HHS recently issued its final ?Ç£Notice of Benefit and Payment Parameters for 2022?Ç¥ (the ?Ç£Notice?Ç¥), which includes the maximum annual limitations on cost-sharing that will apply to ?Ç£essential health benefits?Ç¥ in 2022 under non-grandfathered group health plans subject to the Affordable Care Act. For this purpose, cost-sharing generally includes deductibles, coinsurance, copayments, and other required expenditures that are qualified medical expenses with respect to essential health benefits available under the plan. The 2022 limitations are (i) $8,700 for self-only coverage and (ii) $17,400 for other than self-only coverage. The Notice is available here.
Federal agencies issued a new interim final rule that applies to group health plans that are subject to the Affordable Care Act (?Ç£ACA?Ç¥) and not grandfathered under the ACA. These plans are required to cover, without cost-sharing, qualifying coronavirus preventive services (including recommended COVID-19 immunizations) within 15 business days after the date the preventive service either (i) receives an A or B rating from the United States Preventive Services Task Force or (ii) has a recommendation from the Advisory Committee on Immunization Practices of the Centers for Disease Control and Prevention. Coverage must be provided for any qualifying coronavirus preventive service received in-network or out-of-network. If there is no negotiated rate between the plan and provider, the plan must pay the provider the prevailing market rate for such service. The new rules are effective upon being published in the Federal Register and apply until the end of the public health… Continue Reading
Boards and compensation committees will be reevaluating their incentive compensation arrangements in light of the COVID-19 pandemic and the resulting market uncertainty. Both long-term and short-term incentive plans can lose motivational and retention value if the performance goals are unachievable or if they do not align with market reality. Companies that have not yet established performance goals for their 2020 equity and bonus awards should carefully consider market conditions and shareholder perception before establishing goals, focusing on motivating their executives with pay for performance that aligns with shareholders?ÇÖ interests, while giving the company flexibility to navigate through uncharted territory. To the extent possible, companies should also consider delaying the issuance of incentive compensation awards until there is more stability in the business and in the financial markets. Companies that have already established goals for their 2020 awards (or that are evaluating the continued effectiveness of performance goals for prior year… Continue Reading
Under the Tax Cuts and Jobs Act of 2017 (the ?Ç£Act?Ç¥), Congress broadened the $1 million deduction limitation under Code Section 162(m) for a public company?ÇÖs top executives by, among other things, broadening the scope of who are ?Ç£covered employees?Ç¥ and by eliminating the performance-based compensation exception. Prior to the changes made by the Act, in order for compensation payable to a covered employee in excess of $1 million to be deductible under Code Section 162(m), the company?ÇÖs compensation committee had to certify that the performance goals were met following the end of the performance period and before any payouts were made. Any misstep would disqualify the compensation awards. Beginning in 2018, there is no particular tax benefit for companies to follow the certification procedures, as any compensation over $1 million will not be deductible if paid to a covered employee. Notwithstanding the foregoing, the Act grandfathered some incentive compensation… Continue Reading