Health & Welfare Plans Newsletter

July 22, 2019

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[Guidance Overview]

Treasury Recognizes Preventive Care for Chronic Conditions Under High Deductible Health Plans

"There is only limited guidance that identifies specific preventive care expenses for HDHP purposes other than expenses that are regarded as preventive care under the [ACA] ... An appendix in the new guidance adds to this list of preventive care expenses, identifying 14 cost-effective items and services likely to prevent the worsening of a chronic condition or the development of a secondary condition that would require costly treatment." Ballard Spahr LLP

[Advert.]

Health Reimbursement Arrangement Plans Update

Sponsored by Lorman and BenefitsLink

July 23 webinar will review the benefits of establishing an individual coverage HRA or an excepted benefit HRA and provide you with what you need to know to establish one or both of them. BenefitsLink discount .


[Guidance Overview]

IRS Expands Preventive Care Benefits That Are Not Subject to HDHP Deductible

"The IRS and Treasury used the following criteria to determine whether a treatment was preventive care: [1] the medical service or item is low-cost; [2] there is medical evidence supporting high cost efficiency of preventing exacerbation of the chronic condition or the development of a secondary condition; and [3] there is a strong likelihood, documented by clinical evidence, that with respect to the class of individuals prescribed the item or service, the specific service or use of the item will prevent the exacerbation of the chronic condition or the development of a secondary condition that requires significantly higher cost treatments." Greensfelder

[Guidance Overview]

Pennsylvania Supreme Court Orders Steel City to Lift Sick Leave Barrier

"On Wednesday, July 17, 2019, the Pennsylvania Supreme Court reversed trial and appellate court rulings that found the Pittsburgh Paid Sick Days Act [PSDA] ... in violation of state law.... Despite a lengthy opinion providing extensive historical, factual, and legal background, ... the Court ruled that the PSDA does not violate the Home Rule Law because Pittsburgh has 'express statutory authority to legislate in furtherance of disease control and prevention.' " [ Penn. Restaurant and Lodging Assoc. v. City of Pittsburgh , No. 57 WAP 2017 (S. Ct. Penn. Jul. 17, 2019)]
Seyfarth Shaw LLP

[Guidance Overview]

Pittsburgh Employers: Immediate Action Needed on New Paid Sick Days Act

"Prior to the lower court rulings, the City posted notice and promulgated rules, meeting the requirements for the effectiveness of the Act. While retroactive application is unlikely, employers should consider the Act reinstated and in effective now." [ Penn. Restaurant and Lodging Assoc. v. City of Pittsburgh , No. 57 WAP 2017 (S. Ct. Penn. Jul. 17, 2019)]
ReedSmith

Update on New Jersey Individual Health Insurance Mandate

"All employers who withhold and submit tax to New Jersey on behalf of their employees will be required to comply. On July 19th, the State of New Jersey pushed back their deadline for receiving 2019 forms to March 30, 2020, which matches the due date for the IRS. They also opened their testing window for receiving files, which runs through September 1, 2019." Tango Health

Is Direct-To-Provider Contracting a Potential Silver Bullet for Achieving Value-Based Care for Employer-Sponsored Plans?

"The interest that providers and employers have expressed for direct-to-provider solutions is complicated by the numerous ways these arrangements can be structured.... The key challenge to direct-to-provider contracting is implementing a model that is acceptable to both the employer and the provider.... While the overall concept of direct-to-provider contracting makes sense, there are key issues that make it difficult to implement broadly in the employer market -- the typical employer geography and employer commitment to the approach." Milliman

Consumers Will Be Able to Pay for Doctor Visits on Their Phones, Via Anthem

"The rollout will begin this month in one state but eventually reach the big insurer's full geographic territory, in the latest sign of the industry's ambition to bring the seamless experience of an Uber ride to the fragmented health-care business. Companies including UnitedHealth Group Inc., CVS Health Corp. and Cigna Corp. are all working on apps and other tools aimed at boosting convenience, shaping users' care and reducing costs." The Wall Street Journal; subscription may be required

Politicians Tackle Surprise Bills, but Not the Biggest Source of Them: Ambulances

"Five states have passed laws this year to restrict surprise billing in hospitals and doctor's offices. Congress is working on a similar package of measures ... Ordinary ambulances that travel on roads have been left out of every bill." The New York Times; subscription may be required

Court Upholds Final Regs on Short-Term Health Insurance Plans

"Judge Leon rejected the plaintiffs' arguments that the short-term plan rule is contrary to Congress's intent in adopting the [ACA] and [HIPAA].... Congress delegated authority to the federal government to define short-term, limited duration insurance under HIPAA in 1996.... [T]he ACA did not alter this definition.... Judge Leon concludes that the federal government is entitled to deference in defining short-term coverage and that its interpretations were reasonable." Assoc. for Community Affiliated Plans v. U.S. Dept. of Treasury , No. 18-2133 (D.D.C. Jul. 19, 2019)]
Katie Keith, in Health Affairs

VEBAs That Are MEWAs: Was the Court of Claims Correct for the Wrong Reason in Assessing PCORI Fee?

"Although the Court may well be wrong that the ERISA 3(5) definition of employer under Title I does not apply under ACA Section 9010, this ruling may not make a difference ... If we assume that the Court may be correct that the IBA arrangement is a 'covered entity,' it shifts the focus to the IRS regulation implementing ACA Section 9010. The concern is that in the implementing regulation and the associated preamble, the IRS did not focus sufficiently on the distinction drawn by the DOL between plan MEWAs and non-plan MEWAs[.]" [ Iowa Bankers Benefit Plan v. U.S. , No. 17-842T (Ct. Cl. May 2, 2019)]
The Wagner Law Group

How the Eastern Band of Cherokee Indians Took Control of Their Health Care

"Half of the Indian Health Service budget is now managed by Indian tribes to various degrees. But while full control has worked out well for tribes with resources like the [Eastern Band of Cherokee Indians], they are one of just a few bright spots in an otherwise dire medical landscape. It remains to be seen how widely this model can be applied." Kaiser Health News

Colorado Decision Clarifies Payout of Unused Vacation Time

"Based on the court's holding, employers can write their policies to require employees to use or lose their accrued vacation time and also impose conditions for a payout at separation from employment.... [S]ilent or ambiguous policies may be interpreted as permitting rollover of vacation time or requiring compensation for accrued but unused vacation time at time of separation." [ Nieto v. Clark's Market, Inc. , No. 18CA1154 (Colo. Ct. App. Div. IV, Jun. 27, 2019)]
Ballard Spahr LLP

Benefits in General

When Is the Right Time for Your Employee Benefit Plan Check-Up?

"A best practice is to schedule a periodic review of your plan, at least annually, to make sure it complies with any changes in laws or regulations. Also, examine the plan provisions to verify they are being applied appropriately in their day-to-day operation." EisnerAmper

Press Releases

Most Popular Items in the Previous Issue

Impact of New DOL Regs on Retiree-Only HRAs Kilpatrick Townsend & Stockton LLP, via Lexology; free registration required

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David Rhett Baker, J.D., Editor and Publisher
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BenefitsLink Health & Welfare Plans Newsletter, ISSN no. 1536-9595. Copyright 2019 BenefitsLink.com, Inc. All materials contained in this newsletter are protected by United States copyright law and may not be reproduced, distributed, transmitted, displayed, published or broadcast without the prior written permission of BenefitsLink.com, Inc., or in the case of third party materials, the owner of those materials. You may not alter or remove any trademark, copyright or other notices from copies of the content.

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