|
DOL
Releases Model Notices for Employers Implementing Health Care Reform
The
U.S. Department of Labor's Employee Benefits Security Administration has
released a number of Model Notices for employer-sponsored health plans to
comply with requirements of the Affordable Care Act. Model notice
language is now available from the Department of Labor for the following:
Opportunity
to Enroll in Connection with Extension of Dependent Coverage to Age 26
The
interim final regulations extending dependent coverage to age 26 provide
transitional relief for a child whose coverage ended, or who was denied
coverage (or was not eligible for coverage) under a group health plan or
health insurance coverage because, under the terms of the plan or
coverage, the availability of dependent coverage of children ended before
the attainment of age 26. This enrollment opportunity (including the
written notice) must be provided not later than the first day of the
first plan year beginning on or after September 23, 2010. For more
information and to view the Model Notice, please click here.
Patient
Protection Model Disclosure
Individuals
enrolled in a plan or health insurance coverage must be notified of their
rights to (1) choose a primary care provider or a pediatrician when a
plan or issuer requires designation of a primary care physician; or (2)
obtain obstetrical or gynecological care without prior authorization.
This notice must be provided no later than the first day of the first
plan year beginning on or after September 23, 2010. For more information
and to view the Model Notice, please click
here.
Model
Language Notice Lifetime Limit No Longer Applies and Enrollment
Opportunity
Plans and
issuers are required to give written notice that the lifetime limit on
the dollar value of all benefits no longer applies and that an
individual, if covered, is once again eligible for benefits under the
plan. Additionally, if the individual is not enrolled in the plan or
health insurance coverage, or if an enrolled individual is eligible for
but not enrolled in any benefit package under the plan or health
insurance coverage, then the plan or issuer must also give such an
individual an opportunity to enroll that continues for at least 30 days
(including written notice of the opportunity to enroll). The notices and
enrollment opportunity must be provided beginning not later than the
first day of the first plan year beginning on or after September 23,
2010. For more information and to view the Model Notice, please click here.
To visit the Department of Labor's webpage dedicated to the Affordable
Care Act, please click
here. For more on recent developments under health care reform, visit
the HR & Benefits Essentials 2010 Health Care Reform Section
by clicking
here.
Applications
for Early Retiree Reinsurance Program Accepted as of June 29, 2010
The
Department of Health and Human Services' Office of Consumer Information
and Insurance Oversight (OCIIO) has announced it will begin accepting
applications for the Early Retiree Reinsurance Program (ERRP).
The
Early Retiree Reinsurance Program will reimburse employers for medical
claims for retirees age 55 and older who are not eligible for Medicare,
and their spouses, surviving spouses, and dependents. Employers who
provide health coverage for early retirees are eligible to apply.
Reimbursements will be available for 80% of medical claims costs for
health benefits between $15,000 and $90,000. Program participants will be
able to submit claims for medical care going back to June 1, 2010.
June
29, 2010 was the first day applications started being accepted. A draft
application was made available June 7, and OCIIO has hosted several
stakeholder outreach calls to explain the program. Additional application
assistance, including a webinar, will be available online this week.
Applications
Application
instructions and the Application
are available
here, along with an updated Fact Sheet, Application
Submission Do's and Don'ts, FAQs and other guidance. You can also
visit www.hhs.gov/ociio to access
the materials.
Interim
Final Rules Cover Market Reforms Taking Effect As Early as 2010
The
U.S. Departments of Treasury, Labor and Health and Human Services have
issued interim
final rules under the Affordable Care Act. These rules relate
to:
- Preexisting
condition exclusions of children under 19,
- Lifetime
and annual limits,
- Rescissions
of coverage, and
- Certain
other provisions.
To
view a Fact Sheet on the rules, please click
here. The rules issued are now available for public comment at www.regulations.gov.
|
|
|
Keeping Your Plan's Grandfather
Status
 In the June newsletter, we covered the
general concept of grandfathered plans under health care reform (those
plans which were in place on March 23, 2010), and which
parts of the new health care law apply to grandfathered plans, such
as dependent coverage to age 26 and children's pre-existing conditions.
We also noted that we were awaiting government guidance as to how a plan
can be changed without losing grandfathered status. On June 17, 2010, the
Departments of Treasury, Labor and Health and Human Services issued
interim final rules that made important clarifications on maintaining
grandfather status. In evaluating whether to keep your plan, it is
important to review the following rules related to maintaining
grandfather status:
The
regulation allows employers and insurers to make "routine"
changes to plans without them losing grandfather status. Routine changes
will include cost adjustments to keep pace with medical inflation, adding
new benefits, making modest adjustments to existing benefits, voluntarily
adopting new consumer protections under the new law, or making changes to
comply with state or other federal laws. Under the rules, plans will lose
their "grandfather" status if they choose to significantly cut benefits or
increase out-of-pocket spending for consumers. However, premium changes are not taken
into account when determining whether or not a plan is
grandfathered.
Compared
to their polices in effect on March 23, 2010, grandfathered plans:
- Cannot
Significantly Cut or Reduce Benefits: For
example, if a plan decides to no longer cover care for people with
diabetes, cystic fibrosis or HIV/AIDS.
- Cannot
Raise Co-Insurance Charges: Typically, co-insurance
requires a patient to pay a fixed percentage of a charge (for
example, 20% of a hospital bill). Grandfathered plans cannot
increase this percentage.
- Cannot
Significantly Raise Co-Payment Charges:
Frequently, plans require patients to pay a fixed-dollar amount for
doctor's office visits and other services. Compared with the
copayments in effect on March 23, 2010, grandfathered plans will be
able to increase those co-pays by no more than the greater of $5
(adjusted annually for medical inflation) or a percentage equal to
medical inflation plus 15 percentage points. For example, if a plan
raises its copayment from $30 to $50 over the next 2 years, it will
lose its grandfathered status.
- Cannot
Significantly Raise Deductibles: Many plans
require patients to pay the first bills they receive each year (for
example, the first $500, $1,000, or $1,500 a year). Compared with
the deductible required as of March 23, 2010, grandfathered plans
can only increase these deductibles by a percentage equal to medical
inflation plus 15 percentage points.
- Cannot
Significantly Lower Employer Contributions: Many
employers pay a portion of their employees' premium for insurance
and this is usually deducted from their paychecks. Grandfathered
plans cannot decrease the percent of premiums the employer pays by
more than 5 percentage points (for example, decrease their own share
and increase the workers' share of premium from 15% to 25%).
- Cannot Add
or Tighten an Annual Limit on What the Insurer Pays: Some
insurers cap the amount that they will pay for covered services each
year. If they want to retain their status as grandfathered plans,
plans cannot tighten any annual dollar limit in place as of March
23, 2010. Moreover, plans that do not have an annual dollar limit
cannot add a new one unless they are replacing a lifetime dollar
limit with an annual dollar limit that is at least as high as the
lifetime limit.
- Cannot
Change Insurance Companies: If an employer decides to
buy insurance for its workers from a different insurance company,
this new insurer will not be considered a grandfathered plan. This
does not apply when employers that provide their own insurance to
their workers switch plan administrators or to collective bargaining
agreements.
Disclosure Requirement
- Model Notice
The
regulation on grandfathered plans requires a plan to disclose to
consumers every time it distributes materials whether the plan believes
that it is a grandfathered plan and therefore is not subject to some of
the additional requirements of the Affordable Care Act. The plan must
also provide contact information for enrollees to have their questions
and complaints addressed. Model language that can be used to satisfy this
disclosure requirement is available
here, and is also provided in the interim final rules.
Recordkeeping
Under the
interim final rules, to maintain status as a grandfathered health plan, a
plan or issuer must also maintain records documenting the terms of the
plan or health insurance coverage that were in effect on March 23, 2010,
and any other documents necessary to verify, explain, or clarify its
status as a grandfathered health plan.
Ways
Grandfather Status Can Be Revoked
To
prevent health plans from using the grandfather rule to avoid providing
consumer protections, the regulation:
- Revokes a
plan's grandfathered status if it forces consumers to switch to
another grandfathered plan that, compared to the current plan, has
less benefits or higher cost sharing as a means of avoiding new
consumer protections
- Revokes a
plan's grandfathered status if it is bought by or merges with
another plan simply to avoid complying with the law.
For
more information on this regulation, please see this Fact
Sheet on the Affordable Care Act and "Grandfathered" Health
Plans. Please also view FAQs on
Grandfathered Plans. To view the interim final rules, please click
here.
For
more on grandfathered plans generally, including a timeline of required key changes
to grandfathered plans, please click
here.
|
|
Interview Questions - What You
Need to Know
 As hiring
begins to rebound, many small businesses may once again be thinking about
recruitment and candidate selection. And, of course, one of the most
important parts of the process is conducting the interview.
Whether
you are a small business owner who conducts your own interviews, manager
of a department or experienced HR professional, the following is a quick
"refresher" on the do's and don'ts related to interview
questions.
Questions You
May Ask
Interview
questions should be job-related, and provide insight into the candidate's
ability to perform the essential functions of the position you are
filling. They can also provide certain information about the interviewee.
Some examples of acceptable job-related inquiries include:
- Job
Requirements: desired position, salary, full time or part time, date
of availability to start.
- Essential
functions of the job: Essential functions are the fundamental job
duties that the employee must be able to perform on his or her own
or, in the case of a person with a disability, with the help of a
reasonable accommodation.
- Willingness
to travel
- Educational
background
- Skills:
word processing, computer languages, etc.
- References
- Eligibility
to work in the United States
Questions to
Avoid
Because
of the numerous federal, state, and local anti-discrimination laws that
govern the employment process, direct and indirect inquiries concerning
an interviewee's race, color, religion, sex, national origin, age,
disability, genetic information, military service, or any other protected
class status should be avoided. In addition, some states have strict
limitations on pre-employment inquiries about criminal backgrounds, in
particular, arrests not leading to convictions. Questions to avoid
include:
- How old
are you?
- What is
your nationality? Or what is the origin of your name?
- What is
your race?
- Were you
or are you currently disabled?
- Are you
taking any medications?
- What is
your religion?
- Have you
ever been arrested?
- Do you
have a drinking problem?
Interviewing in
Compliance with the Americans with Disabilities Act
The
Americans with Disabilities Act (ADA) goes one step further than the
traditional civil rights laws that prohibit employment discrimination on
the grounds of race, sex, age, or other protected classes. Under the ADA,
it is not enough that an employer simply does not discriminate. Employers
must, under certain situations, also take steps to make "reasonable
accommodations" for individuals with disabilities. To avoid charges
of discrimination, employers should also adhere to the following
guidelines when interviewing applicants with disabilities:
- Prepare
for the interview by clearly understanding the essential job
functions of the position in question.
- Employers
may ask about an applicant's ability to perform specific job
functions. For example, an employer may state the physical
requirements of a job (such as the ability to lift a certain amount
of weight, or the ability to climb ladders), and ask if an applicant
can satisfy these requirements.
- Employers
may ask about an applicant's non-medical qualifications and skills,
such as the applicant's education, work history, and required
certifications and licenses
- Don't ask
questions about an applicant's disabilities.
Additionally,
many state civil rights agencies have their own guidelines on
pre-employment inquiries based on both federal and state
nondiscrimination laws. Be sure to check on any additional restrictions
your state may impose on job interview questions. For more information on
the ADA compliant interview, please click here. To
view a list of state labor offices, please click here.
|
|
Treasury Department Report -
COBRA Subsidy Widely Used by Middle Class
 According to a recent Treasury
Department survey, federal subsidies of health insurance premiums for
the unemployed were widely used by the middle class during the recession.
Many laid-off workers and their families maintained their health coverage
as a result of the subsidy.
The
American Recovery and Reinvestment Act of 2009 (ARRA) established a tax
credit that paid 65 percent of the cost of health insurance premiums for
eligible unemployed workers and their family members who maintained their
health coverage through the federal COBRA continuing coverage program.
Usually, individuals on COBRA coverage are required to pay up to 102% of
the total cost of premiums. The Treasury Department estimates that for a
typical family nationwide, the ARRA subsidy reduced the cost of COBRA
from about $13,500 to $4,725.
The
Treasury analysis is one of the earliest reports on the profile of
unemployed individuals who obtained continuing health insurance coverage
through the ARRA COBRA subsidy. The study surveyed more than 6,000 New
Jersey workers receiving Unemployment Insurance in the fall and winter of
2009. The report found that between one-quarter and one-third of eligible
unemployed workers enrolled in subsidized COBRA. In addition, roughly 15%
of Unemployment Insurance beneficiaries received health insurance
coverage through COBRA.
The
report concludes that the subsidy appears to have been especially
important for maintaining health coverage for middle-class families
during the recession, and likely reduced the number of Americans who
otherwise would have gone uninsured during the recession. A separate
publication from the Treasury Department estimates that up to 2 million
households were provided premium assistance in 2009, and over 300,000
claims were filed by employer tax reporting units through early 2010. The
Treasury Department suggests that the availability of the program may
have significantly slowed the growth of the uninsured population, which
had been significantly increasing through Feb. 2009.
To
view the Treasury Department report, please click
here.
|
|
COBRA Subsidy Eligibility Period
Expires - ARRA Notices No Longer Apply
 On June 1,
2010, the eligibility period to qualify for COBRA premium reduction under
ARRA (as extended by the Continuing Extension Act of 2010) expired.
Consequently, employers and plan administrators are not required to
provide subsidies for COBRA premiums to workers terminated on or after
June 1, 2010, unless and until a further extension of the ARRA COBRA
subsidy is enacted.
Model Notices
for Use On or After June 1, 2010
Employers
and administrators should note that a further extension of the COBRA
premium reduction under ARRA may still occur. However, with no further
extensions, employers and administrators should use the Model General
Notice and Model
Election Notice provided by the DOL, for workers who are terminated
on or after June 1, 2010. Remember, involuntary terminations that
occurred at any time from September 1, 2008, through May 31, 2010 may
have been qualifying events entitling such terminated workers to COBRA
premium reductions and applicable notices. Individuals are encouraged to
seek assistance regarding Notice Requirements by calling the Employee
Benefits Security Administration toll-free at 1-866-444-3272. HR &
Benefits Essentials will provide updates on any ARRA COBRA extensions as
they occur.
|
|
