December 23, 2010

HRB 29 - Agencies Issue Additional PPACA Clarifications

Released December 23, 2010I Download as a PDF

December 23, 2010 --  In their on-going effort to assist employers in complying with the Patient Protection and Affordable Care Act (PPACA) and other laws, the issuing Agencies (DOL, HHS and IRS) have just provided some sub-regulatory guidance, in the form of Questions and Answers. Of particular note, are the following:

Automatic Enrollment in Health Plans

The PPACA requires employers employing 200 or more employees to automatically enroll full-time employees, and to retain enrollment for those already covered by the plan. According to the law, this provision became effective on the law’s enactment date (March 23, 2010). The Agencies have indicated that employers will not be required to comply with this provision until implementing regulations are issued.

60-day Advanced Notice of Material Change in Benefits

The PPACA requires a 60-day advance notice of any material change in benefits. According to these FAQs, plans will not be obligated to comply with this requirement until the uniform benefit summary is issued. To date, the uniform benefit summary has not been issued.

Differences in Dependent Coverage

The PPACA requires that if a plan covers dependents, then certain dependents must be covered until his/her 26th birthday. This guidance clarifies that if certain categories of dependents receive a more favorable benefit than all other covered lives, including spouses of employees, this difference is OK. The example used in the FAQ is the waiver of an office visit co-pay for children under the age of 19. According to the example, a co-pay is not imposed on office visits for children under the age of 19, even in situations in which the office visit is not for preventive service; whereas, for dependents aged 19 and older, as well as for spouses of employees, a co-pay is imposed. According to this guidance, this kind of arrangement is permissible.

Mental Health Parity and HIPAA health-based Discrimination Rules

Finally, the FAQs reiterate the applicability of the Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) to employers employing 50 or more employees. They also address the HIPAA rules relating to health-based discrimination rules, specifically as they relate to wellness programs. While these FAQs don’t break new ground, they do provide affirmation about how these rules should be implemented.


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