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"COVID-19
Uncategorized

COVID-19 Changes to Health Plans Must Be Documented, Circulated

by Inoventive Solutions
July 1, 2020

A number of plan sponsors have made changes to their group health plans in response to the COVID-19 pandemic, such as covering testing and sometimes treatment without any cost-sharing by the plan enrollee.

But any changes that are made must be followed up by amending the plan and communicating the changes to the enrollees.

Under the Employee Retirement Income Security Act, all health plans are required to deliver a Summary Plan Description (SPD) to enrollees to inform them of the full spectrum of coverage and their rights under the plan.

Whenever a plan sponsor makes a material modification to the terms of the plan or the information required to be in an SPD, they must amend the plan and let participants know about the change through a Summary of Material Modification (SMM).

Material changes

To qualify as “material,” a change must be important to plan enrollees. Examples include adding or eliminating a benefit, changing insurance companies, or changing rules for dependent eligibility.

Plan changes related to the COVID-19 pandemic that would have to be included in the SMM and SPD could include:

  • Offering continuing coverage to staff who would otherwise lose coverage due to a furlough, layoff or reduction of hours.
  • Changing eligibility terms to allow workers who may not have been eligible for coverage before to secure coverage (this could include part-time workers).
  • Covering a larger portion of an employee’s premium share.
  • Adding an employee assistance program to provide counseling for workers who may be undergoing unusual stress.
  • Adding telemedicine coverage.
  • Using funds in health savings accounts (HSAs) and flexible spending accounts (FSAs) to purchase over-the-counter medications.
  • Covering COVID-19 testing with no cost-sharing. 
  • Covering COVID-19 treatment without cost-sharing.

Some of the above changes are required by new laws and health plans must respond accordingly by changing their SMMs and SPDs. For example, the Families First Coronavirus Response Act requires that group health insurance and individual health insurance plans cover coronavirus testing with zero cost-sharing.

And the Coronavirus Aid, Recover and Economic Stabilization Act reverses an Affordable Care Act rule that barred policyholders from using funds in HSAs and FSAs to pay for over-the-counter medications. 

When the plan sponsor adopts these changes, it must also amend its plan summaries.

And SMMs must be delivered to plan participants within 60 days after a change has been adopted. You can deliver the SMM by mail, e-mail or posting it on your company’s intranet site. It’s recommended at this time that you opt for e-mail delivery.

One of the issues that may come up with any changes implemented in response to the COVID-19 outbreak is that some of the changes may be temporary. 

If that’s the case, the plan needs to include the termination date of any benefits that are adopted on a temporary basis.

However, if you don’t know how long the temporary benefits will be in effect, their temporary nature must be communicated in the SMM. Employers need to issue another SMM when the temporary benefit or coverage term ends.

The takeaway

This is an unusual time and unusual times call for unusual measures. It’s unusual for changes to be made to a plan in the middle of a plan year but because of the way the pandemic crash-landed, many plan sponsors have had to make changes. 

That said, you should work with us and your carrier on ensuring that the amended documents are sent out to staff.

As the employer, you should be aware of all the changes that have been made in response to COVID-19 so you can discuss them with any employees that have concerns or questions.

Uncategorized

Pandemic Could Depress Health Care Costs

by Inoventive Solutions
June 18, 2020

A new study predicts that employer health care costs will be stable or could fall this year because medical care for people who are not infected with COVID-19 has actually declined precipitously during the pandemic, all of which would bode well for insurance rates.

Because of the fear of contagion, health care practitioners have expressed concern that people who have had mild heart attacks or strokes or other ailments have not gone to hospital for treatment.

Additionally, the number of elective surgeries has plummeted during the pandemic. In other words, deferred medical care is pushing down overall medical expenses borne by employers and group health plan insurers.

Several factors at play

There are other factors at play besides deferred medical care. Because people are also social distancing to protect against contracting COVID0-19, they are not contracting other communicable diseases like the cold and flu. 

Also, because of shelter-at-home orders, people are not involved in as many accidents, like vehicle crashes and sports injuries. Violent crime, shootings and stabbings have also plummeted, meaning fewer people are coming to the emergency room with serious or life-threatening injuries. 

“With treatment for COVID-19 top of mind, people have been putting off non-emergency medical care, including routine office visits and elective procedures at hospitals,” said Trevis Parson, chief actuary of Willis Towers Watson. “Given this reduction in use of medical services, we expect cost reductions due to care deferral to more than offset projected cost increases associated with COVID-19 infections.”

The WTW study notes that infection levels vary greatly from city to city and region to region. Less densely populated areas are faring better than large cities. It estimates overall health care costs this year based on various infection rates and how much medical care is deferred as follows:

  • In areas with a 1% infection level (rural areas) – Employer costs could decline between 1% and 4%.
  • In areas with a 15% infection level (large cities and surrounding areas) – Employer costs could rise or fall by roughly 1%.
  • In areas with a 20% infection level (large metropolises) – Employer costs could rise between 1% and 3%.

WTW noted that ultimately the financial impact on group health care plans will depend on how much the virus spreads and how severe the illness is in those people who are hospitalized. 

The estimates in the analysis only reflect increases to employer medical and pharmacy claim costs for this year. Other health care plan costs, such as dental and vision, will likely see lower costs in 2020, as employees will likely eliminate some discretionary care.

The analysis also does not consider other impacts, including non-health benefit costs (e.g., disability and life insurance), increased mortality and broad negative economic impact.

The study is an update to a WTW analysis released in late March that estimated employers could see health care benefit costs rise by 7% due to the pandemic.

At the time, WTW estimated that at a 10% infection level, benefit costs could rise by 1% to 3%, while a 30% infection level could see costs rise by 4% to 7%. At the highest rate included in the analysis, a 50% infection level, costs could rise between 5% and 7%.

Another study by ehealth.com backs up WTW’s findings. An earlier poll of health insurers found that COVID-19 will have little effect on 2021 health insurance product menus or premiums. In fact, 83% of insurers polled said they did not anticipate raising rates in 2021 as a result of the crisis. 

Although 17% of the insurers said they thought COVID-19 could lead to an increase in rates, none predicted COVID-19 would increase 2021 rates by more than 5%, according to the survey.

Other positives

The ehealth.com survey of 33 insurance companies also found the following:

  • 32 insurers said they are waiving deductibles and other out-of-pocket costs for testing.
  • 19 insurers said they are waiving out-of-pocket costs for COVID-19 treatment.
  • 32 insurers are seeing enrollees make more use of telemedicine services.
"health
Uncategorized

IRS Allows Mid-Year Changes to Health Plans, FSAs

by Inoventive Solutions
June 9, 2020

The IRS has loosened restrictions on employees who want to make changes to their group health plans and flexible spending accounts (FSAs) in the middle of the policy year.

IRS rules are typically stringent and rigid, barring changes from being made to health plans except during open enrollment. Under the new rules, the employer would still have to approve letting staff make changes to their plans if they have more than one option to choose from.

The IRS issued the new guidance after employer groups lobbied the agency and Congress to loosen the rules because the COVID-19 pandemic has led to profound changes in employees’ health care needs as well as access to childcare.

The new rules are temporary and apply only to 2020. All of the following mid-year changes must be approved by the employer;

Health plan changes: Employers can let employees make mid-year changes that would be in effect for the remainder of the year. The new guidance allows employees to:

  • Drop out of their health insurance if they have another option,
  • Sign up for insurance if they have not done so,
  • Add family members to their plan, or
  • Switch to a different health insurance plan.

Allowing these changes could be beneficial to employees who have had their salaries cut, or were furloughed, but were able to retain their health coverage. Someone in this position, for example, may decide to switch to a lower-cost health plan if they are unable to afford the premiums on their current plan. 

Flexible spending accounts: Employees must decide before the plan year starts how much to set aside every paycheck into their FSA, the funds of which can be used to pay for health care-related expenses. Under the new guidance, they are allowed to make changes to their contribution levels mid-year.

Employees that expect more medical expenses and are able to afford it, can elect to increase their FSA funding. But those who may have been setting aside funds for an elective surgery that they may want to postpone, can chose to decrease the amount they put into their FSA every month.

Carryover amount: Regulations governing FSAs require employees to use all of the funds in their FSA in a given year or lose it. There are two exceptions: Employers can give employees a two-and-a-half-month grace period after the end of the plan year to spend remaining funds that are in the account at the end of the year, or they can let workers carry over up to $500 from one year to the next.

Starting this year, the carryover limit will be set at 20% of the maximum health care FSA contribution limit, which is indexed to inflation. That means that for 2020, employers can let employees carry over up to $550 into 2021.

The takeaway

While allowing your employees to make changes can help them better budget their health care spending, making the change will result in extra administrative expenses for you. Changing plans mid-year, signing up employees for new plans and adding dependents can involve a significant amount of paperwork and documentation.

That said, allowing employees to make these changes mid-year could help them better budget their health care spending and give them some extra peace of mind.

""/
Uncategorized

What COVID-19 Services Your Health Plan May Cover

by Inoventive Solutions
May 27, 2020

Under two new laws new laws that took effect in March, all health plans must cover testing, preventative services and vaccines for COVID-19 without cost-sharing.

The Families First Coronavirus Response Act requires that group health insurance and individual health insurance plans cover coronavirus testing with zero cost-sharing. This includes deductibles, copayments and coinsurance for items and services provided during a provider visit, whether it is in-person, telehealth-enabled, at an urgent care center, or in an emergency room.

It also waives prior authorization and other “medical management requirements.”

That law was followed up 10 days later by the CARES Act, which requires group plans and individual market plans to cover preventative services and vaccines for COVID-19 without cost-sharing. The coverage applies both to the test itself and to the visit in which the test was administered.

Unfortunately, neither law requires that health plans cover COVID-19 treatment, which would include medication and in-hospital services if you or a member of your family needed to be hospitalized.

Telehealth services

The CARES Act greatly expands the availability of telehealth services beyond diagnosis and treatment for COVID-19 in order to expand access to care. 

As part of the law, the Federal Communications Commission will receive $200 million to provide telecommunications and information services and devices.

Also, restrictions on health savings accounts have been waived to allow high-deductible health plans to cover telehealth services without a deductible. 

The CARES Act also removes the existing requirement that a Medicare beneficiary have a pre-existing patient/provider relationship in order to be treated through telehealth.

The new law also authorizes federally qualified health centers and rural health clinics to be sites for telehealth consultations, and it enhances payments for such telehealth services provided during the emergency period.

The mandate that a number of Medicare services require face-to-face meetings (such as home dialysis patients, home health, and hospice care) has been waived for the duration of the outbreak. The CARES Act also appropriates $25 million for telemedicine and distance learning in rural areas. 

Beware of treatment costs

While most private health plans likely cover most items and services needed to treat complications due to COVID-19, there is no clear federal requirement to do so.

The essential health benefits standard under the ACA defines categories of services to be covered, but it is left to states to designate “benchmark” policies that define specific covered services.

As a result, coverage for at least some services needed to treat COVID-19 ― such as home-delivered care, telemedicine visits, or respiratory therapy visits ― are likely to vary under health insurance plans that are subject to the essential health benefits standard.

Nearly all private health plans use networks of participating hospitals, doctors, laboratories and other providers.

One issue that health plan enrollees have to watch out for is going out of network for coronavirus testing or care.

HMOs, for example, could deny claims for out-of-network services, other than emergency services. Under PPO plans that provide some coverage for out-of-network care, patients can face higher cost-sharing (e.g., patients might be required to pay 20% coinsurance for in-network claims and 50% coinsurance for out-of-network claims.)

In addition, out-of-network care exposes patients to “balance billing,” or the difference between the provider’s undiscounted charge and the amount the health plan considers reasonable. If you are seeking care, make sure you are going to an in-network provider to avoid any undue surprises.

"Covid
Uncategorized

10 Potential Causes of Employee COVID-19 Lawsuits

by Inoventive Solutions
May 12, 2020

The novel coronavirus that broke out in the winter has caused immeasurable suffering, both physical and economic.

For employers struggling to stay in business, this is a fraught time where mistakes in managing their workforces could lead to employee lawsuits. Here are 10 potential trouble spots to watch for.

Workplace safety – Businesses that still have employees working on-site run the risk that a single infected worker may send the virus ripping through the entire workforce.

While workers’ compensation laws may prevent employees from suing, their family members who become ill or suffer through a worker’s illness face no such constraints.

Sick time and paid leave – Congress enacted the Families First Coronavirus Response Act in March, guaranteeing full-time employees of small businesses 80 hours of sick leave (part-timers get a prorated amount.)

State and local laws may entitle workers to additional leave. Mistakes in administering these benefits could prompt lawsuits.

Workplace discrimination – Because the coronavirus originated in China, there have been reports of Asian-Americans being targets of racist actions. Employers must take care to avoid the appearance of making workplace decisions based even partly on employees’ race. 

Americans with Disabilities Act – The ADA prohibits discrimination against disabled individuals and requires employers to make reasonable accommodations for these workers.

Employees who become ill from COVID-19 (the illness caused by the virus) may suffer after-effects that include trouble breathing, speaking and working at their former pace. Employers must accommodate these workers to the extent that is practical.

Wage and hour violations – Non-exempt employees working remotely may be working more than their regular hours, missing rest and meal breaks, and using their own equipment.

Employers must keep careful records, reimburse employees for their use of personal equipment where warranted, and remind employees to take mandatory breaks.

Battered retirement plans – Stock markets have cratered since the beginning of the year, taking retirement account balances down with them.

Questions may be asked about whether fund managers did enough to limit the damage. Employees who are not satisfied with the answers may go to court. 

Health information privacy – Employee health information privacy is protected by law. Employers must secure the records of infected employees from unauthorized access by individuals within and outside the company.

Union contracts – Collective bargaining agreements may contain provisions that go beyond federal requirements for breaks, paid leave, layoff notices, and workplace safety.

Employers must keep their CBAs in mind and work with their unions to avoid contract violations.

Disparate impact from layoffs – If layoffs are necessary, employers must take a thoughtful approach when deciding which employees to part company with.

An appearance of singling out older workers or other protected classes under discrimination laws could invite lawsuits.

WARN Act – The Workers Adjustment and Retraining Notification Act requires some employers to provide at least 60 days’ notice before layoffs. Many businesses’ revenues fell off the cliff so quickly that they were unable to provide that much notice.

A final thought

The pandemic is a crisis that few businesses foresaw. The effects, including the litigation, may haunt them for a long time to come.

"health
Uncategorized

COVID-19 Changes to Health Plans Must Be Documented, Circulated

by Inoventive Solutions
May 6, 2020

A number of plan sponsors have made changes to their group health plans in response to the COVID-19 pandemic, such as covering testing and sometimes treatment without any cost-sharing by the plan enrollee.

But any changes that are made must be followed up by amending the plan and communicating the changes to the enrollees.

Under the Employee Retirement Income Security Act, all health plans are required to deliver a Summary Plan Description (SPD) to enrollees to inform them of the full spectrum of coverage and their rights under the plan.

Whenever a plan sponsor makes a material modification to the terms of the plan or the information required to be in an SPD, they must amend the plan and let participants know about the change through a Summary of Material Modification (SMM).

Material changes

To qualify as “material,” a change must be important to plan enrollees. Examples include adding or eliminating a benefit, changing insurance companies, or changing rules for dependent eligibility.

Plan changes related to the COVID-19 pandemic that would have to be included in the SMM and SPD could include:

  • Offering continuing coverage to staff who would otherwise lose coverage due to a furlough, layoff or reduction of hours.
  • Changing eligibility terms to allow workers who may not have been eligible for coverage before to secure coverage (this could include part-time workers).
  • Covering a larger portion of an employee’s premium share.
  • Adding an employee assistance program to provide counseling for workers who may be undergoing unusual stress.
  • Adding telemedicine coverage.
  • Using funds in health savings accounts (HSAs) and flexible spending accounts (FSAs) to purchase over-the-counter medications.
  • Covering COVID-19 testing with no cost-sharing. 
  • Covering COVID-19 treatment without cost-sharing.

Some of the above changes are required by new laws and health plans must respond accordingly by changing their SMMs and SPDs. For example, the Families First Coronavirus Response Act requires that group health insurance and individual health insurance plans cover coronavirus testing with zero cost-sharing.

And the Coronavirus Aid, Recover and Economic Stabilization Act reverses an Affordable Care Act rule that barred policyholders from using funds in HSAs and FSAs to pay for over-the-counter medications. 

When the plan sponsor adopts these changes, it must also amend its plan summaries.

And SMMs must be delivered to plan participants within 60 days after a change has been adopted. You can deliver the SMM by mail, e-mail or posting it on your company’s intranet site. It’s recommended at this time that you opt for e-mail delivery.

One of the issues that may come up with any changes implemented in response to the COVID-19 outbreak is that some of the changes may be temporary. 

If that’s the case, the plan needs to include the termination date of any benefits that are adopted on a temporary basis.

However, if you don’t know how long the temporary benefits will be in effect, their temporary nature must be communicated in the SMM. Employers need to issue another SMM when the temporary benefit or coverage term ends.

The takeaway

This is an unusual time and unusual times call for unusual measures. It’s unusual for changes to be made to a plan in the middle of a plan year but because of the way the pandemic crash-landed, many plan sponsors have had to make changes. 

That said, you should work with us and your carrier on ensuring that the amended documents are sent out to staff.

As the employer, you should be aware of all the changes that have been made in response to COVID-19 so you can discuss them with any employees that have concerns or questions.

"Medicare
Uncategorized

Medicare Advantage, Part D Plans Get COVID-19 Leeway

by Inoventive Solutions
April 28, 2020

The Centers for Medicare and Medicaid Services has issued new guidance regarding how Medicare Advantage and Part D plans can respond to enrollees affected by the coronavirus outbreak.

Under the guidance, the plans are authorized, but not required to waive out-of-pocket costs for testing, treatment and other services related to the coronavirus.

The rules come on the heels of many of the country’s largest insurance companies announcing that they would be treating at least COVID-19 testing as covered benefits and would waive cost-sharing for tests.

The CMS made the announcement in light of the fact that COVID-19, which is caused by the coronavirus, has the most severe effects on the elderly population, as well as people with pre-existing health conditions like heart disease, cancer, diabetes and compromised immune systems. 

“Medicare beneficiaries are at the greatest risk of serious illness due to COVID-19 and CMS will continue doing everything in our power to protect them,” CMS Administrator Seema Verma said in a prepared statement. She added that the new guidance was aimed removing “barriers that could prevent or delay beneficiaries from receiving care.”

In the new COVID-19 guidance Medicare Advantage and Part D plans can:

  • Waive cost-sharing for testing.
  • Waive treatment cost-sharing, including primary care, emergency department, and telehealth services.
  • Eliminate prior authorizations for treatment.
  • Eliminate prescription refill restrictions.
  • Decrease limitations around home or mail prescription delivery.
  • Increase patient access to telehealth care.

These waivers are aimed at breaking down barriers to accessing care and allow plans to work with pharmacies and providers to treat patients.

Medicare Advantage rule changes

Under the new guidance, if a state of emergency is declared in your state, Medicare Advantage insurers are required to:

  • Cover Medicare Parts A and B services and supplemental Part C plan benefits furnished at non-contracted facilities, as long as they have participation agreements with Medicare.
  • Provide the same cost-sharing for enrollees at non-plan facilities as if the service or benefit had been furnished at a plan-contracted facility.
  • Make changes that benefit the enrollee effective immediately without the typical 30-day notification requirement (such as changes like reductions in cost-sharing and waiving prior authorizations).

The CMS said it would continue toexercise its enforcement discretion regarding the administration of Medicare Advantage plans’ benefit packages in light of the new emergency guidance.

Part D changes

Under the new rules:

  • Part D insurers may relax their “refill-too-soon” rules if circumstances are reasonably expected to result in a disruption in access to drugs. The rules may vary, as long as they provide access to Part D drugs at the point of sale. Part D sponsors may also allow an affected enrollee to obtain the maximum extended day supply available under their plan, if requested and available.
  • Part D insurers must ensure enrollees have adequate access to covered Part D drugs if they have to get their prescription filled at an out-of-network pharmacy in cases when those enrollees cannot reasonably be expected to obtain covered Part D drugs at a network pharmacy.
    Plan cost-sharing levels would still apply and enrollees could be responsible for additional charges (i.e., the out-of-network pharmacy’s usual and customary charge), if any, that exceed the plan allowance.
  • If enrollees are prohibited by a mandatory quarantine from going to a pharmacy to pick up their medications, Part D insurers can relax any plan-imposed rules that may discourage mail or home delivery, for retail pharmacies that choose to offer these delivery services in these instances.
  • Part D insurers may choose to waive prior authorization requirements at any time that they otherwise would apply to Part D drugs used to treat or prevent COVID-19, if or when such drugs are identified. Any such waiver must be uniformly provided to similarly situated enrollees who are affected by the disaster or emergency.

The takeaway

With these new rules and guidelines in place, if you are a Medicare recipient, this news should give you comfort as it should mean reduced costs and access to care and medicine as the outbreak continues.

If you are concerned about coverage, you can contact your Medicare Advantage plan to confirm that it has made the necessary changes to ease the burden on policyholders during the coronavirus crisis.

"telecommuting"/
Uncategorized

Tips for Successful Telecommuting During Outbreak

by Inoventive Solutions
April 21, 2020

As the coronavirus spread ramps up and more people are being asked to self-isolate, many employers are scrambling to put systems in place to allow their employees to telecommute. 

Many companies are not set up for telecommuting arrangements, and they have legitimate concerns about productivity, communications ― and even the possibility of workers’ comp claims stemming from home hazards that may not be typical in the workplace.

But there are steps you can take to make sure that you keep your employees engaged and on task.

1. Make sure they have the right technology

If you don’t already have one, you may want to consider setting up a company VPN so your employees can access their company e-mail and databases. Any employee working from home should also be provided with a company laptop and make sure that they have an internet connection that is fast enough to handle their workload. 

Also provide an infrastructure for them to be able to work together on files. If they are not sensitive company documents, they can use Dropbox or Google Documents.

These services allow multiple editors to view and update documents simultaneously, from remote locations. This ability to check up on your employees’ work helps keep them honest. Plus, a centralized online location for shared work files minimizes the likelihood that important files will be accidentally lost or deleted.

2. Provide clear instructions

It’s extremely important that you provide clear instructions to remote workers. Some people do not perform well without direct oversight and human interaction. Without that factor, you will need to spell out your expectations and the parameters of the project they are working on in detail.

Make it clear that if they are confused or unsure about any part of the work, they should contact a supervisor for clarification. If you can eliminate misunderstandings, then your workers can be more efficient.

3. Schedule regular check-ins

To hold your employees accountable for being on the clock, schedule calls or virtual meetings at regular intervals. Even regular instant messaging works. Use these meetings to allow them to update their superiors on their work. This also helps with productivity, since there are consequences for failing to meet expectations and showing up to the meeting empty-handed.

Their supervisors should be working when they are, so they can be in regular communication. If your employees know when their supervisors are working, and vice versa, then you also create a collaborative environment where they can ask and answer questions and provide input.

4. Keep employees engaged, feeling part of the team

One of the hardest parts of working from home is the feelings of isolation and detachment from colleagues. It’s important that you build an interactive time for your workers.

One way to do that is by using a chat program like Slack, Hangouts or WhatsApp (which has a group chat function). For remote workers, these programs are a blessing because they make it easy to keep in touch with their colleagues in and out of the office ― and they level the playing field, so to speak, by making distance a non-issue. 

You can also encourage your staff to collaborate and use Skype, Facetime or Google Hangouts to video chat. Using video services creates a distinctly more intimate and real-feeling work environment for both parties.

5. Cyber protection

With more employees working from home, you also increase your cyber risk exposure, especially if they are using a company computer that is tapped into your firm’s database or cloud.

You should impress upon your employees the need to follow cyber protection best practices, such as:

  • Not clicking on suspicious links in e-mails from unknown senders.
  • Making sure that their systems have the latest security updates and patches.
  • Backing up their data daily.
  • Training them on phishing, ransomware and malware scams, especially new ones that try to take advantage of people’s fears about COVID-19.

The takeaway

If you’ve not had staff telecommuting in the past or are asking many employees who never have worked in that way to telecommute, there will be some growing pains as you work out the kinks. 

But if you follow the above tips, it will make the transition easier and less painful for your workers, their managers and the organization as a whole.

"coronavirus
Uncategorized

IRS Allows HDHPs to Pay for COVID-19 Testing, Treatment Pre-Deductible

by Inoventive Solutions
April 13, 2020

The IRS has issued new emergency guidance that allows insurers to waive the cost of coronavirus testing and treatment for individuals who are enrolled in high-deductible health plans (HDHPs).

Major health insurers report they’ve been concerned that if they can make the change to their high-deductible plans without breaching IRS regulations regarding such plans. 

Specifically, the new guidance states that HDHPs will not lose their plan status if they provide medical care services and items related to coronavirus testing or treatment even before an enrollee has met their deductible.

While the regulation does not require HDHPs to cover the testing and treatment without any out-of-pocket expenses by the enrollee, the plans can do so ― and without breaching the rules regarding these plans.

The new rule could also pave the way for non-HDHPs like PPOs and HMOs to also provide coronavirus testing without out-of-pocket costs for their participants. While there is no rule preventing them from doing so now, many of the country’s large PPOs and HMOs have been reluctant to start offering free testing until they know how HSA plans would be affected.

Typically, enrollees in HDHPs with an attached HSA are required to pay all of their medicinal costs up to their deductible before the insurer will pay. The Trump administration earlier issued another rule that allows HDHPs to foot the bill for certain preventative health services, such as vaccines and screenings for specific conditions like diabetes and high blood pressure before the deductible is met.

In notice 2020-15, the IRS says that “Due to the unprecedented public health emergency posed by COVID-19, and the need to eliminate potential administrative and financial barriers to testing for and treatment of COVID-19, a health plan that otherwise satisfies the requirements to be an HDHP under section 223(c)(2)(A) will not fail to be an HDHP merely because the health plan provides medical care services and items purchased related to testing for and treatment of COVID-19 prior to the satisfaction of the applicable minimum deductible.”

The notice only applies to coronavirus and does not void any other requirements governing HDHPs and HSAs. It states that “Individuals participating in HDHPs or any other type of health plan should consult their particular health plan regarding the health benefits for testing and treatment of COVID-19 provided by the plan, including the potential application of any deductible or cost-sharing.”

"closed
Uncategorized

CARES Act Helps Coronavirus-affected Employers, Employees Alike

by Inoventive Solutions
April 7, 2020

The $2 trillion Coronavirus Aid, Relief, and Economic Security (CARES) Act stimulus law to help American workers and businesses weather the outbreak has a number of provisions that employers and their workers need to know about and can take advantage of during this crisis.

The CARES Act includes provision for:

  • Extended unemployment benefits.
  • Requiring health plans to cover COVID-19-related costs.
  • Small Business Administration (SBA) disaster loans.
  • Loans for large corporations.

Parts of the CARES Act will likely benefit your organization and employees in some way. Here’s what you need to know:

Extended unemployment

The CARES Act extends unemployment insurance benefits to workers, as long as they lost their jobs due to the outbreak.

Unemployment benefits under the CARES Act also apply to furloughed employees.

Depending on your state, workers will be able to collect both state unemployment and federal unemployment through the CARES Act, which was designed to augment any unemployment benefits workers may receive in your state.

The Pandemic Emergency Compensation program funded by the CARES Act will provide an additional $600 per week on top of state unemployment benefits, through July 31. 

The law extends state-level unemployment by an additional 13 weeks. For example, whereas most of California’s unemployment benefits last 26 weeks, the bill extends state benefits to 39 weeks. The extended benefits will last through Dec. 31.

Health plan changes

Under the CARES Act, employer-sponsored group health plans must provide for covered workers – without cost-sharing or out-of-pocket expenses – the cost of COVID-19 testing, treatment and vaccinations when and if they become available.

SBA loans

In response to the Coronavirus (COVID-19) pandemic, small business owners are eligible to apply for an Economic Injury Disaster Loan advance of up to $10,000.

This advance will provide economic relief to businesses that are currently experiencing a temporary loss of revenue. Funds will be made available following a successful application. This loan advance will not have to be repaid.

This program is for any small business with fewer than 500 employees (including sole proprietorships, independent contractors and self-employed persons) as well as private non-profit organization affected by COVID-19.

And the law’s The Paycheck Protection Program offers 1% interest loans to businesses with fewer than 500 workers.

Borrowers who don’t lay off workers in the next eight weeks will have their loans forgiven, along with the interest.

These loans are designed to provide a direct incentive for small businesses to keep their workers on the payroll. If small businesses maintain payroll through this economic crisis, some of the borrowed money via the PPP can be forgiven – the funds will be available through June 30. Act fast.

Mid-sized employers

Under the CARES Act, the Secretary of the Treasury is authorized to implement financial assistance programs which specifically target mid-size employers with between 500 and 10,000 employees.

Loans would not have an annualized interest rate higher than 2% and principal and interest will not be due and payable for at least six months after the loan is made. But unlike loans under the PPP, these are not forgivable.

Large employers

The CARES Act provides $500 billion to the Treasury Department’s Exchange Stabilization Fund for loans and other funding for large companies and corporations affected by the outbreak.

  • $454 billion is set aside for loans, loan guarantees.
  • Companies that receive funds are prohibited from using them for stock buybacks.
  • Loans include terms limiting employee compensation and severance pay.

Like loans for mid-sized employers, they are not forgivable.

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