Health and Welfare Plans Archives - EMPLOYEE BENEFITS BLOG

McDermott Submits Amicus Brief to the US Supreme Court in United Behavioral Health

by Charlie Seidell | Jan 23, 2024 | Employee Benefits, Health and Welfare Plans

On January 2, 2024, McDermott filed an amicus curiae brief on behalf of the ERISA Industry Committee (ERIC) and the United States Chamber of Commerce (Chamber) in United Behavioral Health v. David K., No. 23-586, in the US Supreme Court. The case presents two questions of broad public importance concerning the requirements under the Employee Retirement Income Security Act (ERISA) for denials of health benefits. But underlying the two questions is an even more fundamental Administrative Procedure Act (APA) issue: May a court, at the invitation of an agency in an amicus brief, effectively amend regulations by judicial fiat, providing the agency with an end run around the APA’s notice-and-comment rulemaking procedures?

The answer to that question should be an obvious no. But that is precisely what happened in the court of appeals in this case. After the plaintiffs filed their response brief, the US Department of Labor (DOL) filed an amicus brief urging a radically new interpretation of regulations the agency had promulgated to implement ERISA’s procedural protections. In essence, the DOL argued that its disability- and health-benefit regulations should be read to contain the same procedural requirements, despite clear regulatory language specifying that some requirements only apply in one context and not the other. The US Court of Appeals for the Tenth Circuit adopted the DOL’s position, decreeing a new regulatory requirement for health-benefit denials that the DOL, in dual 2015 and 2016 rulemakings, expressly considered and chose to adopt only for disability-benefit denials and not for health-benefit denials.

If not corrected by the Supreme Court, the decision will stand as an invitation to agencies to file amicus briefs in the courts of appeals, advocating for substantial changes to their regulations without the bother (or transparency) of APA rulemaking. When so much lawmaking today is undertaken by unaccountable federal bureaucrats, that is a deeply troubling prospect. ERIC and the Chamber supported the petition, explaining the legal and practical issues with the approach the DOL and Tenth Circuit mutually took. Agency interpretations that defy clear regulatory text are entitled to no deference because they are invalid (especially after the Court’s decision in Kisor v. Wilkie). Ignoring this basic proposition of administrative law undercuts the core values served by the APA, including transparency and accountability. Most directly, however, an agency’s decision to seek backdoor revisions to its rules through interpretations announced in litigation deprive the agency of the benefit of public comment that can provide critical data and analysis to inform the agency’s policymaking. Had the DOL engaged in notice and comment, as it should have done, commenters would have presented key distinctions between the disability- and health-benefit contexts; without that information, the DOL’s decision was not fully informed.

ERIC and the Chamber are frequent amici in cases concerning ERISA and the APA’s interpretation and requirements. While the Supreme Court grants only a tiny fraction of the petitions it receives each term, the amici are hopeful that this brief will help focus the Court’s attention on this [...]

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Obamacare Would Be Even Harder to Kill Now, but Trump Promises to Try Anyway

by Rodney Whitlock | Jan 22, 2024 | Employee Benefits, Health and Welfare Plans

While former President Donald Trump has threatened to repeal the Affordable Care Act (ACA) if he wins reelection, the landmark healthcare law would be increasingly difficult to dismantle. In this CNN article, McDermott+Consulting’s Rodney Whitlock says the country is “as close as we’ve been to meeting the aspirational goals of 2010 for the ACA.”

Access the article.

Healthcare Payors and Providers and AI Companies Voluntarily Commit to AI Principles

by Jennifer S. Geetter, Purnima Boominathan and Jayda Greco | Jan 17, 2024 | Digital Health, Employee Benefits, Health and Welfare Plans, Privacy and Data Security

The Biden administration recently announced that 28 healthcare payors and providers intend to implement and adhere to voluntary commitments for the safe, secure and trustworthy development and deployment of artificial intelligence (AI) in healthcare. The signatory companies aligned around the FAVES principle—namely, that AI should lead to healthcare outcomes that are fair, appropriate, valid, effective and safe.

Read more here.

CMS Proposes to Prohibit Overrides in Medicare Advantage

by Mary Moll Alexandre, Jeremy Earl, Kate McDonald and Fabiola Díaz Vera | Jan 16, 2024 | Employee Benefits, Health and Welfare Plans

On November 6, 2023, the Centers for Medicare & Medicaid Services (CMS) issued a proposed rule for the Medicare Advantage and Part D programs. Among other proposals, CMS proposed significant changes to longstanding rules on permissible payment structures for agents and brokers. Specifically, CMS proposes to prohibit “overrides” or administrative fees paid to agents and brokers outside of the fair market value enrollment compensation limits established by CMS. This could have a significant impact on MA and Part D plan arrangements with agents and brokers.

Read more here.

UK Healthcare Waiting Lists: Will Choice Make a Difference?

by Sharon Lamb | Jan 11, 2024 | Employee Benefits, Health and Welfare Plans

How can the independent sector and choice make a dent in reversing the increasingly high number of United Kingdom healthcare patients waiting for treatment? In this LaingBuisson News article, Sharon Lamb examines the latest waiting time data and offers perspective on potential solutions.

Read more here.

New Illinois Protections Against Patient Medical Debt May Also Help Reduce Hospital Bad Debt

by Sumaya Noush, Gregory Fosheim and Drew Elizabeth McCormick | Jan 9, 2024 | Employee Benefits, Health and Welfare Plans

The Protect Illinoisans from Unfair Medical Debt bill will require Illinois hospitals to take a much more active role in limiting consumers’ medical debt. The bill puts into place four primary requirements designed to reduce the medical debt burden of individuals receiving care. These requirements will apply to services provided on or after June 29, 2024.

Learn about the requirements here.

The MHPAEA Proposed Rule: Scalability and the Plight of the Small(er) Self-Funded Plan

by Alden Bianchi | Jan 4, 2024 | Employee Benefits, Health and Welfare Plans, Mental Health Parity and Addiction Equity Act

After a brief hiatus to discuss the pleading standards adopted by the US Court of Appeals for the Tenth Circuit in E.W. v. Health Net Life Insurance Company, we return to our examination of the comments submitted in response to the proposed regulations under the Mental Health Parity and Addiction Equity Act (MHPAEA). The US Departments of Labor, Health and Human Services and the Treasury (the Departments) issued the proposed regulations in 2023. Our previous MHPAEA content is available here.

In this post, we examine the impact of the proposed regulations on small and medium-sized self-funded plans through the lens of a National Association of Benefits and Insurance Professionals (NABIP) comment letter.

The MHPAEA governs the conduct of group health plans and health insurance issuers. This structure works fine in the case of fully insured group health plans, since compliance by the issuer or carrier generally results in compliance by the plan. The former acts on the latter’s behalf. The calculus is different, however, in the case of self-funded plans that typically rely on third-party administrators for their MHPAEA compliance. Often, the third-party administrator is also a licensed carrier that is providing services on an “administrative services only” basis. Here, the group health plan alone bears the responsibility for MHPAEA compliance even though, as a practical matter, the plan will rely heavily, if not entirely, on its administrative services only provider to comply.

One of the attractions of self-funding is that the plan has the ability (in theory) to customize plan design features and strategies, including mental health benefits. In practice, only large employers have the bargaining leverage to modify their group health plan’s design features, however. Other employers are essentially beholden to their service provider(s) for their mental health benefits and other plan designs. To date, that compliance has been less than robust. See, e.g., a comment letter submitted by the state attorneys general of New York, California, Colorado, Delaware, the District of Columbia, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, Oregon, Pennsylvania, Rhode Island, Vermont and Washington addressing their efforts to enforce their mental health and substance use parity laws against carriers. In this sense, then, it can be said that MHPAEA compliance does not “scale.” As a plan’s leverage over its service providers decreases, so does its design flexibility and options.

There is another, perhaps more basic, sense in which the MHPAEA rules do not scale. The cost of compliance can be substantial. That cost may be manageable when spread over hundreds of thousands of covered lives but not so much when spread over hundreds of lives. The net effect of this disparity is that small plans will likely be forced to adopt far simpler, prepackaged and potentially less effective nonquantitative treatment limitation (NQTL) design strategies.

The NABIP’s comment letter addressed the following issues, principally from the perspective of self-funded plans:

The need for a compliance safe harbor

States Advance Telehealth Legislation and Rulemaking

by Purnima Boominathan and Angela Theodoropoulos | Jan 2, 2024 | Digital Health, Health and Welfare Plans

Numerous states—including Alaska, Florida, Texas, Utah and Washington—have been busy finalizing and proposing rulemaking and legislation impacting telehealth-related care. Washington’s Department of Health, for example, published a proposed rule focused on implementing the multistate nurse licensure compact.

What else have these states been up to over the last month?

Read more here.

Pharmacy Benefit Manager Reform: What’s on the Horizon? (December 2023 Update)

by Leigh Feldman, Amy Kelbick, Rachel Stauffer, Erica Stocker and Katie Waldo | Dec 27, 2023 | Employee Benefits, Health and Welfare Plans

The price of prescription drugs has brought scrutiny to the entire drug supply chain. Congress and other policymakers continue to seek opportunities to lower costs for patients and the federal government. Pharmacy benefit managers (PBMs) are a key stakeholder in the drug supply chain, functioning as intermediaries between insurance providers and pharmaceutical manufacturers.

Congress and other stakeholders are raising questions about PBMs’ operations and their impact on drug prices and out-of-pocket costs for patients. In the 118th Congress, six key committees have advanced legislation that would increase PBM transparency and reporting obligations and modify other business practices. In the House, three committees combined to introduce H.R. 5378, the Lower Costs, More Transparency Act, which passed the House December 11, 2023. Read on as we review and compare policies in the Lower Costs, More Transparency Act and the PBM bills considered individually by the relevant House and Senate committees.

Access the full report.

Remote Monitoring and Digital Therapies: CMS Updates Coverage and Payment Policies

by Caroline Reignley, Michael Ryan and Deborah Godes | Dec 26, 2023 | Employee Benefits, Health and Welfare Plans

In recent years, the Centers for Medicare & Medicaid Services (CMS) has expanded payment for remote monitoring services in an effort to pay for non-face-to-face services that improve care coordination for Medicare beneficiaries. On November 2, 2023, CMS released the calendar year 2024 final rule for services reimbursed under the Medicare Physician Fee Schedule. In the final rule, CMS clarified certain guidance for remote monitoring services, finalized separate reimbursement for remote monitoring provided by rural health centers and federally qualified health centers, and discussed a recent request for information for digital therapies.

Read more here.

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