The IRS finalized regulations concerning information reporting of health insurance coverage for Code Sections 5000A, 6055 and 6056. The regulations provide an automatic deadline extension for filing ACA forms and an alternate method for providing ACA forms to certain individuals, among other changes.
Section 204 of Title II of Division BB of the Consolidated Appropriations Act, 2021 amended the Internal Revenue Code, the Employee Retirement Income Security Act of 1974 and the Public Health Service Act to add rules governing prescription drug data collection (RxDC). The rules require group health plans, including plans offered to Federal Employees Health Benefits carriers, and health insurance issuers to report certain information related to prescription drug and other healthcare expenditures to the US Departments of Labor, Health and Human Services and the Treasury (collectively, the Departments). Under the statute, the first RxDC reports were due to be filed by December 27, 2021. However, in response to concerns expressed by stakeholders, enforcement was pushed back a full year to December 27, 2022.
In an FAQ issued December 23, 2022 (FAQ About Affordable Care Act and Consolidated Appropriations Act, 2021 Implementation Part 56), the Departments provided relief to group health plans and health insurance issuers who are required to report information relating to prescription drug and healthcare spending.
On December 23, 2022, US Congress approved a year-end omnibus legislative package, Consolidated Appropriations Act, 2023 (CAA 2023), which consists of all 12 fiscal year 2023 appropriations bills and numerous other provisions, including health policy changes. The healthcare provisions in this omnibus package extend key Medicare telehealth flexibilities and the temporary telehealth safe harbor for High Deductible Health Plans (HDHP) first-dollar coverage.
The passing of the omnibus package presents a victory for industry advocates that have sought to extend the COVID-19 Medicare flexibilities and the HDHP safe harbor. The Medicare provisions will continue the flexibilities for providers and, coupled with the HDHP safe harbor, will enable beneficiaries to access expanded healthcare options through telehealth services. However, as the COVID-19 flexibilities and HDHP safe harbor are extended on a temporary basis through December 31, 2024, stakeholders will need to continue to engage with Congress on a more permanent solution.
Multiple Republican lawmakers are opposing a US Department of Health and Human Services (HHS) proposed rule that would expand the Affordable Care Act’s Section 1557 requirement preventing most health plans from discriminating on the basis of sex. According to this SHRM article, the rule applies to health insurers or plans that receive federal funds or that contract with the government. McDermott lawyers previously wrote about this proposed rule, noting that the definition of a covered entity is “similar in many ways to the 2016 Final Rule” but “does not explicitly include employee benefit group health plans as covered entities subject to Section 1557.”
A North Carolina health plan’s refusal to cover gender dysphoria treatment violated the Affordable Care Act. According to this Law360 article, the December ruling by US District Judge Loretta C. Biggs is a win for participants and parents of transgender children enrolled in the North Carolina State Health Plan for Teachers and State Employees. McDermott’s Warren Haskel, Dmitriy Tishyevich and Lauren H. Evans represented the health plan’s participants.
In this three-part podcast series focusing on healthcare governance, McDermott Partner Michael Peregrine joins the American Health Law Association to discuss a range of governance issues, including the following:
The Respect for Marriage Act would preserve the company benefits of same-sex couples. The legislation, which passed the US Senate on November 29, was inspired by concerns that the US Supreme Court might reconsider its landmark same-sex marriage decision.
In this SHRM article, McDermott Partner Todd Solomon noted that federal and state law no longer distinguish between same-sex or opposite-sex marriages.
“Same-sex spouses must be extended spousal benefit coverage by employers” for fully insured health plans, Solomon said.
The Biden administration recently finalized an overhaul of an initiative known as the Medicare Shared Savings Program that seeks to pay health providers based on patient outcomes instead of the number of services they perform. In this Axios article, McDermott+Consulting’s Mara McDermott offers insight into providers’ Congressional push to extend a 5% pay increase for participants in advanced alternative payment models.
“If the bonus is not continued, it will soften or dampen the momentum toward alternative payment models, because it would create this mentality, or the view, that we’re not serious about that transformation,” McDermott said.
On September 29, 2022, California Governor Gavin Newsom signed Assembly Bill 1278, which requires physicians and their employers to provide patients with notices about the Open Payments database starting January 1, 2023.
The federal Open Payments program is designed to promote transparency by requiring applicable manufacturers of drugs, devices, and biological or medical supplies to annually report to the Centers for Medicare & Medicaid Services certain payments and other transfers of value made to physicians, certain advanced practice providers (e.g., nurse practitioners) and teaching hospitals. Currently, pharmaceutical companies in California must disclose their compliance program, including information related to the annual dollar limits on gifts, promotional materials or incentives provided to medical or health professionals (California Health & Safety Code § 119402). The enactment of this new legislation will impose new disclosure requirements specifically onto physicians and their employers regarding physicians’ financial relationships with pharmaceutical and medical device manufacturers.
Following the US Supreme Court’s decision in Dobbs v. Jackson Women’s Health Organization, many employers extended travel benefits to women residing in states where abortion or reproductive health procedures may now be unlawful. Recently, US Equal Employment Opportunity Commission (EEOC) Commissioner Andrea Lucas filed a Commissioner’s Charge against at least three companies alleging that doing so violates Title VII of the Civil Rights Act of 1964 (Title VII) and the Americans with Disabilities Act of 1990 (ADA). Although these charges are not public, it’s believed they mirror a letter that Sharon Fast Gustafson, the former EEOC General Counsel, recently sent en masse to employers around the country also alleging such travel programs violate federal anti-discrimination laws. The EEOC has since issued a statement that Gustafson’s views are her own and do not necessarily reflect those of the EEOC.
When Title VII was amended in 1978 by the Pregnancy Act amendments, language was added requiring pregnancy, childbirth and related medical conditions be treated equally with other medical conductions under an employer’s “fringe benefit programs.” Lucas asserts that providing travel benefits for those seeking abortions provides preferential treatment to women, thus constituting gender discrimination. Her contention is also that travel benefits further implicate religious discrimination by favoring those who terminate pregnancies over those who, for religious reasons, carry a child to term. Her final contention is that the provision of travel benefits violates the ADA, which she claims requires parity of benefits for those with physical disabilities.
Employers are now asking whether Lucas’ and Gustafson’s position may be the beginning of litigation by the EEOC or private plaintiffs and whether they can take measures to address the legal arguments being raised.
First, it is doubtful the EEOC will be suing. While Title VII and the ADA authorize a single commissioner to file a Commissioner’s Charge, that Charge will be investigated like any other Charge of Discrimination. If cause is found, EEOC procedure requires in cases garnering public attention (which this most certainly is) that litigation may only be commenced if a majority of the Commissioners (minus the Commissioner who brought the Charge) vote in favor of doing so. In the absence of a quorum, then only the General Counsel of the EEOC may initiate suit. At this time, Lucas would not appear to have such votes.
Second, employers can and should draft around these contentions to prepare for private suits. Specifically, such travel benefits should cover not only abortion and/or reproductive health, but also all covered services or procedures that are unavailable within a covered individual’s state of residence or area, regardless of the individual’s gender, pregnancy or childbirth status, or disability status. This would make the benefits “available” to everyone.
Finally, there is a suggestion that, even with such drafting, this travel benefit will still be utilized primarily by non-Christian women, thus supporting a disparate impact claim based on religious discrimination. This is an overreach. Title VII claims require an adverse employment action such as an employee who requests but is denied a travel benefit due [...]
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