Compliance and Regulatory
Podcast Episode 139: Guidance and Litigation Relating to CAA Gag Clause Prohibitions
Reminder: Form 5500 Filing for Calendar Year Plans Due July 31
June Get Wise Wednesdays – Register Now
Reminder: PCOR Fee, Form 720 Filing Due July 31
Reminder: End of COVID-19 National Emergency Outbreak Period Fast Approaching
Fifth Circuit Affirms Insurer Abused Discretion in Denying Cancer Therapy Treatment
DOL Issues Opinion Letter on Calculating FMLA Leave Used During a Holiday Week
IRS Provides Guidance on EPCRS Expansion Under SECURE 2.0 Act
IRS Releases Updated Form 5300, Form 5307 and Form 5310 Instructions
In this episode, Suzanne Spradley and Chase Cannon review the CAA’s prohibition on gag clauses in TPA and service provider contracts, as well as the employer’s obligation to attest to the removal of gag clauses (due December 31, 2023, for the first time).
Suzanne outlines the challenges employers and plans face when working with TPAs, and explores how recent guidance attempts to address those challenges. Additionally, Suzanne and Chase discuss two recent cases between plans and their TPAs. They examine how these cases may impact employers’ paths forward in complying with the CAA gag clause prohibition and attestation requirements.
Periodically, NFP's legal experts make the subject of compliance personal for a wide audience. By breaking down the daunting details of emerging policies and bridging the gap between legislation and what it means for the listener, Chase Cannon and Suzanne Spradley make compliance issues relatable and relevant. Visit our Soundcloud page for the most up-to-date episode.
Applicable plan sponsors must file their Form 5500-series returns on the last day of the seventh month after their plan year ends. As a result, calendar-year plans generally must file by July 31. Plans may request a two-and-a-half-month extension to file by submitting Form 5558, Application for Extension of Time to File Certain Employee Plan Returns, by the plan's original due date.
The 2022 Form 5500 and instructions are accessible on the DOL website.
As a reminder, group health plans sponsored by a governmental or church entity aren’t required to file a Form 5500, as those plans aren’t subject to ERISA. Additionally, unfunded, insured, or a combination of unfunded and insured health plans with fewer than 100 participants on the first day of the plan year are also exempt from the filing.
NFP has vendors available to assist with filings. Please ask your advisor if you need assistance.
Topic: Summer Camp Is in Session: Benefits Compliance 2023 Mid-Year Check-In
School is out, and benefits compliance summer camp is in session. Join us as we discuss the current status of legislation affecting group health plans, including updates on transparency rules, the end of the national emergencies, preventive care mandates, and more.
Date/Time: June 21, 2023
2:00 to 3:00 p.m. CT (3:00 to 4:00 p.m. ET)
This program is pending approval for 1.0 (general) recertification credit hours toward PHR, SPHR and GPHR recertification through the HR Certification Institute. For more information about certification or recertification, visit the HR Certification Institute website at hrci.org.
The ACA imposed the PCOR fee on health plans to support clinical effectiveness research. The PCOR fee applies to plan years ending on or after October 1, 2012, and before October 1, 2029. The PCOR fee is generally due by July 31 of the calendar year following the close of the plan year.
PCOR fees are required to be reported annually on Form 720, Quarterly Federal Excise Tax Return, for the second quarter of the calendar year. Plan sponsors that are subject to PCOR fees but no other types of excise taxes should file Form 720 only for the second quarter.
The PCOR fee is generally assessed based on the number of employees, spouses and dependents covered by the plan. The fee for policy and plan years ending on or after October 1, 2021, but before October 1, 2022, remains at the applicable rate of $2.79, multiplied by the average number of lives covered under the plan. For plan years ending on or after October 1, 2022, but before October 1, 2023, the fee is increased to the applicable rate of $3.00, multiplied by the average number of lives covered under the plan.
The PCOR fee can be paid electronically or mailed to the IRS with the Form 720 using a Form 720-V payment voucher. According to the IRS, the fee is tax-deductible as a business expense.
As a reminder, the insurer is responsible for filing and paying the fee for a fully insured plan. The employer plan sponsor is responsible for filing on a self-insured plan, including an HRA. A stand-alone dental or vision HRA would be excepted and wouldn’t be subject to the PCOR fee.
Now that the COVID-19 National Emergency has ended, employers must prepare for the end of the Outbreak Period. Based on DOL FAQ guidance and subsequent commentary, the Outbreak Period will end on July 10, 2023. This means that the tolling of certain ERISA plan deadlines (e.g., COBRA elections, payments and certain notices, HIPAA special enrollments, and claims and appeals filings) will no longer be required.
Accordingly, employers should work with legal counsel, TPAs, COBRA vendors and other service providers to ensure related plan documents, procedures and systems are updated to accommodate the Outbreak Period end and subsequent reversion to pre-pandemic election, notice and payment timelines after July 10, 2023. Additionally, employers should ensure appropriate communications are provided to plan participants and COBRA beneficiaries regarding the approaching deadlines and upcoming changes.
An employer considering extending the tolling past July 10, 2023, should consult with legal counsel and ensure express permission is obtained from the carrier or TPA.
For further information, please ask your consultant for a copy of our NFP publication, End of COVID-19 Emergency Declarations: A Guide for Employers.