Federal Compliance Update

Federal Pregnancy and Lactation Accommodations Expanded

While federal employment law changes are generally few and far between, the budget bill that was just passed by Congress and signed by the President includes two sections that provide new protections for pregnant and lactating employees and applicants.

Pregnant Workers Fairness Act

Employers with 15 or more employees must now accommodate employees’ and applicants’ known limitations related to pregnancy, childbirth, or related medical conditions unless it would create an undue hardship. Employers also cannot take any adverse action against an employee or applicant for requesting or usingan accommodation.

Previously under federal law, employers generally only had to provide reasonable accommodations for pregnant employees and applicants if they also provided accommodations to other employees who were similar in their ability or inability to work. Note that many state laws already went above and beyond federal law in requiring accommodations for pregnant employees.

This new law will take effect in June 2023.

Lactation Accommodations

The “Providing Urgent Maternal Protections for Nursing Mothers Act,” or PUMP Act, expands the current federal requirements for providing employees with time and space to breastfeed or pump at work to nowcover exempt employees. Previously, only nonexempt employees were covered.

This law applies to employers of all sizes but (still) has an exception for employers with fewer than 50 employees if they can show that providing accommodations would cause an undue hardship.

How the End of the COVID-19 Emergency Periods Will Impact Health Plans

The Biden Administration has announced its plan to end the COVID-19 national emergency and public health emergency (PHE) on May 11, 2023. Employer-sponsored health plans have been required to comply with certain coverage requirements during the COVID-19 emergency periods, including the following:

• Health plans must cover COVID-19 diagnostic tests and related services without imposing any cost sharing (such as deductibles, copayments or coinsurance) during the PHE; and
  
• Non-grandfathered health plans must cover certain preventive services, including recommended COVID-19 vaccines and boosters, without cost sharing. During the PHE, this coverage mandate applies to COVID-19 immunizations provided by all providers, regardless of whether they are in- network or out-of-network.

In addition, during the COVID-19 outbreak period (which is tied to the national emergency), certain health plan deadlines are extended, including the deadlines to request special enrollment under HIPAA, elect COBRA continuation coverage and comply with the plan’s claims and appeals procedures.

Impact on Health Plans

When the PHE ends, health plans will no longer be required to cover COVID-19 diagnostic tests and related services without cost sharing. Health plans will still be required to cover recommended preventive services, including COVID-19 immunizations, without cost sharing, but this coverage requirement will be limited to in-network providers. In addition, once the COVID-19 outbreak period ends, health plans can go back to their nonextended deadlines for purposes of HIPAA special enrollment, COBRA continuation coverage, and claims and appeals procedures.

Health Plan Changes

When the PHE ends, the following health plan coverage rules related to the COVID-19 pandemic will no longer apply:

• COVID-19 Diagnostic Testing Without Cost Sharing—During the PHE, health plans and health insurance issuers must cover COVID-19 tests and related services without imposing any cost sharing or prior authorization or other medical management requirements. As of Jan. 15, 2022, this coverage requirement extends to at-home COVID-19 diagnostic tests. Health plans and issuers will no longer be required to provide this first-dollar coverage when the PHE ends.
• COVID-19 Vaccines—Out-of-Network Providers—Non-grandfathered group health plans and health insurance issuers must cover coronavirus preventive services, including recommended COVID-19 immunizations, without cost sharing requirements. During the PHE, covered services may be provided by in-network or out-of-network providers. Once the PHE ends, health plans and issuers must continue to cover recommended COVID-19 immunizations without cost sharing but can limit this coverage to in-network providers.
• Standalone Telehealth Benefits—For plan years beginning during the PHE, a large employer (more than 50 employees) may offer standalone telehealth benefits and other remote care services to individuals who are not eligible for coverage under any other group health plan offered by the employer without violating the Affordable Care Act’s market reforms. These types of standalone arrangements will not be permitted after the PHE ends.

NATIONAL EMERGENCY – OUTBREAK PERIOD

Various deadlines related to employer-sponsored group health plans are extended during the COVID- 19 outbreak period.

On Jan. 30, 2023, the Biden Administration announced its plan to end the COVID-19 national emergency on May 11, 2023. Under this timeline, the outbreak period will end on July 10, 2023.

Deadline Extensions

During the outbreak period, some key deadlines for employee benefit plans and participants are extended. Deadline extensions that apply during the outbreak period include the following:

• HIPAA Special Enrollment—The 30-day period (or 60-day period, if applicable) to request special enrollment.
• COBRA Notice and Premium Payment Deadlines—The 60-day period to elect COBRA coverage; the date for making COBRA premium payments (generally at least 45 days after the day of the initial COBRA election, with a grace period of at least 30 days for subsequent premium payments); and the date for individuals to notify the plan of a qualifying event or disability determination (generally 60 days from the date of the event, loss of coverage or disability determination).‍
• Claims and Appeals Deadlines—The deadlines to file a benefit claim, file an appeal of an adverse benefit determination or request an external review of a claim under the plan’s claims and appeals procedures.

Under the relief, these deadline extensions end when the outbreak period is over or, if earlier, after an individual has been eligible for a specific deadline extension for one year.

PRE-DEDUCTIBLE TELEHEALTH COVERAGE

In response to the COVID-19 pandemic, the Coronavirus Aid, Relief and Economic Security (CARES)  Act allowed high deductible health plans (HDHPs) compatible with health savings accounts (HSAs) to provide benefits for telehealth or other remote care services before plan deductibles were met. This relief was not linked to the PHE or outbreak period; rather, it applied for plan years beginning before Jan. 1, 2022. A spending bill extended this relief to telehealth services provided in months beginning after March 31, 2022, and before Jan. 1, 2023.

The Consolidated Appropriations Act, 2023 (CAA), which was signed into law on Dec. 29, 2022, extends the ability of HDHPs to provide benefits for telehealth or other remote care services before plan deductibles have been met without jeopardizing HSA eligibility. This extension applies for plan years beginning after Dec. 31, 2022, and before Jan. 1, 2025. Thus, regardless of when the COVID-19 emergency periods end, HDHPs may be designed to waive the deductible for any telehealth services for plan years beginning in 2023 and 2024 without causing participants to lose HSA eligibility.

This Compliance Bulletin is not intended to be exhaustive nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel for legal advice. ©2023 Zywave, Inc. All rights reserved.

Federal: IRS Increases Mileage Reimbursement Rate

The Internal Revenue Service (IRS) has announced that its optional standard mileage rate will increase to 65.5 cents per mile driven for business purposes. The increase takes effect on January 1, 2023.

Use of this rate is optional for private employers, though it is widely used as a standard rate for calculating mileage reimbursement for employees who use their personal vehicles for business purposes.

Action Item

If your organization uses the IRS rate to calculate mileage reimbursement, be sure to update your systems to account for this change.

(The IRS released IR-2022-234 on December 29, 2022)

State Compliance Update

All is quiet for now…

Compliance Calendar

February

2/1 – Deadline for Posting OSHA Form 300A

2/28 – Forms 1094-B, 1095-B, 1094-C, and 1095-C Filing Deadline (paper filers)

March

3/2 – Deadline to Distribute Forms 1095-B and 1095-C 3/2 – Deadline to Submit Form 300A Data to OSHA

3/2 – Medicare Part D Creditable Coverage Disclosure Deadline for Calendar Year Plans 3/31 – Forms 1094-B, 1095-B, 1094-C, and 1095-C Filing Deadline for Electronic Filers

April

4/29 – Remove OSHA Form 300A 04/30 – Form 941 Filing Deadline (Q1)