In our Looking Ahead Part 2: The Pace of Change Accelerates in 2021, we advised employers to stay tuned for “what’s next” as part of their 2021 action plan. “What’s next” is here, as the new Biden Administration acts rapidly to change existing programs. In this article, we will explain some of the recent changes on the table for employers and what next steps they should take.
Biden Administration Prioritizes Healthcare Reform
We expected 2021 to be a year of rapid change, and the Biden Administration is getting to work with new legislation that will impact healthcare in a big way.
The first year of a new presidential administration is usually an eventful year for legal and regulatory makeovers. There are changes afoot that are already in motion or will soon be set in motion through enactment of laws, issuance of executive orders, or rulemaking by federal agencies through the Administrative Procedures Act.
One of the key priorities that the Biden Administration will focus on in his first 100 days in office is with healthcare reform. The President has expressed his intention to (1) restore benefits and protections that were in place before the last administration, and (2) expand access to affordable healthcare to more Americans.
What’s Up First? Expanding ACA
President Biden will immediately work on his campaign promises about expanding and improving upon the Affordable Care Act (ACA). The Administration got the ball rolling by opening a 90-day special enrollment window from February 15th through May 15th for uninsured individuals to sign up for Marketplace coverage. The special enrollment window paired with additional advertising for Marketplace insurance should boost enrollment numbers to help stabilize the ACA Exchanges.
|The $1.9 trillion American Rescue Plan, that was signed into law on March 11, 2021, will provide a $34 billion injection aimed at shoring up the ACA and making healthcare coverage affordable to more Americans during the pandemic:|
Even employer-sponsored group health plans would benefit from an enhanced and stabilized ACA Marketplace. When more and more individuals (especially healthy ones) enroll in ACA coverage, it puts downward pressure on healthcare costs by spreading risk across a larger pool of enrollees. Marketplace insurance providers should see a leveling out of costs for care, treatments, drugs, etc., which in turn should ease the pressure to shift costs from an unstable ACA marketplace to the more stable employer-sponsored group health plan space.
Older Americans will see the most significant reduction in the cost of coverage obtained through the Marketplace. For employers, this could mean that older employees who are considering early retirement could use coverage in the ACA Marketplace (which would likely be cheaper than COBRA) to bridge the gap until Medicare eligibility kicks in. Note that the ACA subsidy relief is good for two years, but there’s hope that this could turn into a permanent fix.
The Rescue Plan provides other tremendous benefits-related assistance as well, but that is a topic for another blog. Stay tuned!
HIPAA Reform and Mental Health Parity Audits
Department of Labor (DOL) Revamping Rules and Increasing Scrutiny of Plans
The DOL has also been busy behind the wheel, working diligently to revamp various outdated rules and increase scrutiny of certain employee benefit plans. Most notably, we anticipate significant changes to the HIPAA Privacy Rule and continued focus on enforcing mental health parity rules.
Last December (2020), the DOL proposed the first major modification to the HIPAA Privacy Rule in more than seven years. The modifications are intended to ease the administrative burden for providers for coordinating care without diminishing the protections over an individual’s personal health information.
|Some of the most interesting DOL-proposed HIPAA Privacy Rule changes include:|
Most of the HIPAA Privacy Rule changes will have a more immediate impact on insurance carriers and service providers rather than on employers.
In addition to updating HIPAA, the DOL will continue to keep close watch over compliance with the Mental Health Parity and Addiction Equity Act (MHPAEA). The DOL closed 183 investigations involving review of mental health parity compliance for both fully insured and self-insured health plans. The DOL just created a new national MHPAEA enforcement project for 2021 and will pay particular attention to claim denials involving autism spectrum disorder.
EEOC Proposes New Rules on Wellness Program Incentives
Not to be outdone by their peers, the Equal Employment Opportunity Commission (EEOC) has also been busy this year. In early January 2021, the EEOC issued new proposed rules regarding how wellness program incentives can comply with the Americans with Disabilities Act (ADA) and the Genetic Information Nondiscrimination Act (GINA). In a nutshell, programs that are offered outside of a group health plan setting will comply with the “voluntary” standard under the ADA and GINA as long as the incentives are “de minimis” (e.g., a gift card worth less than $50). For wellness programs that are offered in conjunction with a group health plan, the incentive limits go back to the HIPAA standard—30% of the total cost of the coverage the employee is enrolled in, or up to 50% for tobacco-cessation incentives.
Expertise for What’s Next in Employee Benefits
Legislation is changing fast and impacts the significant investment you have made in your employee benefit plans.
Woodruff Sawyer Benefits consultants will help you review your current strategies in light of the changing economic environment and legislative impacts. Strategy, compliance, and cost all come together to ensure your employees receive the full value of your benefit plans.
At our webinar, we answered many key questions, but those we could not get to, we have answered in this FAQ.
In this second edition of Accelerate, we again welcome a panel of founders, owners, and entrepreneurs to share their thoughts and expertise on ways to provide innovative benefits that meet your business objectives.
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