US Department of Labor Archives - EMPLOYEE BENEFITS BLOG

Mental Health Parity, Quantitative Treatment Limitations, Employee Assistance Plans and the End of the COVID-19 Emergency

by Jacob Mattinson, Sarah Raaii, Alden Bianchi and Teal Trujillo | Mar 29, 2023 | Employee Benefits, Health and Welfare Plans, Mental Health Parity and Addiction Equity Act

The Biden administration has announced its intention to end the COVID-19 National Emergency (NE) and the COVID-19 Public Health Emergency (PHE) on May 11, 2023 (read our series introduction for more information). Among other things:

The NE and the PHE modified the rules governing financial requirements and quantitative treatment limitations under the Mental Health Parity and Addiction Equity Act (MHPAEA). The end of the NE and the PHE will require modifications to group health plans’ and health insurance issuers’ MHPAEA testing as it relates to financial requirements and quantitative treatment limits. The NE and the PHE also affect the design and operation of some employee assistance plans (EAPs).
The NE and the PHE allowed plan sponsors to expand coverage under excepted benefit EAPs in certain respects without risking their status as the Health Insurance Portability and Accountability Act (HIPAA)-excepted benefits.

MHPAEA

MHPAEA requires that the financial requirements (such as coinsurance and copays) and quantitative treatment limits (such as visit limits) imposed on mental health or substance use disorder (MH/SUD) benefits cannot be more restrictive than the predominant financial requirements and treatment limitations that apply to substantially all medical/surgical benefits in a particular benefit classification. During the public health emergency period, group health plans and health insurance issuers were permitted to disregard certain items and services related to testing for the detection of SARS-CoV-2, the virus that causes COVID-19, when performing the “substantially all” and “predominant” tests. Absent this relief, the costs of covering COVID-19 testing items and services without cost-sharing would be the amounts allocated to medical/surgical benefits, thereby putting group health plans and health insurance issuers at risk of running afoul of MHPAEA quantitative treatment limits.

From and after the end of the PHE, group health plans and health insurance issuers must include the cost of covering COVID-19 tests, either diagnostic or over-the-counter, or testing-related services, when calculating MHPAEA quantitative treatment limits.

Action Items: Employers should revisit their MHPAEA compliance testing to ensure that the coverage of COVID-19 tests is properly accounted for in applying the relevant quantitative treatment limits. There is, however, no longer a requirement that a group health plan or health insurance issuer cover these services without charge.

EMPLOYEE ASSISTANCE PLANS

The end of the NE and the PHE could have various impacts on EAPs depending on the specific plan design. Employers may, for example, see a spike in the need for mental health support that could be met through EAP services. While the pandemic may be winding down, the mental health impacts of the past three years may continue for by many employees. Employers may need to continue to offer mental health services and resources through their EAPs, and potentially explore expanding mental health services through an EAP or otherwise, to support employees who are struggling with anxiety, depression or other mental health issues related to the pandemic.

Particular attention is required in the case of excepted benefit EAPs. Excepted benefit EAPs do not provide minimum essential coverage for Affordable Care [...]

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District Court Vacates Provisions of No Surprises Act Final Rule

by Debra Curtis, Kristen O'Brien and Erica Stocker | Mar 10, 2023 | Employee Benefits, Health and Welfare Plans

On February 6, a US district court in Texas vacated provisions of the No Surprises Act final rule related to the independent dispute resolution (IDR) process for determining payment for out-of-network services.

The district court granted summary judgment to the Texas Medical Association, which had brought suit against the US Departments of Health and Human Services (HHS), Labor and the Treasury over the IDR process. The district court held that provisions of the final rule were contrary to law and therefore in violation of the Administrative Procedure Act. The order vacated the provisions of the final rule that require IDR entities to look at the qualifying payment amount first and consider other factors only if those other factors are not already accounted for in the qualifying payment amount.

The departments have not yet filed a notice of appeal or amended their sub-regulatory guidance to align with the district court’s order.

Proposed Universal Contraceptive Coverage in Response to Roe Reversal

by Alden Bianchi and Sarah Raaii | Feb 14, 2023 | Employee Benefits, Health and Welfare Plans

The US Departments of Health and Human Services, Labor and Treasury (the Departments) recently issued a proposed rule to eliminate a moral exemption to the Affordable Care Act (ACA) contraceptive mandate and establish an “individual contraceptive arrangement” to permit individuals to obtain contraceptive services at no cost in instances in which their employer does not offer coverage based on its religious beliefs. This is the latest development in the Biden administration’s efforts to increase reproductive health access after Dobbs v. Jackson Women’s Health Organization. The Departments previously issued a reminder to health plans and insurers that the ACA requires contraceptive coverage at no additional cost to individuals.

Read more here.

Employer Group Urges Justices To Hear Seattle Benefits Row

by Michael B. Kimberly, Sarah P. Hogarth and Andrew Liazos | Nov 16, 2022 | Benefit Controversies, Retirement Plans

An employer group says the federal government erred in arguing that a Seattle benefits mandate for hotel workers doesn’t conflict with federal law. According to this Law360 article, the ERISA Industry Committee (ERIC) asked the US Supreme Court to review a US Court of Appeals for the Ninth Circuit decision that backed the Seattle ordinance despite arguments from the US Department of Labor that the law doesn’t contradict the Employee Retirement Income Security Act. McDermott’s Michael B. Kimberly, Sarah P. Hogarth and Andrew C. Liazos represent ERIC.

Access the article.

Return to Work | Managing Your Workforce During Periods of Uncertainty

by Lindsay Ditlow, Cristell Fortune, Abigail M. Kagan and Marjorie C. Soto Garcia | Nov 10, 2022 | Employment, Labor

How can employers manage their workforces during periods of economic uncertainty? In this McDermott webinar, Lindsay Ditlow, Cristell Fortune, Abigail Kagan and Marjorie Soto Garcia offer perspective on the following topics:

Communicating the transition
The impact on contractual and other obligations
WARN Act, furloughs, layoffs and salary reductions
Strategies for unionized workforces

Access the webinar.

Departments Issue Final Rule Implementing Certain No Surprises Act Provisions

by Brian Stimson, Jamie Gelfman, Drew Elizabeth McCormick and Emily Curran | Sep 14, 2022 | Employee Benefits, Health and Welfare Plans

On August 19, 2022, the US Departments of Health and Human Services (HHS), Labor and Treasury posted a final rule revising portions of the federal No Surprises Act (NSA). Generally, the rule finalizes three aspects of the two-part interim final rule that the Departments published along with the Office of Personnel Management in 2021. First, the final rule expands the information about the qualifying payment amount (QPA) that plans and issuers (collectively, payers) must disclose to providers and facilities (collectively, providers). Second, it reinterprets the provisions of the NSA that govern the determination of the appropriate out-of-network rate through the federal independent dispute resolution (IDR) process, and prescribes how certified IDR entities are to weigh the QPA and other considerations when selecting one of the parties’ offers. The certified IDR entity must now consider the QPA first, and then give weight to other considerations only if those other considerations are not accounted for in the QPA. Third, the final rule expands the information that a certified IDR entity must provide in its written payment determination to include a statement explaining why the QPA did not already account for other considerations weighed by the IDR entity.

Read more here.

Responsible Financial Innovation Act: Proposed Tax and Reporting for Digital Assets

by John Lutz, William R. Pomierski, Andrew Granek and McDermott Will & Emery | Sep 8, 2022 | Employee Benefits, Employee Stock Ownership Plans (ESOPs), Retirement Plans

On June 7, 2022, Senators Cynthia Lummis (R-WY) and Kirsten Gillibrand (D-NY) introduced the highly anticipated Responsible Financial Innovation Act (the bill), which sets out to create the first complete regulatory and bipartisan framework for digital assets. The bill is intended to establish some legal clarity for regulators and the industry and to protect consumers by providing a range of disclosures and clarifying settlement conditions and rights over digital ownership. The bill would also treat all digital assets that are not treated as securities as commodities regulated by the Commodity Futures Trading Commission. This article discusses key tax considerations raised by the bill concerning taxation and reporting requirements for participants in the digital asset industry.

Read more here.

How Does the FMLA Apply to a Remote Workforce?

by Brian Mead and Dawn Peacock | Sep 6, 2022 | Employee Benefits, Employment, Labor

The Family and Medical Leave Act (FMLA) was enacted in 1993, a year when the idea of working a corporate job from a living room was rare. When the law was passed, the FMLA didn’t contemplate a remote workforce. Now, and especially post-pandemic, many companies are embracing a fully remote workforce (e.g., sales representatives, healthcare medical device technicians and software engineers). While employees’ needs for a leave of absence have always been around, remote employment and its effects on the applicability of the FMLA requirements has not. For well over two years, many employees have been working from home. Some report to a manager at the headquarters or worksite. Plenty of remote employees, however, report to an individual who also works remotely. The new remote landscape is making what used to be an easy application of FMLA eligibility into a difficult analysis. This article examines the FMLA regulatory framework for remote employees, a recent Texas federal court decision on the issue and the practical options that employers have moving forward.

Read more here.

When Are Cryptocurrencies Appropriate Investments for Retirement Plans and IRAs?

by Brian Tiemann and McDermott Will & Emery | Jun 7, 2022 | Employee Benefits, Fiduciary and Investment Issues, Privacy and Data Security, Retirement Plans

The US Department of Labor (DOL) recently issued guidance for the first time on the investment of retirement plan assets in cryptocurrencies. Compliance Assistance Release No. 2022-01 cautions 401(k) plan fiduciaries to “exercise extreme care” before allowing participants to invest plan assets in cryptocurrencies because cryptocurrencies “present significant risks and challenges to participants’ retirement accounts, including significant risks of fraud, theft, and loss.” In this Intellectual Property & Technology Law Journal article, McDermott Partners Andrea S. Kramer and Brian J. Tiemann outline what retirement plan fiduciaries need to know about cryptocurrency investments in the current market.

Access the article.

ERISA Litigation: What Have We Learned?

by McDermott Will & Emery | May 24, 2022 | Employee Benefits, Employee Stock Ownership Plans (ESOPs), Executive Compensation, Fiduciary and Investment Issues, Retirement Plans

Earlier this spring, McDermott Partner Erin Turley delivered a presentation about the impacts of recent Employee Retirement Income Security Act of 1974 (ERISA) litigation. Lawsuits now target both large and small employee benefit plans; plan sponsors are being sued and dragged into complex and lengthy litigation, thus changing the basic economics of the provision of fiduciary liability insurance. In response to these lawsuits, plan sponsors are looking to outsource as much of this fiduciary responsibility and potential liability and exposure as possible.

Access the presentation slides.

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