COVID-19 Relief / Stimulus and New Health Care Requirements for Employers
On December 27, President Trump signed into law the Consolidated Appropriations Act, 2021. At almost 5,600 pages, the Act contains COVID-19 relief and stimulus as well as the most voluminous health care legislation since the Affordable Care Act, and more. See list and bulletins below for highlights of the provisions pertinent to employee benefits.
Families First Coronavirus Response Act (FFCRA) Paid Leave
(Optional; Note: Employers may be subject to state and local leave requirements.)
- No requirement to provide paid leave per the Emergency Paid Sick Leave Act (EPSLA) and Emergency Family and Medical Leave Expansion Act (EFMLA) for leave taken after December 31, 2020.
- Employer tax credits for qualifying leave will continue to be available for employers that offer EFMLA and EPSLA leave through March 31, 2021; subject to prior limitations.
- Employees will only be eligible for paid leave in 2021 for the unused portion of their original allotment that remains on January 1. For example, an employee who was entitled to 80 hours of EPSL between April 1 and December 31, 2020 and used 40 hours in 2020, would have only 40 hours left to use between January 1 and March 31, 2021.
- Guidance is needed to clarify whether certain employers must offer additional hours when an employee’s EFMLA bank could reset if the employer uses the calendar year or another fixed FMLA tracking period that starts before March 31 and the DOL fails to readopt the regulations they wrote related to EFMLA.
Flexible Spending Accounts (FSA)
(Optional and generally applies for plan years ending in 2020 and 2021. Note: Employer must communicate changes to employees and amend the cafeteria plan appropriately)
- Employees may carry over all unused amounts to the next plan year.
- An employer may extend the grace period to 12 months after the end of the plan year.
- Employees whose health FSA participation ends during the 2020 or 2021 plan year may continue to receive reimbursements from unused amounts through the end of the plan year and grace period, in which their participation ceased.
- A special carry forward rule can be implemented for dependent care FSAs where the dependent turned 13 years old during the pandemic. See bulletin below for more information including applicable plan years, which differ from the above-stated provisions. Eligibility may be extended for dependents from age 13 to age 14.
- Employees may prospectively change their FSA election without experiencing a qualifying change in status for plan years ending in 2021.
Surprise Medical Billing
(Required; many provisions apply for plan years beginning in 2022. Note: Generally, employers will be responsible for compliance for their self-insured health plans.)
- Health plans must cover out of network emergency services at in-network cost-sharing and without prior authorization, if coverage is available for emergency services in emergency department. This is similar to existing emergency services coverage requirements.
- Non-emergency services provided by out-of-network providers at a network facility, as well as, non-network air ambulance services, must be covered at in-network cost-sharing.
- Health plans and insurers will be subject to a new audit by HHS to confirm correct payment calculations. HHS will issue regulations to establish qualifying payment methodology and develop the audit program by July 1, 2021 and October 1, 2021 respectively.
- Prompt payment or denial notice must be provided for expenses for certain emergency services, out-of-network providers at a provider facility and air ambulance.
- Applicability of the surprise billing and air ambulance provisions will be decided via the existing external review process following an adverse benefit determination.
- Health plans and insurers must report air ambulance claims data.
- Health plans and insurers must provide an advance explanation of benefits (EOB) for scheduled services.
- Binding arbitration may be initiated by the plan or insurer for certain out-of-network claims.
- Health plans and insurers must develop and maintain a price comparison tool.
- Health plan ID cards must include deductible, out-of-pocket maximum and telephone number and website for consumer assistance information.
- Health plans and insurers must provide updated provider directories every 90 days and respond to participant questions about provider network status within one business day.
- Individuals undergoing certain treatment plans must be allowed to receive in-network coverage for 90 days if/when their provider leaves the network.
Other Patient Protections
- Health plans and insurers cannot bar disclosure of cost and quality information about a health care provider.
- Information on compliance with Mental Health Parity and Addiction Equity Act must be provided to government agencies and departments.
- Detailed pharmacy benefits and drug costs must be reported annually to government agencies and departments.
- Direct and indirect compensation to brokers must be disclosed at the time of contracting.
You should be in contact with insurers and TPAs who are currently processing the health plan requirements to develop a smooth and effective implementation plan, and you should work with your health plan clients on next steps for compliance with applicable provisions.
Other noteworthy employer provisions address the items listed below, which may require consultation with your tax, legal or financial advisor:
Several Unemployment Benefit programs related to the pandemic are extended and weekly benefits include up to an additional $300 through March 14, 2021.
Paycheck Protection Program and Emergency Injury Disaster Loans receive additional funding, and small businesses may qualify for related taxable income exclusions and business expense deductions.
Employee Retention Tax Credit is available until July 1, 2021 at an increased percentage of 70% (from 50%). Eligibility of qualifying employers is expanded, and the limit on qualifying wages per employee is $10,000 per quarter.
Voluntary Payroll Tax Deferral deadline is extended from April 30, 2021 to December 31, 2021.
Retirement Plan provisions provide various relief.
Employer Education Assistance allows employers to make qualified student loan payments by January 1, 2026 on a tax-free basis, up to $5,250.
Individual payments of $600 for people with incomes at or below $75,000 and $600 per dependent child; payments phase out for higher incomes.
If you have questions or need help, please contact one of our benefit consultants.
|Check out our COVID-19 Resource Center for more resources and information.|