The tri-governing agencies (Departments of Labor, Treasury and Health and Human Services) released a set of FAQs on June 23, 2020 that clarify a number of issues relating to Families First Coronavirus Response Act (FFCRA) and CARES Act and other health coverage issues. Following is a brief summary of the more salient points made by this guidance.
Coronavirus testing requirements
As a reminder, the FFCRA and CARES Act requires individual and group health plans, including insured, self-funded plans and grandfathered health plans, to provide first dollar coverage for testing of COVID-19, including FDA-approved tests, as well as tests provided by labs on an emergency basis, state-developed tests, and any other tests determined appropriate by the Department of Health and Human Services (HHS). To assist in determining approved tests, FAQ 2 provides a list of FDA-approved laboratories and manufacturers offering COVID-19 tests.
At-home testing is covered by the mandate as long as it is ordered by a health care provider and is deemed medically appropriate (see FAQ 4). Multiple diagnostic COVID tests must be covered when ordered by a health care provider and are deemed medically appropriate (see FAQ 6). Coverage for COVID testing is not required if used for general surveillance or employment purposes, such as for return to work purposes (see FAQ 5)
Notification of Plan Enhancements
Plans that have made benefit enhancements such as increasing benefits, or reducing or eliminating cost sharing for the diagnosis and treatment of COVID-19, or for telehealth and other remote care services are required to provide notice of the change(s) to participants. For background relating to benefit enhancements, see our prior article, Benefit Plan Regulatory Relief in Response to COVID-19 – Guidance for Employers, and the Employer Compliance Handbook: COVID-19's Impact on Benefits and Employment.
For purposes of notifying participants of plan changes, plans subject to ERISA would use a summary of material modification (SMM) to communicate the change, unless an updated summary plan description is provided to participants. FAQ 13 affirms that as long notification of any plan change is provided as soon as practicable, and as long as it is clear about the duration of the change, then the plan sponsor will be deemed to have timely informed participants. Based on this guidance, it is prudent to make certain that any SMM is clear about the duration of any temporary benefit enhancement.
Telehealth and Other Remote Care Services
Generally, a telehealth or other remote health care program that provides a medical benefit is deemed to be a health plan subject to the market reform provisions of the Affordable Care Act (ACA). In order to satisfy this requirement, the telehealth program must be offered in conjunction with comprehensive health plan.
This guidance provides temporary relief by allowing large employers (those employing 50 or more employees) to offer their telehealth or other remote health care program to certain individuals who are not otherwise eligible for the employer’s comprehensive health plan (see FAQ 14). This temporary relief applies for plan years beginning during the declared emergency. These types of programs are provided relief from complying with the ACA’s market reform provisions but remain subject to certain requirements, such as the prohibition of pre-existing condition exclusions, the prohibition of discrimination against individuals based on health status, the prohibition of rescissions, and the requirements of the federal mental health parity laws (MHPAEA).
Wellness Programs
Certain contingent wellness programs require individuals to perform an activity or achieve a goal in order to receive a reward. The coronavirus pandemic may have created difficulty for individuals to accomplish the task in order to receive these goals or rewards. This guidance clarifies that if a wellness program cannot be properly administered due to coronavirus situation, the employer can choose to waive standards for obtaining a wellness reward, including reasonable alternatives, under a health-contingent wellness program as long as it does so for all similarly situated individuals (see FAQ 17).
Individual Coverage HRA Notice
Once an individual coverage health reimbursement arrangement (IC-HRA) has been established, the sponsoring employer is obligated to provide a written notice about the availability of the program to all eligible employees at least 90 days prior to the beginning of each plan year.
As discussed in our prior article, the DOL’s Disaster Relief Notice provides timing relief from certain ERISA Title I disclosures, such as providing the SPD, SMM and similar notifications including the IC-HRA notice, as long as the failure to timely provide the required document is solely attributable to COVID-19 related issues, and as long as the plan administrator is working in good faith to otherwise comply with its reporting and disclosure obligations.
Because there may be delays for individuals enrolling in individual coverage who wish to participate in an IC-HRA, and because this may be the first year that an IC-HRA is offered, the agencies are, nevertheless, encouraging employer/plan sponsors to notify these individuals as soon as practicable about the importance of enrolling in individual health coverage through an open or special enrollment period for those who newly gain access to an IC-HRA (see FAQ 18). The notice should be provided in advance of the first day to which the IC-HRA is available so that they individuals have sufficient time make an informed decision as to whether or not to enroll in the IC-HRA or take advantage of a special enrollment opportunity.
Changes and clarifications made by this guidance will be incorporated into our CBIZ FAQs, Coronavirus: Impact on Benefits and Employment.
