On Dec. 20, 2016, the DOL issued FAQs About Affordable Care Act Implementation Part 35. The FAQs address special enrollment periods (SEPs) under HIPAA, the coverage of preventive services as required by the PPACA and the new benefit option called “qualified small employer health reimbursement arrangements” (QSEHRAs). While the guidance really doesn’t provide any new information on these issues, they do answer employers’ frequently asked questions.
On Jan. 9, 2017, the DOL, HHS, and the Treasury (the Departments) jointly issued FAQs About Affordable Care Act Implementation Part 36. This FAQ is focused on accommodation for religious employers in providing contraceptive coverage for plan participants.
Special Enrollment Periods, Part 35, Q1
An individual who is enrolled in an individual health insurance policy through the Marketplace and loses eligibility for that policy is entitled to enroll in the group health plan through a HIPAA SEP. Please note that loss of coverage for cause or failure to pay premiums does not trigger a SEP. Those individuals would have to wait to enroll in the group health plan following another qualifying event or during the next open enrollment period. Examples of a valid loss of eligibility for coverage that would trigger special enrollment include moving out of the policy’s service area or the carrier no longer offering the policy.
Preventive Services, Part 35, Q2; Part 36, Q1
In December 2016, the Health Resources and Services Administration (HRSA) updated its guidelines for women’s preventive services. Effective for plan years starting on or after Dec. 20, 2017, non-grandfathered group health plans must provide coverage for these preventive services with no cost sharing for participants. The updated guidelines expand coverage for breast cancer screening, breastfeeding services and supplies, cervical cancer screening, contraceptive services (religious exemption applies), gestational diabetes mellitus screening and HIV screening.
Certain religious employers, such as churches and synagogues, are exempt from the PPACA’s requirement to provide coverage for contraceptive services without cost sharing for plan participants. Other employers may qualify for an accommodation if they are a non-profit organization with religious objections to providing contraceptive coverage or a closely held for-profit corporation that has religious objections. Under the accommodation, there are two options for the eligible employer. The employer may self-certify its objection to the insurer (or TPA) on EBSA Form 700 or self-certify directly to HHS with no form.
In May 2016, the U.S. Supreme Court considered the case of Zubik v. Burwell, in which eligible employers claimed the accommodation violated their rights under the Religious Freedom Restoration Act (RFRA). The Court vacated the lower courts’ decisions and remanded the challenges to the accommodation. Although the Court declined to opine on whether the accommodation violated the RFRA, the Court did encourage the parties to develop an approach that accommodates religious exercise while ensuring that women covered by employer’s health plans have their needs, including contraceptive coverage, met. In July 2016, the Departments published a request for information regarding revisions to the accommodation. The recently issued ACA FAQs Part 36 is the Departments’ response after considering the comments they received.
The Departments are not making changes to the accommodation at this time. The guidance states “…no feasible approach has been identified at this time that would resolve the concerns of the religious objectors, while still ensuring that the affected women receive full and equal health coverage, including contraceptive coverage.”
The remainder of the FAQ discusses the comments that the Departments received along with the issues that they present. The Departments also provide a detailed explanation of why they believe the existing accommodation regulations are consistent with the RFRA.
Employers eligible for the contraceptive coverage accommodation are to continue to rely upon the two existing self-certification methods.
QSEHRAs, Part 35, Q3
Q3 reiterates the provision of the QSEHRA in Section 18001 of the Cures Act, which was discussed in the Dec. 13, 2016, edition of Compliance Corner. A small employer that is not subject to the employer mandate and that does not sponsor a group health plan for any employees may implement a QSEHRA. The QSEHRA must be fully funded by the employer up to a maximum annual benefit of $4,950 for single coverage and $10,000 for family coverage. Qualified medical expenses, including the cost of individual health insurance policy premiums, are eligible for reimbursement from the QSEHRA. To maintain its tax advantaged status, any participating employee must provide proof of other MEC.
Any small employer offering a QSEHRA must provide employees with a written disclosure describing the requirement to maintain MEC coverage, the arrangement’s impact on eligibility for a premium tax credit and identifying the annual benefit.
Finally, a QSEHRA is not subject to ERISA or COBRA.
ACA FAQs Part 35 »
ACA FAQs Part 36 »