Consolidated Appropriations Act Archives

Six Wishes for the Forthcoming Final Regulations Under MHPAEA

by Alden Bianchi | Jul 30, 2024 | Employee Benefits, Health and Welfare Plans, Mental Health Parity and Addiction Equity Act

On July 1, 2024, the US Department of Labor (DOL) submitted final regulations to the Congressional Budget Office (CBO), implementing the Mental Health Parity and Addiction Equity Act (MHPAEA) as most recently amended by the Consolidated Appropriations Act, 2021 (CAA). The CAA added a requirement that plans and issuers perform and document comparative analyses of the design and application of nonquantitative treatment limitations (NQTLs) on mental health and substance use disorder benefits (MH/SUD) and medical and surgical (M/S) benefits. Submission to the CBO is the last step in the process of issuing a binding, final rule. The agency ordinarily acts on these submissions within 90 days, but it is widely anticipated that the final rule will be issued sooner.

The final regulations implement proposed regulations issued in July 2023, which were widely commented on. Our previous content explaining the proposed regulations, including a series of blog posts commenting on the comments, is available here.

To call the proposed rule contentious is an understatement, and the stakes for group health plan sponsors that provide mental health benefits are significant. Many comments on the proposed regulations asked the regulators to withdraw the proposed rule and to reconsider the issue anew. While the chance of that happening was always remote, it is now clear that this is not going to happen. There will shortly be final regulations. Recognizing this to be the case, here are six items in the proposed regulations that we would like to see changed or clarified.

Application of the Quantitative Testing Requirements to NQTLs

MHPAEA generally provides that financial requirements and treatment limitations imposed on MH/SUD benefits cannot be more restrictive than the predominant financial requirements and treatment limitations that apply to substantially all M/S benefits in a classification. The 2013 final regulations established the following classifications for this purpose: inpatient, in-network; inpatient, out-of-network; outpatient, in-network; outpatient, out-of-network; emergency care; and prescription drugs. “Treatment limitations” can be either quantitative treatment limitations (QTLs) (e.g., visit limits) or NQTLs (i.e., concurrent review). The rules for the testing of QTLs set out in the 2013 final regulations include detailed numerical standards, which have spawned a cottage industry for testing services.

The proposed regulations would impose quantitative testing requirements on NQTLs. This is at least modestly counterintuitive. It would also make an already complex testing rule materially more complicated. It is our hope that the DOL, US Department of Health and Human Services, and the US Department of the Treasury (the Departments) see fit to back away from this requirement.

Mental Health Carve-Out Vendors

The proposed regulations establish a three-prong test that plans and issuers must pass to impose an NQTL in a classification. To qualify, an NQTL:

Must be no more restrictive when applied to MH/SUD benefits as compared to M/S benefits;
The plan or issuer must meet specified design and application requirements; and
The plan or issuer must collect, evaluate and consider the impact of relevant data on [...]

Continue Reading

Telehealth and the End of the COVID-19 Emergency

by Jacob Mattinson, Sarah Raaii, Alden Bianchi and Teal Trujillo | Mar 22, 2023 | Employee Benefits, Health and Welfare Plans

The Biden administration has announced its intent to end the COVID-19 National Emergency (NE) and the COVID-19 Public Health Emergency (PHE) on May 11, 2023 (read our prior article for more information). In response to the COVID-19 pandemic, lawmakers and agencies made legislative and regulatory changes to expand access to telehealth services for individuals. This article explores what will happen to these temporary telehealth benefits at the end of the PHE and NE.

Current flexibilities under the Affordable Care Act (ACA) allow applicable large employers (ALEs) to offer stand-alone telehealth and remote care services to employees who were not eligible for other employer coverage during the PHE.

In addition, the Coronavirus Aid, Relief, and Economic Security Act (CARES) Act and IRS Notice 2020-29 established a temporary telehealth safe harbor, providing that a high-deductible health plan (HDHP) could cover telehealth and other remote care services on a pre-deductible basis without impacting an individual’s ability to contribute to an HSA. This relief applied to services provided on or after January 1, 2020, with respect to plan years beginning on or before December 31, 2021. Thus, for most calendar-year plans, this relief ended on December 31, 2021. The Consolidated Appropriations Act, 2022 (CAA 2022) renewed the relief under the CARES Act for months beginning after March 31, 2022, and before January 1, 2023—but it created a three-month gap in coverage from January 1, 2022, to March 31, 2022. The CAA 2022 also extended certain flexibilities related to Medicare coverage and payment for telehealth services through the end of 2024. The relief provided under the CAA 2022, however, was provided on a temporary basis and not tied to the PHE or NE.

Effective December 29, 2022, the Consolidated Appropriations Act, 2023 (CAA 2023) provided a two-year extension allowing first-dollar coverage of telehealth under an HDHP so that individuals can access services without needing to meet a deductible first. The CAA 2023 extends telehealth relief for plan years beginning after December 31, 2022, and before January 1, 2025. Most calendar year plans should therefore have coverage of pre-deductible telehealth services without affecting HSA eligibility for all of 2023 and 2024. When the PHE ends, stand-alone telehealth offerings must cease, but telehealth offerings on a pre-deductible basis can continue.

The stand-alone telehealth relief under the ACA is available until the end of the latest plan year that begins on or before the last day of the PHE. For calendar-year plans, this relief would last until December 31, 2023. When an employer ends its stand-alone telehealth benefit, it may need to provide participants a 60-day notice of a material reduction in benefits.

Employers offering telehealth coverage on a pre-deductible basis with HDHPs have been provided statutory relief through December 31, 2024, through the CAA 2023. However, employers should continue to watch for legislative updates regarding telehealth. Lawmakers have proposed multiple other bills in Congress to extend or make permanent telehealth flexibilities.

For any [...]

Continue Reading

Webinar Replay: What to Know About SECURE 2.0

by Sarah L. Engle, Jeffrey Holdvogt, Andrew Liazos, Lisa Loesel, Jacob Mattinson and Brian Tiemann | Feb 1, 2023 | Employee Benefits, Fiduciary and Investment Issues, Retirement Plans, SECURE 2.0 Act

What do retirement plan professionals and participants need to know about the recently passed SECURE 2.0 Act of 2022? In this webinar replay, McDermott’s Employee Benefits team discusses the many changes to retirement plans and individual retirement accounts, including the key changes for 401(k), 403(b) and defined benefit plans as well as other changes impacting health and welfare plans. Discussion topics include the following:

Automatic plan enrollment and escalation
Allowance of matching contributions for elective deferred student loan repayments
Emergency savings option
Expansion of Roth account contributions
Automatic cashout, hardship and disaster changes
Penalty-free distributions
Changes to required minimum distributions

Access the webinar.

Access the webinar’s slides.

Read the On the Subject about SECURE 2.0 here.

JOIN US: SECURE 2.0 Takes Second Bite at Retirement Security

by Sarah L. Engle, Jeffrey Holdvogt, Andrew Liazos, Lisa Loesel, Jacob Mattinson and Brian Tiemann | Jan 24, 2023 | Employee Benefits, Fiduciary and Investment Issues, Retirement Plans, SECURE 2.0 Act

Join partners from McDermott’s Employee Benefits team on Wednesday, January 25, 2023, as they discuss the impact of the recently passed SECURE 2.0 Act of 2022. With over 90 changes to retirement plans and individual retirement accounts (IRAs), this webinar will highlight the key changes for 401(k) and 403(b) plans and defined benefit plans, as well as changes in the Consolidated Appropriations Act, 2023 impacting health and welfare plans.

Topics Include:

Automatic Plan Enrollment and Escalation
Allowance of Matching Contribution for Elective Deferred Student Loan Repayments
Emergency Savings Option
Expansion of Roth Account Contributions
Automatic Cashout, Hardship and Disaster Changes
Penalty-Free Distributions
Changes to Required Minimum Distributions

To learn more, read the full On the Subject here.

REGISTER FOR THE WEBINAR HERE.

Welcome (But Last Minute) Relief for Prescription Drug Reporting Originally Due December 27

by Alden Bianchi | Dec 29, 2022 | Employee Benefits, Employment, Health and Welfare Plans

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.

Omnibus Bill Extends Medicare Telehealth Flexibilities and HDHP Telehealth Safe Harbor

by Amanda Enyeart, Marshall E. Jackson, Jr., Lisa Schmitz Mazur, Rachel Stauffer, Grayson I. Dimick, Jayda Greco, Abby Higgins, Ashley Ogedegbe and Sarah Raaii | Dec 28, 2022 | Digital Health, Employee Benefits, Health and Welfare Plans

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.

CMS Addresses Virtual Care Expansion in CY 2022 Medicare Physician Fee Schedule Proposal

by Amanda Enyeart, Marshall E. Jackson, Jr., Lisa Schmitz Mazur and Dale C. Van Demark | Sep 15, 2021 | Employee Benefits, Health and Welfare Plans

The Centers for Medicare & Medicaid Services recently published its annual proposed changes to the Medicare Physician Fee Schedule, which include several key telehealth and other virtual care-related proposals. The proposals address long-standing restrictions that have historically limited the use of telehealth and virtual care, including geographic and originating site restrictions, and limitations on audio-only care, as well as coverage extensions for some services added during the COVID-19 public health emergency.

COVID-19 Stimulus Package Significantly Expands CARES Act Employee Retention Tax Credits

by David Fuller, Andrew Liazos, Brian Tiemann and Sarah L. Engle | Jan 21, 2021 | Employee Benefits, Employment

The Consolidated Appropriations Act, 2021, which became law on December 27, 2020, makes significant changes to the employee retention tax credits available under the Coronavirus Aid, Relief and Economic Security Act (the CARES Act). The changes are generally designed to increase the availability, scope and amount of the credits. Significantly, employers that received a Payroll Protection Program (PPP) loan (or that were related to employers that received a PPP loan) may be able to claim the credit, including retroactively for periods beginning as early as March 13, 2020.

Access the article.

Consolidated Appropriations Act: Health and Welfare Benefits Provisions

by Jacob Mattinson and Sarah Raaii | Jan 20, 2021 | Employee Benefits, Health and Welfare Plans

The Consolidated Appropriations Act (the Act) was signed into law by the president on December 27, 2020, and includes significant health and welfare benefits provisions that affect group health plans and health insurance issuers. The Act is the most comprehensive single piece of legislation to impact group health plans since the Affordable Care Act.

Access the article.

Healthcare and Childcare FSA Fix for 2021, Finally: Special Carryover Rules and More

by Jacob Mattinson | Jan 14, 2021 | Employee Benefits, Health and Welfare Plans

The Consolidated Appropriations Act provides tax relief for workers who socked away pre-tax money into flexible spending accounts (FSAs) for 2020 and couldn’t use it because of the coronavirus pandemic. Now employees may be able to carry over all of their unused funds to use later. Even ex-employees might get more time to spend down unused money instead of forfeiting it.

In a recent article in Forbes, McDermott partner Jacob Mattinson speaks to the employer perspective on FSA carryovers.

Access the article.