New York and Wisconsin have recently joined the ranks of states mandating that group health insurance policies make coverage available to certain adult children of covered individuals. Typically, such state laws have an upper-age limit on which children must be offered coverage and include specific general eligibility conditions, for which exceptions may exist. A Wisconsin exception eliminates the upper-age limit for certain adult children returning from military service. These laws do not affect self-funded group health plans and cannot require an employer offering an insured group health plan to bear any of the cost of such mandated coverage if that coverage is not otherwise provided under the terms of the employer's group health plan. Such state mandates also have no impact on the definition of who is a tax dependent under the federal Internal Revenue Code. If such mandated coverage of an individual is requested under an employer's insured group health plan, it will be important to determine in advance what the obligations of the employer are with regard to premium payments, including obligations under any cafeteria plan providing for pretax payment of health insurance premiums; how the insurance company will determine and allocate the incremental cost of such mandated coverage; and what the income tax consequences are to the covered employee.
New interim final regulations are issued by the IRS, the DOL, and the U.S Department of Health and Human Services to implement provisions of the Genetic Information Nondiscrimination Act of 2008 (GINA). (Preamble to TD 9464; Treas. Reg. 54.9801-1 and -2; Treas. Reg. 54.9831-1; and Treas. Reg. 54.9802-3T) GINA prohibits discrimination based on genetic information in employment-based health coverage as well as individual market health insurance and Medicare supplemental coverage. In general, group health plans cannot:
- Set premiums on the basis of genetic information
- Request or require an individual to undergo a genetic test
- Request, require, or purchase genetic information for underwriting purposes or collect genetic information about an individual before the individual is enrolled or covered under the plan
The rules apply in plan years that begin after May 21, 2009. This means they apply for calendar-year plans on January 1, 2010. The interim final regulations are complex and include detailed explanations of how GINA applies to many pertinent Internal Revenue Code provisions.
The Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) is generally effective for plan years beginning after October 2, 2009, which means January 1, 2010 for calendar-year plans. (There is an alternative effective date for collectively bargained group health plans.) Plan sponsors need to review their plans for compliance with this complex law. MHPAEA extends the coverage of the Mental Health Parity Act of 1996 to include substance-use-disorder benefits. In addition, MHPAEA imposes several new requirements on group health plans that offer both medical/surgical benefits and mental health and/or substance-use-disorder benefits relating to certain financial requirements (deductibles, co-payments, coinsurance, and out-of-pocket expenses); treatment limitations; out-of-network providers; and the availability of plan information.