Category: Client Alerts

Final HHS Rule on Section 1557 Leaves Questions for Self-Funded Plans

4 minute read Section 1557 of the Affordable Care Act (ACA) prohibits discrimination on the basis of race, color, national origin, sex, age, or disability by health programs and activities funded or administered by the Department of Health and Human Services (HHS). In the context of health and welfare plans this means that section 1557 generally applies to healthcare providers and insurance carriers who process payments from Medicare or Medicaid...
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The Crucial Role of Comparative Analyses Under the Mental Health Parity Proposed Rule and Technical Guidance

10 minute read On July 25, 2023, the agencies released an extensive proposed rule related to the Mental Health Parity and Addiction Equity Act (the “Proposed Rule”) as well as a Technical Release requesting comments on certain proposed data requirements for nonquantitative treatment limitations (“NQTLs”) and the potential for an enforcement safe harbor if certain data requirements are met. The Proposed Rule clarifies and solidifies...
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IRS Adjusts Health Flexible Spending Account and Other Benefit Limits for 2024

4 minute read On November 9, 2023, the Internal Revenue Service (IRS) released Revenue Procedure 2023-34, which increases the health flexible spending account (FSA) salary reduction contribution limit to $3,200 for plan years beginning in 2024, an increase of $150 from 2023. Thus, for health FSAs with a carryover feature, the maximum carryover amount is $640 (20% of the $3,200 salary reduction limit) for plan years beginning in 2024. Of course,...
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IRS Releases PCORI Fee For Plan Years Ending Before October 1, 2024

3 minute read The IRS has released Notice 2023-70, which sets the applicable PCORI fee for plan years ending between October 1, 2023, and September 30, 2024, at $3.22 per covered life. As a reminder, the PCORI was established as part of the Affordable Care Act (ACA) to conduct research to evaluate the effectiveness of medical treatments, procedures, and strategies that treat, manage, diagnose, or prevent illness or injury. Under the ACA, most...
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Agencies Issue Additional FAQs Regarding the Transparency in Coverage Final Rules

5 minute read On September 27, 2023, the DOL, IRS, and HHS released FAQs About Affordable Care Act Implementation Part 61 (“FAQ Part 61”) which addresses lingering questions about enforcement of the Transparency in Coverage Final Rules (TiC Final Rules), specifically the provisions of the TiC final rules requiring plans and carriers to post machine-readable files for in-network negotiated rates and historical net prices for all covered...
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Tenth Circuit Court of Appeals Hands Down a Big Win for ERISA Preemption

3 minute read After several failed attempts by pharmacy benefit managers (“PBM”) to challenge state laws regulating PBMs, the 10th Circuit Court of Appeals (in Pharmaceutical Care Management Association v. Mulready) handed down a big win for PBMs and, by extension, self-funded ERISA plans, when it held that provisions under an Oklahoma insurance law that established strict network adequacy standards and over-broad “any willing provider”...
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IRS Issues Affordability Percentage Adjustment for 2024

3 minute read The Internal Revenue Service (IRS) has released Rev. Proc. 2023-29, which contains the inflation-adjusted amounts for 2024 used to determine whether employer-sponsored coverage is “affordable” for purposes of the Affordable Care Act’s (ACA) employer-shared responsibility provisions and premium tax credit program. As shown in the table below, for plan years beginning in 2024, the affordability percentage for employer mandate...
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Agencies Release Proposed Regulations on Fixed Indemnity Insurance, Seek Comments on Level Funded Plans

8 minute read On July 12, 2023, the IRS, DOL and HHS (collectively, “the Agencies”) released proposed regulations that modify the conditions for hospital indemnity and other fixed indemnity insurance to be considered an “excepted benefit.” Maintaining “excepted benefit” status is important for fixed indemnity plans, as it exempts them from having to comply with the ACA’s insurance mandates and market reforms, which is not feasible...
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FICA Reduction Redux – IRS Issues Guidance on Wellness Indemnity Payments

5 minute read On June 9, 2023, the IRS released OCC Memo 202323006, which advises that wellness indemnity payments under a fixed indemnity insurance policy are wages for purposes of Federal Insurance Contributions Act (FICA) taxes, Federal Unemployment Tax Act (FUTA) taxes, and federal income tax withholding (FITW) (collectively, “employment taxes”) if the employee has no unreimbursed medical expenses related to the payment. The memo,...
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REMINDER: PCORI Fees Due By July 31, 2023

5 minute read Employers that sponsor self-insured group health plans, including health reimbursement arrangements (HRAs) should keep in mind the upcoming July 31, 2023 deadline for paying fees that fund the Patient-Centered Outcomes Research Institute (PCORI) via Form 720, which was recently updated and released by the IRS. As background, the PCORI was established as part of the Affordable Care Act (ACA) to conduct research to evaluate the...
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