We get it: wading through legalese and staying on top of the latest healthcare regulations can be confusing.
Unfortunately, in healthcare, a solid understanding of compliance changes is a necessary evil. As we approach the new year, Maestro Health took a look at what’s on the horizon for healthcare compliance and legislation in 2020 and translated what’s to come to help you stay in the loop.
Here’s what we know:
Association Health Plan Changes
Status: Final rule as of September 1, 2018; effective for self-insured AHPs as of January 1, 2019
What it is:
ERISA updated the definition of “Employer” in 2018 to include association health plans (AHP). This resulted in some broadening of AHP regulations, making it easier for businesses and people to band together for healthcare coverage.
However, many businesses requested delays in the effective date due the need to re-budget for increased healthcare costs along with ACA regulations, so ERISA provided staggered dates, depending on business size, with January 1, 2019, being the effective date for self-insured AHPs.
You can find the official ruling here.
What you need to know:
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All businesses should be in compliance with the final AHP ruling as of January 1, 2019.
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The Commonality of Interest requirement is now much more flexible, allowing businesses to band together as long as there’s at least “one substantial purpose unrelated to healthcare” in common.
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While businesses must still be within the same trade or industry, the final ruling hasn’t formally defined “substantial purpose,” which could result in additional flexibility for businesses who want to band together.
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AHPs can now be offered to employers in the same industry without geographic limitations.
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Sole Proprietors are now considered employees and employers, thus qualifying them to receive coverage under an AHP.
New HRAs: Individual Coverage & Excepted Benefit Healthcare Reimbursement Agreements (ICHRA & EBHRA)
Status: Effective January 1, 2020
What they are:
ICHRAs and EBHRAs are two new classes of HRAs designed to expand the types of HRAs alongside employees’ health coverage and can be offered by businesses of any size. As with traditional HRAs, employees will front the expenses and then submit for reimbursement. Employers can choose to offer one or the other, but not both.
You can find the official ruling here.
ICHRA (Individual Coverage) is available to any employee (plus their spouse and dependents) who is already enrolled in ACA-compliant coverage or Medicare.
What you need to know for ICHRA:
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There’s no federal allowance cap, though employers can set their own based on employee classes (such as: full-time, hourly, etc.).
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Employees are able to opt out of ICHRA as long as the employer-offered allowance falls below affordable coverage guidelines.
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If the employee loses their healthcare coverage, they also lose their ICHRA.
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Employees who participate in ICHRA aren’t eligible for the premium tax credit.
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Employers who offer ICHRA aren’t able to offer EBHRA.
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Employers are not able to offer their employees the option between group health coverage and an ICHRA—they can only offer one or the other.
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ICHRAs are not subject to ERISA as long as they meet certain safe harbor guidelines.
EBHRA (Excepted Benefit) is only available to employees who are eligible for the employer’s group healthcare plan. Unlike ICHRAs, EBHRAs are not available for the employee’s spouse or children.
What you need to know for EBHRA:
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EBHRAs are subject to a federal allowance cap of $1,800 per employee.
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Employees can opt out of group health coverage and still use the EBHRA. Similarly, an employee could lose their primary coverage and still be eligible for EBHRA.
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Employers can limit EBHRAs to a specific class of employee (such as: full-time, hourly, etc.), but it must be made available to all employees within that class.
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Only excepted benefits will be eligible for EBHRA reimbursement. These include: STDLI, limited vision and dental, COBRA, copays, deductibles and long-term care coverage. Medicare premiums are not eligible expenses.
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Employees can roll over un-used EBHRA funds and the rollover amount will not count towards the federal allowance cap.
Proposed Safe Importation Action Plan
Status: Still in planning (the FDA needs to sign off and then the HHS Secretary will need to make a certification to Congress)
What it is:
The FDA released an action plan to allow for the safe importation of drugs from foreign markets. This plan includes provisions that would potentially help lower the cost of drugs by importing from similar, but cheaper, manufacturer markets that still fall within FDA guidelines.
The plan is split into two separate pathways:
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The Demonstration Projects pathway proposes importing drugs from Canada that are manufactured in accordance with the FDA. This plan does not include the importation of controlled substances, infusions, IVs, inhaled drugs, and biological products. The primary benefit here would be (potentially) lowers costs and expanded drug availability.
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The Voluntary Manufacturer Importation pathway proposes allowing drug manufacturers to import versions of FDA-approved drugs that are made and sold in other countries. The primary benefit here would be cost savings for the manufacturer and would allow them to potentially lower prices for the consumer.
You can find the FDA’s action plan here.
What you need to know:
Nothing has changed yet. The FDA still needs to conduct additional research and partner with HHS to define and outline requirements for these new regulations.
EEOC Wellness Regulations
Status: No ruling from the EEOC yet
What it is:
Currently, wellness incentive programs are in limbo due to a lack of definition of key terminology from the Americans with Disabilities Act and Equal Employment Opportunity Commission, specifically around eligibility and voluntary disclosure of personal health information.
Two key criticisms of the regulations today are based around the fact that current regulations appear to penalize employees who choose not to disclose their information and the fact that there isn’t a defined dollar-based incentive cap.
You can find the Final Rule from 2016 here and the proposed amendment from 2019 here.
What you need to know:
Employers should work closely with their legal and compliance partners to make sure their incentive programs are well within the currently defined state and federal parameters.
