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Health Insurance Considerations for Workers Who Move Out of State

One fallout from the COVID-19 pandemic has been an increase in the number of Americans who are working from home permanently.

With so many people being freed from the yokes of the office, many have chosen to move to other states for a variety of lifestyle or cost reasons. But while these arrangements can be a boon for workers, they can make it difficult when it comes to your workers’ group health insurance.

One of the main stumbling blocks is that most group plans are local or regional at best, as they contract with providers and hospitals in the area where an employer is located.

For employers that suddenly have staff now working far afield from their headquarters, securing health insurance coverage in other states can create headaches, particularly if they have contracted with a local or regional insurer.

And to make matters worse, some employees who are working remotely don’t bother telling their employers they are moving, which can render their coverage obsolete if they locate to a place out of their insurance policy’s coverage area.

Remote employees who fail to inform their employers when they relocate could suddenly find themselves in an area with no access to their insurer’s preferred network and they could have their claims denied if they seek out medical care. To avoid this issue, consider instituting a policy that they have to inform you of any move to another state.

What you can do

If all of your staff are working in a single location, city or state, there are usually plenty of options for group health insurance. But if you now have people working out of state, you have choices to make for how to get them covered.

Many national insurance companies don’t have the same type of network in every state, and even among those that do, health care providers may not offer the most cost-efficient networks for out-of-state employees.

Some carriers offer national group health plans that are available to employees in most states. If you now find yourself with employees who are scattered around the country, a national plan helps you avoid having to comply with different state regulations and finding carriers with good networks in other states.

In these types of plans, all of the employees in your organization receive the same group benefits regardless of where they live and work, and they all have access to the same quality coverage.

But there are just a handful of carriers that offer this type of group coverage. Talk to us if you want to know more.

One option is to find local coverage for employees in specific locations, but if you don’t have many employees in that region, you may not be able to find preferable rates for their group coverage.

If that is too difficult, you can set up a taxable stipend that your employees could use to purchase their own health insurance. A stipend is a fixed amount of money paid to an employee in addition to their basic salary, designed to cover whatever extra costs the employer allows, such as health insurance, internet and other expenses.

The takeaway

As more U.S. companies have workforces spread across many states, health insurance needs to be on the top of the list of considerations.

The health insurance you choose will depend largely on your budget and coverage preferences, and what is available to your staff in the state they are working in.

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Long-Haul COVID Can Be Covered Under ADA

The Equal Employment Opportunity Commission has issued guidance stating that employees suffering from “long COVID-19” may be protected under workplace disability discrimination statutes.

The guidance states that someone suffering from impairments resulting from long-haul COVID-19 symptoms can be considered “disabled” under the Americans with Disabilities Act and entitled to the same treatment as other disabled workers. But not in every case.

The EEOC emphasized that long-haul COVID symptoms can vary greatly from person to person and that eligibility would have to be determined on a case-by-case basis.

Employers should read the guidance, posted on the EEOC’s website on Dec. 14, to ensure they stay on the right side of the law if they are confronted with a worker who is battling COVID-19 symptoms for more than a few weeks and they ask for special accommodation under the ADA.

According to the guidance, a person infected with COVID-19 who is asymptomatic “or who has mild symptoms similar to those of the common cold or flu that resolve in a matter of weeks — with no other consequences — will not have an actual disability within the meaning of the ADA.”

But for those who have COVID-19 symptoms lasting more than a few weeks, and depending on their specific symptoms, a worker may have a “disability” if the illness is affecting them in any of the following ways:

Physical or mental impairment — The EEOC states that COVID-19 is a physiological condition affecting one or more body systems, which would be considered a disability under the ADA.

Substantially limiting a major life activity — “Major life activities” include both major bodily functions, such as respiratory, lung or heart function, and major activities, such as walking or concentrating. COVID-19 has been known to cause these issues. An impairment need only substantially limit one major bodily function or other major life activity to be substantially limiting.

Examples of COVID-19 cases that may be considered a disability under the ADA include:

  • An employee who experiences ongoing but intermittent multiple-day headaches, dizziness, brain fog and difficulty remembering or concentrating, which their doctor attributes to the coronavirus.
  • Someone who received supplemental oxygen for breathing difficulties during initial stages of treatment and continues to have shortness of breath, associated fatigue and other virus-related effects that last for several months.
  • Someone with heart palpitations, chest pain, shortness of breath and related effects due to the virus that last for several months.

What to do

As a result of this guidance, an employee experiencing long-haul COVID with symptoms that could be considered a disability may ask for reasonable accommodation for work. To determine if the employee is eligible, the employer and the employee must enter into an interactive process.

The employer can ask the worker to provide backup documentation about their disability or need for reasonable accommodation, such as notes from doctors outlining restrictions. The employer can also request that the employee sign a limited release allowing the employer to contact the employee’s health care provider directly.

If the worker doesn’t cooperate in providing the information, the employer can deny the accommodation request.

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Health Plans Dropping Out-of-Pocket Cost Waivers for COVID-19 Treatment

As the light at the end of the pandemic tunnel gets brighter, more health insurers are ceasing to offer cost-sharing waivers for COVID-19 treatment.

After legislation was enacted in 2020 that required health insurance companies to cover COVID-19 tests and vaccines, many insurers voluntarily waived all deductibles, copayments and other costs for insured patients who fell ill with COVID-19 and needed hospital care, doctor visits, medications or other treatment.

Not all health insurers extended these waivers to their enrollees, but many did.

Insurers are still required to provide free COVID-19 testing and vaccinations to their enrollees. That’s because federal guidance requires them to waive such costs.

Also, guidance issued in February after President Joe Biden assumed office, reinforced the Trump administration rule about waiving cost-sharing for testing. Biden’s guidance took an extra step, saying that it applies even in situations in which an asymptomatic person wants a test before traveling or seeing a relative.

Almost 90% of individual and group health plans enrollees were in plans that waived cost-sharing for COVID-19 treatment, according to the Peterson-KFF Health System Tracker.

What insurers are now doing

However, starting in late 2020, more and more insurers have quietly been dropping those waivers. For example:

  • UnitedHealthcare started curtailing its waivers in November.
  • Anthem stopped its cost-sharing waivers on Jan. 31.
  • Cigna stopped offering cost-sharing waivers for COVID-19 treatment on Feb. 15.
  • Aetna ceased offering deductible-free inpatient COVID-19 treatment waivers on Feb. 28.

Not all insurers are doing this though. Blue Cross and Blue Shield of Minnesota extended eligibility for telehealth benefits and COVID-19 treatment waivers through the end of 2021.  Humana, meanwhile, has left the cost-sharing waiver in place for Medicare Advantage members, but dropped it on Jan. 1 for those in job-based group plans.

A study by the Peterson Center on Healthcare and the Kaiser Family Foundation released in November 2020, found that 88% of Americans who have health coverage — including employer-sponsored health plans and individual plans purchased on exchanges — had policies that waived cost-sharing for COVID-19 treatment.

Despite the fact that vaccines are rolling out quickly across the country and in light of a significant percentage of people who are hesitant to get vaccinated for COVID-19, the coronavirus is expected to be a presence in society for some time to come. And that means people will contract it and get sick.

There are also concerns about mutant strains that have developed in South Africa and Brazil, and possibly in India during the massive outbreak in April.

The takeaway

You may want to check with your group health plans to see if they have waived any cost-sharing for COVID treatment, and have since dropped or are planning to drop it.

You should meet with your employees or send them a memo explaining any impending changes for them if they have a health plan that is ending or has ended waivers.  

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The Top Five Health Conditions Driving Insurance Costs

A new study has identified the top five health conditions that are driving the overall cost of group health plan outlays, and without which spending would actually be falling.

The report is enlightening, and employers can use the findings to offer programs aimed at education and prevention to help control their employees’ health care costs and cut into health insurance premiums paid by both employers and workers.

Inspecting its study data for trends, the Health Action Council (HAC) determined that 63% of its covered lives had at least one of five conditions that were driving health care costs. Most of these top five conditions are preventable or treatable with lifestyle modifications that employers can encourage. 

Here’s a look at the five conditions and the burden they put on your employees and your company:

Asthma

Average costs paid per member of the HAC for asthma treatment are increasing on average 6.4% a year. This is one of the most prevalent health conditions in the country. Three important stats:

  • The incidence of asthma was 31% higher among women than men.
  • The incidence of asthma among African American covered lives was 20% more prevalent than among other races.
  • The average age of HAC members with asthma was 31.9, two years younger than the overall membership average age of 33.9.

Diabetes

Average costs paid per member of the HAC for diabetic treatment are also increasing 6.4% a year. Three important stats:

  • Diabetes was 20% more common in men than women among the HAC’s enrollees.
  • The average age of HAC plan enrollees with diabetes was 52.
  • Although Asian covered lives amounted to only 3% of the HAC enrollees, they had the highest incidence of diabetes of all racial groups.

Hypertension

Average costs paid per member of the HAC for hypertension treatment are increasing 6.3% a year. Three important stats:

  • Hypertension was 23% more common in men than women.
  • The average age among HAC enrollees with hypertension was 53.1.
  • The risk of African Americans developing hypertension was 63% more than for other races.

Back disorders

Average costs paid per member of the HAC for back treatment are increasing 3.4% a year. Three important stats:

  • Back disorders were 27% more common in women than men.
  • The average age among HAC enrollees with back disorders was 43.3.
  • Caucasian HAC members had 14% higher back disorder prevalence than other races.

Mental health, substance abuse

Average costs paid per member of the HAC for mental health and substance abuse treatment are increasing 2.7% a year. Three important stats:

  • Mental health and substance abuse problems were 39% more common in women than men.
  • The average age among HAC enrollees with mental health and substance abuse issues was 32.8.
  • Caucasian HAC members had 20% higher mental health and substance abuse issues than other races.

The takeaway

To help workers with these conditions, the report recommends:

  • Creating and implementing simple education and targeted wellness programs to address common conditions among your employees.
  • Instituting an exercise, stretch or meditation program at the beginning of a work shift to improve safety and decrease injuries. These types of practices are preventative and may decrease the severity of an injury if one occurs.
  • Evaluating benefit plan design for opportunities to implement continuum-of-care protocols. For example, employers can make chiropractic care or physical therapy mandatory for back disorders before moving to more aggressive treatments.
  • Covering medications for specific common chronic conditions as preventative care. Another option is to promote the use of patient assistance programs for medicines that may be excluded in your plan’s drug formulary.
  • Promoting virtual care for specific conditions; for example, mental health support if you have staff in rural areas.
  • Working with your health insurer or medical expert(s) to identify opportunities for provider outreach and education to your workers.
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Changes for 2021 Summary of Benefits and Coverage

There are new Summary of Benefits and Coverage notice requirements for health plans starting with the 2021 coverage year.

The requirements, released by the Department of Labor, have new model templates, new instructions and new information that affects the coverage examples that are required to be in SBC documents that employers with group health plans must distribute to their employees.

Under the Affordable Care Act, all non-grandfathered health plans are required to provide enrollees and prospective applicants an SBC, which is essentially a synopsis of the plan’s coverage and benefits. It must be produced in a specific format, contain specific information, and be written in a way that is easily understood.

Here are the changes that were made to the SBC template for plans that started on or after Jan. 1:

Coverage example

The coverage examples that appear on the last page of the document have been modified to reflect changes in the cost of medical services that occur over time due to inflation and other factors:

  • “Managing Joe’s Type 2 diabetes” (diabetes example): The total amount of expenses incurred for “Joe” has decreased.
  • “Mia’s simple fracture” (fracture example): The total amount of expenses incurred by “Mia,” who visited the emergency room for a simple fracture, has increased.
  • “Peg is having a baby” (maternity example): The costs incurred during “Peg’s” hospital stay have been changed to remove separate newborn charges. The deductible line of the example should now match “your deductible amount” (if applicable).

Minimum essential coverage

Under the entry for minimum essential coverage, the template has been revised to reflect the elimination of the individual mandate penalty, which was repealed effective Jan. 1, 2019.

The entry now indicates that individuals eligible for certain types of minimum essential coverage may not be eligible for a premium tax credit under the ACA marketplace.

Uniform glossary

The uniform glossary has been updated to remove references to the individual mandate penalty.

What to do

If you offer group health plans to your employees, you are a plan sponsor and thus required to distribute SBCs to staff who are eligible for coverage during open enrollment. The SBC must also be given to new hires within 90 days of hiring for mid-year enrollment. 

If you don’t have your latest SBC, you can contact us or your health insurer. The insurer is obligated to provide all covered employers with updated SBCs after the Department of Labor and the Department of Health and Human Services release changes to templates.

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Uncategorized

The Big Question: Can Employers Require Workers to Vaccinate?

As the COVID-19 pandemic rages on and more employers bring staff back to the workplace, many businesses are considering implementing mandatory vaccination policies for seasonal flus as well as the coronavirus.

A safe and widely accessible vaccine would allow businesses to open their workplaces again and start returning to a semblance of normalcy. But employers are caught in the difficult position of having to protect their workers and customers from infection in their facilities as well as respecting the wishes of individual employees who may object to being required to be vaccinated.

The issue spans Equal Opportunity Employment Commission regulations and guidance, as well as OSHA workplace safety rules and guidance. With that in mind, employers mulling mandatory vaccination policies need to consider:

  • How to decide if such a policy right for the company,
  • How they will enforce the policy,
  • The legal risks of enforcing the policy, and
  • Employer responsibilities in administering the policy.

Proceed with caution

A number of law firms have written blogs and alerts on the subject of mandatory vaccinations, and the overriding consensus recommendation is to proceed with caution. 

In 2009 pandemic guidance issued during the H1N1 influenza outbreak, the EEOC stated that both the Americans with Disabilities Act and Title VII bar an employer from compelling its workers to be vaccinated for influenza regardless of their medical condition or religious beliefs – even during a pandemic.

The guidance stated that under the ADA, an employee with underlying medical conditions should be entitled to an exemption from mandatory vaccination (if one was requested) for medical reasons. And Title VII would protect an employee who objects due to religious beliefs against undergoing vaccination.

In these cases, the employer could be required to provide accommodation for these individuals (such as working from home).

Additionally, the employer would have to enter into an interactive process with the worker to determine whether a reasonable accommodation would enable them to perform essential job functions without compromising workplace safety. This could include:

  • The use of personal protective equipment,
  • Moving their workstation to a more secluded area,
  • Temporary reassignment,
  • Working from home, or
  • Taking a leave of absence.

One issue that employment law attorneys say may not have any legal standing is if an employee objects to inoculation based on being an “anti-vaxxer,” or someone who objects to vaccines believing that they are dangerous. In this case, depending on which state your business is located, you may or may not be able to compel an anti-vaxxer to get a vaccine shot.

Protecting your firm

To mount a successful defense of a vaccination policy if sued, you would need to be able to show that the policy is job-related and consistent with business necessity. And that the rationale is based on facts, tied to each employee’s job description and that you enforce the policy consistently without prejudice or favoritism. 

Also, you must ensure that any employee who requests accommodation due to their health status or religious beliefs does not suffer any adverse consequences. In other words, you cannot punish someone that is covered by the ADA or Title VII for refusing a vaccine.

Also, you will need to project and safeguard your employees’ medical information, under the law.

The takeaway

A number of employment law experts say that once a vaccine is widely available, most employers will likely have the right to require that workers get it, as long as they heed the advice above about the ADA and Title VII. Until then, you may want to consider following the 2009 guidance.

If you do implement a policy requiring vaccination, consider:

  • Fully covering vaccine costs if they are not fully covered by your employees’ health insurance.
  • Allowing employees to opt out entirely if they have medical or religious objections.
  • In the event of a medical or religious objection, you must engage in an interactive process to determine whether the individual’s objections can be accommodated.
  • Including safeguards for keeping your employees’ medical information confidential.
  • Not abandoning your other efforts to keep your workplace safe, such as the use of social distancing, regular cleaning and disinfecting, and the use of personal protective equipment.
"Helath
Uncategorized

Alternative Group Plan Funding Gets a Second Look

Watching their group health plan premiums climb higher with each passing year, some employers start looking into alternative funding strategies in hopes they can get a better handle on their employees’ health costs.

While group plans are the standard, larger employers have typically had more options for funding their group health coverage. But now even small and medium-sized employers – even companies with fewer than 100 employees – can benefit from alternative funding approaches.

There are three main types of alternative funding strategies that are available to employers:

  • Captives
  • Private exchanges
  • Full and partial self-funding.

Captives

With a captive, multiple employers pool their resources and share the risk in providing health insurance to their employees. It is essentially a self-insured pool built into a captive insurance company (an insurer that is owned by the entity that created it). The captive has staff that will administer the health plan.

Captives are also multi-year agreements, so once an employer commits to make it worth their investment, they need to stick with it for a period of time.

Group captives will often have a specific funding mechanism that is broken down into four layers:

Layer 1: The employer is responsible for the first $25,000 of any claim made by one of its employees.

Layer 2: All employers involved in the captive will share the costs of that claim if it exceeds $25,000, up to $250,000.

Layer 3: For claims that cost more than $250,000, the captive will secure reinsurance coverage to cover amounts above that level. This reinsurance is also called “stop-loss” insurance.

Layer 4: Another layer of protection known as “aggregate stop-loss” coverage protects each employer in the captive for the total claims of their employees, ranging from 115% to 125% of expected claim costs in a year.

Private exchanges

Typically, businesses using a private exchange will offer employees a credit that can be applied toward the purchase of a health plan. Employees can then access a variety of health plans through an online portal and can chose and enroll in plans that meet their needs.

Private exchanges are run by insurance carriers or consultancies, and plans on the exchange are regulated as group coverage. Employees shopping on these exchanges are not eligible for the Affordable Care Act’s tax credits or cost-sharing subsidies.

Most employers currently using private exchanges are large; therefore, most private exchange plans are regulated as large-group coverage and are not part of the ACA’s single risk pool. However, to the extent that smaller employers participate in private exchanges, they are subject to the ACA’s small-group rating regulations and risk-pool requirements.

One of the main features of private exchanges is that they enable employees to comparison-shop among multiple health insurance plans.

Self-insuring

There are many different types of self-insurance, from minimum-premium or risk-sharing arrangements to a fully self-funded plan, in which the employer is responsible for all claims.

Employers can choose from:

Retrospective premium arrangements – The insurer will credit back a portion of the unused premium to the employer (typically as a credit for the following year). This is often used in a fully insured arrangement.

Minimum premium arrangements – The employer pays fixed costs (administration charges, stop-loss insurance and network access fees) and claim costs up to a maximum liability each month.

Partial self-funding -The employer takes on more liability and pays fixed costs (administration, network access, stop-loss premiums and some fees and taxes). It’s partial self-funding because the employer will purchase individual stop-loss insurance, which caps the employer’s liability on any given claim to a certain amount, say $50,000.

That way, the employer is self-insuring most of their employees’ medical needs, but is protected in case some of those claims become catastrophic.

Full self-funding – This is like partial self-funding except that there is no stop-loss insurance and the employer is responsible for all costs that are not shared by its employees.  This kind of arrangement is usually only available to large employers.

The takeaway

These alternative funding approaches are what is available now. But the industry is innovating to making health care and insurance more affordable for all involved.

Uncategorized

Pandemic Could Depress Health Care Costs

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.
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Uncategorized

IRS Allows Mid-Year Changes to Health Plans, FSAs

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.

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Uncategorized

What COVID-19 Services Your Health Plan May Cover

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.

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