Health & Welfare Plans Newsletter

July 21, 2020

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View job as Manager, Defined Contribution Administration for Group RHI
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Group RHI
Telecommute / Spring TX / Dallas TX / University Place WA

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View COVID-19 News and Resources

[Official Guidance]

Text of IRS Rev. Proc. 2020-36: 2021 Updates for ACA Applicable Percentage Table and Employer Required Contribution Percentage (PDF)

"This revenue procedure ... updates the applicable percentage table ... for calendar year 2021. This table is used to calculate an individual's premium tax credit. The revenue procedure also updates the required contribution percentage ... used to determine whether an individual is eligible for affordable employer-sponsored minimum essential coverage under Section 36B.... For plan years beginning in calendar year 2021, the required contribution percentage ... is 9.83%."

Internal Revenue Service [IRS]

[Guidance Overview]

Group Health Plan PCORI Fees Due July 31

"Insurance carriers are responsible for paying the PCORI fee on behalf of a fully-insured plan, but employers must pay the fee for any self-insured medical benefits, including general purpose health FSAs and HRAs. For plans that offer a mix of fully-insured and self-insured benefits, both the insurer and the employer must pay fees."

Warner Norcross & Judd LLP

[Guidance Overview]

New Proposed Rule Provides Cost-Sharing Flexibility for Grandfathered Group Health Plans

"The goal is to allow more flexibility in cost-sharing changes in grandfathered group health plans and group health insurance coverage to help better serve the public.... The proposed rule will allow for high-deductible health plans (HDHP) to increase fixed-amount cost-sharing requirements in accordance with changes to [IRS] requirements for HDHPs that would otherwise cause a loss of grandfather status under the current rules."

Frost Brown Todd LLC

[Guidance Overview]

Colorado Adopts New Paid Sick Leave Requirements for Employers

"Under the new law, Colorado employees will earn one hour of paid sick leave for every 30 hours worked, up to a total of 48 hours (or six eight-hour workdays) of paid sick leave in a year.... In the event of a public health emergency, employees will be entitled to additional sick leave of up to 80 hours, based on the number of hours the employee works."

Faegre Drinker

[Guidance Overview]

Colorado Passes Broad Paid Sick Leave Law

"The Act provides employees with three new sick leave entitlements: [1] Paid Sick Leave related to COVID-19 (COVID-19 Leave), [2] a state-wide Paid Sick Leave (PSL), and [3] Supplemental Public Health Emergency Paid Sick Leave (PHE-PSL). The COVID-19 leave expands the scope of paid leave during the current pandemic, which ... has already been required in some form by an executive order for Colorado employers in certain industries."

Epstein Becker Green

[Guidance Overview]

IRS Issues Instructions on Reporting Emergency Paid Leave Wages

"The IRS guidance clarifies that FFCRA qualifying leave wages paid to employees must be added to the sum of wages reported in Boxes 1, 3 (as applicable), and 5 of Form W-2. Additionally, employers must separately report three categories of leave wages in Box 14 (or on a separate statement), labeling them using the model or similar language[.]"

Ogletree Deakins

21 States and D.C. Sue Trump Administration for Changing Nondiscrimination Provisions of ACA

"The suit was filed in the Southern District of New York, led by the attorneys general of New York, Massachusetts, and California. It asks that the rule relating to Section 1557 of the [ACA] be set aside because it is 'is arbitrary, capricious, an abuse of discretion, or not in accordance with law.' ... HHS claimed that the rule change would save nearly $3 billion a year, primarily from eliminating the LEP requirements that notices be published in the top 15 languages of each state and other requirements. The change also exempted insurers from Section 1557, saying payers are not engaged in health care activity." [New York v. HHS, No. 20-5583 (S.D.N.Y. complaint filed Jul. 20, 2020)]

American Journal of Managed Care

Appeals Court Upholds Rule Relaxing Restrictions on Short-Term Health Insurance

"Like the district court, the DC Circuit points to the history of the definition of [short-term, limited duration insurance (STLDI)]. Congress delegated authority to the federal government to define STLDI under HIPAA in 1996 ... The ACA did not alter the statutory STLDI exclusion when enacting the law in 2010. In part due to this history, the majority concludes that the federal government is entitled to deference in defining STLDI and that its interpretations were reasonable." [Association for Community Affiliated Plans v. U.S. Dept. of the Treasury, No. 19-5212 (D.C. Cir. Jul. 17, 2020)]

Katie Keith, in Health Affairs

(Drug Pricing) Transparency is Dead, Long-Live (Hospital Pricing) Transparency

"The U.S. Court of Appeals for the District of Columbia Circuit struck down the [CMS] rules requiring pharmaceutical companies to include prices in their commercials. Only a few days later, the Washington D.C. District Court upheld the hospital transparency rules issued by CMS.... The main difference? CMS was authorized by Congress under the [ACA] to issue the hospital transparency rule.... [F]or the drug pricing rule, CMS relied on its general authority to issue rules supporting the 'efficient administration' of the Medicare and Medicaid programs." [Merck & Co. v. HHS, No. 19-5222 (D.C. Cir. Jun. 16, 2020); American Hospital Ass'n v. Azar, No. 19-3619 (D.D.C. Jun. 23, 2020)]

HUB International

ACA Litigation Round-Up: Recent Supreme Court Actions

"The Supreme Court recently ended its 2019 term, which included two [ACA] decisions and several other decisions with implications for ACA cases. Briefing in California v. Texas is ongoing and will be heard later this fall, with a decision expected in 2021. Beyond the Supreme Court, there are many ACA-related legal challenges pending at appellate and district courts across the country. This post summarizes the recent Supreme Court decisions and the latest in California v. Texas."

Katie Keith, in Health Affairs

Cinematographers File Class Action Suit Over Health Care Cutoff

"In order to maintain coverage, participants must work 400 hours over a six-month period. [The two plaintiffs] contend that they -- and many others -- would have met that threshold had production not shut down entirely in mid-March. The board of the health plan extended a 300-hour credit to workers whose eligibility deadline fell in April and May, and is providing no-cost COBRA after that. But [the plaintiffs'] eligibility deadline fell on March 21." [Endries v. Board of Directors of the Motion Picture Industry Health Plan, No. 20-6347 (C.D. Cal. complaint filed Jul. 16, 2020)]

Variety

Editor's Pick Is Federally Mandated Paid Leave Coming in 2021?

"Because the [DOL Women's Bureau] does not have the authority to issue or enforce regulations, one might not expect its RFI to lead to specific regulations. However, because that RFI was immediately followed by another RFI on the same general topic (the FMLA) from [the WHD], the agency responsible for issuing and enforcing regulations on the FMLA, it is likely that some changes are certain to come. Whether those changes will involve mandatory pay requirements -- as suggested by the Bureau's RFI -- is to be seen."

Foley & Lardner LLP

[Opinion]

Telehealth in the Pandemic and Beyond: The Policies That Made It Possible, and the Policies That Can Expand Its Potential

"Widespread patient satisfaction with telehealth during the pandemic suggests that many physician practices will continue to offer telehealth services beyond the pandemic. Continued reforms can build on this successful telehealth model and expand its potential for enhancing health care options through sustained innovation."

The Heritage Foundation

Benefits in General

Do Older Workers Without Benefits Find Health and Retirement Coverage?

"Workers in nontraditional jobs, without health and retirement benefits, have to seek coverage elsewhere. On the health side, most do obtain coverage -- often through a spouse's employer or a private individual policy.... On the retirement side, workers often end up with no viable option, as they rarely open an IRA and their spouses with a 401(k) do not save more to compensate. The failure on the retirement side highlights the need for auto-IRA programs."

Center for Retirement Research at Boston College

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Severance Plans and H&W Wrap Plan Documents

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BenefitsLink Message Boards

Press Releases

2020 National ESOP Database Is Now Available
National Center for Employee Ownership [NCEO]

Most Popular Items in the Previous Issue

Text of Additional DOL FFCRA Questions and Answers: New Q&As 94-97
Wage and Hour Division [WHD], U.S. Department of Labor [DOL]

Text of DOL FFCRA Fact Sheet: Employer Paid Leave Requirements
Wage and Hour Division [WHD], U.S. Department of Labor [DOL]

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BenefitsLink Health & Welfare Plans Newsletter, ISSN no. 1536-9595. Copyright 2020 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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