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Court Finds Exclusion for Autism Treatments Violates the Mental Health Parity and Addiction Equity Act

In Doe v. United Behavioral Health, No. 4:19-CV-07316-YGR (N.D. Cal. Mar. 5, 2021) a federal district court in California recently considered a plaintiff’s claim that an exclusion from coverage for “applied behavior analysis” and “intensive behavioral therapies” (the “ABA/IBT Exclusion”) used to assist children with Autism Spectrum Disorder (“Autism”) violated the federal Mental Health Parity and Addiction Equity Act (the “Parity Act”). The plaintiff, as the representative of her minor son who was diagnosed with Autism, was covered under an employer-sponsored, self-funded group health plan subject to ERISA.  The court held that the ABA/IBT Exclusion violated the Parity Act for two reasons. First, the court found that the ABA/IBT Exclusion, on its face, created a separate treatment limitation applicable only to services for a mental health condition (in this case, Autism). Second, the court concluded that the ABA/IBT Exclusion constituted a more restrictive limitation for a mental health condition than… Continue Reading

Employee Benefits Regulations Potentially Impacted by the Biden Administration’s Regulatory Freeze

On January 20, 2021, the Biden Administration issued a memorandum (the “Memo”) announcing a regulatory freeze on regulations that have not taken effect as of the date of the Memo. Specifically, the Memo recommends postponing the effective date of any regulation that has been issued, but has not taken effect, for 60 days from the date of the Memo. The Memo further directs that regulations not yet published in the Federal Register be immediately withdrawn for review. Listed below are some of the proposed and final regulations related to employee benefits that may be subject to withdrawal or postponement under the Memo: Prohibited Transaction Exemption 2020-02 – Improving Investment Advice for Workers & Retirees. Final Rule. Application of the Employer Shared Responsibility Provisions and Certain Nondiscrimination Rules to Health Reimbursement Arrangements and Other Account-Based Group Health Plans Integrated with Individual Health Insurance Coverage or Medicare. Final Rule. Pension Benefit Statements-Lifetime… Continue Reading

Before Cleaning Out Files, Brush Up on Record Retention Requirements

Our world is filled with paper and electronic records, and the HR departments at most companies are no exception. Enrollment forms, notices, plan documents, summary plan descriptions, benefit statements, and service records are just a few of the records that fill the HR department’s file cabinets and computer storage. While it might be tempting to clean out files, plan sponsors should exercise care before disposing of any files relating to benefits under a plan. A clean desk today could create headaches tomorrow. Generally, ERISA requires an employer to retain plan records to support plan filings, including the annual Form 5500, for at least six years from the filing date (ERISA §107) and to maintain records for each employee sufficient to determine the benefits due or that may become due to such employee (ERISA §209), with no time limit on such requirement. In addition, HIPAA requires retention of the policies and… Continue Reading

Get Ready to Update HIPAA Privacy Policies Next Year

Last week, HHS issued a Notice of Proposed Rulemaking that proposes changes to the HIPAA Privacy Rule that will affect HIPAA privacy policies and procedures for employer group health plans.  The proposed revisions affect (i) an individual’s right to access “protected health information” (“PHI”), (ii) the content required in the Notice of Privacy Practices, and (iii) the ability to use and disclose PHI based on professional judgment, to avert a threat to health or safety, or for coordination of care and case management.  HHS proposed that compliance with the changes would be required within 180 days after the effective date of a final rule.  HHS has requested comments on the proposed changes within 60 days after their publication in the Federal Register, which publication should occur soon.  The Notice of Proposed Rulemaking is available here.

Updated Self-Compliance Tool for Mental Health and Substance Use Disorder Parity

The DOL released an updated tool to help employer-sponsored group health plans comply with the federal Mental Health Parity and Addiction Equity Act (“MHPAEA”). In general, the MHPAEA requires that financial requirements under a group health plan (such as copays) and treatment limitations (such as prior authorization) on mental health and substance use disorder benefits be comparable to, and applied no more stringently than, those that apply to medical and surgical benefits under the plan. The DOL last updated the tool in 2018. This updated version includes FAQs issued in 2019, additional compliance examples, best practices for establishing an internal compliance plan, and examples of plan provisions that may indicate a potential MHPAEA violation. In particular, the concept of the “internal compliance plan” is new, and although not required under the MHPAEA, the DOL’s goal for the internal compliance plan was to show how an internal compliance strategy can assist… Continue Reading

Regulations Provide for More Cost Transparency in Health Coverage

The federal Departments of Health and Human Services, Labor, and the Treasury (collectively, the “Departments”) have jointly issued final regulations that are intended to provide for more transparency in health coverage (the “Regulations”). The Regulations have important implications for employer sponsors of certain group health plans (“Plans”) and health insurers. The Regulations do not apply to health plans that are grandfathered under the Affordable Care Act, health reimbursement arrangements, certain other account-based group health plans, or short-term limited duration insurance. The Regulations require two key forms of disclosures (collectively, the “Disclosures”) in order to provide for this improved transparency: Self-Service Disclosure. First, the Regulations require Plans and insurers in the individual and group markets to disclose certain cost-sharing information upon request to a participant, beneficiary, or enrollee (or his or her authorized representative), including (a) an estimate of the individual’s cost-sharing liability for covered items or services furnished by a… Continue Reading

Additional Rules Issued Regarding Coverage of COVID-19 Preventive Care

Federal agencies issued a new interim final rule that applies to group health plans that are subject to the Affordable Care Act (“ACA”) 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

Employer Religious and Moral Exemptions to the Provision of Contraceptive Care Remain Intact

In a recent seven-to-two opinion in the case of Little Sisters of the Poor Saints Peter and Paul Home v. Pennsylvania, et al., the U.S. Supreme Court upheld the rights of certain employers to claim exemption from providing contraceptive care under the preventive care mandate of the Affordable Care Act (“ACA”) based on religious or moral objections. General Background of the Case The ACA requires covered employers to provide women with “preventive care and screenings” without any cost sharing requirements (the “Preventive Care Mandate”). The ACA relies on “preventive care guidelines” (“Guidelines”) supported by the Health Resources and Services Administration (“HRSA”), an agency of the federal Department of Health and Human Services, to determine what “preventive care and screenings” should include. The Guidelines mandate that health plans provide coverage for all FDA approved contraceptive methods. When the Departments of Health and Human Services, Labor, and the Treasury (collectively, the “Departments”)… Continue Reading

Additional Federal Guidance Regarding COVID-19 and Telehealth Coverage: Some Employer Take-Aways

The U.S. Departments of Labor, Treasury, and Health and Human Services (the “Departments”) recently issued FAQs regarding the Families First Coronavirus Response Act, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), and COVID-19. A number of these FAQs address a group health plan’s required coverage of COVID-19 tests, including which tests must be covered, related facility fees, reimbursement rates, and balance billing to patients. Employers should ensure that the third party administrators of their group health plans have incorporated this guidance for plan administration purposes. In addition, some of the other FAQs may be of interest to employers. For example, the FAQs provide that, if a group health plan reverses the increased coverage of COVID-19 or telehealth after the COVID-19 public health emergency period is over, the Departments will consider the plan to have satisfied the requirement to provide advance notice of changes to the Summary of Benefits… Continue Reading

Payments for Certain Healthcare Arrangements are Tax Deductible

The IRS recently issued proposed regulations that address the treatment of amounts paid by an individual for a “direct primary care arrangement” or a “health care sharing ministry” (collectively, the “Arrangements”) as being tax-deductible “medical care expenses” under Section 213 of the Internal Revenue Code (the “Code”). Under the proposed regulations, a direct primary care arrangement (“DPC Arrangement”) is defined as a contract between the individual and one or more primary care physicians pursuant to which the physician(s) agree to provide medical care for a fixed annual or periodic fee without billing a third party. A health care sharing ministry (“Sharing Ministry”) is defined as a tax-exempt organization under Section 501(c)(3) of the Code that meets specified requirements, including that its members share a common set of ethical or religious beliefs and share medical expenses in accordance with those beliefs. HSAs and the Arrangements. The preamble to the proposed regulations confirms… Continue Reading

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