who waive the employer’s group medical plan). There is no restriction that the employee and dependents be enrolled in their employer sponsored health plan.
    • Con: There is a maximum benefit of $1,800 per employee per year for this type of HRA (the standard EBHRA limit). Expenses for dependent would still be covered, but the maximum is capped at $1,800 per employee. 

    Employers may wish to exclude emergency transportation from this plan benefit in order to funnel emergency transport services through the medical plan for cost management and claims processing expertise.

    Employers may also wish to clarify that the medical travel expense reimbursement plan is available when seeking medical services that are not available within 100 miles of an employee’s home. While the impetus for many employers who may be considering launching a medical travel HRA at this time is the potential non-availability of abortion services, the benefit would typically be written to cover medical travel expenses for any procedure that was not available within a certain radius of the employee’s home.
     

    A Few Thoughts About Reality

    Just as our country is divided, employees hold strong beliefs on both sides of the underlying abortion issue. Our experience has been that employers are thoughtfully considering the importance of this issue and how it will impact their employees. 

    What about cost? Some employers have jumped to offering a medical travel benefit without much regard for the potential cost, assuming benefits can be capped and will be low compared to other healthcare costs. Others have expressed concerns such as, “There are a lot of additional benefits we would like to offer our employees. Should we be investing those limited dollars in a medical travel benefit?” 

    It is possible that for many employers who adopt a medical travel benefit, it may be largely symbolic. The reality that both stigma and confidentiality loom large under such a medical travel benefit cannot be ignored.
     

    Next Steps

    Vita is prepared to assist clients who wish to implement such plans by providing formal plan documentation and confidentially administering the Health Reimbursement Arrangement (HRA) on behalf of clients. Please reach out to your Vita account management team if you would like to further explore or implement this benefit.

    If employers choose to administer the reimbursement internally, it is recommended that careful consideration be given to privacy and confidentiality concerns. In addition, employers should consult with a third-party administrator or legal counsel to draft formal plan documentation and create guidelines for acceptable documentation for reimbursement.

    Lastly, Vita will monitor legislative activity to stay up to date on potential new restrictions to health care that is currently covered under medical plans. Should abortion or other reproductive services be restricted from reimbursement, employers who may wish to maintain such coverage can consider expanding the HRA to include direct reimbursement for those medical services as well.

     
    • Employee Benefits
  3. Telehealth Exemption for HDHPs Extended

    System Administrator – Thu, 31 Mar 2022 15:00:00 GMT – 0
    In March 2022, Congress passed, and the President signed, a $1.5 trillion omnibus spending bill (the Consolidated Appropriations Act, 2022). This law includes a temporary extension of the ability for HDHP plans to provide telehealth and other remote care services without being subject to the deductible. Importantly, this avoids the problem of having that no-deductible coverage disqualify contributions to health savings accounts (HSA). This provision restores employers’ option to adopt pre-deductible telehealth visits in their HDHP plans (but it does not mandate it).

    Since the early days of the COVID-19 pandemic, telehealth has been an important way to obtain necessary medical care while maintaining recommended social distancing. Because of this, most employers adopted these provisions to enhance access to COVID-safe office visits for participants in HDHP plans.
     

    Background

    By way of background, tax-advantaged contributions generally cannot be made to an HSA unless the account holder is covered by a qualifying high-deductible health plan (HDHP) and does not have disqualifying non-HDHP coverage. The CARES Act (signed in March 2020) created exceptions to those rules to facilitate the use of telehealth during the COVID-19 pandemic, however, those exceptions applied only to plan years beginning on or before December 31, 2021. The new legislation restores these exceptions for the last nine months of 2022.

    The vast majority of employer-sponsored HDHPs with HSAs elected to cover telehealth services on a pre-deductible basis. Specifically, 83% of fully insured plans and 81% of self-insured plans, according to a study from the trade group America's Health Insurance Plans (AHIP). As a reminder, the HDHP minimum statutory deductible for 2022 is $1,400 for single coverage and $2,800 for family coverage.
     

    Two Key Provisions

    The new legislation amends two key provisions for HSAs:
     
    1. Telehealth and other remote care services will be considered disregarded coverage; therefore, such pre-deductible coverage will not cause a loss of HSA eligibility. This new provision applies from April 1, 2022 through December 31, 2022.
       
    2. Plans may provide coverage for telehealth and other remote care services before the HDHP minimum deductible is satisfied without losing their HDHP status during that nine-month period.

    Both amendments apply only to the nine-month period from April 1, 2022 through December 31, 2022, without regard to the HDHP’s plan year. Importantly, the relief does not apply for the first three months of 2022, therefore some plans (specifically, calendar-year plans) must still apply the minimum deductible to telehealth and other remote care services during those months to remain compliant.
     

    Not Retroactive - A Few Wrinkles

    Permissive, Not Mandatory: The legislation offers permission for plans to adopt these changes, but the changes are not mandatory. Thus, HDHPs are not required to waive their minimum deductible for telehealth and other remote services during the additional relief period. As a result, some plan sponsors may conclude that a midyear change to take advantage of the restored exception is too difficult to communicate and administer, and not worth the effort.

    Pre-Deductible Coverage Gap: The legislation also is expressly not retroactive, and this leaves an unfortunate gap in first-dollar coverage for participants. HDHP participants in plans that previously adopted this provision have enjoyed telehealth services not being subject to the deductible in 2021 and may do so for nine additional months (April 1, 2022 through December 31, 2022), but this leaves a 3-month gap in first-dollar coverage for these services. This could create confusion for plan participants and certainly would require careful communication.

    Not Retroactive: Plan sponsors, who expected that Congress would extend the CARES Act relief without a gap and thus continued providing telehealth services during the first three months of 2022 without applying the minimum deductible, have a unique problem. Specifically, determining whether their plans can and should apply the minimum deductible to telehealth and other remote services retroactively to the gap period. Some covered individuals may be able to avoid the adverse HSA-eligibility consequences of their plan’s failure to satisfy the minimum deductible requirement during the first three months of 2022 by using the full contribution rule, which allows a full year’s worth of HSA contributions to be made by someone who is HSA-eligible for only a portion of the year. However, that rule may not be available to all plan participants because some may not remain HSA-eligible through December 1, 2022, and some may not remain HSA-eligible throughout the 13-month testing period beginning on that date. If an employer wanted to take corrective action, participants could be billed for any telehealth visits between January 1, 2022 and March 31, 2022. Those billed charges would then apply to the deductible. This solution would require re-adjudicating telehealth claims incurred during those interim months.
    • Employee Benefits
    • Pre-Tax
  4. California Dental Summary of Benefit Coverage

    System Administrator – Wed, 16 Mar 2022 15:00:00 GMT – 0

    In 2018, CA passed SB 1008 which requires fully insured dental plans in California to provide a dental Summary of Benefits Coverage. This requirement mirrors the health plan Summary of Benefits Coverage introduced by the Affordable Care Act, only this law applies to dental plans.

    The intention behind the ACA provision was to make it easier for employees to compare their medical plan options (in an apples-to-apples format). Now, California has added an equivalent disclosure for dental plans.
     

    Fully Insured Dental Plans Only

    This applies to fully insured dental plans only, as self-funded plans are exempt from state legislative authority. Only plans written in California are subject to this disclosure law.
     

    Required Format

    The law prescribes that the Summary of Dental Benefits Coverage (SDBC) follow a very specific format. The law outlines the “uniform benefits and disclosure matrix” down to the requirement to use an Arial 12-point font. This matrix has been dubbed the dental SBC or SDBC.
     

    Who Must Create the SDBC?

    Insurance carriers are responsible for creating and providing the dental SBC to employers.
     

    Distribution Requirements

    Employers must distribute the dental SBCs to all eligible employees. The dental SBC must be distributed at the following times:

    1. Upon being newly eligible

    2. At open enrollment

    3. At Special Enrollment


    The method of distribution must be in one of three formats:

    1. Paper form free of charge to the individual’s mailing address

    2. Electronically by email

    3. Electronically by directing the participant to the insurer’s website for a copy of the dental SBC.


    In the case of either electronic distribution option, notice must be provided that a paper copy is available free of charge.
     

    Effective Date

    The effective date for this law is January 1, 2022, so dental carriers are now required to provide dental SBCs to employer groups.
     

    How Does ERISA Fit In?

    Generally, ERISA preempts state laws that “relate to” employee benefit plans. This typically relegates state legislators to governing (or mandating) insurers, not employers sponsoring employee benefit plans. In this case, legislators have done a bit of an end-run around by including specific “Group Policyholders Obligations” in the law. Most pundits would say that the inclusion of Group Policy Holder Obligations regulates something that “relates to” an employee benefit plan (in this case a dental plan) by specifically requiring employers to provide the dental SBC matrix disclosures to plan participants.

    While the insurer provisions are not controversial, the employer disclosure requirements will likely be challenged at some point. That said, in the meantime, employers would be wise to include the dental SBCs with their health plan SBC disclosure materials.
     

    What are Dental Carriers Doing?

    At this point, we are seeing dental carriers, well, scrambling. Despite the long runway on this law, as a rule, carriers are not prepared to distribute the customized dental SBC to employers. We are seeing carriers send out “generic” dental SBCs (along with directions to pair it with the plan certificate) despite the law’s very detailed customization instructions. It is our sense that carriers have been expecting the law to be challenged, and thus have been lulled into non-action. But with 2022 here, the carriers are now scrambling to get something out to comply with the law.

    • Compliance
    • Employee Benefits
  5. The No Surprises Act Explained

    System Administrator – Fri, 13 Aug 2021 15:00:00 GMT – 0

    The No Surprises Act (NSA) was enacted in December 2020 as part of the Consolidated Appropriations Act of 2021. The rule bans the practice of surprise-billing for out-of-network medical care, including from air ambulance providers, hospitals, facilities, and individual providers.

    Surprise billing happens when patients unknowingly get care from providers that are outside of their health plan's network. The law outlines new requirements and restrictions for many billing situations; however, the major focus on the bill is on three major categories of care, those where patients are most vulnerable to surprise billing.

    • Emergency Care - At Out-of-Network Facilities: Surprise billing often occurs in an emergency care situation where patients have little or no choice in where they receive care. Examples of this would be emergency care at a non-participating hospital or air ambulance services furnished by a non-network provider.
    • Ancillary Care – By Out-of-Network Providers at In-Network Facilities: Surprise billing can also occur in non-emergency care situations when patients at an in-network hospital or other facility receives care from ancillary providers (such as anesthesiologists or radiologists) who are not in-network and whom patients do not specifically choose.
    • Air Ambulance: Air ambulance services are usually furnished by nonparticipating providers, and the service is called upon when patients have essentially no choice of provider.

    The problem of “balance billing” occurs when a provider charges a patient the remainder of what their insurance does not pay. This practice is currently prohibited by both Medicare and Medicaid. The No Surprises Act extends similar protections to insureds covered under employer-sponsored and individual health plans.

    New Guidance

    On July 1, 2021, the DOL, HHS, and the IRS released the first round of guidance (Interim Final Rule) prescribing regulatory requirements pursuant to surprise medical billing. Broadly, the guidance puts prescriptive rules into place to protect individuals from surprise medical bills, and details how providers will navigate these rules behind the scenes.

    In short, the new rules clarify that patients are only responsible for their in-network cost-sharing amounts in emergency situations and certain non-emergency situations where they do not have the ability to affirmatively choose an in-network provider.

    Highlights

    Following is a summary of the key provisions of the guidance:

    • In-Network Cost Sharing: Cost-sharing (deductible or coinsurance) for out-of-network services that fall within the surprise billing protections are limited to in-network levels. That means patient cost-sharing cannot be higher than if the services were provided by an in-network provider.
    • Counts Toward In-Network OOP: Applicable cost-sharing (deductible or coinsurance) must count toward in-network deductibles and out-of-pocket maximums.
    • All Emergency Care In-Network: Emergency services, regardless of where they are provided, must be treated as if it were provided on in-network basis.
    • No Pre-Authorization: The practice of requiring a prior authorization for emergency services is prohibited.
    • Ancillary Care at In-Network Rates: Out-of-network charges for ancillary care (such as an anesthesiologist or assistant surgeon) provided at an in-network facility is prohibited in all circumstances.
    • No Balance Billing: The practice of balance billing (when providers seek to collect more than the applicable cost sharing amount from the patient) is banned.
    • Notice Required When OON Provider is Selected: When a patient voluntarily seeks care at an out-of-network provider, the provider/facility must provide patients with a plain-language consumer notice. The notice must explain that patient consent is required before that provider can bill at out-of-network rate (and collect any balance billed amount).

    Effective Date and Applicability

    The new law becomes effective for plan years beginning on or after January 1, 2022. It applies to nearly all private health plans offered by employers (including grandfathered group health plans) as well as individual health insurance policies offered through the Marketplace or directly through insurance carriers.

    More Details . . .

    The following sections provide a deeper dive into the details of the guidance for those that prefer a more in-depth review.

    Emergency Services Provided by Out-of-Network Providers

    If a nonparticipating provider (for example, an anesthesiologist or assistant surgeon) provides services at a participating facility or at a nonparticipating emergency facility, the provider may not bill beyond an allowed cost-sharing amount (essentially, the in-network levels).

    In addition to specifying the payment constraint, the guidance also prescribed a specific process by which providers are paid. Within 30 days from when the provider submits a bill to a plan, the plan must determine an initial payment and directly pay the provider or issue a notice of denial. (The regulations clarify that this “initial payment” does not refer to a first installment, but rather the amount that the plan or insurer reasonably intends as payment in full.)

    If the provider disagrees with the plan’s payment, the parties may begin a 30-day open negotiation period. If the parties fail to reach an agreement, the plan or provider has four days to notify the other party and the HHS that they are initiating an Independent Dispute Resolution (IDR) process. The No Surprises Act prescribed the details of this process, including the IDR as the final solution.

    Can Surprise Billing Protections be Waived?

    There are differences in how the guidance treats whether a patient may waive their surprise billing protections. These distinctions are useful in understanding the specific (and narrow) circumstances under which additional cost sharing and balance billing can be applied.

    Out-of-Network Emergency Care
    Types of Care:

    • Emergency Room Care
    • Air Ambulance Services

    Involuntary Ancillary Care at Out-of-Network Facilities
    Types of Care:

    Circumstances where a patient does not have control in choice of provider:

    • Emergency medicine
    • Anesthesiology
    • Pathology
    • Radiology
    • Neonatology
    • Diagnostic services (including radiology and laboratory services)
    • Assistant surgeons
    • Hospitalists
    • Intensivists
    • Nonparticipating providers at a facility where there is no participating provider who can furnish the necessary item or service

    Right to Waive:

    No. Protections can never be waived. Notice and consent provisions cannot be used under any circumstances.

    Voluntary Ancillary Care at Out-of-Network Facilities/Providers
    Types of Care:

    Circumstances where a patient has a meaningful choice as to whether to select a nonparticipating provider:

    • Other services (not listed above)
    • Nonemergency care where the patient elects a specific specialist
    • Care provided where additional cost sharing and balance billing amounts are not a “surprise” because a patient knowingly and purposefully seeks care from the nonparticipating provider

    Right to Waive:

    Yes. Protections can be waived if patient agrees to receive nonemergency care from certain nonparticipating providers. Notice and consent provisions must be followed.

    Cost-Sharing Amounts

    Participants in group health plans will pay cost-sharing for items and services that fall within the No Surprises Act’s scope based on the “recognized amount,” which generally will be the lesser of the “qualifying payment amount” (QPA) (i.e., the plan’s median in-network rate for an item or service) and the amount billed by the provider.

    What is the Qualifying Payment Amount?

    The Qualifying Payment Amount (QPA) is an amount paid to a non-participating provider as determined by the plan or insurer. Generally, it is the median of all the plan or insurer’s contracted rates from January 31, 2019 for a given item or service in that geographic region, increased for inflation. The QPA affects patient cost sharing in many instances and is a key factor for arbitrators to consider if and when payment disputes are resolved through the IDR process.

    Accurate Provider Network Directories

    Health plans must update their provider directory at least every 90 days. They also must respond within one business day to requests from individuals about whether a provider or facility is in-network. Lastly, consumers who rely on incorrect information conveyed by plans or posted in directories are entitled to have services covered with in-network cost sharing applied.

    Continuity of Care

    The No Surprises Act also includes a provision which requires health plans to notify enrollees when a provider/facility leaves the plan network while it is providing ongoing care. In certain circumstances, health plans must provide transitional coverage for up to 90 days or until treatment ends (whichever is earlier) at in-network rates.

    The continuity of care requirement applies to treatment for serious or complex health conditions, institutional or inpatient care, nonelective surgery, pregnancy, and care for patients with terminal illness.

    Advanced Explanation of Benefits

    Beginning in 2022, patients can request advance information about how services will be covered before they are provided. For scheduled services, if a request is submitted, the health plan must provide written information including whether the provider/facility participates in-network and a good faith estimate of what the plan will pay and what patient cost liability may be. Generally, this information must be provided to the patient within three business days.

    Notice and Consent Exception

    Providers furnishing non-emergency services where the patient voluntarily elects to seek care out-of-network must provide notice and receive written consent from the patient in order to be exempt from the NSA’s balance-billing and cost-sharing restrictions. The nonparticipating provider generally has 72 hours before the service is delivered to obtain the patient’s consent. The process can be executed either in paper or electronic form, but notice must be provided to patients and patients must provide consent in advance of services in order for the provider to apply out-of-network cost sharing and/or balance bill for any services. To enable a plan or insurer to apply cost-sharing correctly, a provider relying on the notice and consent exception must timely notify the plan or insurer and provide the plan or insurer a signed copy of the binding notice and consent documents.

    Model Notice

    A model notice is provided for plans and insurers to post and include in all explanations of benefits to which the No Surprises Act applies. The regulations outline the process for providing the notice, which is intended to serve as good faith compliance with the NSA requirement that, beginning in 2022, a plan or insurer must disclose the prohibition on surprise billing and the entities to contact in the event of a violation.

    • Employee Benefits
  6. Supreme Court Upholds ACA for Third Time

    System Administrator – Fri, 18 Jun 2021 22:36:42 GMT – 0

    On June 17, 2021, the United States Supreme Court effectively upheld the Affordable Care Act by ruling that the plaintiffs lacked standing to bring the case to court. This 7-2 vote was the third time the Supreme Court ruled to uphold the Affordable Care Act. 

    The ruling preserves the current provisions of the law, which was enacted by Congress in 2010. More information about the case and key arguments can be found in our prior blog post. The Court’s formal opinions are posted here.  

    Political opinions aside, we expect many employers and insurers to consider this good news; any changes to the Affordable Care Act would create additional administrative burden for an industry already focused on implementing recent legal changes that support pandemic recovery, as well as stabilizing increased costs.  

    • Employee Benefits
  7. Navigating Workplace Vaccine Mandates, Vaccine Hesitancy, and Employer Responsibilities [Video]

    System Administrator – Fri, 21 May 2021 04:30:19 GMT – 0

    As employees begin returning to the workplace, how can employers keep their employees safe, accommodate their concerns, and minimize liability? What are the challenges and risks of instituting a vaccine mandate? Join Jeanine DeBacker, employment law attorney at McPharlin Sprinkles & Thomas LLP, and Brie Linkenhoker, PhD and Founder of Worldview Studio, as they provide guidance and clarity on these questions and others. We address several topics, including:

    • Vaccine mandates
    • Privacy issues
    • Accommodation requests
    • Masking protocols
    • Employee education resources

    Note: The content of this presentation is not to be considered legal advice. We recommend Clients speak with legal counsel specializing in labor and employment law to ensure your organization meets requirements.



    Additional Resources

    Employer Action Plans

    • COVID-19 Resources for Employers with model policies and communications by ThinkHR
    • Vaccine Guidance with model policies and accommodation requests by Fisher Phillips
    • Workplace Vaccine and Mask Mandates guidance by Sun Life
    • Model Mandatory/Voluntary Vaccine Policy Memo by SHRM (see below)
    • CDC’s Workplace Vaccination Program
    • Vaccine Communications Guidance for Employers by Communicate to Vaccinate
    • California Employment Law Blog from Jeanine DeBacker

    COVID-19 Vaccine Education

    • Department of Health & Human Services Communication Toolkit
    • COVID-19 FAQ’s from the Ad Council
    • COVID-19 FAQ’s from the National Foundation for Infectious Diseases

    Model Mandatory/Voluntary Vaccine Policy Memo to Employees

    Mandatory Vaccination Option

    Date:
    To:
    From:
    Subject: Mandatory Vaccination Policy

    [Company name] has implemented a mandatory vaccination policy effective [date] requiring [disease name(s)] vaccination(s) for all employees. In accordance with [Company name]'s duty to provide and maintain a workplace that is free of known hazards, we are adopting this policy to safeguard the health of our employees and their families, our customers and visitors, and the community at large from infectious diseases that may be reduced by vaccinations. In making this decision, the executive leadership team reviewed recommendations from [insert department names or other organizations consulted such as the Centers for Disease Control and Prevention, the Advisory Committee on Immunization Practices and local health officials].

    All employees must receive the vaccination no later than [date]. Individuals seeking an exemption from this requirement for medical or religious reasons should complete a request for accommodation form and submit the form to the human resources department.

    Vaccinations will be administered by [insert details regarding who will provide the vaccine and where employees must go to receive the vaccine].

    [Company Name] will pay for all vaccinations and the time spent receiving the vaccinations.

    Should you have any questions regarding this new policy, please contact [name and contact information].

    Voluntary Vaccination Option

    Date:
    To:
    From:
    Subject: Voluntary Vaccination Policy

    [Company name] is implementing a voluntary vaccination policy effective [date] regarding [disease name(s)] vaccination(s) for employees. In accordance with [Company name]'s duty to provide and maintain a workplace that is free of known hazards, we strongly encourage employees to receive this vaccination to minimize the risk of infectious disease in our workplace. In making this decision, the executive leadership team reviewed recommendations from [insert department names or other organizations consulted such as the Centers for Disease Control and Prevention, the Advisory Committee on Immunization Practices and local health officials].

    Employees may obtain the vaccination wherever they choose; however, [Company name] is facilitating vaccinations through [insert details regarding who will provide the vaccine and where employees can go to receive the vaccine]. [Company Name] will pay for all vaccinations and the time spent receiving the vaccinations.

    Should you have any questions regarding this new policy, please contact [name and contact information].

    • Employee Benefits
  8. Washington State New Long-Term Care Trust Tax

    System Administrator – Thu, 20 May 2021 21:11:23 GMT – 0

    Starting January 1, 2022, employees who work in the state of Washington will pay a mandatory 0.58% payroll tax on all W-2 income with no cap. This tax will fund a state-run long-term care insurance program which can provide up to a maximum of $36,500 of long-term care benefits for care provided in the state. This equates to a daily benefit of $100 per day for one year. There is a provision to increase the benefit. However, benefit increases will track with the Washington CPI. The tax will increase as income increases since there is no cap to the tax.

    Eligibility Details

    To be eligible for benefits, employees must have paid into the system for three years within the past six years or for a total of 10 years with at least five of those years paid without interruption. Benefits can only be received if you reside in Washington state.

    Opt Out Option

    Employees can opt out of this tax permanently if a) they own their own long-term care insurance policy, and b) if they can attest that the plan provides benefits equal to or better than the state program. The long-term care insurance must be in place by November 1, 2021. This attestation must be submitted to the state’s Employment Security Department between October 1, 2021 and December 31, 2022.

    Who Should Consider a Private LTC Policy?

    Arguably, there are three groups of employees who may benefit from considering a private long-term care insurance policy:

    1. Employees who earn $300,000 or more in annual compensation. Most employees in this income bracket can find a policy that is more cost effective than the payroll tax.
    2. Employees who plan to move out of the state of Washington when they retire because they will forfeit the benefit.
    3. Employees who plan to retire in the next few years since they will not have vested benefits through the state.

    Employer Action

    If you have employees in Washington and would like to consider a long-term care benefit, provide a resource for employees, or explore an executive carve-out, please reach out to your Vita Account Manager. We will do an assessment to confirm the best options and course of action.

    • Employee Benefits
  9. Healthcare and Employee Benefits in the Biden Era [Video]

    System Administrator – Wed, 14 Apr 2021 20:34:53 GMT – 0

    With the ongoing global pandemic and a new administration, legislative priorities continue to shift and are causing confusion for many employers. Join James Slotnick, Sun Life’s AVP of Government Relations, as he discusses how these dynamics could impact the employee benefits industry. He covers:

    • Ongoing legislative response to COVID-19
    • How Congress has both advanced and hindered President Biden’s priorities
    • Which employee benefits issues are likely to be most impacted by the Biden Administration
    • How the 2022 mid-terms could change President Biden’s agenda

    Note: The content of this presentation is not to be considered legal advice. We recommend Clients speak with legal counsel specializing in labor and employment law to ensure your organization meets requirements.

     

     

    • Employee Benefits
  10. Supreme Court to Determine Fate of the ACA - A Peek Into the Crystal Ball

    System Administrator – Thu, 12 Nov 2020 06:58:54 GMT – 0

    Just as the nation is facing the COVID-19 global pandemic, the Affordable Care Act (ACA) is once again in the limelight. On November 10, the U.S. Supreme Court will take up California v. Texas and hear arguments on whether the ACA is constitutional, in whole or in part. The case will address two things:

    1. Penalty-Less Individual Mandate: The constitutionality of the individual mandate now that the penalty for not having coverage has been zeroed out.
    2. Severability: Whether the individual mandate is so central to the rest of the ACA that it cannot be severed from the rest of the law (if it is considered unconstitutional) or whether the entirety of the statute would be invalidated in the absence of the individual mandate.

    Case History

    The Supreme Court already addressed the constitutionality of the ACA back in 2012. At that time, the court upheld the constitutionality of the ACA's penalty on individuals who do not comply with the mandate to have health coverage (the so-called individual coverage mandate) as a justifiable exercise of Congress' power to tax. The key issue here was that the law expressed the fine for not carrying health insurance as a “penalty” and not expressly as a “tax.” The ruling at that time was that the penalty was sufficiently “tax-like” to fall under Congress’ power to levy taxes. Thus, the individual mandate was upheld on the grounds that the fine for not carrying health insurance was, in fact, a tax.

    Why Does This Matter?

    Had the fine not been deemed a tax, then the law would have to be interpreted as Congress mandating behavior (to purchase health insurance). However, Congress’ power is limited to “expressed powers” and not general powers, and there is no expressed power to compel or mandate certain behaviors. Levy taxes, yes. Mandate behavior, no. Thus, the determination that the Individual Mandate was deemed constitutional hangs on the fact that the fine is considered a tax.

    Enter the Zero Tax

    In December 2017, President Trump signed into law the Tax Cuts and Jobs Act which eliminated the ACA's penalty on individuals who lack health coverage. At this stroke of a pen, the thread by which the Individual Mandate’s constitutionality hung was eliminated.

    Crystal Ball Option #1: ACA Falls

    So, what are the likely or potential outcomes? Without question, the case is complex. That said, several important facts are relevant to consider:

    1. The constitutionality of the individual mandate was upheld based on the penalty being a tax. The federal court which most recently invalidated the individual mandate portion of the ACA concluded that, “the individual mandate, unmoored from a tax, is unconstitutional.”
    2. There is no longer a tax.
    3. The argument brought forth by the challengers is that if the constitutionality of the individual mandate was upheld based on the tax, and there is no longer a tax, then it stands to reason that the change in the tax would render the individual mandate unconstitutional.

    What about Severability?

    If the individual mandate were found to be unconstitutional, the question becomes whether the individual mandate can be “severed” from the rest of the law or whether it is so central to the foundation of the law that the entire law would be invalidated by the demise of that one provision. Writing for the majority in the 2012 opinion, Chief Justice Roberts addressed the issue of severability in a detailed analysis, reaching the conclusion that the individual mandate was, in fact, not severable from the rest of the law. Importantly, none of the other justices offered dissenting opinions addressing this issue. This lays a foundation of uniform thought on the bench regarding the severability issue.

    What Happens if the ACA is Invalidated?

    If the individual mandate were found to be unconstitutional and not severable from the rest of the ACA, the entirety of the law would be invalidated. This would include many popular provisions of the law including:

    • Protections for people with pre-existing conditions
    • Funding for premium subsidies
    • Funding for Medicaid expansion.
    • Small group reforms
    • Coverage mandates (free preventive care, no lifetime limits, caps on out-of-pocket cost sharing, dependent coverage to age 26, etc.)

    If the law were invalidated, Congress could pass legislation to restore key provisions of the law. Such action would render moot any Supreme Court determination to the contrary. This, of course, assumes Congress is aligned on the provisions to restore and has the votes to push such legislation through.

    Crystal Ball Option #2: ACA is Upheld

    Oral arguments were heard by the Supreme Court on November 10, 2020. While there has been speculation that they newly-conservative-leaning Supreme Court would lean toward invalidating the law, feedback from the oral arguments was less definitive than some had expected. Early feedback from Chief Justice Roberts and Justice Kavanaugh indicate that they see a possible path to invalidate the individual mandate but consider it severable from the law, thus enabling the remainder of the law to stand. This argument would suggest that since 2017 the ACA has actually been operating without the individual mandate (because the penalty has been zeroed out) and it has not imploded. Therefore, it has effectively proven that it is severable. Justice Alito offered the analogy of an airplane:

    “At the time of the first case, there was strong reason to believe that the individual mandate was like a part in an airplane that was essential to keep the plane flying, so that if that part was taken out the plane would crash. But now the part has been taken out and the plane has not crashed . . . So, how would we explain why the individual mandate in its present form is essential to the operation of the act?"

    There is also a possibility that the Supreme Court will determine that Texas and the other GOP-led states that brought the challenge don’t, in fact, have standing to sue in the first place. There was some discussion on this issue in the hearing as well.

    Ultimate Fate

    The ACA’s fate is now in the hands of the Supreme Court. The court is expected to rule on this case before the end of the term in June 2021. In the meantime, the ACA remains fully in effect, and all employer provisions and reporting requirements remain enforceable.

    • Employee Benefits
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