COVID-19 in 2022

Emergency Periods

HHS has extended the Public Health Emergency every 90 days since January, 2020. At present, the emergency period is set to expire January 11, 2023. Several benefits related items are tied to these respective emergency periods, such as the waiver of out of pocket costs for medically necessary COVID testing, and vaccinations.

EBSA Disaster Relief Notices 2020-1 and 2021-1 are also still in effect as long as the emergency periods continue, tolling several ERISA deadlines until the end of the National emergency period. As a reminder, this applies to COBRA election and payment deadlines, the ability of individuals to submit FSA claims from the prior year, filing for external review of an adverse benefit determination, and the HIPAA special enrollment window for mid year election changes on account of a HIPAA event.

Workplace COVID Testing

The EEOC’s 2020 and 2021  guidance confirmed that mandatory worksite COVID-19 testing on its face met the ADA standards, which require that mandatory employment related medical tests be “job related and consistent with business necessity.”  The EEOC’s new guidance states that COVID-19 workplace testing is no longer automatically compliant with this ADA standard, and employers need to determine if the current statistics and climate render this testing truly “consistent with business necessity” at this time.

Paid Leave for COVID

New York employers must still offer 2 weeks (14 calendar days) of paid leave to any employees that test positive for COVID, or are under mandatory quarantine and cannot telework. This is available up to 3 times for the same employee. As of the date of this writing this leave law is still in effect.

California passed a supplemental COVID paid leave law for 2022, tracking the 2021 law in many ways. Up to 80 hours of paid time off, available in 2 ‘buckets’ of 40 hours, is required for employers with at least 26 employees located in California, and applies only to those employees physically working within the state. AB 152 has extended this paid leave in the state of California through December 31, 2022.

DOL

Mental Health Parity

On May 25, the Wage and Hour Division issued Facts Sheet #280 and a list of FAQs addressing mental health and qualified leaves of absence under the FMLA. Specifically, the DOL notes that employees may take FMLA for their own serious health condition, or to care for a covered family member because of a serious health condition, that a serious health condition can include a “mental health condition.” The full Fact Sheet can be viewed here.

In line with the focus on mental health under FMLA, the DOL continues to emphasize the importance of employer compliance with the Mental Health Parity and Addiction Equity Act (MHPAEA). The 2021 Consolidated Appropriations Act required employers, beginning in February 2022, to produce a comparative analysis of any non quantitative treatment limitations (NQTLs) upon request by the DOL, IRS or HHS. Examples of common NQTLs include ‘fail first’ or step therapy protocols, referrals requirements, network tier designs, and exclusions based on failure to complete a course of treatment. Employers should be aware of this requirement and communicate with their carriers or ASO providers to obtain a compliant comparative analysis.

Transparency in Coverage

The Transparency in Coverage Rule issued in 2020 and has a phased in enforcement timelines. July 1, 2022 marked the first employer obligation under the rule, to post ‘machine readable files’ (MRFs) on their public websites, listing the in-network rates of all covered services, and out-of-network amounts allowed for covered services. The pharmacy cost component of this rule has been indefinitely delayed.

No Surprises Act

The No Surprises Act (NSA) took effect for plan years beginning in 2022 to ban balance and surprise billing for patients enrolled in group health plans. In February, a Texas District court vacated the arbitration provision of the HHS regulations implementing the No Surprises Act, as well as the presumption that the entity mediating a billing dispute refer to a ‘qualifying payment amount’ in its decision. 

Following the October 2021 interim final rule, and the resulting judicial uncertainty and legal challenges, a final rule released in August offers some clarity for health plans. The August 2022 final rule implements requirements under the No Surprises Act, and provides necessary clarification surrounding independent dispute resolution payment determinations. Importantly for carriers and health plans, the final rule  includes examples illustrating how independent dispute resolution entities are to use different factors when determining payment amounts, and what must be included in the written decisions following the resolution. The DOL’s fact sheet is a helpful resource for the final rule here.

Wellness

In March 2022, a large class action settlement was announced between Yale University and a group of its employees over ‘coercive’ wellness incentives. The program at issue required employees and their spouses to participate in various health related activities, such as medical screenings, or pay $25 per week/$1,300 per year, in higher group health plan premiums. In the absence of clear regulations about what constitutes a ‘voluntary’ wellness program incentive, this settlement is a signal that monetary incentives in this dollar range may not be viewed as ‘voluntary’.

SCOTUS

Dobbs v Jackson

On June 24, the Supreme Court rendered a divisive opinion in Dobbs v Jackson, where they upheld a state abortion ban and ultimately overturned the 1973 landmark case, Roe v Wade.  Dobbs does not prohibit group health plans from covering abortions themselves, or expenses related to obtaining an abortion. Dobbs eliminates federal constitutional protections in electing an abortion. Each state can prohibit or regulate access to abortion. 

Self-insured health plans are largely free from state law, and should be able to provide coverage for this type of service.  Fully-insured plans are regulated by state insurance laws, which are not preempted by ERISA. It is likely that in ‘ban’ states, the law will prohibit insurance policies underwritten in that state from covering abortion, even if the procedure occurs in a state where legal (this may include civil or criminal liability for anyone who “aids or abets” or “assists” a resident of that state with procuring an abortion). This ‘threat’ may not withstand constitutional scrutiny, but it is not clear at this time.

HEALTH CARE REFORM

The ACA

The PCORI fee funds outcome based research, and applies to self insured health plans, including HRAs. The fee is payable via IRS Form 720 by July 31 annually. Calendar year plans, as well as those with start dates of November 1 and December 1 will pay $3.00 per covered employee for their 2022 year, while all other plans will pay $2.79 for their 2021-2022 plan year in July 2023.

Several new health services for women and children have been added to the required list of preventive services covered without cost share, beginning with plan years in 2023. Self funded plans in particular should ensure they consult the current list (linked here) as their 2023 plan designs are drafted.

Beginning January 1, 2023, family coverage will be deemed ‘unaffordable’ if the employee’s share of family coverage premium exceeds 9.12% of income. While there will be no penalty or consequence to the employer in this situation, dependents will be eligible for a subsidy to enroll in Marketplace coverage for the 2023 year. Under IRS 2022-41 (updated on November 9) employers with any plan year may adopt a special qualifying event allowing employees to drop family tier coverage and enroll in single tier coverage if their dependents become eligible for a subsidy under this new rule.

4980H Penalties

Employers with at least full time and equivalent employees in the prior calendar year  must offer minimum essential coverage to all full time employees that costs no more 9.12% of employee income in 2023.

 Two grounds for employer penalty

    The 4980H(A) :

2023: If Employer does not offer coverage to 95% of its full time employees, and one employee receives a subsidy to purchase insurance on the Health Exchange, the Employer is subject to a penalty equal to $2,880 x every full time employee (minus 30) 

The 4980H(B):

2023: If employer offers coverage that is unaffordable (more than 9.12% of income), or doesn’t offer minimum value, and any employees qualify for a subsidy to purchase insurance on the Health Exchange, the employer is subject to a penalty equal to $4,320 x the number of full time employees that receive a subsidy to purchase insurance on the Health Exchange. 

State Paid Leave

2022/2023 Limits on Out of Pocket, HSA/FSA Contributions, and HDHP Deductibles