With Open Enrollment season just around the corner, employers have been hoping for answers regarding the direction of health insurance under the Trump Administration. However, it’s looking like clarity is a long way off. Despite the lack of certainty, there are a handful of important issues employers should keep in mind:
Future of the Affordable Care Act
Although the Trump administration has been vocal regarding its intent to “repeal and replace” the Affordable Care Act (ACA), efforts to do so have been slow going. The House of Representatives narrowly passed the American Health Care Act on May 4, 2017, however, efforts to pass a similar bill in the Senate have hit major roadblocks.
Employers tracking the legislation under consideration in both houses will note the bills include efforts to:
- repeal the Employer Mandate, which would provide increased flexibility to employers to decide whether, and to whom, they will offer health coverage;
- raise Flexible Spending Account and Health Savings Account limits, which will encourage greater employee participation in consumer-driven benefit products; and
- delay the Cadillac Tax, providing a temporary reprieve to employers offering extremely generous health benefits.
Given the unlikelihood that Congress will reach agreement regarding the future of the ACA before employers introduce their 2018 plan design choices to employees, employers would be well-advised to continue to operate as if the ACA will remain in full effect in 2018.
Increased Enforcement Regarding Mental Health/Substance Use Disorder Benefits
For employers sponsoring group health plans that offer mental health and substance use disorder benefits, 2016 brought a dramatic increase in efforts by the Department of Labor, Department of Treasury, and Department of Health and Human Services to improve compliance with the Mental Health Parity and Addiction Equity Act (MHPAEA). Those efforts included:
- DOL investigations of 330 employer group health plans to identify MHPAEA non-compliance;
- encouraging employees to request information and documentation from their employers regarding their mental health and substance use disorder benefits using this Model Form
- passing the 21st Century Cures Act (Cures Act), which clarifies that eating disorders are mental health conditions subject to the MHPAEA, and calls for increased enforcement efforts to ensure compliance with MHPAEA.
In addition to the Cures Act formally identifying eating disorders as a mental health condition and calling for increased enforcement efforts under the MHPAEA, there has also been a recent uptick in private participant lawsuits against employers sponsoring group health plans concerning the coverage of mental health benefits in those plans, including benefits related to gender dysphoria and autism spectrum disorders.
In light of the new guidance and increased enforcement and litigation activity, employers should work with their employee benefit service providers leading up to Open Enrollment to review their group health plan designs and ensure they are in compliance with the MHPAEA parity and disclosure requirements.
Continued Uncertainty Regarding Wellness Programs
Over the last several years, employers sponsoring wellness programs have been forced to navigate complex, and at times contradictory, regulations imposed by a number of different agencies, as documented in our practice update here. These regulations involve the intersection of the Americans with Disabilities Act (ADA), the Genetic Information Nondiscrimination Act (GINA), the Health Insurance Portability and Accountability Act (HIPAA), and the ACA, and impose a number of notice, consent, and incentive limitations on employer wellness programs.
Compliance efforts undertaken by employers seemed to be in jeopardy as a result of a number of ongoing lawsuits challenging the validity of the regulations, particularly those filed in connection with the ADA and GINA. Most recently, a lawsuit was brought by the AARP claiming that its members will suffer irreparable harm because many of them will be unable to afford the premium increases permitted under the ADA and GINA wellness program regulations. However, earlier this year, the AARP lawsuit suffered a major setback when the court declined to enjoin the enactment of the ADA and GINA wellness program regulations.
Although new challenges to the wellness program regulations continue to arise, the recent AARP decision should serve as a clear signal to employers that are in the process of designing their 2018 wellness programs that the regulations are here to stay — at least for the time being.