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Megan Mardy advises companies on a wide variety of health and welfare and retirement benefits issues. She has extensive experience with the Affordable Care Act, the Health Insurance Portability and Accountability Act (HIPAA), Consolidated Omnibus Budget Reconciliation Act (COBRA), the Internal Revenue Code and other federal laws affecting group health and retirement plans. Read Megan Mardy's full bio.

President Trump signed an executive order last year directing the Secretaries of Labor, Treasury and Health and Human Services to consider proposing regulations to “increase the usability of HRAs.” This month, the collective departments issued proposed regulations containing changes to the prohibition on pairing HRAs with individual health policies, as well as other changes to the current HRA rules.

Proposed effective date January 1, 2020; comments due December 28, 2018.

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The Medicare Modernization Act of 2003 requires employers who offer prescription drug coverage to provide an annual notice to all Medicare Part D eligible individuals who are participants in, or eligible for, the employer’s prescription drug coverage indicating whether such coverage is creditable before October 15th of each year. “Creditable coverage” means that the prescription drug coverage offered by an employer plan is expected to pay, on average for all plan participants, as much as the standard Medicare prescription drug coverage pays. Prescription drug coverage is “non-creditable” when it is not expected to pay, on average for all plan participants, as much as the standard Medicare prescription drug coverage pays.

The notice must be furnished regardless of whether the employer plan pays primary or secondary to Medicare, and must be sent to all Part D eligible individuals including retirees, actives, COBRA beneficiaries and dependents of such individuals. The Centers for Medicare and Medicaid Services (CMS) provides Model Disclosure Notices for creditable and non-creditable coverage.

If you would like additional information about this requirement, or if you have any questions, please contact your McDermott lawyer or one of our Benefits attorneys.

Charnae Supplee, a law clerk in the Firm’s Washington, DC office, also contributed to this article.

The US Department of Labor published a final rule that makes it easier for a group or association of employers to act as a single “employer” sponsor of an Association Health Plan under ERISA. By creating an opportunity for small employers and self-employed individuals to take advantage of the economies of scale that are usually enjoyed by large employers, the final rule is intended to expand access to affordable health care.

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Beginning April 1, 2018, new disability claim regulations may apply to some executive compensation arrangements. Given this pending regulatory deadline, employers need to analyze which of their executive compensation arrangements may be subject to the enhanced requirements for disability claims review.

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After some speculation about a delay in implementation of the final rules on claims adjudication of disability claims under welfare and retirement plans (the Final Rule), the US Department of Labor (DOL) confirmed that the Final Rule will be applicable beginning April 1, 2018. McDermott’s article detailing the new requirements in the Final Rule can be found here. A disability welfare or retirement benefit claim, as well as claims under certain executive compensation arrangements, severance plans and other payment plans subject to ERISA’s claims procedures, will be subject to the Final Rule if the benefit is conditioned upon a claimant’s disability, and the claims adjudicator must make a determination of disability in order to decide the claim. However, if a plan links the finding of disability to a determination made by a party other than the plan (e.g., a finding made under the employer’s long-term disability plan or a determination of disability made by the Social Security Administration), then the special rules for disability claims are not applicable to a claim for benefits under such plan.

Plan sponsors and administrators should review retirement, welfare, executive compensation and severance plans to determine whether such benefits are subject to the Final Rule’s additional requirements. Any language detailing claim procedures in plan documents and summary plan descriptions should be updated, and disability claim and appeal administrative practices and procedures, as well as disability claim and appeal notices should be revised to comply with the Final Rule.

The IRS has taken actions indicating that employer mandate penalties under the ACA are about to be enforced. The recently updated Questions and Answers on Employer Shared Responsibility Provisions Under the Affordable Care Act includes the section, “Making an Employer Shared Responsibility Payment,” which expands specifically upon the soon-to-be-issued Letter 226J and what that will include. Continue Reading.

In October 2016, the American Association of Retired Persons (AARP) sued the US Equal Employment Opportunity Commission (EEOC) in the US District Court for the District of Columbia seeking an injunction against the latest iteration of wellness program regulations. The final EEOC regulations issued last year offer employers a roadmap for offering employee wellness programs that pass muster as “voluntary” examinations under the Americans with Disabilities Act (ADA) and the Genetic Information Nondiscrimination Act of 2008 (GINA). In response, AARP argued that the EEOC failed to adequately justify the new rules and abused its regulatory power by reversing course on its long-standing position against wellness programs.

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