Health Insurance Archives - Page 3 of 6

Bills Ban Gag Clauses in Pharmacy Contracts

by Karen Owen Gibbs | Oct 18, 2018 | Employee Benefits, Health and Welfare Plans

On October 10, 2018 President Trump signed two bills that ban “gag clauses” in pharmacy contracts. Congress passed the two bills—one for Medicare prescription drug plans (“Know the Lowest Price Act”) that will go into effect in January 2020, and another for commercial employer-based and individual policies (“Patient Right to Know Drug Prices Act”) effective immediately—by almost unanimous vote in September 2018.

While many states have already prohibited the use of these clauses, this is the first such action on a federal level.

Gag clauses are sometimes found in contracts between pharmacies and insurance companies, pharmacy benefit managers or group health plans and bar pharmacists from telling customers that they could save money by paying cash for their prescriptions rather than using their health insurance. If pharmacists violate the gag rule, they risk penalties and/or contract termination. Under the new legislation, pharmacists are not required to tell patients about the lower cost option, but they also cannot be contractually prohibited from engaging in the cost conversation.

The legislation is consistent with the position of the Centers for Medicare & Medicaid Services (CMS), which, in May of this year, issued guidance stating that “gag clauses” are unacceptable in the Medicare Part D program.

Originally published in the Health & Life Sciences News blog.

No Good Deed Goes Unpunished: Inferior Parental Leave Policies Can Result in Discrimination Claims

by McDermott Will & Emery and Jeremy White | Oct 19, 2017 | Benefit Controversies, Employee Benefits, Employment, Health and Welfare Plans, Labor

To recruit and retain top talent, employers often offer benefits more generous than required under the law. Such benefits include unlimited vacation, paid maternity leave and paid paternity leave. However, a recent US Equal Employment Opportunity Commission (EEOC) lawsuit filed against Estee Lauder Companies, Inc. (Estee Lauder) reveals how even the most well-intentioned of programs can result in a discrimination lawsuit.

IRS Regulations Provide That Certain Employees of Partnerships Now Have Self-Employment Status for Employee Benefit and Tax Purposes

by Jeffrey Holdvogt and Ruth Wimer | May 17, 2016 | Employment, Executive Compensation, Health and Welfare Plans

The IRS and US Department of Treasury have issued final and temporary regulations which address benefit and self-employment tax issues regarding partners in a partnership which is the sole owner of a second, wholly owned legal entity. The regulations are intended to clarify that where the partners are separately working for the second legal entity, such individuals may not be treated as employees, and must be treated as self-employed individuals for both self-employment and employee benefit plan purposes. As a result, the partners may not be provided the tax benefits provided employees with respect to benefit plans such as cafeteria plans, parking and transit benefits, health benefits and health insurance.

Read the full article.

McDermott’s Todd Solomon Discusses Same-Sex Employee Benefits with the Wall Street Journal

by Diane Morgenthaler and McDermott Will & Emery | May 14, 2015 | Benefit Controversies, Employee Benefits, Employment, Executive Compensation, Fiduciary and Investment Issues, Health and Welfare Plans, Retirement Plans

As the U.S. Supreme Court weighs whether gay couples are constitutionally entitled to marry, more companies in states with marriage equality have begun to mandate that gay employees marry in order to maintain benefits, including health care coverage. In a recent interview with the Wall Street Journal, McDermott partner Todd Solomon discusses the shifting terrain of coverage and benefits that companies offer unmarried gay partners. McDermott lawyers have been monitoring domestic partnership benefits for almost two decades, and, as Mr. Solomon notes, the landscape is definitely changing.

Read the full article, “Firms Tell Gay Couples: Wed or Lose Your Benefits,” in the Wall Street Journal.

Final Regulations Allow Retirement Plan Payments for Accident, Health and Disability Insurance

by McDermott Will & Emery | Jun 10, 2014 | Health and Welfare Plans, Retirement Plans

On May 9, 2014, the Internal Revenue Service finalized regulations that govern the tax treatment of payments made by retirement plans to pay accident or health insurance premiums. Under the final regulations, accident or health insurance premium payments by qualified defined contribution plans are taxable distributions to the participant unless those payments are used to pay premiums for disability insurance that replace retirement plan contributions for disabled employees. The regulations apply for tax years beginning January 1, 2015, although taxpayers may elect to apply them to earlier years.

Read the full article.

Fourth Circuit Upholds Health Care Reform Law

by McDermott Will & Emery | Sep 9, 2011 | Health and Welfare Plans

by Michael T. Graham

On September 8, 2011, the U.S. Court of Appeals for the Fourth Circuit dismissed two lawsuits challenging the constitutionality of President Obama’s health care reform legislation, both on procedural grounds. In one case filed by the State of Virginia, the court dismissed a challenge to the legislation’s constitutionality finding that the State of Virginia did not have standing to challenge the law. The State of Virginia argued that the federal health care reform law conflicted with a state law that says no Virginia resident can be forced to buy health insurance. The court found that the only basis for the Virginia state law was “to declare Virginia’s opposition to the federal insurance mandate.” In the second case, the Fourth Circuit dismissed a challenge to the federal legislation’s constitutionality on the ground that the individual mandate was an improper tax on citizens. The court found that it did not have jurisdiction to rule on the case because federal law prohibits challenging a “tax” before it is collected. In this case, one dissenting judge wrote that jurisdiction did exist, but also stated that he would hold that the health care reform law was a constitutional exercise of Congress’ power under the Commerce Clause.

The Fourth Circuit is now the third federal Court of Appeals to rule on the constitutionality of health care reform. Previously, the U.S. Court of Appeals for the Sixth Circuit upheld the constitutionality of the individual mandate under health care reform, while the U.S. Court of Appeals for the Eleventh Circuit struck down the individual mandate requirements as being unconstitutional. There are several other lawsuits pending across the Country. These new decisions, along with the prior decisions from the Sixth and Eleventh Circuits, set the stage for the issue of the constitutionality of the individual mandate under health care reform to reach the Supreme Court of the United States, perhaps as early as its 2012 term.