Federal Group Health Plan Mandates

Transcription

1 Federal Group Health Plan Mandates Note: This document is best used via soft copy in order to link to the sample language and other resources. Federal group health plan mandates are federal laws that impact a group health plan s design and administration. Most federal group health plan mandates are detailed and complex and have exceptions and special rules. It is the employer s responsibility as a plan sponsor to ensure that their benefit plans comply with federal group health plan mandates. Many of the below mandates are governed by Part 7 of Title 1 of the Employee Retirement Income Security Act of 1974 (ERISA). The below covers the most common federal group health plan mandates including touching on the Health Insurance Portability and Accountability Act of 1996 (HIPAA) and Consolidated Omnibus Budget Reconciliation Act (COBRA). HIPAA for purposes of privacy regulations is discussed in the HIPAA Privacy Guide produced by the Melita and the Company highly recommends outsourcing COBRA administration to a third party administrator since COBRA has many compliance requirements. There are other federal group health plan mandates such as 5500 filings which employers must ensure compliance and regulations requiring self reporting for plan excise taxes. The Department of Labor (DOL) has a detailed site for compliance information as well. While the below covers federal group health plan mandates, individual state mandates may also be applicable. Typically, the Summary Plan Description (SPD), Summary of Material Modifications (SMM), or Evidence of Coverage (EOC) will contain language on the various federal group health plan mandates. However, in some instances the federal group health plan mandates require employers to distribute certain notices to participants. This ensures that participants are aware of their rights for certain coverage, prior to enrolling in these plans. The requirements for SPDs, SMMs, and EOCs are a complex matter and employers should contact their legal counsel and insurance carrier for assistance. Employers should ensure all of the necessary plan documents are amended to reflect any necessary compliance changes. The enclosed resource is not intended to address all areas, but to include information on the most common federal group health plan mandates summarized as follows: Children s Health Insurance Program Reauthorization Act of 2009 (CHIP) Fact Sheet Mandate Purpose Notification Responsible Plans and issuers must permit employees and Ensure employees and dependents who are eligible for, but not enrolled in, new hires, when a group health plan to enroll in the plan upon: (1) enrolling in plans receive losing eligibility for coverage under a State Medicaid the Special Enrollment or CHIP program or (2) becoming eligible for State Rights language. premium assistance under Medicaid or CHIP. The May be provided with employee or dependent must request coverage materials during open maintaining a plan in a state that provides Medicaid Model Notice Melita Page 1 1/1/15

2 within 60 days of being terminated from Medicaid or CHIP coverage or within 60 days of being determined to be eligible for premium assistance. or CHIP premium assistance subsidies (see the Model Notice in the righthand column for a full list of impacted states) COBRA under 20 CAL COBRA and 20 or more Federal COBRA Provides employees and their families who lose their health benefits under certain circumstances the right to choose to continue group health benefits under certain restrictions. enrollment or with the SPD on an annual basis. The model notice includes the states. The legislation does not specifically require that employers include all of the states in the notice, but legal suggests that the states be included. Contact legal counsel or COBRA Administrator for required notice information. CAL COBRA carrier. Federal COBRA employer or COBRA Administrator. Model General Notice Model Election Notice Employee Retirement Income Security Requires reporting welfare plan information to the The Form 5500 is due by SAR Act of 1974 (ERISA), Title I Reporting IRS/DOL and disclosures to participants including, the end of the 7th SPD and Disclosure Requirements but not limited to: month following the Form 5500 (Annual Report Filing) close of the plan year Summary Annual Report (SAR) (unless an extension is Summary Plan Description (SPD) filed) Summary of Material Modifications (SMM) SARs must be provided 4-page Uniform Explanation of Benefits within two months of (starting in 2012) the Form 5500 filing deadline (including any Some requirements are eliminated for unfunded or extensions). fully-insured plans covering less than 100 SPDs must be distributed participants as of the beginning of the plan year. to participants: (1) within 90 days after the participant first becomes covered under the plan and (2) at least every 5 years or 10 years if no material changes. Melita Page 2 1/1/15

3 Summary of Benefits and Coverage (SBC) Mandate Purpose Notification Responsible SMMs must be provided within: (1) 210 days after the end of the plan year in which modification or change is adopted or (2) no later than 60 days after the date of a modification or change that is a material reduction in covered services or benefits provided under the plan. Provides a short, standardized, uniform summary of plan benefits. SBCs must be issued annually during open enrollment. SBCs also must be distributed mid-year during special enrollments, following participant requests, or at least 60 days in advance of mid-year benefit changes. for self-funded plans Responsibility jointly shared between employer and carrier for fully-insured plan Template Instructions HIPAA Certificate of Creditable Allows participants to show proof of prior coverage Must be provided: (1) Generally Coverage to reduce pre-existing exclusion periods. upon request, (2) upon employer language loss of benefits coverage and carrier FAQ Requirement to furnish certificate of creditable (for COBRA events within (if employer coverage eliminated effective as of December 31, 14 days of notice of the relies on the qualifying event, for all carrier to other events, within a provide, this reasonable period of should be in time), and (3) upon loss the of COBRA coverage. contract). CAL COBRA carrier. Federal Melita Page 3 1/1/15

4 COBRA employer and/or carrier or COBRA Administrator. HIPAA - Notice of Pre-existing Provides definition of pre-existing conditions, ability Must be provided to and Conditions (General) to demonstrate creditable coverage, late enrollee, participant: (1) as part of carrier (if the and special enrollee rights for any plan that contains enrollment materials and employer FAQ a pre-existing condition exclusion. Effective for plan (2) before pre-existing relies upon years beginning on or after September 23, 2010, condition exclusion can the carrier to plans may no longer impose pre-existing conditions be applied under HIPAA s provide, this for children under age 19. Effective for plan years portability provisions. should be in beginning on or after January 1, 2014, plans may no the contract). longer impose pre-existing condition exclusions. HIPAA - Notice of Pre-existing Condition Exclusion (Individual) FAQ sponsoring plans with pre-existing condition exclusions. HIPAA Notice of Special Enrollment Rights FAQ HIPAA Notice of Privacy Practices Plans may not impose pre-existing condition exclusions before properly notifying participants. Effective for plan years beginning on or after September 23, 2010, plans may no longer impose pre-existing conditions for children under age 19. Effective for plan years beginning on or after January 1, 2014, plans may no longer impose preexisting condition exclusions. Provides description of special enrollment rights including right to enroll after a qualifying life event (QLE). Must be provided with any written application materials. Pre-existing condition exclusion cannot be imposed if notice is not distributed in a timely fashion. Required before or at the time of enrollment under HIPAA s portability provisions. Should be included in plan document and SPD. and carrier (if the employer relies upon the carrier to provide, this should be in the contract) language language language Defines national standards to guard Protected Must be provided by: (1) See The Health Information (PHI) in any form whether it is enrollment, (2) reminder Melita FAQ written, oral, or electronic. every three years, (3) Group s upon request, and (4) HIPAA within 60 days of any Privacy material changes. Guide Medicare Part D and Medicare Medicare Part D: Provide Creditable Medicare Part D: Creditable Secondary Payee (MSP) Medicare Part D added a prescription drug benefit Melita Page 4 1/1/15

5 to Medicare. As a result, employers that provide prescription drug coverage to Medicare-eligible individuals must: (1) disclose whether coverage under the group health plan is "creditable coverage," meaning the value of the employerprovided coverage exceeds the value of the Medicare Part D coverage - this must be disclosed both to the participant and to the Center for Medicare and Medicaid Services (CMS) and (2) coordinate benefits with Part D plans. Michelle s Law MSP Reporting: MSP rules regulate when a group health plan must pay primary and when it may pay secondary when an individual is covered by both Medicare and a group health plan. Medicare Mandatory Reporting: Group health plans and health insurance issuers, are required to electronically submit data on a quarterly basis to help the CMS identify when plans are primary to Medicare. Plan sponsors should request adequate assurances in writing that their insurers or third-party administrators will assume responsibility for the data collection and reporting process. Plan sponsors currently in negotiations with service providers should negotiate the cost and responsibility for the data collection and reporting process, and ensure that the responsibility for the process is clearly stated in the service agreement. Required coverage for dependent students who must take a leave of absence from school or change their enrollment due to a serious illness or injury. Coverage Notices to employees: (1) prior to annual election period (October 15 th of each year), (2) prior to individual s initial enrollment period for Part D, (3) prior to effective date of coverage in Part D (enrollment and open enrollment), (4) when the employer no longer offers prescription drug coverage or changes it so that it is no longer creditable or becomes creditable, and (5) upon request of the individual. Provide annual notice to CMS: (1) within 60 days after beginning of plan year, (2) within 30 days after termination of the prescription drug plan, and (3) and within 30 days after any change in the creditable coverage status of the prescription drug plan. Report data to CMS for Medicare coordination of benefits purposes. Rights to coverage must be included with any notice regarding a MSP Reporting: Responsible Reporting Entity (i.e. group health plan administrator, health insurance issuer, or other contracting entity). Coverage Notices Disclosure to CMS Form Summary of Law Melita Page 5 1/1/15

6 Coverage must be provided for one year following requirement for student the start of the leave of absence, or the date the status for coverage under dependent s coverage would otherwise terminate the plan. under the terms of the plan, if earlier. Certification from dependent s health care provider may be required. Mental Health Parity and Addiction Equity Act of 2008 Fact Sheet Applies: plans sponsored by private and public sector employers with more than 50 employees, including selfinsured as well as fully insured arrangements. MHPAEA also applies to health insurance issuers who sell coverage to employers with more than 50 employees. Cost exemption may apply. Newborns and Mothers Health Protection Act of 1996 (NMHPA) Additional Information Although this law is still in effect, The Patient Protection and Affordable Care Act (PPACA) mandates adult child coverage to age 26, making Michelle s Law less relevant. However, there may be instances where Michelle s Law provides more coverage than PPACA. Requires group health plans and health insurance issuers to ensure that financial requirements (such as co-pays and deductibles) and treatment limitations (such as visit limits) applicable to mental health or substance use disorder (MH/SUD) benefits are no more restrictive than the predominant requirements or limitations applied to substantially all medical/surgical benefits. Group health plans may not restrict benefits for hospital lengths of stay in connection with childbirth for the mother or newborn to less than certain time periods. Must disclose criteria used to make medical necessity determinations by a participant, beneficiary, or contracting provider. Must disclose the reason for any denial of benefits upon request or as otherwise required. The SPD must include a notice regarding this coverage right,, but it is ambiguous as to whether separate notification at enrollment is required., but notice is often included in materials prepared by carrier such as the SPD or EOC. Qualified Medical Child Support Order Requires coverage for a participant s child as a result SPD must disclose the n/a Melita Page 6 1/1/15 n/a language

7 (QMCSO) of a court order. This mandate requires employers Plan s QMCSO to have a written process to validate QMCSOs and procedures or include a ensure compliance with the orders. notice that the Plan s QMCSO procedures are available upon request, free of charge. Provide: (1) notice of receipt of medical child support order including a National Medical Support Notice (NMSN) and the plan s procedures for determining qualification and (2) notice upon determination whether the medical child support order or NMSN is considered qualified. Uniformed Services Employment and Reemployment Rights Act (USERRA) Women s Health and Cancer Rights Act of 1998 (WHCRA) Additional Information and FAQ Requires reemployment and benefit rights to be offered to employees who have served or are serving in the uniformed services. Continuation and reinstatement rights under the employer s group health plan are included in this mandate. Requires group health plans with medical and surgical benefits for mastectomies to provide coverage for certain reconstructive surgery and other mastectomy-related benefits. Model notice must be posted at all times. Must be distributed at: (1) time of enrollment and (2) distributed annually (open enrollment). Can be a stand-alone document or part of SPD. poster language The Genetic Information Bans the use of genetic information for health Notice of Privacy n/a Nondiscrimination Act of 2008 (GINA) insurance and employment purposes. Prohibits: (1) Practices should include Fact Sheet group health plans and health insurance issuers a statement that genetic from discriminating on the basis of genetic information cannot be information with respect to eligibility, premiums, used or disclosed for and contributions and (2) employers from Melita Page 7 1/1/15

8 discriminating on the basis of genetic information in employment decisions and acquiring genetic information except in limited circumstances (which impacts wellness programs), Applies: private and state/local government employers with 15 or more employees Heroes Earning Assistance and Relief Tax Act of 2008 (HEART Act) Health Information Technology for Economic and Clinical Health (HITECH) Allows plans to offer qualified reservist distributions of unused amounts in health flexible spending accounts (FSAs) to qualified reservists ordered or called to active duty for at least 180 days or on an indefinite basis. An employee must request a qualified reservist distribution on or after the date of the order or call to active duty, and before the last day of the plan year (or grace period, if applicable) during which the order or call to active duty occurred. Part of American Recovery and Reinvestment Act of 2009 (ARRA), includes a requirement that, in certain instances, affected individuals, the media, and/or the Secretary of the Department of Health and Human Services (HHS) must be notified in the event of a breach of unsecured protected health information by the plan or a business associate. underwriting purposes. Update Employee Handbook policies to refer to genetic information as a protected characteristic. Plan sponsors offering these distributions will need to issue SMMs and update SPDs. Review and update HIPAA privacy and security materials, notices, policies and procedures, and business associate agreement to reflect the notice of breach requirement. Wellness Programs Notice must disclose the availability of a reasonable In all plan materials that See alternative standard or possibility of waiver of the describe the terms of regulations Applies: group health plans offering otherwise applicable standard. the wellness program. If for model wellness programs that require the plan materials notice individuals to satisfy a standard related merely mention that a to a health factor. program is available, without describing its terms, this disclosure is not required. Patient Protection and Affordable Care Group health plans that are considered GF plans must include a GF Notice Act (PPACA) grandfathered (GF) under PPACA are exempt from notice in all participant Patient Melita Page 8 1/1/15 n/a n/a

9 Mandate Purpose Notification Responsible certain reforms, including the requirement to cover preventive care services at 100%. Plans that make certain changes to participant cost-sharing will lose GF status. PPACA creates new Health Insurance Marketplaces, starting in 2014, where individuals and small employers can go to purchase health insurance coverage. communication materials describing benefits. Non-GF plans that require participants to designate a primary care provider must include a notice in all participant benefit communication materials describing the participants right to designate any available primary care provider in the network. All employers subject to the Fair Labor Standards Act are required to provide notice to all employees of the existence of the Health Insurance Marketplaces. The notice must be provided (1) no later than October 1, 2013 to all existing employees (2) to any employee upon request, and (3) within 14 days of hire date, for new hires. Notice Marketplace Notice (employers who offer health coverage) Marketplace notice (employers who don t offer coverage) Although the responsible party is, at times, indicated as someone outside of the employer; it is imperative to understand that ultimate accountability resides with the employer. Employers must ensure carrier documents or documents from other resources, includes the necessary notifications and language. The above is intended to be a summary of federal group health plan mandates and is not intended to cover all aspects of the regulations. There may be additional mandates which apply such as The Family and Medical Leave Act (FMLA), ADA, ADEA, HMO Act, TRICARE, self reporting requirement and Form 8928, required coverage for adopted children, required coverage for pediatric vaccinations, and other mandates. This summary is not intended to be exhaustive. To Melita Page 9 1/1/15

10 ensure compliance with the above federal mandates, employers should ensure the above notifications are completed in accordance with the regulations. Employers are responsible for ensuring compliance with these mandates and their recommended distribution methods which vary by federal group health plan mandate. Resource List The following resources provide additional information for employers: Compliance Assistance Department of Labor (DOL) Compliance Assistance Guide DOL Chart of Required Notices DOL Employment Law Guide elaws Health Benefits Advisor for Employers Employee Benefits Security Administration (EBSA) s Enforcement Manual Reporting and Disclosure Guide for Employee Benefit Plans Understanding Your Fiduciary Responsibilities Under a Group Health Plan Relevant contact information for additional assistance: DOL Contact Us information Employee Benefits Security Administration (EBSA) - Contact EBSA Melita Page 10 1/1/15