Health & Welfare Plans Newsletter

April 19, 2019

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[Official Guidance]

Text of HHS Final Notice of Benefit and Payment Parameters for 2020

401 pages. "This final rule sets forth payment parameters and provisions related to the risk adjustment and risk adjustment data validation programs; cost-sharing parameters; and user fees for Federally-facilitated Exchanges (FFEs) and State-based Exchanges on the Federal Platform (SBE-FPs). It finalizes changes that will allow greater flexibility related to the duties and training requirements for the Navigator program and changes that will provide greater flexibility for direct enrollment entities, while strengthening program integrity oversight over those entities. It finalizes a change intended to reduce the costs of prescription drugs. This final rule also includes changes to Exchange standards related to eligibility and enrollment; exemptions; and other related topics."
Centers for Medicare & Medicaid Services [CMS], U.S. Department of Health and Human Services [HHS]

[Official Guidance]

Text of CMS 2020 Letter to Issuers in the Federally-facilitated Exchanges (PDF)

21 pages. "The 2020 Letter focuses on guidance that has been updated for the 2020 plan year, and refers issuers to the 2018 Letter to Issuers in the Federally-facilitated Exchanges or 2019 Letter to Issuers in the Federally-facilitated Exchanges in all instances where CMS guidance has not changed. CMS notes that the policies articulated in this Letter apply to the QHP certification process for plan years beginning in 2020."
Centers for Medicare & Medicaid Services [CMS], U.S. Department of Health and Human Services [HHS]

[Official Guidance]

Text of CMS Key Dates for Calendar Year 2019 (PDF)

April 2019. "This document summarizes key dates for calendar year 2019 regarding some activities and policies that are outlined in other documents[.]"
Centers for Medicare & Medicaid Services [CMS], U.S. Department of Health and Human Services [HHS]

[Guidance Overview]

Text of CMS Fact Sheet: Final HHS Notice of Benefit and Payment Parameters for 2020 (PDF)

"Overall, the final rule minimizes the number of significant regulatory changes to provide states and issuers with a more representative, stable, and predictable regulatory framework that facilitates a more efficient and competitive market. The changes finalized in the rule are targeted to further the goals of lowering premiums, increasing market stability, reducing regulatory burdens, enhancing the consumer experience, and reducing federal expenditures."
Centers for Medicare & Medicaid Services [CMS], U.S. Department of Health and Human Services [HHS]

CMS Issues Final Rule for the 2020 Annual Notice of Benefit and Payment Parameters

"The 0.5 percent reduction in the user fee rate comes as a result of CMS' focus on reducing costs through increased operational efficiency, including successful efforts to upgrade IT functionality, a more efficient approach to outreach, and investments focused on proven methods to achieve a seamless enrollment experience and high consumer satisfaction.... Drug companies can offer consumers coupons to incentivize them to purchase the company's brand name drugs even when an appropriate, less-expensive generic medication is available. This rule allows issuers to stop applying the value of these coupons towards an enrollee's maximum-out-of-pocket costs in situations where a generic medication is available and medically appropriate, in order to encourage generic use and result in lower drug spending."
Centers for Medicare & Medicaid Services [CMS], U.S. Department of Health and Human Services [HHS]

CBO Releases Four Products Explaining How Its New Health Insurance Simulation Model Works

"CBO has used a new health insurance simulation model, HISIM2, to generate estimates of health insurance coverage and premiums for the population under age 65.... [CBO is releasing] four products that, in combination, explain how HISIM2 works:

A Summary of the 2020 Actuarial Value Calculator (PDF)

"The Actuarial Value (AV) Calculator is a Microsoft Excel tool released annually used by participating plans to determine the metal level (Platinum/Gold/Silver/Bronze) of a particular benefit design."
Society of Actuaries

Reimbursement Rates Paid to Medical Providers: A Tug-of-War in North Carolina

"The [North Carolina State Health Plan (SHP)] is looking for ways to control healthcare cost and it has its eyes set on the reimbursement rates paid to medical providers.... [The SHP] has an estimated unfunded liability of $35 billion leading to potential insolvency by 2023. Currently, medical providers are reimbursed based on negotiated rates, which are set by insurance carriers.... The proposed plan would reimburse healthcare providers at 182% of Medicare reimbursement rates. By making this change, North Carolina could save approximately $300 million per year; and an additional $60 million per year for the approximately 720,000 members with lower out of pocket expenses."
Hill, Chesson & Woody

DOL Confirms Participant's Right to Appoint an Authorized Representative

"[D]esignating an authorized representative is not the same as executing an assignment of benefits. The assignment lets the healthcare provider 'stand in the shoes' of the claimant, giving the provider full authority to make all decisions, and receive all payments, related to the claim. By contrast, an authorized representative acts on behalf of the claimant, but ultimately the rights belong to the claimant. Plans may want to be clear in their procedures and plan documents that they will not respect assignments of benefits and that a designation of an authorized representative does not create an assignment of benefits."
HUB International

Relative of 2-Percent Shareholder May Deduct Cost of Health Insurance

"The IRS said that an S corporation is treated as a partnership, and any '2-percent shareholder' of the S corporation is treated as a partner of the partnership and is therefore an owner-employee. For purposes of this rule, the term '2-percent shareholder' means any person who owns (or is considered as owning), on any day in the taxable year, more than 2 percent of the outstanding stock of the corporation or stock possessing more than 2 percent of the total combined voting power of all stock of the S corporation."
The Wagner Law Group

Your Plan Costs More Than Mine: The Price Tag for Paid Leave

"The main factor that changes the cost calculation is the number of people likely to use the leave, and that largely depends on whether the program guarantees a worker will be able to return to the job after taking leave and what kinds of leave are covered.... [P]ersonal medical leave is the most expensive to cover, parental leave falls in the middle, and family care leave is the least costly.... Based on private sector use of leave afforded under the [FMLA, one study] estimated that if 13 million workers took paid leave for a medical issue for an average of 4.7 weeks at $452 per week, it would cost $27.5 million in benefits."
Bloomberg BNA

Benefits in General

Editor's Pick How Employers Are Tackling Student Loan Debt (PDF)

16 pages. "Nearly a third (32.4 percent) of [responding] employers ... reported offering or planning to offer some student loan debt program ... These 'Student Loan Debt Focused Employers' were more likely than the typical survey respondent (the full sample of all 250 that responded) to have taken steps to measure the financial wellness needs of employees, including examining existing employee benefit data ... surveying employees ... holding focus groups ... and analyzing other quantitative employee data ... Student Loan Debt Focused Employers cited complexity of the programs as their number one challenge in offering financial wellness benefits in the workplace -- nearly half gave this reason."
Employee Benefit Research Institute [EBRI]

Selected Discussions
on the BenefitsLink Message Boards

Use 401(k) Hardship Distribution to Fund HSA?

I am at the point where I'm going to need to take an $8,000 401k hardship withdrawal to pay medical bills. I will be paying a penalty and taxes on this. Can I then deposit the money into my HSA account and reimburse myself tax-free for these medical expenses?
BenefitsLink Message Boards

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Lois Baker, J.D., President  loisbaker@benefitslink.com
David Rhett Baker, J.D., Editor and Publisher  davebaker@benefitslink.com
Holly Horton, Business Manager  hollyhorton@benefitslink.com

BenefitsLink Health & Welfare Plans Newsletter, ISSN no. 1536-9595. Copyright 2019 BenefitsLink.com, Inc. All materials contained in this newsletter are protected by United States copyright law and may not be reproduced, distributed, transmitted, displayed, published or broadcast without the prior written permission of BenefitsLink.com, Inc., or in the case of third party materials, the owner of those materials. You may not alter or remove any trademark, copyright or other notices from copies of the content.

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