May 29, 2019
Extended Relief for Non-ACA-compliant Small Group and Individual Policies and Plans
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On May 13, 2019, Insurance Commissioner Ridling released Bulletin 2019-04 to extend the ability of health insurance carriers in the individual and small group market to continue transitional health insurance plans that renew for a policy year starting on or before October 1, 2020, as long as the coverage comes into ACA compliance by January 1, 2021.
As background, on March 25, 2019, CMS provided guidance for a transition policy extension that allows insurers the option to renew non-grandfathered non-ACA-compliant plans, as long as the state allows for such an extension. Such transition policies are not required to be in compliance with certain ACA mandates including community rating, coverage of essential health benefits, prohibition on pre-existing condition exclusions and the annual out-of-pocket maximum limit. This bulletin applies this most recent federal extension to Alabama and allows the issuer to renew these non-ACA compliant plans either as an early renewal or short policy year to implement the extension.
Small employers that are interested in renewing their non-ACA-compliant plan should work with their advisors and insurers.
Bulletin 2019-04 »
March 19, 2019
IRS Provides Tax Relief for Victims of Severe Storms, Tornados and Straight-Line Winds
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The IRS recently published guidance containing certain relief for individuals and businesses
affected by severe storms, tornadoes and straight-line winds that took place on March 3,
2019, in Alabama.
Specifically, the IRS offered extensions in relation to certain tax filing deadlines. The
extensions apply automatically to any individual or business in an area designated by the
Federal Emergency Management Agency as qualifying for individual assistance.
Specifically, individuals and businesses that reside in Lee County may qualify for tax
relief. As a result of this relief, individuals or businesses that had forms due on or after
March 3, 2019, and before July 31, 2019, have additional time to file the form through July
31, 2019. As it relates to benefits, the relief would generally apply to quarterly payroll,
employment and excise tax filings due, as well as to any employers that may have previously
applied for a Form 5500 filing extension. However, the extension of time to file and pay
does not apply to the W-2, 1094, 1095, 1097, 1098 or 1099 information return series.
Impacted employers should discuss their filing obligations with their CPA or tax
professional, with this relief in mind.
IRS News Release »
June 12, 2018
Alabama Enacts Data Breach Notification Law
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On March 28, 2018, Gov. Ivey signed SB 318, the Alabama Data Breach Notification Act, into
law. This law requires covered entities to implement reasonable, appropriate security
measures to protect personal information on state residents from a security breach.
Further, it requires employers to notify employees and applicants about any breach of
personal information and if the breach is likely to cause substantial harm.
A covered entity is defined as "a person, sole proprietorship, partnership, government
entity, corporation, nonprofit, trust, estate, cooperative association, or other business
entity that acquires or uses sensitive personally identifying information." Thus, any
public or private employer that acquires or uses certain personal information on Alabama
residents, including on employees and applicants, is subject to the security measure
requirements and breach notification provisions.
Personal information is defined as a resident's first name or first initial and last name
in combination with one or more of the following with respect to the same resident:
- A non-truncated Social Security number or tax ID number
- A non-truncated driver's license number, state-issued ID card number, passport number,
military ID number or other unique ID number issued on a government document used to
verify the identity of a specific individual
- A financial account number, including a bank account number, credit card number or
debit card number, in combination with any security code, access code, password,
expiration date or PIN, that's necessary to access the financial account or to conduct
a transaction that will credit or debit the financial account
- Any information regarding an individual's medical history, mental or physical
condition, or medical treatment diagnosis by a health care professional
- An individual's health insurance policy number or subscriber identification number and
any unique identifier used by a health insurer to identify the individual
- A user name or email address, in combination with a password or security question and
answer that would permit access to an online account affiliated with the covered entity
that's reasonably likely to contain or is used to obtain sensitive personally
identifying information
Covered entities that experience a breach must notify affected residents within a
reasonable time to conduct an appropriate investigation, but no later than 45 days from the
determination that a breach has occurred and is reasonably likely to cause substantial harm
(with certain exceptions). Importantly, if a covered entity's third-party agent experiences
a breach in the agent's system, the agent must notify the covered entity as soon as
possible, but no later than 10 days following the determination of the breach or reason to
believe the breach occurred. If more than 1,000 Alabama residents are affected by a breach,
covered entities must notify the state attorney general and consumer reporting agencies
with specific information. Therefore, covered entities need to review third-party service
agreements to ensure they're meeting these requirements and to ensure breach procedures are
in place should an incident occur.
In addition, the law imposes reasonable security requirements for covered entities and
third-party vendors, including an assessment based on the security measures as a whole.
Therefore, employers with employees in Alabama should familiarize themselves with the
specific data breach notification requirements, and they should update security measures to
adequately protect the data they hold and respond appropriately to any potential data
incident. This law is effective May 1, 2018.
SB 318 »
June 13, 2017
Law on Group Health Coverage for Autism Spectrum Disorder Amended
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On May 19, 2017, Gov. Ivey signed HB 284 into law, amending Alabama Code sections
10A-20-6.16, 27-21A-23 and 27-54A-2 related to the provision of coverage for autism
spectrum disorder. The amendment requires fully insured plans issued in Alabama to
employers with at least 51 employees to provide coverage for diagnosis, screening and
treatment of autism spectrum disorders for plan participants who are age 18 or younger
(under the pre-amended law, the age was 9 or younger).
The amendment is effective for health benefit plans delivered, executed, issued, amended,
adjusted or renewed in Alabama on or after Oct. 1, 2017.
HB 284 »
March 7, 2017
Extension of Non-PPACA-compliant Small Group and Individual Policies and Plans
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On Mar. 3, 2017, Alabama Commissioner of Insurance Jim Ridling released Bulletin 2017-01
related to the extension of non-PPACA-compliant small group and individual policies and
plans. As background, on Feb. 23, 2017, the federal government announced an additional
transition policy that allows insurers (if allowed by the state) to renew non-grandfathered
non-PPACA-compliant plans (this transitional relief has been extended twice before). Such
policies are not required to be in compliance with certain PPACA mandates including
community rating, coverage of essential health benefits, prohibition on pre-existing
condition exclusions and the annual out-of-pocket maximum limit.
The Bulletin states that Alabama will allow insurers to renew policies in the individual
market and the small group market according to the extended transitional policy. Issuers
may use either early renewal or short policy years to implement the extension.
Bulletin No. 2017-01 »
October 20, 2015
On Oct. 1, 2015, Insurance Commissioner Ridling issued Bulletin No. 2015-06. The bulletin
encourages insurers and vision care providers to review their plan form filings and provider
contracts to ensure compliance with the terms of recently adopted Ala. Act No. 2015-481 (SB
270, 2015 Regular Session).
As background, on June 11, 2015, Gov. Bentley signed SB 270 into law. The law prohibits
insurers of vision care services from limiting a vision care provider's ability to set fees for
services and materials, to participate in specific vision care plans and to choose sources of
suppliers in certain circumstances. The law also prohibits vision care providers from charging
more to an insurer than the customary rates of those vision care providers and requires
reasonable reimbursements for vision care services and materials to vision care providers. The
Alabama Department of Insurance may adopt rules to implement this law.
The law became effective June 11, 2015.
Bulletin No. 2015-06 »
July 14, 2015
On June 11, 2015, Gov. Bentley signed SB 296 into law. The law places restrictions on the terms
of certain health insurance policies, health maintenance organization plans and other health
benefit plans with respect to dental services. The new law prohibits a policy or plan from
setting fees for services that are not covered by the plan or policy and provides certain
exceptions. Specifically, an insurance policy, plan or contract providing for third-party
payment or prepayment of health or medical expenses issued after Jan. 1, 2016 may not require a
dental care provider to provide service to a covered person at a fee set by the policy or plan
unless the services are covered by the policy or plan. The law becomes effective Sept. 1, 2015.
Senate Bill 296 – Act No. 2015-483 »
On June 11, 2015, Gov. Bentley signed SB 270 into law. The law prohibits insurers of vision
care services from limiting a vision care provider's ability to set fees for services and
materials, to participate in specific vision care plans and to choose sources of suppliers in
certain circumstances. The law also prohibits vision care providers from charging more to an
insurer than the customary rates of those vision care providers and requires reasonable
reimbursements for vision care services and materials to vision care providers. The Department
of Insurance may adopt rules to implement this law. The law is effective immediately.
Senate Bill 270 – Act No. 2015-481 »
February 10, 2015
On Jan. 26, 2015, a federal district court ruled that Alabama's prohibitions against permitting
same-sex marriage are unconstitutional. Previously, the court ruled that Alabama's prohibitions
against recognizing out-of-state same-sex marriages are unconstitutional. The court blocked the
state from enforcing these prohibitions, but stayed both rulings until Feb. 9, 2015
(Strawser
v. Strange, S.D. Ala., No. 1:14-cv-00424, 1/26/15; Searcy v. Strange, S.D.
Ala., No. 1:14-cv-00208, 1/23/15). On Feb. 9, 2015, the U.S. Supreme Court denied the
application for a continued stay. Therefore, it appears that same-sex marriage is legal in
Alabama.
The rapid changes in state marriage laws have important effects for individuals in Alabama and
for employers administering state tax rules. They are less significant for purposes of
administering federal tax and benefit rules due to the Supreme Court's Windsor decision and
subsequent agency guidance recognizing all same-sex spouses regardless of state of residence.
Employers in Alabama should work closely with their attorneys and tax advisors to ensure plan
design compliance in light of the ongoing developments in this area.
This will most likely mean that group health insurance policies issued in Alabama will need to
amend their plan documents to offer coverage to same-sex spouses. We are expecting further
guidance from the state and will report such in future editions of Compliance Corner.
Strawser v. Strange »
Searcy v. Strange »
Feb. 9,
2015, U.S. Supreme Court Order »
October 7, 2014
On Oct. 2, 2014, the U.S. DOL’s Wage and Hour Division and the Alabama Department of
Labor signed a memorandum of understanding to work together to identify misclassification of
employees as independent contractors. Alabama joins other states which already have such an
agreement in place, including California, Colorado, Connecticut, Hawaii, Illinois, Iowa,
Louisiana, Maryland, Massachusetts, Minnesota, Missouri, Montana, New York, Utah and
Washington. The issue of misclassification of workers has been emphasized over the last few
years due to the potential for these workers to be denied access to health insurance, benefits,
family and medical leave, overtime compensation, minimum wage and unemployment insurance. Due
to health care reform, there is even greater focus on employers properly identifying workers
who must be offered employer-sponsored health insurance if they are working at least 30 hours
per week, or the employer may be at risk for a penalty under the employer mandate.
Press release
»
DOL
misclassification homepage »
August 12, 2014
On July 28, 2014, the Alabama Department of Insurance issued Bulletin No. 2014-03. The bulletin
provides guidance regarding calculation of composite rates for Alabama-issued policies for
policy years beginning on or after Jan. 1, 2015. As background, final rules issued by HHS March
11, 2014, provided for a two-tiered federal calculation method for composite rates (one tier
for each covered adult age 21 or older and a second tier for each covered child under age 21).
However, the same final rule permitted states to substitute their own alternative to the
federal methodology by seeking approval from HHS. This bulletin issued by the state of Alabama
is confirmation that the state has sought such alternative certification and it was approved.
In this case, the state requested to use a four-tiered calculation: employee, employee +
spouse, employee + children and employee + family.
This means that while health insurance carriers issuing small group market plans in the state
will continue to provide per-member billing, they may choose to provide family composite
premiums on an optional basis. If they do so, the carrier must follow the state's four-tiered
approved alternative method. If a carrier offers the family composite methodology, it must make
it available for each small employer in the market.
The bulletin provides definitions for each rating tier, as well as the factors to be used when
determining the final premium charged for each employee. Importantly, the bulletin does not
apply directly to small employers, although this information is important for all employers to
understand. Small employers in Alabama may use composite rates rather than per member rates to
determine the percentage of the premium paid by the employer versus employee contribution
levels for policies issued in 2015 if the carrier has opted to follow this alternative
calculation method. The bulletin is effective immediately.
Bulletin No. 2014-03 »
Federal Chart of Approved States with Rating Variations »
May 20, 2014
On April 2, 2014, Gov. Bentley signed SB 123 into law, creating Act 2014-219. The law suspends
the Alabama Health Insurance Plan (AHIP), which is the state's high-risk pool. The law includes
an exception that would allow the AHIP to reopen if federal law ever requires the state of
Alabama to offer guaranteed-issue health coverage to eligible individuals.
Act 2014-219
»
Alaska
March 16, 2021
State Allows Issuers to Renew Certain Non-ACA Compliant Policies
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On January 27, 2021, the Division of Insurance issued Bulletin 21-02, announcing that the division will allow insurers the option to renew non-ACA-compliant individual and small group coverage if coverage has been continuously in effect since December 31, 2013. Policies may continue to be renewed on or before October 1, 2022, provided that all such coverage comes into compliance with the specified requirements by January 1, 2023. Insurers may early renew coverage or issue coverage for periods less than one year if a policy terminates prior to December 31, 2022.
On January 19, 2021, CMS provided guidance for a transition policy extension that allows insurers the option to renew non-grandfathered non-ACA-compliant plans, as long as the state allows for such an extension. Such transition policies are not required to be in compliance with certain ACA mandates including community rating, coverage of essential health benefits, prohibition on pre-existing condition exclusions and the annual out-of-pocket maximum limit. This bulletin applies this most recent federal extension to Alaska and allows the issuer to renew these non-ACA compliant plans.
Insurers who renew non-ACA compliant policies must provide enrollees with notice concerning how their premiums may be affected by this decision.
Employers with plans regulated by the state should be aware of this development.
Bulletin 21-02 »
January 20, 2021
COVID-19 Insurance Update
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On January 15, 2021, Director Wing-Heier issued orders R21-01, R21-02, R21-03 and R21-04. These emergency measures were issued following the governor’s extension of his public health disaster emergency order regarding COVID-19.
R21-01 requires insurers to waive any cost sharing for laboratory diagnostic testing for respiratory syncytial virus, influenza and COVID-19. It also requires insurers to cover telehealth service categories no less generously than required by Medicare under the national public health emergency as long the public health emergency is in effect. It requires insurers to allow early refills or replacements of lost or damaged medications and expects this flexibility to continue for the duration of the public health disaster emergency. Insurers are required to allow affected consumers to obtain emergency supplies or refills without applying additional authorization requirements. In addition, consumers must be able to access their necessary prescriptions from a local retail pharmacy even if their prescription supply is normally provided by mail order without concern of a penalty. These requirements do not apply to prescriptions containing opioids. Finally, insurers are required to suspend any contract prohibition of family members providing covered home healthcare services during the public health emergency disaster.
R21-02 requires insurers to allow employers to continue covering employees under group policies even if the employee would otherwise become ineligible due to a decrease in hours worked per week. Insurers shall allow employers to continue providing coverage to employees under group policies regardless of any “actively at work” or similar eligibility requirement in the policy. Additionally, insurers are not allowed to increase premium rates or terminate a group policy based on a group’s decreased enrollment or participation due to COVID-19 during a plan year.
R21-03 requires insurers to cover infusion therapies intended to treat COVID-19, cover the vaccine administration at zero cost sharing, and recognize any provider offering the vaccine consistent with a state vaccination program.
R21-04 requires insurers to waive any requirements for location-based credentialing and pay claims for covered services when consumers are billed for services located at, sponsored by or facilitated by the local, state or federal government during this pandemic until such alternate sites are closed.
The orders are effective on January 15, 2021, and expire on February 14, 2021, or until the governor declares that the public health emergency is over.
Employers with plans regulated by the state should be aware of these orders.
R21-01 »
R21-02 »
R21-03 »
R21-04 »
November 10, 2020
State Insurance Update
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On October 2, 2020, the Division of Insurance issued Bulletin 20-18, reminding healthcare insurers in Alaska that they are required to expand telehealth coverage to all covered services of healthcare insurance plans in group markets subject to state law. Services must be provided by a healthcare provider licensed in Alaska. A prior in-person visit must not be required. Insurers cannot mislead consumers or providers concerning mandated services and failing to provide this service is a violation of state law. The insurer must also offer non-network options to those it covers, including access to telehealth services, and state law does not limit the location of telehealth services. Finally, the services must be HIPAA-compliant.
Employers with plans regulated by the state should be aware of this development.
Bulletin 20-18 »
April 28, 2020
COVID-19 Insurance Updates
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On April 15-16, 2020, the Division of Insurance issued four more regulatory orders covering insurance issues relating to the COVID-19 outbreak. In response to the public health emergency order issued by Gov. Dunleavy on March 11, 2020, these orders seek to ensure that insureds in the state continue to have health plan coverage during the outbreak, while giving insurers the flexibility to work with insureds to continue coverage. The orders apply to insurers licensed in the state as well as insurance issued in the state.
Regulatory Order R20-04 prohibits carriers from terminating contracts due to nonpayment; requires carriers to waive late fees, and requires insurers to cover employees when employers wish to extend eligibility of employees that are not actively working or whose hours are reduced. This order expires on November 15, 2020.
Regulatory Order R20-05 prohibits carriers from instituting cost-sharing for lab work relating to respiratory illness, including COVID-19; requires carriers to provide more telehealth options; and requires carriers to allow early refills or replacements of medication without authorization. This order expires on November 15, 2020.
Regulatory Order R20-06 requires the suspension of preauthorization requirements, as well as concurrent and retrospective reviews for inpatient and outpatient services; waives location-based credentialing requirements; requires carriers to pay claims immediately; and suspends nonessential insurance audits of payments. This order expires on November 15, 2020.
Regulatory Order R20-07 extends the prohibition instituted in Regulatory Order R20-04 prohibiting carriers from terminating insurance contracts for nonpayment to June 1, 2020. Discussion of the original order can be found in the March 17, 2020, edition of Compliance Corner.
The orders are primarily directed at insurers. However, employers should also be aware of these developments.
Regulatory Order R20-04 »
Regulatory Order R20-05 »
Regulatory Order R20-06 »
Regulatory Order R20-07 »
April 14, 2020
COVID-19 Insurance Updates
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On March 27, 2020, the Division of Insurance issued Bulletin B 20-11. The bulletin requires insures to continue covering employees under group policies even if they would have been ineligible because of reduced work hours and prohibits insurers from increasing premiums or terminating policies because a group has decreased enrollment or participation due to COVID-19.
The bulletin suspends deadlines for claim and appeal filings and encourages insurers to implement fully electronic claims processes. It also requires insurers to cover services that can be offered via telehealth in order to prevent the spread of COVID-19. In order to prevent a supply shortage, the bulletin requires coverage of off-formulary prescription drugs if there is no formulary drug to treat a covered service. Finally, the bulletin requires insurers to notify the division if they become aware of price gouging or fraud.
On March 29, 2020, the division issued Bulletin 20-12. It requires insurers to pay claims for covered services even if they are provided by facilities located at, sponsored by, or facilitated by the local, state or federal government during the COVID-19 pandemic. The bulletin advises insurers to suspend pre-authorization requirements for inpatient and outpatient services for the duration of the COVID-19 pandemic and for post-acute placements. The bulletin advises insurers to suspend concurrent and retrospective reviews, and urges them to pay claims as soon as possible and to suspend nonessential audits of hospital payments. The bulletin encourages TPAs who are registered with the division to comply with the bulletin too.
The bulletins are primarily directed at insurers. However, employers should also be aware of these developments.
Bulletin 20-11 »
Bulletin 20-12 »
March 31, 2020
COVID-19 Insurance Updates
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Alaska state entities issued four Bulletins and one regulatory order relating to the COVID-19 outbreak, which apply to health insurers providing coverage through health care insurance plans to Alaska residents. In addition, an emergency rule was promulgated to include people suffering from respiratory distress syndromes as high-risk individuals for reinsurance purposes.
On March 17, 2020, the Division of Insurance issued Bulletin 20-07. The bulletin reminds the public that effective March 16, 2020, Alaska insurance law is amended to expand telehealth coverage to all covered services of health care insurance plans in the individual and group markets subject to Alaskan regulation. Services must be provided by a health care provider licensed in Alaska. A prior in-person visit must not be required. A previous bulletin, 20-04, also encouraged the liberal use of telehealth services, as a way of minimizing the spread of COVID-19. Insurers were asked to review their telehealth programs so that they are ready to handle increased demand (see below).
On March 18, 2020, the Division of Insurance issued Bulletin 20-08. The bulletin, issued under the authority granted under Alaskan statute after Gov. Dunleavy declared a public health disaster declaration due to the COVID-19 pandemic, prohibits carriers from terminating insurance contracts due to nonpayment. This effort will provide relief to affected policyholders by allowing continuing insurance coverage. In conjunction with this effort, the DOI will work with carriers to minimize the regulatory effects of such an extension, specifically financial review requirements. The extension of the grace period does not eliminate the obligation to pay the premium, but limits policy cancellation for late payment. Carriers are encouraged to work with policyholders in the collection of premiums and to waive all late fees.
On March 18, 2020, the Division of Insurance issued Regulatory Order R20-02. The order extends deadlines for external health care reviews. Insurers are required to make reasonable efforts to meet the deadlines and expedited reviews must be processed to completion in no more than five working days. The order extends experimental and investigational health care reviews to a 30-day deadline. If there will be significant delays in meeting deadlines, the insurer should inform the Division.
On March 19, 2020, the Division of Insurance issued Bulletin 20-09. This bulletin supersedes Bulletin 20-04, by declaring that, effective March 20, 2020, respiratory panel tests are no longer subject to the zero cost-sharing requirement. In addition, health insurers are also asked to waive the cost sharing for an office visit and urgent care center visit with the above testing, as well as for an emergency room visit with testing for the above. This waiver is applicable for in-network and out-of-network providers, facilities, and laboratories.
The bulletin notifies the public that, under IRS Notice 2020-15 issued on March 11, 2020, health plans that otherwise qualify as HDHPs will not lose that status merely because they cover the cost of testing for treatment of COVID-19 before plan deductibles have been met. Finally, the bulletin confirms that in Section 6001 of HR6201 of US Congress signed by the President on March 18, 2020, health insurance insurers offering group or individual health insurance coverage shall not impose prior authorization or other medical management techniques for COVID-19 testing products, items, and services.
On March 20, 2020, the Division of Insurance issued Bulletin 20-10. This bulletin encourages insurers to allow policyholders to self-audit and self-report changes in their exposure or risk profile and adjust premiums accordingly. For policies that are subject to audit, the bulletin encourages insurers to allow self-auditing and self-reporting in lieu of physical audits to the extent that physical audits are impracticable. Prospective reductions in premium or retroactive refunds of premium made pursuant to the bulletin to accommodate COVID-19-related changes in exposure or risk profile will not be considered a rebate or unfair discrimination to the extent they are reasonable and consistently applied. The bulletin remains in effect until June 1, 2020.
On March 25, 2020, Division of Insurance promulgated an emergency rule amendment to 3 AAC 31.450, to include persons suffering from cardio-respiratory failure and shock, including respiratory distress syndromes, as high-risk individuals whose coverage is subject to reinsurance.
Employers with policies regulated by Alaska should be aware of these developments.
Bulletin 20-07 »
Bulletin 20-08 »
Bulletin 20-09 »
Bulletin 20-10 »
Regulatory Order R20-02 »
Notice of Emergency Regulation »
March 17, 2020
Insurance Updates Regarding COVID-19
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Alaska issued two Bulletins in response to the COVID-19 outbreak, which apply to health insurers providing coverage through health care insurance plans to Alaska residents.
On March 3, 2020, the Department of Commerce, Community, and Economic Development, Division of Insurance, issued Bulletin 20-03. In anticipation of possible quarantines in response to the outbreak, this Bulletin expects applicable insurers to allow consumers to obtain emergency supplies or refills without applying additional authorization requirements, and to allow consumers to refill their prescriptions at a local pharmacy without penalty, even if they normally do so by mail. Insurers are allowed to observe normal processes when prescriptions contain opioids.
Bulletin 20-03 also encourages insurers to review and update their claims and utilization review policies in light of guidance issued by the CDC and the Alaska Department of Health and Social Services.
On March 6, 2020, the Division of Insurance issued Bulletin 20-04. The Bulletin requires applicable insurers to waive any cost sharing for laboratory diagnostic testing for COVID-19, as well as for respiratory syncytial virus, influenza, and respiratory panel tests. However, in order to qualify for this waiver, patients must meet criteria set forth by the Alaska Division of Public Health/Epidemiology and the CDC at the time of service.
Bulletin 20-04 also encourages the liberal use of telehealth services as a way of minimizing the spread of COVID-19. Insurers are asked to review their telehealth programs so that they are ready to handle increased demand.
Employers with policies regulated by Alaska should be aware of these developments.
Bulletin 20-03 »
Bulletin 20-04 »
March 3, 2020
Grandmothered Plans Extended
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On February 10, 2020, the Department of Commerce, Community, and Economic Development, Division of Insurance, issued Bulletin 20-02, granting insurers the option of renewing non-ACA-compliant individual and small group coverage if coverage has been continuously in effect since December 31, 2013. Policies may continue to be renewed on or before October 1, 2021, provided that all such coverage comes into compliance with the specified requirements by January 1, 2022. Insurers may early renew coverage or issue coverage for periods less than one year if a policy terminates prior to December 31, 2021.
If insurers opt to renew these plans, then they must disclose to their enrollees information concerning how such renewal will affect their premiums. Employers should be aware of this extension and of the notice requirement to those employees enrolled in these plans.
Bulletin 20-02 »
April 2, 2019
One-Year Extension for Grandmothered Plans
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On March 27, 2019, the Alaska Division of Insurance published Bulletin 19-05. The bulletin
provides another one-year extension to the transitional policy of non-ACA-compliant
individual and small group policies and plans issued in Alaska.
As background, on March, 25, 2019, CMS issued guidance allowing extensions of so-called
“grand mothered policies” (for example, non-ACA-compliant plans that have been continued
since 2013), subject to state and carrier approval. Bulletin 19-05 represents Alaska’s
approval for such extension.
Bulletin 19-05 states that insurers have the option to renew non-ACA-compliant policies if
coverage has been continuously in effect since December 31, 2013. Those policies may
continue to be renewed on or before October 1, 2020, provided the policy will terminate by
December 31, 2020. Insurers may early renew or issue coverage for periods less than one year
if a policy terminates prior to December 31, 2020, and, in the case of a small group, if the
employer wants coverage through the end of the calendar year.
The bulletin presents two options for insurers that elect to extend non-ACA policies. Under
the first option, an insurer may permit employer-sponsored groups currently enrolled in the
insurer’s non-ACA-compliant plan to continue to renew their coverage. Under the second
option, the insurer may provide an additional opportunity to renew coverage in its
non-ACA-compliant plan to an employer-sponsored group that’s currently enrolled in the
insurer’s non-ACA-compliant plan but has indicated its intent to not renew at the end of the
plan year.
Alaska small employers that are interested in renewing a non-ACA-compliant plan should work
with their advisors and insurers.
Bulletin 19-05 »
February 5, 2019
Information on AHPs
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On Jan. 30, 2019, Director Wing-Heier issued Bulletin B 19-02 to provide information to
insurers and entities regarding association health plans (AHPs) and the application of AK’s
insurance statutes.
As background, the DOL and EBSA published a final rule relating to AHPs on June 21, 2018,
intending to expand access to AHP coverage options. The final rule establishes new
standards and criteria for the creation of AHPs and, by providing additional clarifications
of existing criteria, expands access to health coverage through AHPs. Specifically, the new
regulatory framework expands the “commonality of interest” requirement to include
geographic location and industry. The expansion is intended to allow employers from
non-related industries and trades from the same geographical areas and working owners (for
example, sole proprietors with no employees) to access health coverage through AHPs. This
AK bulletin points out that several provisions of the final rule are in direct conflict
with existing AK statutes, and while AK seeks to harmonize any conflicts to the reasonable
benefit and flexibility to AK employers, the new final rules do not preempt state law.
Because AK continues to have broad authority under ERISA to regulate AHPs under state
licensure and solvency statutes, insurance companies that offer health insurance plans to
AHPs in AK must follow the existing state regulations. Regarding self-funded AHPs, any
entity wishing to form a self-funded AHP in AK must do so within the existing framework of
permissible self-funded arrangements. Specifically, AK requires employers in an AHP to be
members of a “bona fide association or group of two or more businesses in the same or a
closely related trade, profession or industry that provide support, services, or supplies
primarily to that trade, profession or industry.” So, the expansion of “commonality of
interest” within the DOL’s final rules is not permissible in AK. Also keep in mind that all
AHPs, both fully-insured and self-funded, must file with the Division of Insurance for
review.
AK employers interested in AHPs should work closely with insurance carriers on
fully-insured arrangements. However, the provisions of the DOL’s final rule intended to
expand access will likely not be permissible for self-funded AHPs under existing AK
regulations.
Bulletin
B 19-02 »
May 1, 2018
Extension of Non-ACA-Compliant Plans
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On April 12, 2018, the Alaska Division of Insurance published Bulletin 18-07. The bulletin
relates to another one-year extension to the transitional policy of non-ACA-compliant
individual and small group policies and plans.
As background, on April 9, 2018, CMS issued guidance allowing extension of so-called
“grandmothered policies” (i.e., non-ACA-compliant plans that have been continued since
2013), subject to state and carrier approval. Bulletin 18-07 represents Alaska’s approval
for such extension.
Bulletin 18-07 states that insurers have the option to renew non-ACA-compliant policies if
coverage has been continuously in effect since Dec. 31, 2013. Those policies may continue
to be renewed on or before Oct. 1, 2019, provided the policy will terminate by Dec. 31,
2019. Insurers may early renew or issue coverage for periods less than one year if a policy
terminates prior to Dec. 31, 2019 and, in the case of a small group, if the employer wants
coverage through the end of the calendar year.
The bulletin presents two options for insurers that elect to extend non-ACA policies. Under
the first option, an insurer may permit employer-sponsored groups currently enrolled in the
insurer’s non-ACA-compliant plan to continue to renew their coverage. Under the second
option, the insurer may provide an additional opportunity to renew coverage in its
non-ACA-compliant plan to an employer-sponsored group that’s currently enrolled in the
insurer’s non-ACA-compliant plan but has indicated its intent to not renew at the end of
the plan year.
Alaska small employers that are interested in renewing a non-ACA-compliant plan should work
with their advisors and insurers.
Bulletin
18-07 »
July 25, 2017
HHS Approves Alaska's Section 1332 Waiver from Several ACA Requirements
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On July 7, 2017, HHS approved Alaska’s application for a state innovation waiver under
Section 1332 of the ACA. As background, the ACA allows states to apply for a waiver from
certain ACA requirements, so long as the state meets certain requirements (including the
state showing that their own innovative ideas and strategies will result in more
individuals receiving coverage). Alaska’s application sought to implement the Alaska
Reinsurance Program (ARP) for 2018 and beyond. The ARP is a state-operated reinsurance
program that covers claims in the individual market for individuals with one or more of 33
identified high-cost conditions. The ARP is meant to stabilize premiums and increase
coverage in the individual market. Because the ARP will lower premiums, the
second-lowest-cost silver plan premium is reduced, which means the federal government will
spend less on premium tax credits (PTCs) for individuals in Alaska. As a result, Alaska
will receive pass-through funding based on the amount of PTCs that would have been provided
to individuals absent the waiver. This does not mean the individual mandate is no longer
applicable in Alaska, or that individuals cannot continue to receive PTCs in Alaska.
Rather, the federal government will send additional funds to Alaska to help fund the ARP.
The HHS approval is effective for Jan. 1, 2018, through Dec. 31, 2022. HHS also released a
fact sheet with additional information on the Alaska waiver approval.
The HHS approval contains no new employer obligations. But employers may have heard the
news about a waiver, so understanding the approval and its consequences in the individual
market is helpful.
HHS Approval »
Fact Sheet »
August 23, 2016
Updates to Coverage for Primary Care Provider, Pediatrician and OB-GYN Services
On July 20, 2016, Gov. Walker signed HB 372 into law, which provides updates to coverage
requirements for services provided by primary care providers (PCPs), obstetricians and
gynecologists (OB-GYNs) and pediatricians. On PCPs and pediatricians, plans that provide
coverage through networks of providers must allow plan participants to access out-of-network
providers. Such plans may require higher copayments, deductibles or premiums for out-of-network
providers. Also, if a plan requires participants to designate a PCP, participants may choose
any available PCP (which, effective Oct. 16, 2016, includes a pediatrician) to receive
appropriate specialty care. On OB-GYNs, effective Oct. 16, 2016, plans that provide coverage
for OB-GYN services and require participants to select a PCP must allow female participants to
receive OB-GYN care from participating providers that specialize in OB-GYN services without
requiring prior authorization or referrals. Employers with fully insured plans in Alaska should
be aware of the new law and requirements.
HB 372
»
August 9, 2016
On July 11, 2016, Gov. Walker signed SB 53 into law. The new law contains two separate
requirements for fully insured plans in Alaska. The first requirement relates to coverage for
autism spectrum disorder. Under current law, coverage must include treatment prescribed by a
licensed physician or psychologist. Under the new law, that list includes treatment prescribed
by an advanced practice registered nurse practitioner. The second requirement relates to
coverage of services provided by midwives. Specifically, under the new law, plans that provide
coverage for services performed for women during pregnancy and childbirth (and for a period of
time following childbirth) must provide coverage for the same services performed by advanced
practice registered nurses, so long as the services performed are within the practice scope of
certified midwives (also sometimes referred to as ‘certified nurse midwives’). The law is
effective July 7, 2016. Overall, the law adds no new employer compliance obligations, but
employers with fully insured plans in Alaska should be aware of the changes.
SB 53 »
On July 11, 2016, Gov. Walker signed SB 142 into law. The new law relates to coverage for
certain anti-cancer treatment for fully insured plans in Alaska. Under the new law, plans that
provide coverage for anti-cancer medications that are injected or administered intravenously by
a health care provider and such medications administered directly by the plan participant (such
as orally administered or self-injected medications) cannot apply higher cost-sharing
(including co-insurance, co-payments or deductibles) than the plan applies to injected or
intravenously anti-cancer medications. This is the case regardless of the plan’s formulations
or benefit category design or determination. For purposes of the new law, “anti-cancer
medications” include drugs or biologics used to kill, slow or prevent the growth of cancerous
cells or to treat related side effects. The new law is effective for plans beginning (or
renewed) on or after Jan. 1, 2017. The law includes no new employer compliance obligations, but
employers with fully insured plans in Alaska should be aware of it.
SB 142
»
July 12, 2016
On June 14, 2016, Gov. Walker signed HB 234 into law, creating Chapter 17. Under the new law,
plans that provide coverage for mental health benefits must provide coverage for those benefits
delivered through telehealth services by Alaska-licensed health care providers. The law applies
to plans offered, issued, delivered or renewed in Alaska on or after Sept. 11, 2016. The new
law does not add new employer obligations, but fully insured Alaska employers should be aware
of the coverage requirements.
Chapter 17
»
May 3, 2016
On March 24, 2016, the Alaska Division of Insurance published Bulletin 16-04. The bulletin
relates to an extension of non-PPACA-compliant small group policies and plans. As background,
the federal government previously announced a transition policy that allows insurers (if
allowed by the state) to renew non-grandfathered non-PPACA-compliant plans, so long as the
transitional coverage does not extend beyond Dec. 31, 2017.
Bulletin 16-04 states that the Division will allow insurers the option to renew
non-PPACA-compliant policies if coverage has been continuously in effect since Dec. 31, 2013.
Those policies may continue to be renewed on or before Oct. 1, 2017, provided the policy will
terminate by Dec. 31, 2017. Insurers may early renew or issue coverage for periods less than
one year if a policy terminates prior to Dec. 31, 2017 and the employer wants coverage through
the end of the calendar year.
The bulletin presents two options for insurers that elect to extend non-PPACA-policies. Under
the first option, an insurer may permit employer-sponsored groups currently enrolled in the
insurer’s non-PPACA-compliant plan to continue to renew their coverage. Under the second
option, the insurer may provide an additional opportunity to renew coverage in its
non-PPACA-compliant plan to an employer-sponsored group that is currently enrolled in the
insurer’s non-PPACA-compliant plan but has indicated its intent to non-renew at the end of the
plan year.
Alaska small employers that are interested in renewing a non-PPACA-compliant plan should work
with their advisors and insurers.
Bulletin
16-04 »
August 25, 2015
On Aug. 13, 2015, the Alaska Department of Labor and Workforce Development signed a memorandum
of understanding (MOU) with the DOL. The MOU is meant to announce that the state and the DOL
will work together to prevent the improper classification of employees as independent
contractors or other non-employee workers. The MOU states that the two entities will share
information and coordinate enforcement in an effort to protect employee/worker rights under
both federal and state law. The MOU arose as a result of the DOL’s Misclassification
Initiative. According to the press release, Alaska is one of 25 states to sign such an MOU with
the DOL.
Alaskan employers should review their employment practices to ensure that individuals are
properly classified as either employees or independent contractors. The proper classification
is important for purposes of PPACA’s employer mandate, as well as many other federal and state
laws and calculation of employment taxes. Because the classification analysis is based on the
specific facts and circumstances surrounding an employer’s situation, employers should work
with outside counsel to resolve any questions.
Misclassification MOU
»
DOL News Brief
»
Alaska Press Release
»
DOL
Misclassification Initiative Web Page »
March 24, 2015
On Feb. 23, 2015, the Alaska Division of Insurance issued a press release relating to a special
enrollment period (SEP) for the Alaska health insurance exchange. As background, on Feb. 20,
2015, the federal government announced it would allow a SEP related to the federal tax penalty
for consumers in states with health exchanges run by the federal government. The press release
states that Alaskans who "first became aware of, or understood the implications of, the shared
responsibility payment in connection when preparing their 2014" federal income taxes will have
the opportunity to avoid the penalty in 2015 by signing up for coverage during a SEP between
March 15 and April 30. To qualify for the SEP, Alaskans must certify that they filed their tax
returns and paid the penalty for not having coverage in 2014.
The news release does not require any new compliance obligations or otherwise affect employers
in Alaska. However, employers will want to be aware of the news release should employees have
questions relating to SEP opportunities in the exchange.
Press Release »
On Feb. 18, 2015, the Alaska Division of Insurance published Bulletin B 15-05. The bulletin
applies to insurers and relates to coverage of services relating to behavior analysis and other
autism service providers, as required by Alaska law. According to the bulletin, denying a claim
solely on the basis that a behavioral analyst is not licensed in Alaska is a violation of
Alaska law. An insurer’s failure to promptly pay such claims may also result in late
payment interest penalties.
Although the bulletin applies to insurers, employers in Alaska should be aware of the bulletin
and the coverage requirements relating to behavior analysis and autism service providers,
particularly those that may not be licensed in Alaska.
Bulletin
B 15-05 »
November 4, 2014
On Oct 17, 2014, the U.S. Supreme Court denied Alaska’s request for a stay in a case,
Parnell
v. Hamby, Case No. 3:14-cv-00089-TMB (D. Alaska Oct. 12, 2014) challenging
Alaska’s ban on same-sex marriage. As background, in 1998 Alaska voters passed a
constitutional amendment that defines “marriage” as between one man and one woman.
That constitutional amendment has been the subject of recent litigation. Earlier this month, a
federal district court in Alaska ruled that the amendment is unconstitutional. That decision
paved the way for same-sex couples to begin marrying in Alaska. However, the state requested a
stay on the decision and over the course of a few days, that request made its way to the U.S.
Supreme Court. As a result of the stay’s denial, same-sex marriage is now legal in
Alaska. Although no specific guidance has been released, the ruling most likely means that
group health insurance policies issued in Alaska will be required to cover same-sex spouses.
NFP Benefits Compliance will continue to monitor the issue and report on any additional
guidance in future editions of Compliance Corner.
Supreme
Court Denial »
September 9, 2014
On July 2, 2014, the Alaska Division of Insurance updated a document titled “2015 Alaska
ACA Form and Rate Guidance.” The update relates to Alaska’s approach for composite
rating requirements in the small group market. As background, final rules issued by HHS March
11, 2014, provided for a two-tiered federal calculation method for composite rates (one tier
for each covered adult age 21 or older and a second tier for each covered child under age 21).
However, the same final rule permitted states to substitute their own alternative to the
federal methodology by seeking approval from HHS.
The Alaska document states that Alaska has been approved for and will implement a four-tiered
rating structure, including employee, employee plus spouse, employee plus children, and
employee plus family. This means that while insurers issuing small group market plans in the
state will continue to provide per-member billing, they may choose to provide family composite
premiums on an optional basis. If so, the insurer must follow the state’s four-tiered
alternative method. If an insurer offers the family composite methodology, it must make it
available for each small employer in the market, regardless of size. Tiered composite premium
rates must be set at the beginning of the plan year and do not change through the year, even if
the distribution of employees among the tier levels changes.
The tiered-composite methodology applies to Alaska small employer premium rates for plans
offered outside of the federally facilitated exchange in Alaska beginning Jan. 1, 2015. Those
offered on the exchange must use per-member premium ratings.
The document provides definitions for each rating tier, as well as the factors and methodology
to be used when determining the final premium charged for each employee. Importantly, the
bulletin does not apply directly to small employers, although this information is important for
all employers to understand. If the insurer has opted to follow the four-tiered alternative
calculation method, small employers in Alaska may use composite rates rather than per-member
rates to determine the percentage of premium paid by the employer versus the employee.
2015 Alaska ACA Form and Rate Guidance »
Federal Chart of Approved States with Rating Variations »
April 8, 2014
On March 28, 2014, the Alaska Division of Insurance issued Bulletin B14-03. The bulletin
relates to the March 5, 2014, CMS announcement of a two-year extension to the transitional
policy for non-PPACA-compliant health benefit plans (as covered in the March 11, 2014, edition
of Compliance Corner). The bulletin states that Alaska will allow insurers to renew
non-grandfathered plans according to the extended CMS transitional policy in both the
individual and small group markets. Alaska employers that have had their plans cancelled should
consult with insurers on whether those plans can be continued in light of the CMS announcement
and the department’s directive.
Bulletin
B14-03 »
Arizona
April 28, 2020
COVID-19 Insurance Updates
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On April 3, 2020, the Department of Insurance issued Regulatory Bulletin 2020-02. As discussed in the March 31, 2020, edition of Compliance Corner, Gov. Ducey issued an executive order instructing the department to clarify the order’s requirements imposed upon health plans of any type in response to the COVID-19 outbreak. Pursuant to that mandate, this regulatory bulletin, which applies to plans issued or delivered in the state, requires those plans to: cover out-of-network lab testing; waive cost sharing for diagnostic testing related to COVID-19 (including office and urgent care visits); and to cover telemedicine services.
On April 16, 2020, the department issued Regulatory Bulletin 2020-04 to all insurers providing health coverage, among other types of coverage. The bulletin encourages insurers to work with insureds to make sure that policies do not lapse, including refraining from cancelling policies due to nonpayment.
The bulletins are primarily directed at insurers. However, employers should also be aware of these developments.
Regulatory Bulletin 2020-02 »
Regulatory Bulletin 2020-04 »
April 14, 2020
Executive Order on Prescription Drug Coverage During COVID-19
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On April 2, 2020, Gov. Ducey issued Executive Order 2020-20, which requires the Arizona Board of Pharmacy to allow pharmacists to utilize their professional judgement to dispense emergency refills of maintenance medications for up to a 90-day supply and an additional 90-day supply if necessary. The board must also waive electronic prescribing requirements, waive the requirement that companies making hand sanitizer must have a permit, and other measures to facilitate an effective response to the COVID-19 outbreak.
The executive order is primarily directed at the state’s pharmacy board. However, employers and insurers should also be aware of these developments and their impact on costs to health plans.
Executive Order 2020-20 »
FAQ Regarding the Fair Wages and Healthy Families Act
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On April 7, 2020, the Industrial Commission of Arizona updated its FAQ document concerning the state’s Fair Wages and Healthy Families Act (FWHFA) to show how the FWHFA interacts with the FFCRA. The FWHFA mandates that full-time, part-time and seasonal employees be granted paid sick leave, earning a minimum of one hour of leave for every 30 hours worked. Employers with fewer than 15 employees must provide at least 24 hours of paid sick leave each year. Businesses with 15 or more employees must provide a minimum of 40 hours yearly.
The FAQ states that FWHFA leave can be used if an employee or a member of the employee’s family is stricken with COVID-19, and that the paid sick leave provided under the FWHFA is in addition to the paid sick leave granted under the FFCRA.
Arizona employers should be aware of these developments.
FAQ »
March 31, 2020
Insurance Updates Regarding COVID-19
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On March 11, 2020, Gov. Ducey signed Executive Order 2020-07 directing insurance companies to cover the costs of COVID-19 diagnostic testing from all qualified laboratories, regardless of whether the laboratory is in the insurance company’s provider network; waive copays, coinsurance, and deductibles (cost-sharing requirements) related to COVID-19 diagnostic testing; and pass less cost to health plan members for telemedicine visits than for in-person visits, and encourage use of telemedicine during the health emergency.
On March 23, 2020, Gov. Ducey signed Executive Order 2020-12, declaring insurance services as essential business operations.
On March 25, 2020, Gov. Ducey signed Executive Order 2020-15 directing insurance companies regulated by Arizona to provide coverage for all health care services that are provided through telemedicine if the health care service would be covered were it provided through an in-person visit. Insurers can establish reasonable requirements and parameters for this coverage, but they cannot be any more restrictive or less favorable than those delivered in-person. In addition, insurers must reimburse health care providers at the same level for telemedicine visits as they would in-person visits and allow all electronic means of delivering telehealth.
Employers with policies regulated by Arizona should be aware of these developments.
Executive Orders 2020-07, 2020-12, and 2020-15 »
May 29, 2019
Mini-COBRA Law Now Applies to Employers with Fewer Employees
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On May 7, 2019, Gov. Ducey signed SB 1035 into law, creating Chapter 183. The new law relates to Arizona’s mini-COBRA law. Currently, AZ’s mini-COBRA requirement applies to employers with 1-20 employees that offer a fully insured group health insurance plan in AZ. According to Chapter 183, beginning July 27, 2019, AZ employers with 1-19 employees with such fully insured plans will be required to comply with the state’s mini-COBRA law. More information on AZ’s mini-COBRA law can be found in our article here.
Chapter 183 »
April 4, 2017
Los Angeles: Sick Leave Law Revised
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Like many other California cities, Los Angeles implemented its own sick leave ordinance.
The ordinance requires employers to provide paid sick leave to employees who work 2 hours
or more per week in the city of Los Angeles. There is a staggered effective date based on
employer size. Employers with 26 or more employees were subject to the ordinance July 1,
2016; and employers with fewer than 26 employees must comply starting July 1, 2017.
For every 30 hours work, an employee accrues 1 hour of sick leave. When using this method,
the employer may impose a maximum leave bank balance of 72 hours. As an alternative to the
accrual method, the employer may provide 48 hours of paid sick leave as a lump sum. Under
transition relief, large employers may have complied by front loading only 24 hours for
July 1 through Dec. 31, 2016. New employees begin accruing on the date of hire, but cannot
use the sick leave until after 90 days of employment.
Employees may use the sick leave for their own sickness or that of a family member or
closely associated individual who has the equivalence of a family relationship.
On March 14, 2017, the City of Los Angeles Office of Wage Standards (OWS) revised the paid
sick leave requirements and guidance. Below are a summary of the most pertinent provisions.
- An employer’s size is based on the number of covered employees working in Los Angeles.
For businesses in operation prior to Jan. 1, 2016, size is based on 2015 data. On the
other hand, for businesses in operation on or after Jan. 1, 2016, size is based on the
first pay period data.
- Small employers wishing to use the front load method may comply by providing a lump sum
of 24 hours of paid sick leave for the period of July 1, 2017, through Dec. 31, 2017.
- If an employer’s policy does not fully comply with the ordinance, but is overall more
generous to employees, the employer may file for approval.
- Leave balances rollover to the next year.
Employers with existing paid leave policies are not required to provide additional leave if
their existing practices comply with the ordinance. However, employers should carefully
review to make sure that all aspects are in compliance, specifically providing paid sick
leave to temporary and part-time employees if they work 2 hours or more in a week.
OWS,
Paid Sick Leave FAQs »
OWS, Paid Sick Leave Revised Regulations »
San Francisco: Employer Annual Reporting Due
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Employers who are subject to the San Francisco Health Care Security Ordinance or the Fair
Chance Ordinance must submit the 2016 Employer Annual Reporting Form by May 1, 2017.
The Health Care Security Ordinance applies to employers with 20 or more total employees
worldwide and at least one employee who performs work within the city or county of San
Francisco. The ordinance requires the employer to meet a certain spending threshold for
each San Francisco employee related to health care.
The Fair Chance Ordinance applies to employers who have 20 or more total employees
worldwide and at least one employee who performs work within the city or county of San
Francisco. Additionally, employers who have a service contract with the city of San
Francisco are also subject to the ordinance, regardless of the number of employees. The
ordinance prohibits employers from asking about arrest or conviction records on a job
application.
The 2016 online form and instructions are now available. Failure to comply with the annual
reporting may result in a penalty of $500 per quarter assessed against the employer.
Reporting Form
Reporting
Instructions
February 22, 2017
New Ordinance Mandates Paid Parental Leave for San Francisco Employees
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On April 21, 2016, Mayor Lee signed the San Francisco Paid Paternal Leave Ordinance (SF
PPLO) into law. The ordinance will enhance the California Paid Family Leave (CA PFL)
program by supplementing compensation available to covered employees who take time off to
bond with a new child. Under the current CA PFL law, California workers may receive 55
percent of their wages for up to six weeks (set to increase to 60 or 70 percent in 2018,
depending on income).
However, effective Jan. 1, 2017, the SF PPLO requires covered employers (as defined by the
San Francisco Police Code) with 50 or more total employees to provide the balance remaining
after the CA PFL so that the covered employee’s compensation equals 100 percent. Further, a
phase in schedule requires covered employers with 35 or more employees to comply by July 1,
2017 and those with 20 or more employees to comply by Jan. 1, 2018.
The SF PPLO defines a “covered employee” (i.e., one who is eligible for additional
compensation) as one who meets all of the following criteria:
- Began employment at least 180 days before start of the leave period
- Performed a minimum of 8 hours per week for the employer located in San Francisco
- At least 40 percent of weekly hours worked for the employer were in San Francisco; and
- Eligible to receive CA PFL compensation for purposes of bonding with a new child
In addition, covered San Francisco employers have a new SF PPLO poster requirement,
compensation calculation instructions and a specific leave form that employees must
complete in order to receive additional compensation. The San Francisco Office of Labor
Standards Enforcement is responsible for enforcing the employer requirements of the PPLO.
San Francisco Paid Paternal Leave Ordinance »
PPLO Final Rule »
PPLO
Supplemental Compensation Calculation Instructions »
PPLO
FAQs »
PPLO Poster »
January 24, 2017
State Disability Rates Revised for 2017
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The California Employment Development Department (EDD) recently announced that the 2017
employee contribution rate for State Disability Insurance will remain at 0.9 percent.
The taxable wage base from which the contributions will be taken will increase from
$106,742 to $110,902 for calendar year 2017 and the maximum amount to withhold for each
employee will be $998.12.
For claims beginning on or after Jan. 1, 2017, weekly benefits range from $50 to a
maximum of $1,173. To qualify for the maximum weekly benefit amount ($1,173) an
individual must earn at least $26,070.92 in a calendar quarter during the base period.
Lastly, effective Jan. 1, 2017, the tax rate for employers, partners and self-employed
individuals who choose coverage in California's temporary disability insurance program
is 4.55 percent.
Disability Insurance and
Paid Family Leave Benefit Amounts »
Rates,
Withholding Schedules and Meals and Lodging Values »
San Francisco HCSO Health Care Expenditure Rates Increased for 2017
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The San Francisco Health Care Security Ordinance (HCSO) requires covered employers to
satisfy an employer spending requirement by making health care expenditures for their
covered employees, among other reporting and notice requirements. For more information
on what constitutes covered employers/covered employees, please visit the San Francisco
HCSO website link below.
The health care expenditure rate varies depending on the size of the employer and
increases incrementally each year. As of Jan. 1, 2017, the health care expenditure rate
for large employers with 100 or more employees increases to $2.64 per hour payable (up
from $2.53 per hour in 2016). For medium-sized employers with 20 to 99 employees, the
expenditure rate will rise to $1.76 per hour payable (up from $1.68 per hour payable in
2016).
In addition, beginning Jan. 1, 2017, the city of San Francisco now requires that 100
percent of the required amount of health care expenditures for each covered employee be
made as irrevocable expenditures. An irrevocable health care expenditure is a health
care expenditure that has not been retained by and cannot at any time be recovered by
or returned to the employer. Importantly, an irrevocable expenditure now also includes
all employer contributions to HRAs. For more information on what constitutes an
irrevocable expenditure, please visit the HCSO website link below.
Finally, all covered employers are required by the HCSO to post an official notice
regarding the HCSO in a conspicuous place at any workplace or job site where any
covered employee works. The HCSO has released the updated 2017 Official OLSE Notice.
The San Francisco Office of Labor Standards Enforcement (OLSE) is responsible for
enforcing the employer requirements of the HCSO. Covered employers should ensure the
revised version of the notice is displayed at applicable job sites. A copy of the new
2017 Notice can be found below.
2017
San Francisco HCSO Overview and Rates »
2017
San Francisco HCSO FAQs on Health Care Expenditures »
HCSO 2017 Official OLSE Notice »
January 10, 2017
New Law Mandates Paid Sick Leave for Santa Monica Employees
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The Santa Monica City Council recently adopted new sick pay leave provisions under the
City’s Minimum Wage law. This ordinance both raises the city’s minimum wage and
provides additional paid sick leave benefits to employees (in addition to the 24 hours
of paid sick leave required under California state law).
Effective Jan. 1, 2017, the city ordinance requires employers to provide employees with
one hour of paid sick leave for every 30 hours worked. Small employers with 25 or less
employees are required to provide employees with at least 32 hours of leave, and large
employers with 26 or more employees must provide at least 40 hours of leave. As of Jan.
1, 2018, accrual limits will increase to 40 hours for small employers and to 72 hours
for large employers.
Employees can roll over any sick time earned up to the employer’s accrual limits (i.e.,
32, 40, or 72 hours). New employees can use accrued sick leave after the first 90 days
of employment. However, employers may be more generous by allowing earlier sick time
usage, or may front load sick leave hours at the beginning of the calendar, fiscal or
anniversary year. Additionally, if an employee terminates, employers are not required
to pay the individual for any unused sick leave hours.
Certain employer posters are required. Employers must comply with the new law starting
on July 1, 2017.
City of Santa Monica Press Release »
Santa Monica City Ordinance »
City of Santa Monica Fact Sheet »
City of Santa Monica Required Posters »
October 4, 2016
Out-Of-Network Coverage and Cost-Sharing
On Sept. 23, 2016, Gov. Brown signed AB 72 into law. This new legislation amends the
California Health & Safety Code to address reimbursement for out of network (OON) providers
who provide services at in-network facilities. California joins several other states,
including New York, Connecticut and Florida, which offer consumers protections against
surprise OON bills, as well as a process for providers and insurers to resolve payment
disputes for OON care.
The legislation provides that if an insured receives services covered by his/her health
plan by an OON provider at an in-network facility, the insured is only obligated to pay the
OON provider the cost sharing amount that he/she would otherwise be obligated to pay had
the same covered service been provided by an in-network provider. In addition, the OON
provider is prohibited from billing or collecting any amount beyond the insured’s cost
sharing obligation, unless the insured has a plan that includes an OON benefit and the
insured consents in writing to receive services from the OON provider at least 24 hours in
advance of the episode of care. At the time consent is provided, the OON provider must give
the insured a written estimate of his/her total out-of-pocket cost of care.
A health plan must pay an OON provider who provides covered services to an insured at an
in-network facility the greater of the average contracted rate or 125 percent of the amount
Medicare reimburses for the same or similar service. Payment made by the plan to the OON
provider will constitute payment in full unless either party uses the independent dispute
resolution process or other means to resolve the dispute. The Department of Managed Health
Care will establish a new independent dispute resolution process for resolving payment
disputes between OON providers and payers.
AB 72 is effective July 1, 2017.
AB 72 »
Contraceptives: Annual Supply
On Sept. 23, 2016, Gov. Brown signed SB 999 into law. This law enables doctors and other
health-care providers to prescribe up to a 12-month supply of FDA-approved,
self-administered hormonal contraceptives such as birth control pills, the ring and the
patch. In addition, it authorizes pharmacists to dispense, at a patient’s request, up to a
12-month supply of FDA-approved contraceptives at one time and it requires health care
service plans and health insurance policies to cover the costs of a 12-month prescription.
Currently, women are allowed to fill at most a 90-day prescription of birth control at one
time.
SB 999 becomes effective Jan. 1, 2017.
SB 999 »
Premium Rate Change Notice
On Sept. 23, 2016, Gov. Brown signed SB 908 into law. This law is meant to help alert
consumers whenever state regulators consider increases to their health insurance premiums
to be too high. Under current law, the California Department of Managed Health Care and the
California Department of Insurance review premium rate increases proposed by insurers and
health plans that each agency regulates. When the agencies conclude that an increase is
unjustified, they can ask the insurer to rescind the increase, but the company is not
legally obligated to comply. The agencies’ only recourse is to post the information on
their websites.
Under this new legislation, insurers are required to send written notices to policyholders
advising them that regulators found their small group premium rate increases to be
unreasonable or unjustified. The notices must be sent at least 60 before the policy renewal
date, or 10 days before the start of the next health insurance open enrollment period,
thereby giving consumers time to shop for a new plan.
SB 908 is effective Jan. 1, 2017.
SB 908 »
Autism and Pervasive Developmental Disorders
On Sept. 23, 2016, Gov. Brown signed AB 796 into law, which amends California’s Lanterman
Developmental Disabilities Services Act. Under that law, every health care service plan
contract and health insurance policy issued in California must provide coverage for
behavioral health treatment for pervasive developmental disorder or autism until Jan. 1,
2017. This new legislation simply deletes the sunset date in the Lanterman Act and extends
the operation of these provisions indefinitely, thereby creating a new state-mandated
program that will provide services for people with developmental disabilities, including
autism.
AB 796 is effective Jan. 1, 2017.
AB 796 »
Notice of Timely Access to Care
On Sept. 23, 2016, Gov. Brown signed SB 1135 into law. The new legislation requires health
plans and insurers in California to notify consumers and health care providers about a
patient’s right to timely care and language assistance. Under current law, consumers have
the right to timely access to care and care in their preferred language. However, very few
people know these consumer protections exist. Therefore, this new law requires health plans
and insurers to communicate these rights through existing documents and communication
channels, such as:
- Evidence of coverage documents;
- Wherever information on language assistance is provided, as required by existing law;
- Provider directories;
- Health plan and insurer websites; and
- Annual enrollment or renewal notices.
In addition, SB 1135 requires health plans and insurers in California to provide doctors,
hospitals and other health providers with information about timely access requirements.
SB 1135 is effective July 1, 2017.
SB 1135 »
Cost-sharing Changes
On Aug. 25, 2016, Gov. signed SB 923 into law. This law prohibits health plans and insurers
in the individual and small group markets from changing the cost-sharing design during the
plan year except when required by state or federal law. Under current law, health plans and
insurers are prohibited from changing the premium rates in a given “rate year.” This new
law extends that protection to a plan’s cost-sharing design as well. For purposes of this
legislation, cost-sharing refers to what the copays or coinsurance are for a specific
benefit: For example, the copay for a generic drug is $10 or $25; the copay for the brand
name drug is $20 or $50 while the coinsurance for a hospital stay is 20 percent of the
cost.
SB 923 is effective on Jan. 1, 2017.
SB 923 »
Immigration Status
Earlier this year, Gov. Brown signed SB 10 into law. SB 10 expands health care coverage to
all Californians, regardless of immigration status, by permitting the state to apply for a
federal waiver that would allow undocumented immigrants and their non-US born children to
buy coverage through Covered California, the state’s health insurance marketplace, by using
their own money. PPACA explicitly excludes undocumented immigrants from receiving health
coverage through federally-funded programs, including Covered California. This law removes
that barrier by directing the state to apply for a waiver under PPACA Section 1332. If
granted, the waiver would make it possible for undocumented adults to review and purchase
plans from Covered California. These individuals will remain ineligible to receive
subsidies.
While the law is effective immediately, the requirement to offer qualified health plans to
undocumented individuals on the state’s exchange does not become operative until Jan. 1,
2018, for coverage beginning Jan. 1, 2019. This allows the state time to apply for and
receive a Section 1332 waiver.
SB 10 »
June 1, 2016
On Oct. 8, 2015, California Gov. Jerry Brown signed AB 1305 into law. This law imposes a
maximum out-of-pocket (OOP) limit for an in individual participant enrolled in family
coverage that is no greater than the maximum OOP limit for self-only coverage for that
insurance product. Essentially, this means that for all fully-insured plans sitused in
California, an individual enrolled in family coverage will not be required to pay more than
what he/she would pay in OOP expenses if he/she were enrolled in self-only coverage under
the same insurance product. In other words, the self-only OOP maximum is “embedded” in the
family coverage. This OOP maximum requirement went into effect on Jan. 1, 2016.
Additionally, AB 1305 requires embedded deductibles. This means that if a family plan
includes a deductible, the plan may not impose a greater deductible on an individual
participant in family coverage than the deductible for self-only coverage. For individual
and small group plans, the embedded deductible requirement became effective Jan. 1, 2016,
and for large group plans, this requirement becomes effective Jan. 1, 2017.
AB 1305 does pose a compliance concern for employers offering fully-insured HSA-compatible
HDHP coverage in California if that coverage offers a self-only deductible or OOP maximum
amount that is below the minimum federal deductible required for family HDHP coverage.
As background, PPACA imposes OOP maximums on individual and group health plans. For 2016,
those maximum limits are $6,850 for self-only coverage, and $13,700 for family coverage.
Furthermore, to be eligible to contribute to an HSA, federal law requires that an
individual be covered under an HDHP that meets certain deductible thresholds (and those are
indexed each year). For 2016, an HDHP must have a minimum deductible of $1,300 for
self-only coverage and $2,600 for family coverage.
However, in light of this new law, let’s consider a fully-insured HSA-compatible plan with
a deductible and OOP maximum of $1,500 for individual coverage and $3,000 for family
coverage. AB 1305 requires that the family HSA benefit have an embedded OOP maximum of
$1,500 for individuals since the OOP maximum is $1,500 for individuals; despite the fact
that federal law requires that in order to be considered as a qualified HDHP for HSA
purposes, the family deductible has to be no lower than $2,600. This contradicts federal
rules. Therefore, in order to satisfy AB 1305 requirements and at the same time comply with
federal HSA-HDHP rules, fully-insured HSA-compatible HDHP plans in California have
increased their self-only OOP maximums to meet the family $2,600 deductible threshold.
Changes may be forthcoming to resolve this potential problem, and NFP Benefits Compliance
will provide an update if the legislation is revised. Also, it’s worth noting that AB 1305
does not apply to grandfathered plans; rather it applies to non-grandfathered individual
and group health care service plan contracts that provide for essential health benefits.
AB 1305 »
April 19, 2016
As a reminder, employers covered by San Francisco's Health Care Security Ordinance (HCSO)
are required to submit the 2015 Employer Annual Reporting Form to the Office of Labor
Standards Enforcement (OLSE) by April 30, 2016. Failure to submit the form may result in
penalties of $500 per quarter. If you were not covered by the HCSO in any quarter of 2015,
you do not need to submit the form, and no further action is required.
Employers can check whether they are required to complete the form by completing a short
survey on the first page of the Annual Reporting Form. Employers that were not covered by
the HCSO in 2015 will be directed to a web page indicating that they do not need to
complete the remainder of the 2015 Employer Annual Reporting Form.
Annual Reporting Form
»
Additional
Information »
On April 11, 2016, Gov. Jerry Brown signed AB 908 into law. The law will bolster the Paid
Family Leave (PFL) program for all California workers by increasing the PFL wages available
to workers who take time off to care for ill family members or bond with a new child.
Under the current California PFL law, California workers may receive 55 percent of their
wages for up to six weeks. However, starting Jan. 1, 2018, those wages will increase as
follows:
- If an employee earns up to 33 percent of the state's average weekly wage ($1,120.67),
the employee’s PFL wage replacement will go from 55 to 70 percent of normal earnings;
- If an employee earns more than 33 percent of the state's average weekly wage
($1,120.67), that employee’s PFL wage replacement will go from 55 to 60 percent of
normal earnings.
In addition to PFL wage increases, the new law eliminates the one-week waiting period for
PFL claims. The 6-week period for PFL benefits will not change.
AB 908 »
January 12, 2016
The California Employment Development Department (EDD) recently announced that the 2016
employee contribution rate for State Disability Insurance will remain at 0.9 percent. The
taxable wage base from which the contributions will be taken will increase from $104,378 to
$106,742 for calendar year 2016 and the maximum cost to an employee will be $960.68.
For claims beginning on or after Jan. 1, 2016, weekly benefits range from $50 to a maximum
of $1,129. To qualify for the maximum weekly benefit amount ($1,129) an individual must
earn at least $26,070.92 in a calendar quarter during the base period.
Finally, effective Jan. 1, 2016, the tax rate for employers, partners and self-employed
individuals who choose coverage in California's temporary disability insurance program is
4.67 percent.
Disability Insurance and Paid Family Leave Benefit Amounts »
Rates,
Withholding Schedules and Meals and Lodging Values »
The San Francisco Health Care Security Ordinance (HCSO) requires covered employers to
satisfy an employer spending requirement by making health care expenditures for their
covered employees, among other reporting and notice requirements. For more information on
what constitutes covered employers/covered employees, please visit the San Francisco HCSO
website, linked below.
The health care expenditure rate varies depending on the size of the employer and increases
slightly each year. As of Jan. 1, 2016, the health care expenditure rate for employers with
100 or more employees will be $2.53 per hour payable (up from $2.48 per hour payable in
2015). For employers with 20 to 99 employees, the expenditure rate will increase to $1.68
per hour payable (up from $1.65 per hour payable in 2015).
The San Francisco Office of Labor Standards Enforcement (OLSE) is responsible for enforcing
the employer requirements of the HCSO.
San
Francisco HCSO Website »
Beginning Jan. 1, 2016, the city of San Francisco requires that at least 80 percent of the
required amount of health care expenditures for each covered employee must be made as
irrevocable expenditures. An irrevocable health care expenditure is a health care
expenditure that has not been retained by and cannot at any time be recovered by or
returned to the employer. For more information on what constitutes a revocable and
irrevocable expenditure, please visit the HCSO website.
San
Francisco HCSO Website »
All covered employers are required by the HCSO to post an official notice regarding the
HCSO in a conspicuous place at any workplace or job site where any covered employee works.
The HCSO has released a new 2016 Official OLSE Notice (note: the Notice is 8.5” x 14”).
Covered employers should ensure the new version of the notice is displayed at applicable
job sites. A copy of the new 2016 Notice can be found here.
November 3, 2015
On Sept. 28, 2015, Gov. Brown signed AB 1515, which clarifies and corrects sections in the
insurance code and restores the requirement that interest be applied to claim payments
under non-health disability policies when a payment is made more than 30 days after receipt
of the claim. In addition, the law updates the California Department of Insurance’s contact
information on notices and disclosures for consumers by requiring these disclosures to
include the Department of Insurance’s website address. In addition, the law aims to
increase the department’s efficiency in processing and approving administrative settlements
by allowing the commissioner to delegate settlement authority for minor non-insurer cases
to a deputy commissioner. Finally, AB 1515 makes several other changes that include
increasing conformity to the National Association of Insurance Commissioner’s Model Laws.
AB 1515 is effective January 1, 2017.
AB 1515 »
On Oct. 9, 2015, Gov. Brown signed AB 387 into law. The new law is intended to improve the
department's ability to approve draft disability policies by extending the period of time
allowed for the department to review the policy forms and any associated risks and premium
rates from 30 to 120 calendar days. Moreover, it authorizes the commissioner to develop new
guidelines to streamline the file review process for life and disability insurance forms
and then to publish these procedures on the department’s website for public review. The
legislature hopes that by providing clearer guidelines for insurers to follow when
submitting policies for approval, and increasing time allowed to review and approve
policies, the new law will improve the overall process and reduce confusion for consumers
and the industry.
AB 387 »
On Oct. 6, 2015, Gov. Brown signed SB 575 into law, giving consumers new protections
concerning non-forfeiture benefits under their long-term care contracts. The new law
protects consumers, specifically the elderly and their caregivers, by requiring long-term
care insurers to provide annual notification of the availability of non-forfeiture benefits
and contingent benefits to the insured and the insured's designated backup contact. The
notification must include the availability of the non-forfeiture benefit, the dollar amount
of the non-forfeiture benefit and the name, address and telephone number of the insurer for
questions about the benefit. Insurers must send the first annual revised notice to affected
policyholders by July 1, 2016.
SB 575 »
October 6, 2015
On July 16, 2015, Gov. Brown signed into law AB 987, which amends the Fair Employment and
Housing Act (FEHA) to provide protection for employees who make a request for an
accommodation of a disability or religious beliefs. Existing law requires an employer to
provide reasonable accommodation for, among other things, a person’s disability and
religious beliefs and prohibits discrimination against any person who has either opposed
any practices forbidden under the act or filed a complaint. This bill would also prohibit
an employer from retaliating or otherwise discriminating against a person for requesting
accommodation of his or her disability or religious beliefs, regardless of whether the
accommodation request was granted.
AB 987 was initiated in reaction to Rope v. Auto-Chlor System of Washington, Inc., a 2013
decision from a California appellate panel. In that case the employee requested a leave of
absence to donate a kidney to his sister five months prior to the surgery. Two months
before the surgery the employee was terminated. He sued for associational disability
discrimination under FEHA, but the appellate panel affirmed dismissal of his suit, holding
that "a mere request—or even repeated requests—for an accommodation, without more" does not
constitute protected activity sufficient to support a claim for retaliation in violation of
FEHA. AB 987 amends the statute to establish that "[a] request for reasonable accommodation
based on religion or disability constitutes protected activity … such that when a person
makes such a request, he or she is protected against retaliation for making the request."
The changes to FEHA take effect Jan. 1, 2016.
AB 987 »
August 25, 2015
On July 14, 2015, Gov. Brown signed AB 1541 into law. The new law amends Section 1798.81.5
of the California Civil Code that requires employers to protect employees' and applicants'
personal information for accessing online accounts. Existing law requires employers to
implement and maintain reasonable security procedures and practices to protect state
residents' personal information from unauthorized access, destruction, use, modification
and disclosure. Current law defines ‘personal information’ as first name/initial and last
name in combination with data such as a Social Security number, where the name or data are
unencrypted. AB 1541 expands the definition of personal information to include username or
e-mail address in combination with a password or security question and answer that permits
access to online accounts. Personal information will not include information lawfully made
available to the public from government records.
The new law takes effect Jan. 1, 2016.
AB 1541 »
On July 27, 2015, California’s Office of Administrative Law voted to approve an emergency
regulation submitted by the California Department of Insurance. The regulation amends Title
10 of the California Code of Regulations that requires health insurers to maintain adequate
medical provider networks that meet the needs of their policyholders, maintain accurate
provider directories and requires disclosure of out-of-network providers who may
participate in a patient’s planned care.
The amended provisions include:
- Insurers must ensure their networks have an adequate number of primary care physicians
accepting new patients.
- The network must include providers of the following services: Behavioral health
therapy, substance use disorder, psychiatric inpatient hospitalization, detoxification,
psychological testing and outpatient retail pharmacies.
- Participants must be able to access information about mental health and substance use
disorder services, such as benefits and providers, by calling a customer service
representative during normal business hours.
- The network must include an adequate number of providers with admitting and practice
privileges at network hospitals.
- If medically appropriate care cannot be obtained from a network provider, then the
insurer shall arrange for care from a non-network provider with the patient only
responsible for in-network cost sharing.
- The network should have adequate capacity and availability of licensed health care
providers to allow for appropriate appointment waiting times. For example, a
participant should not have to wait more than 48 hours for an urgent care appointment
that does not require prior authorization; 10 business days for a non-urgent primary
care physician or mental health provider appointment; 15 days for a non-urgent
specialist appointment.
- The network must ensure triage or screening services are available by telephone, and
that the waiting time for these services does not exceed 30 minutes.
- Insurers shall also ensure that during normal business hours, the waiting time for a
person to speak with a customer service representative does not exceed 10 minutes.
- Policies that cover pediatric dental and/or vision essential health benefits must
assure that there are adequate oral and vision providers, including general and
specialists, to accommodate anticipated enrollment growth.
- Online network provider directories must include specific information about each
provider and be made available to both covered persons and consumers. The network
provider directory must be updated weekly.
While the new regulations apply to insurers, employers should understand the new safeguards
and provisions that will be included under their group insurance policy.
The emergency regulation is effective from July 27, 2015, to Oct. 27, 2015, with the
expectation of further legislative action.
Title
10 CCR Section 2240 »
June 30, 2015
On June 17, 2015, Gov. Brown signed SB 125 into law. The law provides that for plan years
starting on or after Jan. 1, 2016, employer size will be determined using the federal
method of calculating full-time equivalent employees for employer mandate purposes. When
determining whether an employer is eligible for a small or large group policy, the employer
will need to calculate the number of full-time employees working 30 hours or more per week.
They will then need to total the number of hours by all non-full-time employees and divide
by 120. The sum of the two calculations will yield the employer’s number of full-time
equivalents. If an employer has 100 or fewer full-time equivalent employees, they will be
considered a small employer. Finally, it is important to note that when determining size,
the employer must include employees of all related employers.
SB 125 »
May 5, 2015
On March 5, 2015, the California Fair Employment and Housing Council amended the California
Family Rights Act, which is the state’s version of FMLA.
Existing California law is already similar to FMLA in that it provides up to 12 weeks of
unpaid job protected leave for employees who have worked for the employer for at least 12
months and at least 1,250 hours in the last 12 month period. Under both laws, the employee
must have a qualifying reason for leave. Qualifying reasons include birth, adoption, foster
care or serious health condition of an employee or family member.
The amendments more closely align the state’s regulations with FMLA. The amended provisions
include:
- An employer may deny reinstatement to a key employee if certain requirements are met.
- A covered employer includes a successor employer.
- Joint employers may share responsibility for an eligible employee. A joint employment
relationship occurs when two or more businesses control the work conditions of the
employee (such as a PEO or staffing agency and recipient organization).
- When determining whether the employee has met the 12-month service requirement, the
employer must include employment records for the last seven years.
- When determining whether the employer has at least 50 employees within a 75-mile
radius, employees with no fixed worksite (for example, working from home) would be
included in the count for the worksite from which they receive assignments or to which
they report.
- The term 'serious health condition' includes inpatient care or continuing treatment,
which may include substance abuse.
- The employee has the right be reinstated to the same or comparable position. Comparable
is clarified to mean that the position is equivalent in terms of pay, benefits, shift,
schedule, geographic location, working conditions, privileges, perquisites, status,
duties, responsibilities, skill, effort and authority.
- The employer must respond to a request for leave within five business days. (The
deadline under CFRA was previously 10 calendar days.)
- If the employee’s leave is unpaid, the employee may agree to prepayment of any required
premiums or the employer may require payment during the leave.
The regulations include a revised certification form. There is a new posting requirement;
however, the revised poster is not yet available. The amendments are effective July 1,
2015.
Regulations
»
The California Division of Labor Standards Enforcement recently posted guidance related to
the state’s new paid sick leave law on its website in the form of frequently asked
questions. The guidance provides clarification on rehired employees. If an employee is
rehired within one year by the same employer, the employee’s previously accrued hours are
restored. Additionally, the rehired employee’s 90 day waiting period is waived if they met
the requirement during their previous employment period.
The guidance also states that employers are required to provide individualized notice to
new employees hired after Jan. 1, 2015. Existing employees must receive a notice by July 8,
2015.
Paid Sick Leave
FAQs »
Employee Notice
»
January 13, 2015
As discussed in the Sept. 23, 2014 edition of Compliance Corner, eligible
employees must accrue at least one hour of paid sick leave for every 30 hours worked
beginning July 1, 2015. Effective Jan. 1, 2015, employers must notify employees of the new
law effective by posting the new employment poster.
Paid Sick Leave Poster »
On Sept. 30, 2014, Gov. Brown signed AB 1710 into law. Existing law requires businesses
that maintain computerized personal information to notify affected individuals of a
security breach in which their information was accessed by an unauthorized person. The new
law, which took effect Jan. 1, 2015, requires the business to provide the affected
individuals with 12 months of appropriate identify theft prevention and mitigation
services.
AB 1710 »
December 2, 2014
The California Office of Labor Standards Enforcement (OLSE) has released the 2015 Health
Care Security Ordinance (HCSO) expenditure rates. Effective Jan. 1, 2015, employers with
100 or more employees will be required to spend $2.48 per hour, which is an increase from
the 2014 rate of $2.44 per hour. For-profit employers with 20 to 99 employees, as well as
nonprofit employers with 50 to 99 employees, will be required to spend $1.65 per hour,
which is an increase from the 2014 rate of $1.63. For-profit employers with one to 19
employees and nonprofit employers with one to 49 employees continue to be exempt from the
HCSO requirement.
The OLSE has also implemented new rules regarding expenditure methods. Effective Jan. 1,
2015, at least 60 percent of the employer’s HCSO expenditures must be irrevocable
expenditures, meaning the amount paid by the employer cannot be recovered or returned to
the employer. Examples of irrevocable expenditures are insurance premiums, contributions to
the City Option and HSA contributions. An example of a revocable expenditure is a
contribution to an HRA in which the employer allocates the funds as a debit in its
accounting, but does not actually pay the funds into a separate account on the
employee’s behalf.
Effective Jan. 1, 2016, at least 80 percent of the employer’s expenditures must be
irrevocable with that amount increasing to 100 percent Jan. 1, 2017.
2015 HCSO Rate Announcement
»
Irrevocable Expenditures
FAQs »
The California Employment Development Department has released the 2015 withholding rates
for the State Disability Insurance (SDI) program. The withholding rate is 0.9 percent,
which is a decrease from the 2014 rate of 1.0 percent. The maximum wage limit is $104,378,
which is an increase from the 2014 limit of $101,636. The maximum annual contribution for
an employee is $939.40, which is a decrease from the 2014 limit of $1,008.80.
SDI
Rate Announcement »
October 21, 2014
On Sept. 25, 2014, Gov. Brown signed SB 1182 into law, which requires insurers to provide
large group clients deidentified claims data annually upon request. For this purpose, a
large group client is defined as an employer who has at least 1,000 covered lives, of which
at least 500 are covered by that insurer; or a multiemployer trust with at least 500
covered lives, of which at least 250 are covered by that insurer.
The new law also requires the Department of Managed Health Care and the Department of
Insurance to post the following information on its website for at least 60 days prior to
the implementation of an insurer’s significant rate increase:
- Justifications for an unreasonable rate increase
- The plan’s overall medical trend factor assumptions
- The plan’s actual costs by category, including hospital inpatient, hospital
outpatient, physician services, prescription drugs, laboratory and radiology
- The amount of the projected trend attributable to price inflation, fees and policy
trends
SB 1182 »
On Sept. 25, 2014, Gov. Brown signed AB 1962 into law, which will apply the federal medical
loss ratio rebate requirements to dental policies issued in California. The law is
effective Jan. 1, 2018.
AB 1962 »
On Sept. 25, 2014, Gov. Brown signed SB 1052 into law. The new law requires insurers that
provide prescription drug benefits with one or more drug formularies to post the
formularies on the insurer’s website. Any changes to the formularies must be updated
on at least a monthly basis. The Department of Managed Health Care and the Department of
Insurance will develop a template for this purpose prior to Jan. 1, 2017.
SB 1052 »
On Sept. 25, 2014, Gov. Brown signed SB 1053 into law, which mandates certain coverage
related to contraceptive services and devices. As background, PPACA requires
non-grandfathered group health plans to provide coverage for contraception with no
cost-sharing for participants. The new law requires all group health plans (both
grandfathered and non-grandfathered) that provide coverage for hospital, medical and
surgical expenses to provide coverage for:
- All FDA-approved contraceptive drugs, devices and other products for women, including
those available over the counter, as prescribed by the insured’s provider.
- Voluntary sterilization procedures.
- Patient education and counseling on contraception.
- Follow-up services related to the covered drugs, devices, products and procedures,
including but not limited to the management of side effects, counseling for continued
adherence and device insertion and removal.
As required by PPACA, non-grandfathered plans may not impose any cost-sharing for these
services and devices. The same coverage shall be provided to spouses and dependents as is
provided to employees. There is an exemption for religious employers. The law is effective
for policies issued or renewed on or after Jan. 1, 2016.
SB 1053 »
October 7, 2014
On Sept. 25, 2014, Gov. Brown signed SB 1053 into law. Effective for plan years starting on
or after Jan. 1, 2016, group health insurance policies must provide coverage for all
FDA-approved contraceptive methods for women. Covered contraceptive methods include drugs,
devices and products available over the counter as prescribed by the participant’s
health care provider; voluntary sterilization procedures; and patient education and
counseling related to contraception. Additionally, health insurance policies must provide
coverage for follow-up services related to covered drugs, devices, products and procedures
including management of side effects, counseling for continued adherence and device
insertion and removal. Non-grandfathered plans may not impose any cost-sharing amounts on
these covered services.
An exemption is available for plans sponsored by a religious employer. For this purpose,
“religious employer” is defined as an entity for which the inculcation of
religious value is the purpose of the entity, the entity primarily serves and employs
persons who share the religious tenets of the entity, and the entity is a nonprofit
organization under IRC Section 6033(a)(3)(A).
SB 1053 »
On Sept. 25, 2014, Gov. Brown signed SB 1182 into law. Under the new law, health insurers
will be required to provide large group policyholders with aggregate de-identified claims
information on an annual basis. The information shall be available upon request and at no
charge to the policyholder.
SB 1182 »
September 23, 2014
On Sept. 10, 2014, Gov. Brown signed AB 1522 into law. The new law requires employers to
provide certain employees with paid sick leave. Employees are eligible if they work 30 days
or more in the first year of employment. Eligible employees will accrue at least one hour
of paid sick leave for every 30 hours worked. The paid sick leave accrues from the date of
hire, but an employee may not be able to use the accrued hours until the 90th day of
employment. Accrued hours carry over to subsequent years. An employer may limit an
employee’s use of paid sick leave to 24 hours, or three days, per year. Employees may
use paid sick leave for the purpose of diagnosis, care or treatment of an existing health
condition; preventive care for an employee or family member; or leave related to the fact
that the employee is a victim of domestic violence, sexual assault or stalking. The law is
effective July 1, 2015.
AB 1522 »
August 26, 2014
On Aug. 15, 2015, Gov. Brown signed SB 1034 into law. The new law will bring the
state’s mandated 60-day maximum waiting period in line with federal requirements by
increasing the maximum waiting period to 90 days for policies issued in California.
Effective Jan. 1, 2015, group health plans subject to California insurance mandates may
impose a maximum waiting period of 90 days. The change creates some confusion for both
employer plan sponsors and insurance carriers who have adjusted plan designs to accommodate
the previous 60-day maximum requirement. It is not yet known how carriers will respond to
the law. They may choose to leave the 60-day maximum waiting period as is in their group
product offerings.
SB 1034 »
July 29, 2014
The DOL and the California Department of Insurance will present a free two-day compliance
seminar for employer plan sponsors on Sept. 9 and 10, 2014. The seminar will be held in Los
Angeles and cover a number of topics, including the employer mandate, other health care
reform requirements, the California marketplace, FMLA, COBRA, California insurance mandates
and fiduciary responsibility.
Additional Information and Registration »
On July 14, 2014, the San Diego City Council approved a sick pay ordinance that will apply
to employers who have an employee performing work within the San Diego city limits.
Employees must accrue one hour of paid sick leave for every 30 hours worked within the
city, up to a maximum accrual of 40 hours per year. Unused hours will carry over to the
next year, but are not required to be paid out upon termination of employment. Employees
may use the paid sick leave hours for their own health care appointments or illness, to
care for an ill family member or an absence related to domestic violence. The law is
effective April 1, 2015. Employers will be required to post a notice informing employees of
the new benefit, as well as provide a notice to new employees hired after April 1, 2015.
Ordinance »
July 15, 2014
On June 16, 2014, Gov. Brown signed SB 20 into law. The new law provides that policies sold
in the individual market on or after Jan. 1, 2014, shall limit enrollment to an annual
enrollment period and special enrollment periods. The annual enrollment period for coverage
effective Jan. 1, 2015, will be Nov. 15, 2014, to Feb. 15, 2015. The annual enrollment
period for subsequent years will be Oct. 15 to Dec. 7 of the preceding calendar year. While
the law only applies to individual policies, employers may be interested in what options
are available for employees.
SB 20 »
On July 7, 2014, Gov. Brown signed SB 1446 into law. The new law relates to the March 5,
2014, CMS announcement of a two-year extension to the transitional policy for
non-PPACA-compliant health benefit plans (as covered in the March 11, 2014, edition of
Compliance
Corner). The California Department of Insurance and the Department of Managed
Health Care will permit insurers to renew noncompliant policies, but on a more restrictive
basis than was provided by CMS. The law allows insurers to renew non-grandfathered small
employer policies that were in effect on Dec. 31, 2013, and that are still in effect on
July 7, 2014, to be renewed until Jan. 1, 2015, and to continue to be in force until Dec.
31, 2015. Such policies would not be subject to the federal and state requirements related
to community rating, the prohibition of pre-existing condition exclusions and coverage of
essential health benefits.
SB 1446 »
June 17, 2014
On June 10, 2014, the California Court of Appeals, Second Appellate District issued a
ruling in Rea v. Blue Shield of California, B244314, 2014 WL 2584433 (Cal. Ct.
App. June 10, 2014). At issue was the fact that the Blue Shield policy excluded residential
treatment for anorexia nervosa. The court reversed an earlier decision by a trial court and
ruled that anorexia nervosa was a mental condition and, as such, was covered by the
California Mental Health Parity Act. The act requires medically necessary treatment for
mental conditions. Thus, the court ordered Blue Shield to provide coverage for residential
treatment for anorexia nervosa when it was determined to be medically necessary for the
insured.
In California, HMO's and managed care organizations (including Blue Shield) are governed by
the Department of Managed Health Care, while all other insurers are governed by the
Department of Insurance. On June 11, 2014, Insurance Commissioner Dave Jones issued a press
release announcing that the ruling will apply to all insurance policies issued in
California. Employers sponsoring group health insurance policies in California should
review the exclusions of their plan and work with the carrier to make any necessary
amendments regarding coverage of residential treatment for anorexia nervosa.
Rea v. Blue Shield of California »
Insurance Commissioner's Press Release »
June 3, 2014
On May 16, 2014, the California Department of Insurance issued a notice summarizing the
state's security breach notification requirements. The law applies to entities that conduct
business in California and own or license computerized data that contains personal
information, including employers. A state resident must be notified if it is reasonably
believed that his/her unencrypted personal information was acquired by an unauthorized
person (i.e., security breach). If more than 500 residents are affected, the entity must
also submit a copy of the breach notification to the California attorney general.
Notice »
April 22, 2014
On March 26, 2014, the California Metropolitan Transportation Commission approved the
launch of the Bay Area Commuter Benefits Program. The program implements SB 1339, which was
signed into law in September 2012. Bay Area employers with 50 or more full-time employees
(those working 30 hours or more per week) will be required to provide commuter benefits to
covered employees (those working 20 hours or more per week). It applies to employers in the
following counties: Alameda, Contra Costa, Marin, Napa, San Francisco, San Mateo and Santa
Clara, as well as the southern portion of Sonoma County and the southwestern portion of
Solano County.
Employers must register via the program website and offer one of four commuter benefit
options, listed below, by Sept. 30, 2014.
-
Option 1: Pretax Benefit – Allow employees to exclude up to $130
of their transit or vanpooling expenses each month from taxable income.
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Option 2: Employer-provided Subsidy – Provide a subsidy to
reduce or cover employees’ monthly transit or vanpool costs, up to $75 per month.
-
Option 3: Employer-provided Transit – Provide a free or low-cost
transit service for employees, such as a bus, shuttle or vanpool service.
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Option 4: Alternative Commuter Benefit – Provide an alternative
commuter benefit that is as effective in reducing single-occupancy commute trips as
Options 1, 2 or 3.
Announcement »
Program Registration and
Details »
January 28, 2014
On Dec. 4, 2013, Section 2274.53 was added to Title 10 of the California Administrative
Code. The new regulations provide additional information on the grace period that insurers
must provide employer policyholders for payment of group health policies. Under existing
rules, employers have a 30-day grace period in which to submit payment. The new rules
clarify that the 30-day period begins the day following the last day of coverage for which
the insurer has received payment. If payment is made on or before the last day of the grace
period, the insurer shall continue coverage beyond the grace period without interruption.
This is an important clarification for employers because nonpayment of premium is one of
the few reasons that an insurer may refuse to renew a group policy. Section 2274.53 is
effective Jan. 1, 2014.
Regulations
»
The maximum benefit under the state-mandated disability insurance program has increased
from $1,067 to $1,075 per week. The change is effective for claims beginning on or after
Jan. 1, 2014. As background, California is one of a handful of states that require
disability insurance coverage for employees performing work in the state.
Announcement
»
On Dec. 20, 2013, the City and County of San Francisco Office of Labor Standards
Enforcement posted new frequently asked questions related to the Health Care Security
Ordinance. The new guidance clarifies that employer contributions toward excepted benefits
constitute valid health care expenditures to satisfy the employer's spending requirement
under the ordinance — including contributions for dental insurance, vision insurance,
medical indemnity insurance, long-term, nursing home, home health or community-based care
insurance, and insurance limited to a specific disease or illness. Contributions to a
stand-alone dental or vision HRA would also count as valid health care expenditures.
FAQs
»
Colorado
August 3, 2021
State Requires Access to COVID-19 Vaccines without Cost Sharing
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Commissioner Conway adopted emergency regulation 21-E-11, which became effective on July 22, 2021. This regulation applies to all carriers offering individual, small group, large group plans, student health plans and managed care plans subject to the state’s insurance laws. Those carriers must cover all FDA-authorized or approved vaccines for COVID-19 throughout the duration of the COVID-19 recovery, including all associated costs of administration, at no cost sharing. The requirement applies upon FDA authorization or approval and is not contingent on the issuance of a recommendation by the Center for Disease Control’s Advisory Committee on Immunization Practices.
Employers with plans regulated by the state should be aware of this requirement.
Emergency Regulation 21-E-11 »
April 13, 2021
State Insurance Exchange Special Enrollment Period Extended
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In response to the extension of the special enrollment period (SEP) in the federal marketplace exchange, the state’s health insurance marketplace (Connect for Health Colorado) has extended its special open enrollment period to August 15, 2021.
While the creation of the SEP will affect individuals that will enroll on the marketplace, employers should be mindful of this extension in case there are employees who seek to drop coverage under their plans to take advantage of the SEP. Specifically, the permissible qualifying event for a revocation due to enrollment in a qualified plan will allow an employee to drop their employer’s plan mid-year if they intend to enroll in the marketplace. Unless future legislation or guidance indicates otherwise, applicable large employers are still required to offer full-time employees minimum value coverage satisfying one of the affordability safe harbors.
Connect for Health Colorado Press Release »
March 30, 2021
Emergency Regulation Requires Coverage of COVID-19 Treatment without Cost Sharing
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Effective March 23, 2021, the Division of Insurance issued Emergency Regulation 21-E-06, which requires carriers regulated by the state to provide persons covered by their healthcare policies with COVID-19 treatments and vaccinations with no cost sharing. It also requires these carriers to pay out-of-network providers that provide emergency services to the participants in their plans in accordance with Colorado law.
This emergency regulation replaces Emergency Regulation 21-E-03, which was discussed in the March 2, 2021, edition of Compliance Corner.
Employers with health plans regulated by the state should be aware of this development.
Emergency Regulation 21-E-06 »
March 2, 2021
Emergency Regulation Establishes SEP for State Exchange
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Effective February 5, 2021, the Division of Insurance adopted Emergency Regulation 21-E-02. This emergency regulation establishes a SEP for the state’s health insurance exchange, Connect for Health Colorado. The SEP begins on February 8, 2021, and extends through May 15, 2021.
While the creation of the SEP will affect individuals that will enroll on the marketplace, employers should be mindful of this extension in case there are employees who seek to drop coverage under their plans to take advantage of the SEP. Specifically, the permissible qualifying event for a revocation due to enrollment in a qualified plan will allow an employee to drop their employer’s plan mid-year if they intend to enroll in the marketplace.
Emergency Regulation 21-E-02 »
Emergency COVID-19 Regulation Extended
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Effective February 24, 2021, the Division of Insurance adopted Emergency Regulation 21-E-03. This emergency regulation is an extension of regulation 20-E-17, which requires carriers to provide covered people with treatment related to COVID-19 and access to COVID-19 vaccines without cost sharing. This emergency regulation also ensures that out-of-network providers rendering emergency services for emergency medical conditions, including but not limited to COVID-19, are appropriately compensated for per regulation without delay. The regulation is in effect for 120 days or during any period in which a disaster declaration is in effect in the state of Colorado due to the presence of COVID-19, whichever is shorter.
Employers with plans regulated by the state should be aware of this emergency regulation.
Emergency Regulation 21-E-03 »
February 2, 2021
Marketplace Special Enrollment Period
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On January 28, 2021, the Division of Insurance announced that the state will open its marketplace for enrollment. The announcement was made in conjunction with the federal government announcement that it would open the federal marketplace, as reported elsewhere in this edition of Compliance Corner.
The standard open enrollment period for the state marketplace ended on January 15, 2021. The marketplace will be reopened from February 8 through May 15, 2021, to enroll more state residents who do not have health insurance through their employers.
While this change will affect individuals that will enroll on the marketplace, employers should be mindful of this extension in case there are employees who seek to drop coverage under their plans to take advantage of the marketplace’s special open enrollment period. Specifically, the permissible qualifying event for a revocation due to enrollment in a qualified plan will allow an employee to drop their employer’s plan mid-year if they intend to enroll in the marketplace.
State announcement »
January 20, 2021
Emergency COVID-19 Regulation Adopted
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On December 23, 2020, the Division of Insurance adopted Emergency Regulation 20-E-17. This emergency regulation requires carriers to provide covered persons with treatment related to COVID-19 and access to COVID-19 vaccines without cost sharing. This emergency regulation also ensures that out-of-network providers rendering emergency services for emergency medical conditions, including but not limited to COVID-19, are appropriately compensated per regulation without delay. The regulation is in effect for 120 days or during any period in which a disaster declaration is in effect in the state of Colorado due to the presence of COVID-19, whichever is shorter.
Employers with plans regulated by the state should be aware of this emergency regulation.
Emergency Regulation 20-E-17 »
Utilization Review Regulations Adopted
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On January 14, 2021, the Division of Insurance adopted amended Regulation 4-2-17. This regulation requires carriers to adopt and implement reasonable standards for the prompt investigation of claims arising from health coverage plans; promptly provide a reasonable explanation of the basis in the health coverage plan in relation to the facts or applicable law for denial of a claim or for the offer of a compromise settlement; and refrain from denying a claim without conducting a reasonable investigation based upon all available information.
The amendments allow dentists to evaluate first level reviews involving dental care and consult with an appropriate clinical peer or peers, and other non-substantive changes. The amendments are effective March 15, 2021.
Employers with plans regulated by the state should be aware of these amendments.
Regulation 4-2-17 »
December 22, 2020
Telehealth Services Required during COVID-19 Crisis
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On December 15, 2020, the Division of Insurance issued Emergency regulation 20-E-16. It extends coverage and reimbursement for telehealth services during the ongoing public health emergency, by requiring carriers to reimburse providers for the provision of telehealth services. The regulation requires insurers to reimburse providers for telehealth service at rates that are at least the same as those paid for the in-person equivalent and prohibits carriers from imposing limits on technologies to telehealth, and from imposing more certification and training requirements. The regulation also prohibits carriers from requiring providers to provide documentation beyond what is needed for the same service or procedure if performed in-person.
The rule is primarily directed at insurers. However, employers should also be aware of these developments.
Emergency Regulation 20-E-16 »
December 8, 2020
New Regulations Aim to Make Plans More Affordable
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On December 3, 2020, the Division of Insurance announced that it adopted Regulation 4-2-72, which establishes standards for carriers that issue health plans to employers that cover over 10,000 lives. The division intends to use these standards to make health insurance more affordable by setting targets for carriers to increase utilization of primary care by the proportion of total medical expenditures in Colorado allocated to primary care by one percentage point annually in calendar years 2022 and 2023, compared to each carrier’s baseline primary care spending (the baseline is calculated as the proportion of total medical expenditures allocated to primary care for the calendar year 2021). The new regulations also require that carriers target 25% of the expenditure to be made through prospective payments by the end of calendar year 2023.
In addition, the regulations require that carriers target 50% of a carrier’s total medical expenditures in Colorado to be made through alternative payment models (APMs) by the end of calendar year 2022. The regulations define APMs to mean “health care payment methods that use financial incentives to promote greater value – including higher quality care at lower costs – for patients, purchasers, and providers. Unlike traditional fee for service payments, APMs utilize cost and quality control strategies that benefit consumers by increasing the value of care delivered and, ultimately, the affordability of care.” The regulations mandate that carriers target 10% of the expenditure to occur through prospective payments by the end of calendar year 2022.
Employers with plans issued by state-regulated carriers should be aware of these new standards and requirements.
Regulation 4-2-72 »
November 10, 2020
Voters Pass Statewide Family and Medical Leave Statute
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On November 3, 2020, voters passed Proposition 118, an initiated state statute (that is, a statute passed directly by the voters, rather than through the legislature) which establishes a family and medical leave program that provides up to 16 weeks of paid leave.
Starting on January 1, 2023, each employer in the state must remit a payroll tax for each employee in an amount equal to 0.9% of the employee’s wage to a state fund established to pay for the leave taken by employees under this law. Although the employer is responsible for remitting the tax, the cost of the tax is split 50/50 between the employer and employee. After the first two years, this tax may be increased or adjusted up to a cap of 1.2% of the employee’s wage.
Starting on January 1, 2024, employees who have earned at least $2,500 at their jobs can take family and medical leave under this law. The law ensures that employees who take this leave receive insurance benefits as well as up to $1,100 per week in wages. The pay is tied to the state average weekly wage, so it may increase or decrease year to year. In addition, the employee can take up to 12 weeks of paid leave (plus an extra four weeks for pregnancy and childbirth complications). This leave can be taken intermittently if such leave is already provided for by the employer.
The employee can take this leave for any of the following reasons:
- Caring for their own serious health condition
- Caring for a new child during the first year after the birth or adoption or for foster care of a new child
- Caring for a family member with a serious health condition
- When a family member is on active duty military service or is called for active-duty military service
- When the individual or the individual’s family member is a victim of domestic violence, stalking or sexual assault
Finally, employers cannot retaliate against employees who request or take this leave. If the employee has worked for the employer for at least 180 days, then the employee is entitled to return to the same or similar position after the leave is taken.
Colorado employers should be aware of this new law.
Proposition 118 »
October 13, 2020
Statute Imposes Fee on Insurers
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On June 20, 2020, Gov. Polis signed SB20-215 into law. This statute imposes a health insurance affordability fee on health insurers that offer plans in the state in order to:
- Provide services to increase enrollment in health benefit plans offered by carriers across the state
- Increase the number of individuals who are able to purchase health benefit plans in the individual market by providing financial support for certain qualifying individuals
- Fund the reinsurance program that offsets the costs carriers would otherwise pay for covering consumers with high medical costs
- Improve the stability of the market throughout the state by providing consistent private healthcare coverage and reducing the movement of individuals from insured to uninsured status
- Reduce provider cost shifting from the individual market and the uninsured to the group market
- Create a healthier risk pool for all carriers by establishing a path for consistent coverage for individuals
The statute creates a health insurance affordability enterprise that will provide these services, as well as assess and collect the fee, starting in 2021. The fee is based on a percentage of premiums collected by health insurers in the previous calendar year on health benefit plans issued in the state, and serves to replace the ACA’s HIT tax (which is set to expire at the end of this year). The enterprise will also assess and collect a fee from hospitals and provide similar services to them.
Although this statute affects carriers regulated by the state, employers should be aware of these developments as these costs may be passed down to them in the form of increased premiums.
SB20-215 »
September 29, 2020
Statute Reduces Burdens on Telehealth
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On July 6, 2020, Gov. Polis signed SB 20-212 into law. This statute revises an existing telehealth statute to prohibit carriers from imposing specific requirements or limitations on HIPAA-compliant technologies that a provider uses to deliver telehealth services; imposing a requirement that a patient-provider relationship must exist before providing telehealth services; and imposing any additional certification, location or training requirements on a provider as a condition for reimbursing that provider for providing telehealth services.
The statute also allows for the supervision of home healthcare services via telemedicine or telehealth and requires that any healthcare provided through telemedicine meet the same standards of care as in-person visits.
Finally, the statute also requires that the state reimburse rural health clinics, the federal Indian health service, and federally qualified health centers for providing telehealth or telemedicine services at the same rates as those for face-to-face meetings.
Although this statute affects carriers regulated by the state, employers should be aware of these developments.
SB 20-212 »
September 1, 2020
Paid Sick Leave Update
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In August 2020, the Division of Labor and Employment issued two Interpretive Notices and Formal Opinions (INFOs) describing the terms of the “Healthy Families and Workplace Act” (SB 20-205). INFO #6A covers the statute’s paid leave requirements which will be in effect through December 31, 2020. During this time, employers must provide up to two weeks (or 80 hours) of paid leave paid sick leave to workers who miss work for one of three COVID-19 related reasons as outlined in the statute. INFO #6B covers the statute’s paid leave requirements which will be in effect beginning January 1, 2021. Starting in 2021, employers are only required to provide one hour of paid sick leave for every 30 hours worked, up to 48 hours per year, but the worker can use this leave for a wider range of reasons.
SB20-205 was discussed in the July 21, 2020, edition of Compliance Corner.
Employers with employees in the state should be aware of these Interpretive Notices and Formal Opinions.
Interpretive Notice and Formal Opinion #6A »
Interpretive Notice and Formal Opinion #6B »
August 4, 2020
COVID-19 Insurance Update
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Effective July 18, 2020, the Division of Insurance promulgated Emergency Regulation 20-E-09, which replaces and extends the coverage and cost-sharing requirements for commercial insurers related to claims arising from the testing and treatment of COVID-19. These requirements were established in Emergency Regulation 20-E-01, which was discussed in the March 31, 2020, edition of Compliance Corner.
This regulation applies to insurers, but employers should be aware of the extension.
Emergency Regulation 20-E-09 »
July 21, 2020
Legislature Passes New Paid Leave Legislation
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On July 14, 2020, Gov. Polis signed SB20-205 into law. The legislation creates three categories of leave: 1) it expands the Families First Coronavirus Response Act (FFCRA) emergency paid sick leave to apply to employers who employ 500 or more employees; 2) it creates paid sick and safe leave for Colorado employees; and 3) it creates public health emergency leave for Colorado employees.
FFCRA’s emergency paid sick leave provisions apply to employers with fewer than 500 employees. The legislation expands the application of these provisions to employers with 500 or more employees. However, it does not provide tax credits to employers who provide leave under the law and is only effective until December 30, 2020.
The legislation requires employers to provide one hour of paid sick and safe leave for every 30 hours a Colorado employee works. An employee may earn up to 48 hours per year in this manner and unused hours can carry forward into the next year. An employer can offer this leave “up front” and employers that already have policies which provide this leave plus public health emergency leave at least as generous as that provided by the legislation may be exempt. Employees can use this leave to deal with physical or mental illness with themselves or their family members, as well as to deal with issues relating to domestic abuse, sexual assault, or harassment. This leave applies to employers with 16 or more employees beginning on January 1, 2021, and then will apply to all employers on January 1, 2022.
Finally the legislation requires employers to give employees up to 80 hours of leave in the event of a public health emergency, such as the COVID-19 pandemic. The paid sick and safety leave established by this legislation can be applied toward this leave, and employees can access it for up to four weeks after the emergency is officially declared over. The employee can use this leave to take care of himself or herself or a family member who is affected by the cause of the emergency, and to take care of a child who does not have access to child care as a result of the emergency. Employees must notify their employers of the need to take this leave as soon as practicable.
The legislation also requires employers to post notices regarding employees’ rights to this leave, and employers are prohibited from requiring employees to waive their access to this leave and from finding replacement workers when they take the leave. Employees will have a private cause of action to enforce this legislation in civil court, although there is an administrative requirement to report alleged violations to the state’s Department of Labor and Employment and allow that agency to resolve the matter first.
Employers with employees in the state should be aware of this new legislation. If the governor signs it into law, regulations and model notices will soon follow, so employers should keep their eyes open for those as well.
SB20-205 »
May 12, 2020
COVID-19 Insurance Updates
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On April 30, 2020, the Division of Insurance issued Bulletin No. B-4.108, which covers all carriers offering individual, small group and large group health benefit plans, and managed care plans, including health-savings-account (HSA)-qualified health benefit plans, and grandfathered health benefit plans that are subject to the insurance laws of Colorado. TPAs for self-insured plans are also encouraged to read and follow the requirements in the bulletin.
The bulletin clarifies the testing, diagnosis and screening for COVID-19 and insurers’ obligations under Emergency Regulation 20-E-01 (as discussed in the March 31, 2020, edition of Compliance Corner). It requires carriers to use both in-network and out-of-network labs in order to make sure that there is enough testing for COVID-19 to meet the demand, with no cost sharing. In addition, carriers shall cover cost sharing where licensed health care providers are administering COVID-19 tests and are prohibited from requiring providers to collect cost shares. This testing shall be covered when the testing is conducted in an in-network provider office setting, an in-network urgent care center setting, an emergency room setting, and nontraditional care settings where licensed health care providers are administering the testing.
The bulletin reminds carriers that the emergency regulation requires them to cover without cost sharing any test approved for use in detecting or diagnosing of COVID-19 in accordance with the CARES Act and subsequent federal guidance, including serological testing and any other tests a provider determines appropriate when determining the need for COVID-19 diagnostic testing, such as influenza or pneumonia testing.
The regulation is primarily directed at carriers. However, employers should also be aware of these developments.
Bulletin No. B-4.108 »
April 28, 2020
COVID-19 Insurance Updates
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The Division of Insurance promulgated Emergency Regulation 20-E-07, effective April 18, 2020, that requires carriers that issue plans regulated by the state to pay out-of-network providers for emergency services rendered for treatment of COVID-19 and suspends prior authorization requirements for emergency services.
The regulation is primarily directed at insurers. However, employers should also be aware of these developments.
Emergency Regulation 20-E-07 »
April 14, 2020
Emergency Rule Regarding Telehealth
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On April 3, 2020, the Commissioner of Insurance promulgated Regulation 20-E-05 requiring carriers to reimburse providers for the provision of telehealth services during the COVID-19 nationwide public health emergency. The regulation requires insurers to reimburse providers for telehealth service at rates that are at least the same as those paid for the in-person equivalent and that behavioral health services provided via telehealth have parity with medical services. It prohibits carriers from imposing limits on technologies to telehealth, and from imposing additional certification and training requirements. The regulation also mandates coverage of telehealth by out-of-network providers if they provide “medically necessary” services.
The rule is primarily directed at insurers. However, employers should also be aware of these developments.
Emergency Rule 20-E-05 »
Special Enrollment Period on Exchange Extended
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On April 3, 2020, the Commissioner adopted Emergency Regulation 20-E-06, which extends a special enrollment period (SEP) for residents of Colorado who have either lost their health insurance or who anticipate such a loss as a result of the COVID-19 outbreak. The extended SEP runs from April 4, 2020, through April 30, 2020 (extended from previous emergency rule deadline of April 3, 2020). This SEP was originally established by emergency regulation 20-E-02 issued by the Division of Insurance.
Employers with employees located in Colorado should be aware of this option in the event those employees experience a reduction in hours or express an intent to enroll in a plan on the exchange as a result of business decisions made in response to the COVID-19 outbreak. The SEP is also an option for employees whose jobs are terminated and health coverage is lost during this time.
Emergency Rule 20-E-06 »
COVID-19 Insurance Updates
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On April 7, 2020, the Division of Insurance issued Bulletin 4.106 to assist hospitals in anticipation of a surge in COVID-19 cases by encouraging the provision of health care services to those who can be treated at home.
To that end, the bulletin reminds carriers of their obligations to provide coverage for certain home health care services, including the provision of durable medical equipment and medications if the health care provider deems such things medically necessary. The bulletin also requests that carriers eliminate any prior authorization requirements for these products and services, and otherwise expedite requests for them.
The bulletin is primarily directed at insurers. However, employers should also be aware of these developments.
Bulletin B-4.106 »
March 31, 2020
COVID-19 Insurance Updates
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Effective March 17, 2020, the Division of Insurance promulgated emergency regulation 20-E-01 that establishes the coverage and cost-sharing requirements for commercial insurers related to claims arising from the testing and treatment of COVID-19. They also require insurers to provide coverage for COVID-19-related in-network telehealth services with no cost share for the covered person, and to cover at least one additional early refill of all necessary prescriptions to ensure that the covered person has access to necessary medications.
On March 27, 2020, the Division of Insurance issued Bulletin No. B-4.105, which applies to small and large group health benefit plans regulated by the state. The bulletin requires insurers to offer premium grace periods and waive late fees, and it prohibits insurers from canceling policies for nonpayment of premiums.
Employers with policies regulated by Colorado should be aware of these developments.
Emergency Regulation 20-E-01 »
Bulletin No. B-4.105 »
Special Enrollment Period on Exchange
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Connect for Health Colorado announced a special enrollment period (SEP) for residents of Colorado who have either lost their health insurance or who anticipate such a loss as a result of the COVID-19 outbreak. The SEP runs from March 20, 2020, through April 3, 2020. This SEP is established by emergency regulation 20-E-02 issued by the Division of Insurance.
Employers with employees located in Colorado should be aware of this option in the event those employees experience a reduction in hours or express an intent to enroll in a plan on the exchange as a result of business decisions made in response to the COVID-19 outbreak. The SEP is also an option for employees whose jobs are terminated and health coverage is lost during this time.
Connect for Health Colorado Announcement and Links »
Emergency Regulation 20-E-02 »
Emergency Rules Granting Paid Sick Leave for Eligible Workers Amended
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Effective March 11, 2020, emergency rules promulgated by the Department of Labor and Employment, and ordered by the governor, grant eligible workers up to four days of paid sick leave from their employers. The rules apply to workers in the fields of leisure and hospitality; food services; child care; education at all levels, as well as related services such as food service; home health if people are working with elderly, disabled, sick or high-risk people; and nursing homes and community living facilities. Employers must pay applicable workers their regular rate of pay for the workers’ regularly worked hours while they are on this leave. Employers should comply with FMLA when providing sick leave to the extent feasible; employers cannot terminate applicable workers if they fail to provide documentation during the illness and FMLA does not narrow the rights and responsibilities under the emergency rules.
These rules were amended on March 26, 2020, to cover add two more groups of employees to those already covered by the rules. The rules now cover employees under a health care provider's instructions to quarantine or isolate due to a risk of having COVID-19, in addition to employees with flu-like symptoms who are being tested for COVID-19. The rules also apply to employees at retail establishments that sell groceries.
The rules are effective for the longer of 30 days from the effective date or the duration of the State of Disaster Emergency declared by the governor, up to a maximum of 120 days.
Emergency Leave with Pay »
March 17, 2020
Insurance Updates Regarding COVID-19
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On March 9, 2020, the Department of Regulatory Agencies, Division of Insurance, issued Bulletin No. B-4.104 in response to the COVID-19 outbreak that provides guidance to insurers that issue health coverage plans or health benefit plans in the state. The Bulletin directs carriers to conduct an outreach and education campaign to remind individuals of their telehealth coverage options. It also directs carriers to provide telehealth services to cover COVID-19-related in-network telehealth services at no cost share, including copays, deductibles, and coinsurance that would normally apply to the telehealth visit.
The Bulletin directs carriers to cover an additional one-time early refill of any necessary prescriptions to ensure individuals have access to their necessary medications should they need to limit close contact with others. Carriers shall not apply a different cost-sharing amount to an early fill of a prescription due to concerns about COVID-19.
Finally, the Bulletin directs carriers to ensure that coverage is provided for COVID-19 testing without requiring that consumers pay copays, deductibles or co-insurance. The Bulletin directs carriers to waive cost sharing for an in-network provider office visit, an in-network urgent care center visit and an emergency room visit when a covered person is seeking testing for COVID-19. The Bulletin also reminds carriers that if an in-network provider is unable to conduct testing for COVID-19, they must cover such testing if performed by an out-of-network provider pursuant to Colorado law.
The Division of Insurance will promulgate emergency regulations to formalize the Bulletin.
Employers with policies regulated by Colorado should be aware of these developments.
Bulletin B-4.104 »
Emergency Rules Grant Paid Sick Leave for Eligible Workers
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Effective March 11, 2020, emergency rules promulgated by the Department of Labor and Employment, Division of Labor Standards and Statistics, and ordered by the governor, grant eligible workers up to four days of paid sick leave from their employers. The rules apply to workers in the fields of leisure and hospitality; food services; child care; education at all levels, as well as related services such as food service; home health if people are working with elderly, disabled, sick or high-risk people; and nursing homes and community living facilities. Employers must pay applicable workers their regular rate of pay for the workers’ regularly worked hours while they are on this leave. Employers should comply with FMLA when providing sick leave to the extent feasible, although employers cannot terminate applicable workers if they fail to provide documentation during the illness and FMLA does not narrow the rights and responsibilities under the emergency rules.
The rules are effective for the longer of 30 days from the effective date or the duration of the State of Disaster Emergency declared by the governor, up to a maximum of 120 days.
Emergency Leave with Pay »
January 22, 2020
Surprise Billing Law Effective January 1, 2020
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On May 14, 2019, Gov. Polis signed HB19-1174, which aims to limit surprise billing by capping the amount that out-of-network providers can charge persons covered by Colorado state-regulated insurance plans at an in-network facility. The law also applies to out-of-network providers or facilities that provide emergency services to such covered persons. Additionally, the law provides for an arbitration process when a health care provider or facility has a dispute with the amount paid under these circumstances. The law requires health insurance carriers, health care providers, and health care facilities to provide patients covered by health benefit plans with information concerning the provision of services by out-of-network providers and in-network and out-of-network facilities.
The law imposes no new employer compliance obligations, but employers with fully insured plans should be aware of this law. The law is effective as of January 1, 2020.
Surprise Billing Law »
Arbitration Process »
Disclosure Rules »
Cost of Prescription Insulin Drugs Capped
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On May 22, 2019, Gov. Polis signed HB19-1216. The law is effective January 1, 2020, and requires entities providing coverage for prescription insulin drugs through a Colorado health plan to cap the amount that a person covered by the plan must pay out-of-pocket for a 30 day supply of insulin to $100, regardless of the amount or type needed to fill the person’s subscription.
The law imposes no new employer compliance obligations, but employers with fully insured plans should be aware of this law.
Insulin Cap Law »
November 26, 2019
Task Force Formed to Study Implementation of Family Medical Leave Insurance Program
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On May 30, 2019, Gov. Polis signed SB19-188 (the FAMLI Family Medical Leave Insurance Program) into law. This law creates a study of the implementation of a paid family and medical leave program in Colorado, including a task force comprised of members appointed by the governor and the legislature to analyze the costs and administration of a paid leave program for all employees in Colorado and to make a recommendation for a FAMLI program in time for the 2020 Colorado Legislative session.
Since the task force’s recommendations have not yet been considered and a FAMLI program not yet implemented, employers don’t need to worry too much about this yet. However, employers should be mindful of potential requirements such as reporting requirements and premium contributions.
Colorado SB19-188 »
October 15, 2019
State Coverage Option for Individuals
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On October 7, 2019, the Colorado Division of Insurance and the Colorado Department of Health Care Policy and Financing issued a draft report on the development of a state option for affordable health insurance coverage, as required by the Colorado General Assembly’s legislation HB19-1004. The state option would be administered by insurance companies and sold on the individual market but will scale up to the small group market over time. The proposed state option will cover all essential health benefits, many services will be pre-deductible, and average monthly premiums would be reduced by paying hospitals less. The agencies are accepting written comments on draft report until October 25, 2019. For now, there is nothing for Colorado employers to do; but employers with smaller plans will want to follow this development, as it could potentially impact small group options in Colorado.
Draft Report »
Comment Process Information »
HB19-1004 »
September 4, 2019
Special Enrollment Period Available for Consumers Enrolled in Trinity Healthshare
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On August 28, 2019, the Division of Insurance published Bulletin No. B-4.102. According to the bulletin, the Division issued cease and desist orders for Trinity Healthshare and its administrator, Aliera Healthcare, which require the companies to immediately cease and desist conducting insurance business in Colorado. Those orders were issued because Trinity Healthshare and Aliera Healthcare offer non-compliant insurance products within the state of Colorado.
As a result, those enrolled in Trinity Healthshare plans have experienced a special enrollment period (as that term is defined in Colorado law). The trigger date of the special enrollment period is August 28, 2019 (the date of this bulletin), and therefore carriers must provide a special enrollment period for all affected consumers for a period of 60 days (from August 28, 2019).
The bulletin is directed to Colorado consumers who enrolled in Trinity Healthshare, and to carriers who issue on-exchange and off-exchange (private) health benefit plans issued in Colorado. Thus, employers with fully insured plans in Colorado may need to allow a special enrollment if any of their employees were enrolled in the Trinity Healthshare plan. Such employers should work with their carriers to facilitate the special enrollment.
Bulletin No. B-4.102 »
August 7, 2018
Data Privacy Requirements for Employers
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On May 29, 2018, Gov. Hickenlooper signed HB 18-1128 into law. This law generally
requires all covered entities that maintain documents with personal identifying
information of CO residents to develop and maintain written policies for the
protection, destruction and proper disposal of those documents. These requirements are
effective Sept. 1, 2018.
A "covered entity" under this new law is defined as any person or entity
"that maintains, owns, or licenses personal identifying information."
"Personal identifying information" is defined as a Social Security number,
PIN, password, passcode, government-issued driver's license or ID card number, passport
number, biometric data, an employer/student/military identification number, or a
financial transaction device. Therefore, since virtually all employers maintain
information on their employees that meet the definition of personal identifying
information, employers with CO employees will be subject to the requirements of the new
law.
Specifically, the provisions under the new law require that covered entities (1)
implement reasonable security procedures and practices, (2) establish and follow a
written policy for the destruction and proper disposal of personal information, (3)
ensure third-party service providers that handle personal information follow reasonable
security procedures and practices and (4) follow notification procedures in the event
of a security breach.
Employers who maintain personal identifying information on CO residents must comply by
Sept. 1, 2018. Thus, covered entities should take immediate steps to ensure they are
complying with the law’s requirements with the help of outside counsel. Failure to
adhere to these requirements could result in civil penalties of up to $2,000 per
affected person, up to a maximum of $500,000 per incident, or the employer can be held
directly liable to affected individuals harmed by the violation.
HB 18-1128 »
July 24, 2018
Coverage of Drugs to Treat Opioid Addiction Required
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On May 21, 2018, Gov. Hickenlooper signed HB 18-1007 into law. This law requires all
health benefit plans to provide coverage for a five-day supply of at least one
FDA-approved drug for the treatment of opioid dependence. The plan cannot request prior
authorization for this drug if the request is the first in a 12-month period. The bill
also clarifies that an “urgent prior authorization request” includes a request for
authorization of medication to treat substance use disorders.
Although the insurance carriers will implement this law, employers should be aware of
the change. The law is effective Jan. 1, 2019.
HB 18-1007 »
May 15, 2018
Pharmacist Health Care Services Coverage
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On April 9, 2018, Gov. Hickenlooper signed HB 1112 into law. This bill requires plans
to provide coverage for health care services provided by a pharmacist if the services
are provided within a health professional shortage area and the plan provides coverage
for the same services provided by a licensed physician or advanced practice nurse. The
effective date of HB 1112 is Aug. 8, 2018.
HB 1112 »
Step Therapy Prohibited for Stage Four Metastatic Cancer Drugs
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On April 9, 2018, Gov. Hickenlooper signed HB 1148 into law. This bill prohibits
insurance carriers from requiring stage four advanced metastatic cancer patients to
undergo step therapy prior to receiving a prescription drug approved by the FDA. This
prohibition would apply as long as the drug is on the carrier’s prescription drug
formulary and the use of the drug is consistent with best practices for the treatment
of cancer. The effective date of HB 1148 is Jan. 1, 2019.
HB 1148 »
April 4, 2017
Division Releases Bulletin on Telehealth and Telemedicine
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On March 31, 2017, the Colorado Division of Insurance released Bulletin No. B-4.89
related to methods by which telehealth can be delivered. As background, Colorado
recently passed HB15-1029, allowing carriers to utilize telehealth providers. This
Bulletin clarifies that telehealth includes care that is received through any
audio-visual communication, including texting or voice communication provided through a
cellular phone.
While the Bulletin does not directly affect employers, employers should familiarize
themselves with these changes in the law that will affect insurance providers.
Bulletin
No. B-4.89
May 5, 2015
On April 24, 2015, the Colorado Division of Insurance published Bulletin No. B-4.83. The
new bulletin is directed toward insurers and relates to preventive services that must be
covered at zero cost-sharing by health benefit plans in Colorado.
As background, PPACA requires certain preventive care to be covered with no cost-sharing
requirements (e.g., copayments, deductible, coinsurance, etc.) if provided by an in-network
provider. The U.S. Preventive Services Task Force (USPSTF), the Advisory Committee on
Immunization Practices of the Centers for Disease Control and Prevention and the Health
Resources Services Administration (HRSA)) provide recommendations as to which preventive
services are included under the PPACA requirement. The recommendations are ongoing and
generally become applicable no later than the plan year that begins on or after the
one-year anniversary of the recommendation. In addition to federal law, Colorado also
requires certain preventive services to be covered at zero cost-sharing.
The bulletin provides insurers with the most recent recommendations and Colorado preventive
service coverage mandates, including recommendations issued in 2013 and 2014. The bulletin
has three attachments with charts listing the preventive services. Attachment A contains
the USPSTF recommendations which take effect April 24, 2015. These include alcohol misuse
and counseling, breast cancer preventive medications and lung cancer screenings. Attachment
B contains the preventive services mandated by Colorado law (not included in the USPSTF’s
recommendations). These include chicken pox vaccinations, colorectal screening and cervical
cancer vaccine. Attachment C contains the HRSA women’s’ preventive services guidelines,
which includes gestational diabetes screening, human papillomavirus testing and
breastfeeding supplies.
Although the bulletin applies only to insurers, Colorado employers should review the
bulletin to better understand which services and benefits under their group health plans
will be considered preventive care that should be provided with zero cost-sharing to
covered employees.
Bulletin No. B-4.83
On April 16, 2015, Gov. Hickenlooper signed SB 15-015 into law. The new law relates to
health benefit plan coverage for autism spectrum disorder (ASD). Under the new law, group
health plans offered in Colorado must provide coverage for ASD that is substantially
equivalent to benefits for a physical illness and must not contain any limits on the number
of services or visits. ASD is defined by reference to “The Diagnostic and Statistical
Manual of Mental Disorders” and generally includes autistic and Asperger’s disorders.
Although the new law does not create any additional obligations for employers, Colorado
employers with fully insured plans should reach out to insurers to discuss the new coverage
requirements. The new law is effective for plans issued, delivered or renewed on or after
Jan. 1, 2017 (although the law encourages insurers to comply as soon as possible).
SB 15-015
April 7, 2015
On March 20, 2015, Gov. Hickenlooper signed HB 15-1029 into law. The new law relates to
telehealth coverage of health benefit services. According to the new law, insurers cannot
require plan participants to have in-person contact with health care providers if services
can be provided appropriately through telehealth. ’Telehealth’ is defined as
the delivery of health care services through telecommunication systems, including
information, electronic and communication technologies to facilitate the assessment,
diagnosis, treatment, education or self-management of a person’s health care.
Importantly, ’telehealth’ does not include communications via health care
services via telephone, facsimile or email systems. The new law is effective for plans and
policies issued or renewed on or after Jan. 1, 2017. While the new law applies only to
insurers, employers will want to be aware of the law to assist employees that may have
questions with respect to coverage of telehealth services.
HB 15-1029 »
March 24, 2015
On March 13, 2015, the Colorado Division of Insurance (DOI) issued a press release and FAQ
related to phasing out non-PPACA-compliant group health plans in Colorado. Specifically,
health insurance plans for small employers that do not meet PPACA requirements will not
continue into 2016. Previously, the DOI allowed insurers in Colorado to continue
non-PPACA-compliant plans for small groups (employers with two to 50 employees) through
Dec. 31, 2015. The allowance was intended to permit time for transition to PPACA-compliant
plans. The bulletin states that insurers will notify small employers that hold
non-PPACA-compliant plans of the discontinuation of the plans, as well as information about
available options (including whether the insurer will offer PPACA-compliant plans). The
notices must be provided no later than 90 days in advance of the expiration date of the
policy (180 days if the insurer is leaving the Colorado insurance market). Importantly,
according to the bulletin, insurers may not automatically enroll a current policyholder
into a new plan from that insurer. The DOI FAQs provide additional clarification on both
the phase-out process and the insurer notices. Employers with non-PPACA-compliant plans
should be aware of the press release and FAQs, and should work with insurers on identifying
their options going forward.
Press Release »
FAQs »
On March 10, 2015, the Colorado Division of Insurance (DOI) issued a news release related
to exchange special enrollment periods (SEPs) and federal income tax penalties. As
background, on Feb. 20, 2015, the federal government announced it would allow a special
enrollment period related to the federal tax penalty for consumers in states with health
exchanges run by the federal government. According to the news release, Colorado’s
exchange is not run by the federal government, and therefore Colorado may make its own
decisions related to SEPs. The bulletin states that DOI will not allow a SEP for 2015
health insurance coverage for individuals who will have to pay a tax penalty for not having
health insurance in 2014. The press release describes the various factors weighed in coming
to that conclusion.
The SEP generally relates to individual coverage, and does not directly affect employers.
However, employers should be aware of the press release, should employees have questions
related to federal tax penalties or exchange enrollment. The press release includes phone
numbers individuals who have questions relating to special enrollments may call for
information.
News Release »
February 10, 2015
On Jan. 28, 2015, The Colorado Division of Insurance published Bulletin No. B-4.82. The new
bulletin is meant to clarify the Division's position regarding consumer cost-sharing
variations for prescription drug benefits. The bulletin states that certain cost-sharing
structures for prescription drug benefits may constitute discrimination that would violate
Colorado insurance law. As an example, the Division will view the placement of most or all
drugs used to treat a specific condition on the highest cost tiers as discrimination
against those individuals who have chronic conditions that require treatment with such
drugs. The bulletin also describes other prescription drug plan cost-sharing arrangements
that may be problematic under Colorado law. The bulletin does not apply to grandfathered
plans, transitional plans, large group plans and HSA-qualified HDHPs, and is intended to
apply for plan years beginning on or after Jan. 1, 2016.
The bulletin does not affect Colorado employers' compliance obligations, but is a good
resource for understanding how prescription drug plans must be structured in Colorado both
on and off the state health insurance exchange.
Bulletin No. B-4.82 »
January 13, 2015
On Nov. 25, 2014, the State of Colorado Civil Rights Commission adopted revisions to its
rules and regulations relating to employment discrimination. Specifically, 3 CCR Sec. 708-1
was revised to include new rules relating to the prohibition on employment discrimination
against qualified employees and applicants based on sex. The rules also include pregnancy
discrimination. While most of the revisions relate to employment law (such as hiring or
firing, selection and promotion and retirement), some relate to fringe benefits. Under the
revisions, employer contributions for fringe benefits cannot discriminate based on sex.
“Fringe benefits” include insurance, pension and retirement, welfare programs,
profit-sharing, bonus plans and leave. In addition, employers cannot condition fringe
benefits on employees’ status as “head of household” or “principal
wage earner” for their family if this condition adversely affects employees based on
sex. The revisions are effective Dec. 15, 2014.
Revised 3 CCR Sec. 708-1 »
September 23, 2014
On Sept. 9, 2014, the Colorado Division of Insurance issued Bulletin No. B-4.78. The
bulletin clarifies that employers with grandfathered small group health plans that no
longer qualify as small employers under Colorado’s current law may be allowed to
continue such plans until Dec. 31, 2015. The choice to continue the plans is up to the
insurer — they are under no obligation but may choose to do so. Colorado employers
with small group plans should consult with their insurer in determining whether the plan
will be continued pursuant to the bulletin.
Bulletin No. B-4.78 »
September 9, 2014
On Aug. 21, 2014, the Colorado Division of Insurance issued Bulletin No. B-4.77, a new
bulletin relating to health benefit plan premium payment grace period considerations for
consumers, providers and insurers. As background, Colorado law provides for a 31-day grace
period for consumers with individual or small group health benefit plans who are not
receiving the advance payment tax credit (APTC) and who have missed a premium payment, and
a 90-day grace period for individuals receiving the APTC. Grace periods do not apply to the
payment of the first month’s premium. During the 90-day grace period, carriers must
cover claims incurred during the first month and may pend claims incurred during the second
and third months. Insurers must also give notice to consumers that the claims may be denied
if no further premium payments are received, and issue a 30-day advance notice before
terminating the policy due to nonpayment of premiums.
The bulletin clarifies that insurers must always honor and pay claims incurred during the
first month of the grace period, regardless of whether the consumer is receiving the APTC
or not. Consumers are liable for the premium until the policy has been terminated in
compliance with the 30-day advance notice requirement. The bulletin also clarifies notice
requirements between the insurer, provider and consumer with respect to the second and
third months of the grace period, in which the insurer may pend claims. If a provider
receives a notice that a consumer is in those second or third months, the provider may make
arrangements with the consumer – prior to delivering services – to ensure that
the provider receives payment for services during those months (including collection of
full or partial payment from the consumer). If the provider requires full or partial
payment, and the consumer pays all past-due premiums and the insurer pays the pended
claims, the provider must refund all payments received from the consumer to the extent the
payments exceed the consumer’s responsibility.
Although the new bulletin does not add compliance requirements for employers or plans,
employers should be aware of the bulletin in case issues arise with respect to grace
periods and claim payments.
Bulletin No. B-4.77 »
August 26, 2014
On June 9, 2014, Colorado’s health insurance exchange, “Connect for Health
Colorado,” announced in a press release that it has approved its budget for the
2014–15 fiscal year. To help fund the state’s exchange in future years, the
budget includes transitional funding authorized by 2013 Colorado legislation, allowing the
exchange to set a $1.80 per member per month health insurance carrier assessment. Other
states have implemented similar assessments or user fees as a way to fund state exchanges
going forward. The approved budget reduced the assessment to $1.25 per member per month.
The assessment appears to apply to all health insurance policies issued in Colorado from
July 1, 2014, through June 30, 2015. Thus, all health insurance policies – individual
and small and large group – issued on or off the exchange in Colorado will be subject
to the $1.25 per member per month assessment. While the press release and assessment relate
to insurers, the assessment may be passed on to employers and individuals via increased
premium rates.
Press Release »
The Colorado Division of Insurance recently promulgated regulations that require the
inclusion of a two- to three-page supplement to the PPACA-required SBC for each plan
provided to state residents. The SBC supplements must be distributed with SBCs and contain
additional information about deductibles, covered cancer screenings, pre-existing condition
rules, balanced billing and binding arbitration clauses. The regulations require insurance
carriers to produce and distribute the SBC supplement for fully insured plans. Self-insured
plans are exempt from the requirement. While Colorado employers have no obligation to
produce or distribute the SBC, they should be aware of the additional requirement.
SBC Supplement Regulations and Sample »
August 12, 2014
On July 25, 2014, the U.S. District Court for the District of Colorado, in Burns v.
Hickenlooper, No. 1:14-cv-01817-RM-KLM (D. Colo. 2014), ruled that Colorado's
constitutional and statutory prohibitions against same-sex marriage are unconstitutional.
The court blocked the state from enforcing the prohibitions, but stayed its ruling until
Aug. 25, 2014, thereby allowing time for the state to appeal the decision. Previously, on
July 9, 2014, (as reported in the July 15, 2014, edition of Compliance Corner) a
Colorado state court also ruled that the state's same-sex marriage ban is unconstitutional
(but also stayed its ruling). So for now, the same-sex marriage prohibitions in Colorado
remain in effect, pending the outcome of the appeals.
Burns v. Hickenlooper »
July 15, 2014
On July 9, 2014, the Colorado District Court for Adams County, in Brinkman v. Long,
struck down Colorado's ban on same-sex marriage. The Colorado law passed by voters in 2006
defines "marriage" as only between a man and a woman. The court struck down the law as an
unconstitutional violation of due process and equal protection. The court stayed the
ruling, meaning that same-sex marriages cannot take place in Colorado while the case is
appealed. The issue of same-sex marriage appears to be headed to the U.S. Supreme Court, as
other similar cases have already made their way further up in the appellate process. NFP
Benefits Compliance will continue to monitor developments on this case, as same-sex
marriage has significant implications for employers and their health benefit plan
offerings.
Brinkman v. Long »
On June 30, 2014, the Colorado Division of Insurance issued Bulletin No. B-4.76, which
relates to short-term, limited duration health benefit plans and special enrollment
periods. The purpose of the bulletin is to inform carriers and consumers that short-term,
limited duration health benefit plans do not qualify as minimum essential coverage (MEC)
under PPACA's individual mandate and that loss or termination of a short-term health plan
does not trigger a special enrollment period that would allow a consumer to purchase a
PPACA-compliant health benefit plan outside of an open enrollment period. The bulletin
states that all carriers that sell or issue short-term health plans must include on all
marketing materials and the policy's face page a statement that the plan does not qualify
as MEC and that a termination or other loss of a short-term plan does not constitute a
special enrollment right for other coverage.
Bulletin No. B-4.76 »
June 3, 2014
On May 19, 2014, the Colorado Division of Insurance issued Bulletin No. B-4.75. The
bulletin is directed toward insurers, and contains the notices that must be delivered to
consumers (i.e., employers) with non-PPACA-compliant health benefit plans that an insurer
has elected to continue into 2015. Previously, the division announced, in Bulletin No.
B-4.73, that it will allow insurers to continue such non-PPACA-compliant plans through
2015, as allowed by a March 4, 2014, CMS announcement of a two-year extension to their
transitional policy on the issue.
The new bulletin clarifies that insurers do not have to continue non-PPACA-compliant plans,
but that if they choose to do so, they must use the notices attached to the bulletin. The
notices must be distributed to policyholders no later than 30 days prior to the start of
any limited or special enrollment period. The bulletin contains no employer requirements,
but employers should be aware of the bulletin, particularly if they have previously had
their plans cancelled. Employers in this situation should reach out to insurers to
determine if their plans can be continued in light of the division's position.
Bulletin No. B-4.75 »
May 20, 2014
On May 5, 2014, the Colorado Division of Insurance issued Bulletin No. B-4.73, which
relates to the March 4, 2014, CMS announcement of a two-year extension to the transitional
policy for non-PPACA-compliant health benefit plans (as covered in the March 11, 2014,
edition of Compliance Corner). The bulletin formalizes a May 2, 2014, division
press release on the same topic. According to the bulletin, the division will allow
insurance carriers to continue non-PPACA-compliant health plans through 2015. Since
continuation of cancelled plans is optional, Colorado employers that had their plans
cancelled should consult with their carriers on whether those plans can be continued in
light of the bulletin.
Bulletin B-4.73 »
On May 5, 2014, the Colorado Division of Insurance issued Bulletin No. B-4.74, which
relates to the definition of "renewed" as it applies to health insurance. According to the
bulletin, carriers and consumers (e.g., employers) should refer to the policy contract
language first whenever any questions concerning the term "renewed" arises. Absent a
specific definition in the contract, though, "renewed" means a policy renewed upon the
occurrence of the earliest of:
- The annual anniversary date of issue
- The date on which premium rates can be or are changed according to the terms of the
plan
- The date on which benefits can be or are changed according to the terms of the plan
The bulletin further expounds on the definition. Colorado employers should be aware of the
definition, since it applies in several different contexts with respect to plan offerings,
including the renewal date upon which federal and state regulations may take effect.
Employers should review their policy contract and familiarize themselves with the
appropriate definition of "renewed."
Bulletin B-4.74 »
May 6, 2014
On May 2, 2014, the Colorado Division of Insurance issued a press release relating to the
March 4, 2014, CMS announcement of a two-year extension to the transitional policy for
non-PPACA-compliant health benefit plans (as covered in the March 11, 2014, edition of
Compliance
Corner). According to the press release, the Division of Insurance will allow
insurance carriers to continue non-PPACA-compliant health plans through 2015. Since
continuation of cancelled plans is optional, Colorado employers that had their plans
cancelled should consult with their carriers on whether those plans can be continued in
light of the press release.
Bulletin No. B-4.71 »
April 22, 2014
On April 3, 2014, the Colorado Division of Insurance issued Bulletin No. B-4.71. The new
bulletin relates to the minimum benefit for applied behavioral analysis (ABA) treatment for
autism spectrum disorder for children, and is meant to clarify the minimum amount of such
treatment that carriers must provide. Specifically, all group health insurance policies
must provide, at a minimum, $34,000 annually in ABA therapy benefits for children through
age 8, and $12,000 for children age 9 to age 19, regardless of the number of visits
required to reach those benefit amounts. If the minimum ABA therapy benefits of $34,000 or
$12,000, as applicable, have not been provided when the minimum number of visits has been
reached, additional visits must be authorized until the $34,000 or $12,000 minimums have
been provided. The current number of visits established by rule is 550 visits for a child
through age 8 and 185 visits for a child aged 9 to 19. Although the bulletin is directed
toward insurers, employers with fully insured plans in Colorado should be aware of the
coverage requirements.
Bulletin No. B-4.71 »
On April 3, 2014, the Colorado Division of Insurance issued Bulletin No. B-4.72. The new
bulletin is meant to clarify that limited benefit plans, hospital indemnity or other fixed
indemnity plans should not be marketed or represented as substitutes for health benefit
plans, and that such plans do not provide sufficient coverage to qualify as minimum
essential coverage for purposes of PPACA. The bulletin reminds insurers that such plans are
not major medical insurance or comprehensive policies and do not provide the necessary
PPACA-compliant coverage, and therefore may leave a consumer or individual liable for the
individual mandate penalty under PPACA. Insurers selling these limited benefit or indemnity
plans that are marketed as a substitute for or equivalent to a PPACA-compliant plan may be
inviting liability under Colorado’s misleading and deceptive practice laws. In
addition, insurers who sell limited benefit plans must provide notice that the plan does
not provide minimum essential coverage as mandated by PPACA. The bulletin provides required
language that must be included on the policy’s front page. Although the bulletin is
directed toward insurers, employers will want to be aware of the bulletin and the
appropriate types of coverage that will be considered sufficient for purposes of
PPACA.
Bulletin No. B-4.72 »
January 28, 2014
On Jan. 14, 2014, the Colorado Division of Insurance issued Bulletin No. B-4.69. The
bulletin is directed toward insurers, and is meant to help clarify the meaning of
"reasonable assurance" for purposes of ensuring an individual's (in the individual market)
or employer's (in the small group market) possession of pediatric dental coverage as an
essential health benefit (EHB) under PPACA. As background, individual and small group
policies sold both inside and outside of the exchange now must cover EHBs, which includes
pediatric dental coverage. Carriers offering health benefit plans inside the exchange do
not have to provide pediatric dental coverage as long as a certified stand-alone pediatric
dental plan is available for purchase on the exchange.
On the other hand, carriers offering plans outside the exchange must have reasonable
assurance that the purchaser already has pediatric dental EHB coverage prior to issuing a
plan that does not contain such coverage. According to the bulletin, the division has
created two methods to ensure compliance with the reasonable assurance standard. The first
is through an application developed by the division that allows an applicant to certify
that pediatric dental coverage has been obtained under another plan (and the carrier may
require the applicant to provide proof). The second is through the sale of
exchange-certified "child only" pediatric dental policies at low or no cost to individuals
and families that have no children. The bulletin states that these new policies allow
purchasers to obtain the required pediatric dental coverage with full knowledge that the
benefit will never be needed or used. The proof of purchase of that policy meets the
reasonable assurance requirement.
Small employers in Colorado should review the bulletin to better understand the reasons for
the pediatric dental coverage requirement, and the reasons why a carrier may be asked to
provide reasonable assurances if purchasing a small group plan outside the exchange.
Bulletin No. B-4.69 »
Connecticut
May 25, 2021
New Law Extends Relaxed Telehealth Service Requirements
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On May 10, 2021, Gov. Lamont signed House Bill 5596 into law. This legislation provides a two-year extension of the relaxed telehealth service requirements that were previously enacted due to the COVID-19 pandemic.
In March 2020, Gov. Lamont enacted emergency Executive Order No. 7G, which suspended certain telehealth limitations to enable more residents to use telehealth services. For example, the order expanded the types of providers and licensed professionals who can provide telehealth services and permitted licensed providers in other states to provide telehealth services to state residents. The order also allowed for the use of audio-only services. For further information on Executive Order No. 7G, please see our March 31, 2020, Compliance Corner article.
In recognition of the benefits of allowing broader access to telehealth services, the recent law extends the relaxed standards through at least June 30, 2023.
Group health plan sponsors may want to be aware of this development.
House Bill 5596 »
November 10, 2020
Website Offers PFMLA Resources for Employers
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New resources were recently released on the state’s Paid Family and Medical Leave Act (PFMLA) website. These include materials designed to assist employers with their PFMLA compliance obligations.
As background, in June 2019, Gov. Lamont signed legislation that requires private employers to provide paid leave to eligible employees who work in the state. The leave can be taken for life events covered under the federal FMLA, the state FMLA and the Connecticut Family Violence Leave Act. (The law was covered in our July 9, 2019, edition of Compliance Corner.)
The leave is funded through employee payroll deductions. Accordingly, effective January 1, 2021, employers are required to begin withholding a percentage (up to a maximum of .50%) of employee wages. The withheld amounts must be submitted quarterly to the Connecticut Paid Leave Authority, which is responsible for administering the leave benefits. Eligible employees may begin taking PFMLA leave on January 1, 2022.
The website materials include an employer fact sheet, toolkit and poster. Registration requirements are explained. Frequently asked questions have been updated and address a wide variety of issues regarding the paid leave and an employer’s related responsibilities.
Affected employers should be aware of the website and available PFMLA resources.
PFMLA Website »
April 14, 2020
Premium Grace Period Required
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On April 1, 2020, Gov. Lamont issued Executive Order No. 7S, which addressed various health and safety measures related to the coronavirus (COVID-19) pandemic. Amongst other items, the order requires insurers to provide a premium grace period for certain individuals and businesses affected by the COVID-19 emergency.
Following the coronavirus (COVID-19) outbreak, the governor declared a public health emergency on March 10, 2020. With recognition of the worker displacement and business disruption resulting from the disease and mitigation measures, the governor had previously issued a bulletin requesting that insurers take measures to prevent unnecessary policy cancellations or nonrenewals.
Order No. 7S now requires a 60-day grace period (beginning on April 1, 2020) with respect to premium payments and policy cancellations and nonrenewals for certain insureds affected financially by the COVID-19 emergency. The grace period is not a waiver or forgiveness of the owed premium, but rather an extension of time for payment.
The requirement applies to entities licensed or regulated by the Insurance Department that provide any insurance coverage in the state including, life, health, auto, property, casualty and other types. However, the extension is not automatic; eligible individuals or businesses would need to contact their carriers to avail themselves of the temporary relief.
Specifically, insurers must provide the extension to individual policy holders who, due to the COVID-19 pandemic, were laid off, furloughed, fired from employment, or otherwise sustained a significant loss in revenue. Additionally, the grace period must also be extended to businesses that are group policyholders, have group insurance and/or property/casualty insurance, and were required to close or significantly reduce operations or suffered significant revenue loss as a result of the COVID-19 pandemic. Qualifying individuals or businesses may be required to provide a supporting affidavit or other statement acceptable to their carriers.
Although this provision of the order is primarily directed at insurers, employers should be aware of these developments and the available temporary premium relief for qualifying individuals and businesses.
Executive Order No. 7S »
Financial Protections for Health Care Providers and Consumers
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On April 5, 2020, Gov. Lamont issued Executive Order No. 7U, which aimed to provide financial protections to health care providers and consumers. These measures are intended to ensure the state’s health care workforce and facilities have the necessary capacity to address the coronavirus (COVID-19) pandemic. Additionally, the order seeks to mitigate the adverse financial impacts of COVID-19 treatment on consumers.
As background, the governor had declared a public health emergency due to the COVID-19 crisis on March 10, 2020. In response, the state’s health care workforce was supplemented by professionals who did not maintain liability coverage, including volunteers and out-of-state professionals. Additionally, the state recognized that the unexpected costs of COVID-19 treatment may significantly affect the financial security of the state’s residents.
As a result, the order provides certain protections from civil liabilities for health care professionals and facilities due to acts or omissions that were undertaken in good faith while supporting the state’s COVID-19 response. Included are acts or omissions resulting from a lack of resources that prevented a level or manner of care that would normally be required absent the pandemic.
The consumer financial protections extend to the uninsured and those covered by insurance who receive out-of-network health care services during the emergency. Specifically, if emergency services are provided to an insured out-of-network, the carrier may be billed directly and is only required to pay the in-network rates as payment in full for the services. Additionally, the order specifies that a hospital providing COVID-19 treatment and management services to an uninsured patient may collect no more than the Medicare rate for such services as payment in full. Furthermore, hospitals are prohibited from billing individuals for uncovered COVID-19 treatment and management services pending clarification of the availability of federal funds to cover such services.
The order is primarily directed at health care providers, facilities and hospitals, but employers should be aware of these developments.
Executive Order No. 7U »
March 31, 2020
Access Health Announces Special Enrollment Period Due to Coronavirus Emergency
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On March 18, 2020, the state’s health insurance exchange announced a special enrollment period (SEP) available to uninsured residents. During this SEP, eligible individuals will be able to enroll in insurance coverage through Access Health CT.
This measure was taken as a result of the COVID-19 emergency to further protect the public health of state residents. Access Health and the exchange’s insurers, Anthem and ConnectiCare, recognized the need to permit the uninsured to enroll and have access to testing and treatment.
The special enrollment period extends from March 19 through April 2, 2020. Individuals who enroll during this period will generally have coverage effective starting April 1, 2020.
Employers should be aware of this limited enrollment period, which may provide an option for individuals not otherwise eligible to enroll in coverage.
SEP Announcement and FAQs »
Governor Issues Coronavirus Public Health Emergency Response Order
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On March 19, 2020, Gov. Lamont issued Executive Order No. 7G, addressing various health and safety measures related to the coronavirus (COVID-19) pandemic. Among other items, the order addressed the use of telehealth services during the pandemic.
Following the coronavirus (COVID-19) outbreak, the governor declared a public health emergency on March 10, 2020. With recognition of the benefits of expanded telehealth services during the pandemic, the order includes provisions that suspend existing telehealth limitations and restrictions.
Specifically, the order permits telehealth providers that are in-network providers for fully insured plans to provide covered telehealth services to patients with whom there is an existing provider-patient relationship through the use of audio-only phone. The order also suspends certain licensing requirements for telehealth providers. Additionally, the order requires that a provider who receives payment for telehealth services shall not bill the patient for any additional charges beyond the health plan reimbursement. Any related regulatory requirements that such telehealth services be provided from a provider’s licensed facility are also waived.
The memo is directed at state citizens and covers numerous topics in addition to telehealth services.
Executive Order No. 7G »
Insurance Department Calls for Premium Grace Period
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On March 24, 2020, the Insurance Department issued Bulletin Number IC-40 regarding insurance premium payments during the coronavirus (COVID-19) pandemic. The bulletin is directed at admitted and non-admitted insurance companies, licensed producers and other interested parties.
Due to the significant economic disruptions and loss of income following the COVID-19 outbreak, consumers and businesses have been substantially impacted. As a result, the bulletin requests insurers providing any coverage in the state, including life, health, auto, property, casualty and other types, to offer a premium grace period.
Specifically, the Department requests that all insurance companies provide their insureds with at least a 60 day grace period to pay insurance premiums and thus avoid cancellation for nonpayment. The request is intended to be applied to premiums due after the initial premium has been made to secure coverage. It is not intended as a forgiveness of the premium, but an extended grace period for payment without penalty or interest. The memo also requests that agents and brokers who accept insurance premium payments on behalf of insureds provide customers with alternative prompt payment options, such as online payments, to eliminate the need for in person payments.
Employer and brokers should be aware of this premium grace period request.
Bulletin Number IC-40 »
March 17, 2020
Coronavirus Outbreak and Testing Bulletin
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On March 9, 2020, the Connecticut Insurance Department issued Bulletin No.IC-39 to health insurance companies and health care centers authorized to conduct business in the state. The bulletin provides directions to these entities with respect to the coronavirus (COVID-19) outbreak and related issues.
As background, concerns have arisen that cost sharing may be a barrier to covered individuals seeking COVID-9 testing and treatment. Additionally, it is important that the health care insurers and centers are prepared both to inform individuals of their covered benefits and to address increased COVID-19 cases and claims.
Accordingly, the bulletin encourages these entities to waive cost sharing related to COVID-19 laboratory tests, health care provider visits and telehealth services (including out-of-network services when in-network availability is unreasonable). The Department also urges the insurers and centers to authorize payment to pharmacies for a ninety (90) day supply of maintenance prescription medications for individuals. Furthermore, leniency is encouraged with respect to enforcement of otherwise applicable utilization review penalties and claims filing deadlines.
The bulletin is directed at health care insurers and centers, who are requested to inform the Department of measures taken in response. Employers should be aware of this development.
Bulletin No. IC-39 »
February 4, 2020
Guidance Regarding Health Insurance Tax Repeal
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On December 27, 2019, the Insurance Department issued a bulletin to health insurance providers regarding necessary filing and credit adjustments following the Health Insurance Tax repeal. The guidance affects employer groups with plan years beginning between January 1, 2020, and December 1, 2020.
Since 2014, the ACA Health Insurance Tax imposed a sales tax on health insurers, and those insurers generally passed the cost along to consumers and employers by increasing the health plan premium. On December 19, 2019, Congress permanently repealed this tax effective January 2021. However, for plan years beginning after January 1, 2020 (and therefore covering part of 2021), the 2021 portion of the tax was already included in the premium rate charged.
Accordingly, the guidance directs carriers that have approved group rates for plan years beginning in 2020 to refile such rates for the second, third, and fourth quarter of 2020 to remove the fee for the corresponding portion of the plan year in 2021. Filings should be submitted no later than March 1, 2020. For groups with plan years beginning February 1, 2020, through March 31, 2020, carriers are directed to provide a credit or refund of the 2021 fee to the employer group in the 2020 plan year.
Although the bulletin is directed at insurance carriers that deliver or issue group health insurance policies in Connecticut, affected employers should also be aware of the guidance and rate refiling requirements. Additionally, employers with plan years beginning February 1, 2020, through March 31, 2020, should expect a credit or refund of the 2021 health insurance tax fee in the 2020 plan year. They should also analyze any responsibility to return a portion of any such refund to plan participants based on ERISA guidelines.
BULLETIN No. HC-127 »
July 9, 2019
Paid Family Leave Law Enacted
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On June 25, 2019, Gov. Lamont signed into law SB 1, creating Public Act No. 19-25. This is a new law in CT relating to paid family and medical leave (CT PFML). It generally requires all private employers with employees who work in CT to provide paid leave to eligible employees, and the law expands the reasons for which an employee may take a leave. As background, CT already has protections for family and medical leave under its CT family and medical leave Act (CF MLA) — but that law does not require a protected leave to be paid. The new law CT PFML creates that new paid leave requirement, as outlined below.
Beginning on January 1, 2022, eligible employees may begin taking CT PFML leave. CT PFML provides up to 12 weeks of paid family or medical leave within a 12-month period. In addition, employees who have a serious health condition resulting in incapacitation during pregnancy will be eligible for two additional weeks of paid leave. An employee is eligible for CT PFML if they have been working for at least three months prior to the leave request. Generally speaking, the benefit amount is 95% of the employee’s base weekly earnings, capped at an amount that is 60 times the state minimum wage.
CT PFML will be administered by the state (through a newly created regulatory board), so employers will not have to provide benefit payments. However, CT employers will – beginning in 2022 – have to notify their employees of their rights under CT PFML. We anticipate that the new CT regulatory board will provide model notices in advance of that employee notification requirement. Employers will have to notify employees both upon hire and annually thereafter.
CT PFML applies to employers with as few as one employee (and appears to include remote employees working in CT, even if the employer primarily operates in a different state). CT PFML also expands the definition of “family member” to include an employee’s spouse, sibling, son or daughter, grandchild, grandparent, domestic partner, or an individual related to the employee by blood or affinity (if that affinity can be shown to be the equivalent of a family relationship). Employees can take CT PFML for the same reasons they could take CFMLA, which include birth, adoption, or foster care of a child, to take care of a spouse or family member who has a serious health condition, for the employee’s own serious health condition, to serve as an organ or bone marrow donor, or because of any qualifying exigency arising out of a military duty (a family member is on active duty or has been notified of an impending call or order to active duty in the armed forces).
CT’s PFML will be funded through an employee payroll tax of 0.5%, which will begin in January 2021. The new payroll tax will be subject to the Social Security cap (currently $132,900). Employers will need to work with payroll providers to ensure the appropriate taxes are withheld — they’ll have a year and a half to work through that, considering the January 2021 applicability date.
CT PFML does allow for employers to apply for an exemption, assuming the employer provides a private plan that is at least as generous as CT PFML’s requirements for paid leave. CT’s regulatory board has been directed to outline the exemption process. Separately, employers participating in the state plan can coordinate their leave policies with CT PFML. They can require employees to substitute PTO or other paid leave during a CF MLA leave, although the employee still has the right to reserve up to two weeks of any such available PTO or other paid leave.
Overall, the new law creates additional responsibilities for employers with employees in CT. CT PFML requirements do not take effect until 2021 (employee payroll deductions commence) and 2022 (employees may begin taking leave), so there is plenty of time. But employers should work with their payroll providers and outside counsel in developing appropriate leave policies to include CT’s new PFML requirements.
Public Act No. 19-25 »
Press Release »
June 11, 2019
Guidance on Stop-Loss Insurance Policies
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On May 6, 2019, the Insurance Department published Bulletin HC-126. The bulletin relates to stop-loss insurance policies in Connecticut. According to the bulletin, the department will not approve stop-loss policies that have an annual attachment point for claims incurred per individual that is lower than $20,000. For groups of 50 or fewer, the department will not approve polices that have an annual aggregate attachment point that is lower than the greater of $4,000 times the number of group members, 120% of expected claims, or $20,000; for groups of 51 or more, that aggregate attachment point must be higher than 110% of expected claims. Lastly, the department will not approve polices that provide direct coverage of health care expenses of an individual.
The bulletin also outlines several provisions in stop-loss policies that will not be allowed, including claims denials that the employer is legally obligated to pay under the health plan, medical necessity and usual or customary determinations, experimental or investigational determinations, case management requirements and mandated provider networks, or benefits incentives for enrollees. The bulletin includes a full list of such prohibited provisions. The bulletin also states that lasering (the practice of assigning different attachment points or deductibles, or denying coverage for, individual employees or dependents with pre-existing, high cost medical conditions) is allowed during the stop-loss process, but that no attachment point for an enrollee can exceed three times the attachment point for the policy. Finally, the bulletin states that retiree-only stop-loss policies are not subject to the above restrictions, but that the department will review each such policy on a case-by-case basis.
While directed to stop-loss carriers, employers with self-insured plans that use a stop-loss policy issued in CT should be aware of the bulletin. Such employers can work with their adviser or carrier on any questions regarding the bulletin.
Bulletin HC-126 »
April 2, 2019
Clarification of Infertility Treatment Mandates
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On March 19, 2019, Ins. Commissioner Mais issued Bulletin HC-125 to clarify CT’s
mandated coverage for infertility treatments. In 2017, CT started to require that
carriers provide coverage for medically necessary expenses of the diagnosis and
treatment of infertility. This new bulletin clarifies that the harvesting of eggs and
sperm is a covered benefit in cases where the patients will undergo treatment that has
the potential to render them infertile. Carriers and physicians may continue to use
reasonable medical management to determine if the treatment is otherwise medically
necessary. The carrier may apply plan copayments deductibles, and coinsurance (range
from zero to 50 percent). Male infertility treatment is covered under this mandate.
Separately, the bulletin reminds carriers of the prohibition of the use of age-benefit
restrictions in the infertility treatment for policies issued or renewed on or after
January 1, 2016.
Bulletin HC-125 »
October 30, 2018
Connecticut to use AV Calculator
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On Oct. 24, 2018, Ins. Commissioner Wade published Bulletin HC-124 to eliminate the
maximum copayment amounts for specified categories of benefits for health insurance
plans with the exception of those cost sharing maximums set by statute, and instead use
the federal Actuarial Value (AV) calculator. The bulletin rescinds HC-109 issued on
Feb. 5, 2016.
The transition from benefit-by-benefit maximums to the use of the AV calculator is
intended to allow more flexibility in developing innovative plan designs to meet a
wider range of consumer needs while assuring that consumers still receive significant
cost sharing benefits that meet ACA standards.
Going forward, the calculation of the maximum cost sharing allowed will require the use
of the most recent CMS/CCIIO published AV calculator. The enrollee cost sharing amount
shall never exceed 50 percent for the plan benefits provided (for both in- or
out-of-network benefits) and there’s no restriction on the differential of the
coinsurance level between in- and out-of-network benefits. The individual and small
group market will continue to meet the standards of the ACA Metal Tiers.
Self-insured plans should familiarize themselves with the AV calculator to ensure
compliance with actuarial value going forward. Employers with fully-insured plans don’t
need to take any action.
HC-124
»
September 5, 2018
Association Health Plan Regulation of Out-of-state Plans
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On Aug. 27, 2018, Insurance Commissioner Wade released Bulletin HC-123 to provide
additional information regarding the regulation of association health plans (AHPs) that
are established out of state but offered to Connecticut residents. Specifically, fully
insured plans that are established outside of CT that sell products to CT small
employers or sole proprietors must file rates and forms for prior approval with the
Insurance Department. Further, employers should be aware that their participation in an
out-of-state fully insured MEWA (or Multiple Employer Trust (MET)) will fall under CT’s
jurisdiction.
This bulletin supersedes HC-122, which was released Aug. 10, 2018. (We discussed that
bulletin in the Aug. 21, 2018 edition of Compliance Corner). That bulletin
reminded insurers that the state retains the right to regulate MEWAs and METs
regardless of changes to federal law.
This new bulletin also reminds employers of previous guidance regarding self-insured or
self-funded MEWAs or METs. In 1990, the commissioner issued Bulletin HC-43, which
required self-funded MEWAs and METs to be licensed as insurance carriers because they
were considered as doing the business of insurance. If a self-funded MEWA or MET is
doing the business of insurance without authority or license, then they are considered
an illegal operation.
CT employers don’t need to take any action, but just take note that CT is reaffirming
the department’s longstanding commitment to regulating unlicensed entities for the
protection of consumers.
Katherine
L. Wade. “Bulletin HC-123.” Connecticut Insurance Department, www.ct.gov »
August 21, 2018
Association Health Plan Restrictions
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On Aug. 10, 2018, Commissioner Wade issued Bulletin HC-122 to remind insurers that
state law continues to regulate association health plans.
As background, on June 21, 2018, the DOL issued final regulations regarding association
health plans (AHPs). Under the regulations, a group or association of employers may act
as a single “employer” sponsor of an association health plan under ERISA. The federal
regulations attempted to encourage the creation of these associations, but emphasized
that the states retain their authority to regulate AHPs. This bulletin clarifies the
coordination with CT law.
CT allows fully insured AHPs, but any “small employer” participating in an AHP must
continue to be rated as a small employer. CT defines a “small employer” as an employer
with at least one but no more than 100 employees during the preceding calendar year and
that employs at least one employee on the first day of the group plan’s year. The state
does not consider a sole proprietorship that employs only the sole proprietor or the
spouse of such sole proprietor to be a “small employer.”
The bulletin further clarifies that AHPs are considered MEWAs, and that self-insured
MEWAs or multiple employer trusts (METs) must be licensed as an insurance carrier in
the state. An employer that operates a self-insured MEWA or MET without authority or
license is considered an illegal operation.
The main purpose of this bulletin is to remind insurers that the state retains the
right to regulate MEWAs, regardless of changes to federal law. Employers should be
aware that their participation in a fully insured MEWA will likely fall under CT’s
jurisdiction. The state also took the time to reiterate that an organization operating
(or seeking to operate) a self-funded MEWA must be licensed as an insurance carrier to
do so or risk being considered an illegal operation.
Bulletin
HC-122 »
Requirements for Short-term, Limited-Duration Health Policies
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On Aug. 9, 2018, Commissioner Wade issued Bulletin HC-121 to reiterate the state’s
requirements that relate to short-term, limited-duration health insurance policies. The
bulletin states that such plans are considered an individual health policy that must
provide essential health benefits (EHBs) and that any plan (including a renewable plan)
that’s longer than six months in duration must not exclude coverage for preexisting
conditions. In addition, each issued policy must be filed with the state as one of the
following: (i) basic hospital expense coverage; (ii) basic medical-surgical expense
coverage; (iii) major medical expense coverage; (iv) hospital or medical service plan
contract; or (v) hospital and medical coverage provided to subscribers of a health care
center.
As background, the HHS and DOL issued final regulations regarding short-term,
limited-duration health plans on Aug. 1, 2018. The regulations extend the permissible
policy time frame to no more than 12 months (an increase from the previous maximum of
three months) and allow such a policy to be renewed or extended for a period of up to
36 months in total. Such short-term policies are exempt from the ACA’s individual
market rules, but remain subject to state regulation.
The primary purpose of this bulletin is to remind insurers of the state’s requirements
for short-term, limited-duration health policies. Employers should be aware that though
these plans may be a lower cost option for individuals that just experienced a
separation of employment, it doesn’t change an employer’s obligation to make an offer
of COBRA (or state continuation), if otherwise required.
Bulletin
HC-121 »
July 10, 2018
Telehealth Services
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On June 12, 2018, Gov. Malloy signed SB 302 into law. The new law, effective July 1,
2018, revises provisions regarding telehealth services to specify that “telehealth”
means delivering health-care services through information and communication
technologies to facilitate health-care management, consultation, diagnosis, education,
self-management, or treatment of plan participants' physical and mental health when
participants are located at originating sites and telehealth providers are located at
distant sites. Telehealth includes synchronous interactions, asynchronous store and
forward transfers or remote monitoring. Telehealth doesn't include fax transmissions,
audio-only telephone, texts or e-mail.
There is no specific action required of employers, but they should work with insurers
to understand the required coverage and update the plan accordingly.
SB 302 »
Act Mandates Coverage of Essential Health Benefits and Expands Health Benefits for
Women, Children and Adolescents
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On May 25, 2018, Gov. Malloy signed HB 5210 into law. The new law requires small
employer plans to provide coverage for certain preventive care services with no cost
sharing to participants. The coverage is similar to that required of non-grandfathered
plans under the ACA, but the state mandate will also to grandfathered plans and will
remain in place even if the federal requirement is repealed or altered.
The law also requires certain treatment for women, children and adolescents and seems
aimed at protecting some of the preventive services guaranteed by the ACA on the state
level (should the ACA be repealed, and based on the changes to the contraceptive
mandate).
Specifically, plans must provide coverage for preventive care screenings for plan
participants age 21 and younger in accordance with most recent edition of American
Academy of Pediatrics' Bright Futures: Guidelines for Health Supervision of
Infants, Children, and Adolescents or any subsequent corresponding
publication. Issuers can't impose coinsurance, copayments, deductibles or other
out-of-pocket expenses for coverage of preventive care screenings benefits and
services. Cost-sharing when such benefits and services are provided out of network is
permissible except in high-deductible health plans that are used to establish HSAs.
Additionally, plans that provide coverage for prescription drugs must provide coverage
for immunizations recommended by the American Academy of Pediatrics, the American
Academy of Family Physicians and the American College of Obstetricians and
Gynecologists, and immunizations that have in effect a recommendation from the Advisory
Committee on Immunization Practices of the federal Centers for Disease Control and
Prevention
Plans must also provide coverage for evidence-informed preventive care screenings for
infants, children, adolescents and women provided in guidelines supported by the
federal Health Resources and Services Administration, as effective on Jan 1, 2018, and
such additional preventive care and screenings provided for in any comprehensive
guidelines effective after Jan. 1, 2018; and evidence-based items or services that have
a rating of ‘A' or ‘B' in the current recommendations of the US Preventive Services
Task Force effective after Jan. 1, 2018.
Further, plans must provide coverage for screening and counseling for interpersonal and
domestic violence for female plan participants.
And as it pertains to tobacco use by women, plans must provide coverage for
tobacco use intervention and cessation counseling for female plan participants who
consume tobacco.
In seeking to protect some of the women's services offered under the ACA, the law also
requires plans to must also provide certain women's healthcare services coverage for
the following preventive care, benefits and services:
- Well-woman visits for female plan participants who are younger than age 65
- Breast cancer chemoprevention counseling for female plan participants who are at
increased risk for breast cancer due to family history or prior personal history of
breast cancer, positive genetic testing or other indications as determined by
participants' physicians or advanced practice registered nurses
- Breast cancer risk assessment, genetic testing and counseling
- Gonorrhea, human immunodeficiency virus, chlamydia, cervical and vaginal cancer and
sexually transmitted infections screenings for sexually-active female participants
- Human papillomavirus screening for female plan participants with normal cytology
results who are age 30 or older
- Anemia screening and folic acid supplements for pregnant female participants and
female participants likely to become pregnant
- Hepatitis B and Rh incompatibility screenings for pregnant female participants and
follow-up testing for such participants who are at risk for Rh incompatibility
- Syphilis screening for pregnant female participants and female participants who are
at increased risk for syphilis
- Urinary tract infection and other infection screenings for pregnant female
participants
- Gestational diabetes screening for female participants who are 24-28 weeks pregnant
and female participants who are at increased risk for gestational diabetes
- Osteoporosis screening for female participants who are age 60 or older
The same is true of maternity healthcare, and the law requires plans to provide
coverage for:
- Anemia screening and folic acid supplements for pregnant female participants and
female participants likely to become pregnant
- Rh incompatibility screenings for pregnant female participants and follow-up
testing for such participants who are at risk for Rh incompatibility
- Syphilis screening for pregnant female participants and female participants who are
at increased risk for syphilis
- Urinary tract infection and other infection screenings for pregnant female
participants
- Breastfeeding support and counseling for pregnant or breastfeeding plan
participants
- Breastfeeding supplies, including, but not limited to, breast pumps for
breastfeeding participants
- Gestational diabetes screenings for female participants who are 24-28 weeks
pregnant and female participants who are at increased risk for gestational diabetes
Finally, the law imposes a state requirement for plans to provide coverage for all
contraceptive methods. Specifically, plans must provide coverage for the following
benefits and services:
- All contraceptive drugs, including, but not limited to, all FDA-approved
over-the-counter contraceptive drugs (such plans can require plan participants to
use contraceptive drugs designed by the FDA as therapeutically equivalent to
contraceptive drugs prescribed to participants prior to using prescribed
contraceptive drugs, unless participants' prescribing health-care providers
determine otherwise)
- All contraceptive devices and products, excluding all FDA approved over-the-counter
contraceptive devices and products (such plans can require plan participants to use
contraceptive devices or products designated by the FDA as therapeutically
equivalent to contraceptive devices or participants' prescribing providers request
less than a 12-month supply. Participants aren't entitled to receive a 12-month
supply of such contraceptive drugs, devices, or products more than once during any
policy year
- All FDA-approved sterilization procedures for female plan participants
- Routine follow-up services related to FDA-approved contraceptive drugs, devices and
products
- Counseling in FDA-approved contraceptive drugs, devices, and products and proper
use of such drugs, devices, and products
Keep in mind, though, that the law includes a Religious Employer Exemption.
Essentially, employers that are organized to promote religious beliefs, such as
churches and church-affiliated organizations aren't required to offer plans that
provide coverage for prescription contraceptive methods if contraceptive use conflicts
with employer's' religious beliefs. Employers that are organized to promote religious
beliefs, such as churches and church-affiliated organizations, aren't required to offer
plans that provide coverage for contraceptive benefits and services if contraceptive
use conflicts with employers' religious beliefs. There's no specific action required of
employers in this regard, but employers with fully-insured plans in Connecticut should
work with insurers to understand the required coverage and update the plan accordingly.
Public
Act No. 18-10 »
March 20, 2018
Moratorium on Health Insurance Tax Impacts Carrier Rates
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On Feb. 21, 2018, the Connecticut Insurance Department published Bulletin HC-119, which
relates to the 2019 moratorium on the health insurance provider fee (also known as the
health insurance tax, or HIT). As background, the fee was placed on a moratorium for
2019 as part of 2017 tax reform. According to the bulletin, insurance carriers in
Connecticut have included a portion of the 2019 fee as part of the 2018 premium charged
to employer groups with plan years beginning between Jan. 1, 2018, and Dec. 1, 2018.
The bulletin directs such carriers to refile their rates for the second, third and
fourth quarters of 2018 to remove the fee for the portion of the plan year in 2019. The
bulletin also directs carriers to provide a credit or refund of the 2019 fee to the
employer group in the 2018 plan year.
While the bulletin is directed at carriers, employers with fully insured plans in
Connecticut may want to reach out to their carriers for additional information
regarding a potential credit or refund relating to the fee’s moratorium in 2019.
Bulletin
HC-119 »
August 8, 2017
Limits on Participant Payments for Prescription Drugs at the Point of Sale
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On July 10, 2017, Gov. Malloy signed SB 445 into law, creating Public Act No. 17-241.
This law states that health plan issuers cannot require plan participants to pay for
prescription drugs at the point of sale in an amount that exceeds the applicable
copayment, the allowable claim amount or the amount they must pay if they don’t have
health plan coverage or other source of drug benefits or discounts (whichever of those
is lowest). An “allowable claim amount” is generally defined to mean the amount the
issuer pays the pharmacies for prescription medications.
This law is effective Jan. 1, 2018. Although the law doesn’t impose any new employer
compliance obligations, employers may want to be aware of the new requirements in case
questions should arise regarding prescription drug costs for employees.
Public
Act No. 17-241 »
Treatment of Substance Abuse and Opioid Addiction
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On June 30, 2017, Gov. Malloy signed HB 7052 into law, creating Public Act. No. 17-131.
The new law requires plans that provide coverage to plan participants who are diagnosed
with substance use disorders (which includes opioid addiction) to provide coverage for
medically necessary and monitored detoxification services and for medically necessary
and medically managed intensive inpatient detoxification services. The law defines
“medically monitored detoxification services” and “medically managed intensive
detoxification services” by the most recent edition of the American Society of
Addiction Medicine (ASAM) Treatment Criteria for Addictive, Substance-Related and
Co-Occurring Conditions. More information on ASAM can be found here.
In addition, plans may not establish terms, conditions or benefits that place a greater
financial burden on plan participants for diagnosis or treatment of mental or nervous
conditions than that which they provide for medical, surgical or other physical health
conditions. Finally, plans must provide direct reimbursement for diagnosis and
treatment of substance use disorders for covered services provided in Connecticut by
out-of-network health care providers. Reimbursements must be allowed for multiple
screenings as part of a single-day visit and to health care providers or multi-care
institutions.
The new law contains no new employer obligations. But employers should acquaint
themselves with the new rules for health plans and carriers. Generally speaking,
employers should treat mental health conditions the same as physical health conditions.
Not only does that help avoid potential discrimination problems, but also helps address
the general countrywide trend of mental health awareness.
The new law is effective Jan. 1, 2018.
Public
Act No. 17-131 »
Coverage and Definition of Infertility Expanded
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On June 20, 2017, Gov. Malloy signed HB 7124, creating Public Law No. 17-55. The new
law expands the definition of “infertility” to mean conditions affecting plan
participants who cannot conceive, produce conception or sustain a successful pregnancy
during a one-year period, regardless of the insured’s health status. Prior law included
the term “presumably healthy,” which potentially excluded those who may be unhealthy
and unable to conceive. The law’s summary indicates that one potential class of
“unhealthy” participants could be individuals with cancer, with the goal at expanding
the “infertility” definition to include that class. Overall, the expanded definition
takes effect Jan. 1, 2018.
Under current law, fully insured plans in Connecticut must provide coverage for
infertility. Importantly, though, there is a religious employer exemption — employers
that are organized to promote religious beliefs (such as churches or church-affiliated
organizations) aren’t required to offer plans that provide coverage for diagnosis and
treatment of infertility (if that practice conflicts with the employer’s religious
beliefs).
The law contains no new employer compliance obligations, but awareness of the law will
help employers address potential employee questions with respect to the definition and
coverage of infertility.
Public
Law No. 17-55 »
April 18, 2017
Coinsurance in HMO Plan Designs
Expand/collapse »
On April 4, 2017, the Connecticut Insurance Department published Bulletin No. HC-118.
The bulletin relates to a bill currently pending passage in the Connecticut General
Assembly (Bill No. 7023), which allows health care centers to offer HMO plan designs
with coinsurance (a design that was previously disallowed). The bulletin requires
health care centers to proceed with their 2018 individual and small group plan design
filings under the assumption that the bill will pass. Should the bill not pass, the
bulletin contains remedial instructions. Although no new employer obligations result
from the bulletin, employers with small group plans should be aware of the new law,
particularly if HMOs are offered as part of the benefit design.
Bulletin No.
HC-118 »
Bill
No. 7023 »
March 7, 2017
Reminders on Plan Prescription Drug Formularies
Expand/collapse »
On March 2, 2017, the Connecticut Insurance Department published Bulletin No.
HC-113-17, which relates to information on plan formularies. The purpose of the
bulletin is to set requirements and minimum standards for prescription drug formularies
filed with the department. The bulletin reminds insurers of certain formulary
requirements, including that the formulary must be easily electronically searchable,
the medications within the formulary must be grouped in alphabetical order by
therapeutic class, and the definition of each formulary tier must be clearly stated. In
addition, definitions for utilization controls, such as quantity and dosage controls,
prior authorization, step therapy and tier coverage must be clearly stated. The
formulary must also include information on how to obtain drugs that are off formulary
and how drugs might be obtained via mail order pharmacy. Lastly, the formulary must
include customer service contact information.
The bulletin applies to insurers in connection with their annual filing requirements
and contains no new employer obligations. However, the bulletin serves as a helpful
resource for employers with fully insured plans in Connecticut.
Bulletin
No. HC-113-17 »
June 28, 2016
On June 7, 2016, Gov. Malloy signed SB 262 into law, creating Public Act No. 16-195. This
law expands the reasons an eligible employee may take leave under the Connecticut Family
and Medical Leave Act (CTFMLA). In addition to the reasons currently listed in the CTFMLA,
eligible employees may take leave due to a qualifying exigency (as defined by federal FMLA
regulations) arising out of the fact that the spouse, son, daughter or parent of the
employee is on active duty, or has been notified of an impending call or order to active
duty, in the armed forces.
Under the law, in such circumstances private employees may take up to 16 work weeks of
unpaid time off during any 24 month period. In order to qualify, a private employee must
work for an employer with at least 75 employees and have been employed by the employer for
at least 12 months and worked at least 1,000 hours during that time.
The law is effective immediately.
Public
Act No. 16-195 »
June 14, 2016
On June 2, 2016, Gov. Malloy signed HB 5233 into law, creating Public Act No. 16-82. This
law requires certain individual and fully-insured group health insurance policies to cover,
at the option of the covered woman, mammograms provided by breast tomosynthesis. Breast
tomosynthesis is a three-dimensional mammographic method. By law, such policies must cover
baseline mammograms for women age 35 through 39, and annual mammograms for women age 40 or
older. This law is effective Jan. 1, 2017.
Public
Act No. 16-82 »
On May 27, 2016, Gov. Malloy signed HB 5053 into law, creating Public Act No. 16-43. The
law requires insured group health plans that are delivered, issued, renewed, amended or
continued on or after Jan. 1, 2017, to provide coverage for prescription drugs without
prior authorization when they are in their formularies and are approved for treating drug
overdoses. This law contains various provisions on opioid abuse prevention and treatment
and related issues. Thus, there are various effective dates, starting as soon as upon the
passage of this law.
Public
Act No. 16-43 »
On May 27, 2016, Gov. Malloy signed HB 5591 into law, creating Public Act No. 16-29. This
law establishes the Connecticut Retirement Security Program to improve the retirement
security of workers in the state who do not have access to an employer-sponsored retirement
plan or payroll deduction individual retirement account (IRA).
The law's requirements apply to all “qualified employers,” defined as private sector
employers that employ at least five people each of whom was paid at least $5,000 in wages
in the preceding calendar year. “Covered employees” are those who have worked for a
qualified employer for a minimum of 120 days and are at least age 19 years old.
The law creates the Connecticut Retirement Security Authority (“the Authority”), which has
been given the task of establishing the program, which will consist of Roth IRAs for
eligible private-sector employees. The individual Roth IRAs will be established and
maintained through the Authority's program or a third-party entity in the business of
establishing and maintaining IRAs.
Under the program, qualified employers must automatically enroll each covered employee
within 60 days after the employer provides the employee with the informational material on
the program the bill requires. If the employee does not affirmatively opt in (contribution
options are provided) the employer must enroll the employee with a contribution of at least
3 percent but not more than 6 percent of the employee's taxable wages (up to normal IRS
limits). A covered employee may opt out of the program by electing a contribution level of
zero. Employers will not be required to match contributions.
Finally, the law contains penalties for employers that fail to remit contributions or that
fail to enroll employees.
The program is expected to be implemented by Jan. 1, 2018. Some sections of this law are
effective immediately and others are effective July 1, 2016.
Public
Act No. 16-29 »
March 8, 2016
On March 2, 2016, the Connecticut Insurance Department published Bulletin HC-111 regarding
health insurance coverage for preventative services and the repeal and replacement of
Bulletin HC-100 issued on Nov. 3, 2014. The bulletin is directed toward insurers and health
care centers operating in Connecticut.
The revised bulletin still addresses health insurance coverage for preventative services.
The bulletin clarifies requirements under the federal health care reform law and reconciles
these requirements with Connecticut mandates for fully insured non-grandfathered group
health plans, effective Jan. 1, 2015. A discussion of the interaction between federal and
state mandates follows:
- Clarifying that the term “reasonable medical management” under federal law should be
based upon the statutory definition of “medical necessity” found in the Connecticut
General Statutes Section 38a-482a.
- Clarifying that “breastfeeding support” as required under federal law should take into
account Connecticut mandates found under Connecticut General Statutes Section
38a-530c(d) and 38a-503c(d) which requires two follow up lactation support visits occur
when a mother is discharged early from the hospital. The first visit must occur within
48 hours of discharge and the second follow up visit must occur within seven days of
discharge.
- Clarifying that contraceptive coverage must include any prescription contraceptive
method approved by the Food and Drug Administration (FDA). This means that
sterilization procedures for men may not be covered under federal law but may be
covered by an insurance company separately, subject to state law.
- Clarifying that maternity coverage, including prenatal care, is covered without cost
sharing under federal law. However, services related to maternity that are not
preventative may be subject to cost-sharing, although any preventative service with no
direct guidance may be subject to medical necessity.
Bulletin
HC-111 »
February 23, 2016
On Feb. 16, 2016, the Connecticut Insurance Department published Bulletin HC-110 regarding
the one-year moratorium on the fee on health insurance providers (called “covered
entities”). The bulletin is directed toward insurers, and states that they must suspend the
collection of the fee for the 2017 calendar year.
As background, PPACA instituted the fee to help fund the cost of PPACA implementation and
exchanges. This fee applies to any "covered entity" engaged in the business of providing
health insurance to U.S. citizens, residents and certain other persons present in the U.S.
Put simply, this fee only applies to insurers, and the regulations specifically exclude
self-insured plans (although it does apply to fully insured limited-scope dental, vision
and retiree-only plans, which are exempt from most PPACA requirements). On Dec. 18, 2015,
President Obama signed the Consolidated Appropriations Act, 2016 into law, which
includes a one-year moratorium on the fee from Jan. 1, 2017, through Dec. 31, 2017.
The bulletin informs carriers that if they have approved group rates for plan years
beginning in 2016 that they are directed to refile such rates for second, third and fourth
quarter of 2016 to remove the fee for the portion of the plan year in 2017. For groups with
plan years beginning Feb. 1, 2016, and Mar. 1, 2016, carriers are directed to provide a
credit or refund of the 2017 fee to the employer group in the 2016 plan year. Filings
should be submitted no later than Mar. 1, 2016.
While the suspension of this tax does not require any employer action, employers may see a
decrease in costs since most insurers passed the fee onto the plan through rate increases.
Bulletin
HC-110 »
On Feb. 5, 2016, the Connecticut Insurance Department published Bulletin HC-109 to provide
guidance as to the maximum copayment amounts for health insurance plans. The bulletin
rescinds Bulletin HC-94, Maximum Copays and Filing Issues, that was issued on Mar. 10,
2014.
As background, in December 2015, the Insurance Department conducted a data call to
determine reasonable levels of copayment amounts regarding specified categories of
benefits. The maximum copays are set to not exceed 50 percent of the 90 percentile of
claims for the category. For the home health care category, 25 percent was used in lieu of
50 percent to reflect the statutory requirement in Conn. Gen. Stat. Section 38a-493 and
Section 38a-520 that coinsurance cover at least 75 percent of the charges. The maximum
copay for routine radiology does not apply to advance radiology services that are subject
to the limits set forth in Conn. Gen. Stat. Section 38a-511 and Section 38a-550.
The following indicates the revised maximum copays and the copays will be effective for all
policies issued or renewed on or after Jan. 1, 2017.
- Durable Medical Equipment $25
- Home Health Care $25
- Ambulance $225
- Laboratory $10
- Routine radiology services $40
The maximum copays for the following categories of benefits were not part of the most
recent data call and will remain at the current allowable levels.
- PCP Office Visit $40
- Specialist Office Visit $50
- Urgent Care $75
- Emergency Room $200
- Inpatient Admission $500/day up to $2000
- Outpatient Surgery/Services $500
- Generic Drug $5
- Brand Drug $60
Plans that use coinsurance may not impose an enrollee cost sharing amount that exceeds 50
percent. This applies both for in and out of network benefits. There is no restriction on
the differential of the coinsurance level between in and out of network benefits. The level
of coinsurance must be consistent for all services within a service category except for
plans utilizing tiered networks.
Bulletin
HC-109 »
October 20, 2015
On Oct. 9, 2015, the Connecticut Insurance Department published Bulletin HC-106 regarding
rate filings for small employer plans. The bulletin is directed toward insurers, and states
that the change to the definition of small group in CGS 38a-564, as amended by Section 17
of Public Act No. 15-247, will be postponed.
Conn. Gen. Stat. §38a-564 defines ‘small employer’ as up to 100 employees, but provides the
Commissioner the ability to postpone implementation of that definition. In order to be
consistent with federal law as a result of passage of the PACE Act, the Department has
decided that the small group definition will remain 1-50 employees.
The bulletin informs carriers that they may modify previously approved small group rates
for 2016 to the extent the revised rates would be more favorable to the marketplace. The
bulletin is effective immediately.
Bulletin
No. HC-106 »
August 25, 2015
On Aug. 13, 2015, Insurance Commissioner Wade issued Bulletin HC-104. The bulletin repeals
and replaces Bulletin HC-64 (dated Jan. 20, 2006) and clarifies Connecticut’s mandated
coverage for infertility treatment under Conn. Gen. Stat. § 38a-509 and § 38a-536 to
reflect changes brought about under PPACA.
Specifically, the bulletin removes the age limit for the infertility treatment coverage
mandate. This means health insurance plans sold in Connecticut will no longer be allowed to
limit coverage of medically necessary infertility treatment to individuals under age 40.
The bulletin also addresses the general use of age-based benefit restrictions and refers to
HHS guidance on what is considered a potentially discriminatory benefit design. Based on
HHS guidance stating that age limits are discriminatory when applied to services that have
been found clinically effective for all ages, Connecticut has determined infertility
treatment may be clinically effective for all ages and is therefore requiring carriers to
remove age limits on infertility benefits for policies issued or renewed on or after Jan.
1, 2016.
Bulletin HC-104 »
July 28, 2015
On June 30, 2015, Gov. Malloy signed SB 1085 into law. The law amends Section 38a-514 to
expand services for mental or nervous conditions that certain health plans must cover. The
law mandates that each group health plan cover the diagnosis and treatment of mental or
nervous conditions on the same basis as medical, surgical or other physical conditions.
Among other things, the law also requires plans to cover:
- Medically necessary acute treatment and clinical stabilization services
- General inpatient hospitalization, including at state-operated facilities
- Services provided by advanced practice registered nurses for mental or nervous
conditions
- Programs to improve health outcomes for mothers, children and families
Moreover, a group policy may not prohibit an insured from receiving, or a provider from
being reimbursed for, multiple screening services as part of a single-day visit to a health
care provider or multicare institution (e.g., hospital, psychiatric outpatient clinic, or
free standing facility for substance use treatment).
Finally, the law amends Section 38a-514 to substitute the term “benefits payable” for
“covered expenses” as it pertains to the mental or nervous conditions coverage
provisions. Under this law, these are the usual, customary, and reasonable charges for
medically necessary treatment or, in the case of a managed care plan, the contracted
rates.
The law applies to fully insured group health plans issued or renewed on or after
Jan. 1, 2016.
Senate
Bill 1085 »
On June 30, 2015, Gov. Malloy signed SB 949 into law. The law updates Connecticut’s
data security laws and adds stringent new requirements to protect an individual’s
confidential information.
The law creates the requirement for a comprehensive information security program.
By October 1, 2017, health insurers, HMOs, and certain entities regulated by the
Connecticut Insurance Department (e.g. pharmacy benefits managers and TPAs), must
implement and maintain a comprehensive information security program to safeguard an
insured’s and enrollee’s personal information. It specifies program requirements
including encryption of personal information and disciplinary procedures for
employees who violate the security policies, requires the program to be updated at
least annually and requires the entities to offer at least one year of free
identity theft prevention and mitigation services if there is an actual or
suspected breach.
The law also adds a 90-day deadline for data breach reporting, which is applicable
to anyone who conducts business in Connecticut. Generally, it requires the person
to notify impacted state residents of a breach within 90 days after discovering it
and offer at least one year of free identity theft prevention and mitigation
services.
Both of these updates are effective Oct. 1, 2015.
Senate
Bill 949 »
On June 23, 2015, Gov. Malloy signed SB 467 into law, requiring group health plans
to cover telehealth services to the extent that they cover the services through
in-person visits between an insured person and a health care provider. Telehealth
services shall only be provided through real-time, interactive, two-way
communication technology. It does not include the use of a fax machine, audio-only
telephone texting or e-mail. The law also requires that a telehealth provider
obtain a patient’s informed consent at the first telehealth interaction to provide
services and inform the patient about the treatment methods and limitations of
treating a person through telehealth.
The law applies to fully insured group health plans issued or renewed on or after
Jan. 1, 2016.
Senate
Bill 467 »
On July 2, 2015, Gov. Malloy signed HB 6772 into law, which amends Section 52-321a.
The amendments exempt from creditors’ claims interests in or amounts payable to
participants and beneficiaries of certain allocated or unallocated group annuity
contracts purchased by an ERISA-covered plan.
To qualify for the exemption, a group annuity contract must be issued to an
employer or pension plan to provide employees or retirees with defined retirement
benefits. In addition, the original retirement benefits must be protected under
ERISA or Pension Benefit Guaranty Corporation and the group annuity contract must
not be protected by ERISA or the PBGC on or after the effective date of the group
annuity contract.
As background, under Section 52-321a, creditors cannot claim interests in and
payments from certain accounts, including certain retirement accounts, simplified
employee pension plans and medical savings accounts.
The law is effective Oct. 1, 2015.
House
Bill 6772 »
On June 30, 2015, Gov. Malloy signed SB 1502 into law, which provides in Section
413 that the labor commissioner must establish the procedures needed to implement a
paid family and medical leave (FML) program.
By Oct. 1, 2015, the labor commissioner must contract with a consultant to create
an implementation plan for the FML program and to perform an actuarial analysis and
report on the employee contribution level needed to ensure a sustainable FML
program.
Senate Bill 1502 »
July 14, 2015
On June 15, 2015, Insurance Commissioner Wade issued Bulletin HC-102. The bulletin
clarifies Connecticut's mandated coverage for hearing aids under Conn. Gen. Stat. §
38a-490b and § 38a-516b in relation to changes brought about under PPACA. Specifically, the
bulletin addresses the general use of age-based benefit restrictions and refers to HHS
guidance on what is considered a potentially discriminatory benefit design. Based on HHS
guidance stating that age limits are discriminatory when applied to services that have been
found clinically effective for all ages, the state has determined hearing aids may be
clinically effective for all ages and is therefore requiring carriers to remove the age
limits on hearing aid benefits for policies issued or renewed on or after Jan. 1, 2016.
Bulletin No. HC-102
»
On July 8, 2015, Insurance Commissioner Wade issued Bulletin HC-103 to be read in
conjunction with Bulletin HC-95 dated Mar. 17, 2014. The bulletin provides guidance on
provisions that will not be approved in a stop-loss policy issued by an accident and health
insurer, which insures the employer or its group health plan and not the enrollees covered
by the plan. Policies issued or renewed on or after Jan. 1, 2016 may not contain the
following provisions:
- Mid-term rate increases at the discretion of the carrier
- Early termination at the discretion of the carrier other than in accordance with the
cancellation and nonrenewal laws
- Rescissions for reasons other than fraud or intentional misrepresentation
- Annual dollar limitations in coverage
- Requirements that enrollees be actively at work
- Mandated provider networks
- Case management requirements
- Differences in attachment points based on the health status of the insured
Employers who sponsor a self-insured plan with stop-loss coverage should review their
stop-loss contract and work with their attorney and carrier to remove such provisions.
Bulletin No.
HC-103 »
June 30, 2015
On June 22, 2015, Gov. Malloy signed Substitute SB No. 428 into law, creating Public Act
15-56. The law extends workplace harassment, discrimination and retaliation protection
already available to employees covered by the Connecticut Fair Employment Practices Act to
unpaid interns.
The law defines “intern” as “an individual who performs work for an employer for the
purpose of training,” and imposes specific conditions that must be satisfied before the
position qualifies as an internship covered by the new law. Those requirements are:
- The employer is not committed to hire the individual performing the work at the
conclusion of the training period;
- The employer and the individual performing the work agree that the individual
performing the work is not entitled to wages for the work performed; and,
- The work performed
- supplements training given in an educational environment that may enhance the
employability of the individual,
- provides experience for the benefit of the individual,
- does not displace any employee of the employer,
- is performed under the supervision of the employer or an employee of the
employer, and
- provides no immediate advantage to the employer providing the training and may
occasionally impede the operations of the employer
If any of these criteria is not met, the individual is not an “intern” under the new
statute.
While the new law does not require benefit coverage for an unpaid intern, it requires
employers to review their practices relating to interns. Since the law also implicates
non-benefits laws, such as employment and labor law, employers should work with outside
counsel in ensuring compliance. The law is effective Oct. 1, 2015.
Public
Act 15-56 »
June 2, 2015
On May 26, 2015, Gov. Malloy signed SB 1029 into law, creating Public Act No. 15-7. The law
makes minor changes to the state statute concerning uncontested dissolutions of marriage.
While employers are not directly impacted by the changes, it is worth noting that changes
in the law provide for an expedited divorce or legal separation if certain factors are met.
The law permits a couple to file a joint petition in the judicial district in which one of
the party resides for a dissolution of marriage or legal separation and waives certain time
periods if agreement on all terms of the dissolution of marriage or legal separation is
reached.
Connecticut is one of the few states which recognize legal separation. Employers sponsoring
group health plans, especially those subject to COBRA, should be familiar with whether
their plan allows an employee to drop a spouse’s coverage due to legal separation and
whether COBRA is triggered at that time. Further, employers should ensure they have
communicated the proper timeframes (typically 60 days) for the employee to notify the
employer that a divorce or legal separation has occurred. Employers accomplish this by
distributing a COBRA Initial Notice within 90 days of the coverage effective date to both
the covered employee and covered spouse. This becomes even more important for those
employees entering into a uncontested legal separation or dissolution of marriage where the
timeline for the proceedings occurs on an expedited basis and failure to notify the
employer on a timely basis can result in a denial of COBRA coverage. The law is effective
Oct. 1, 2015.
Public
Act No. 15-7 »
On May 19, 2015, Gov. Malloy signed SB 426 into law, creating Public Act No. 15-6. The law
limits employer access to employee social media, email and other online accounts. The law
prohibits employers from requesting or requiring an employee or job applicant to 1) provide
the employer with a user name, password or other way to access the employee's or
applicant's personal online account 2) authenticate or access such an account in front of
the employer; or 3) invite, or accept an invitation from, the employer to join a group
affiliated with such an account. Employers are prohibited from firing, disciplining or
otherwise retaliating against an employee who 1) refuses to provide this access or b) files
a complaint with a public or private body or court about the employer's request for access
or retaliation for refusing such access. Employers may not refuse to hire an applicant
because the applicant would not provide access to his or her personal online account.
‘Personal online account’ is defined as any online account an employee or applicant uses
solely for personal purposes, including, but not limited to email, social media and
retail-based web sites.
Employees and applicants are permitted to file a complaint with the Connecticut Labor
Commissioner, who can impose civil penalties of up to $25 for initial violations against
job applicants and $500 for initial violations against employees. Penalties for subsequent
violations can be up to $500 for violations against applicants and up to $1,000 for
violations against employees.
The new law is effective Oct. 1, 2015.
Public
Act No. 15-6 »
February 24, 2015
On Feb. 18, 2015, the State of Connecticut Insurance Department released Bulletin HC-90-15,
which primarily affects carriers issuing health insurance policies in the state for
individual and small group plans. A couple of points may interest employers, however.
Specifically, the bulletin clarified that the state benchmark plan used for 2014 and 2015
will be extended for use during 2016. All non-grandfathered small employer plans both
inside and outside the state exchange are required to provide coverage for essential health
benefits as outlined in the state benchmark plan. Further, for small group plans offered
beginning Jan. 1, 2016, the state will conform to the federal rating requirements with the
exception of geographic rating areas. Connecticut was approved to establish eight rating
areas by county for the small group market. As a reminder, gender differences, industry and
group size, tobacco use, administrative expense differentials and network cost
differentials will no longer be permitted in the Connecticut small group market for rating
purposes. Finally, rating for family members will be performed in accordance with the final
rule, which states that the family rate is the sum of the rates for the employee, spouse,
children aged 21 or older and the rates for the three oldest children under age 21.
Bulletin
No. HC-101 »
January 13, 2015
On Dec. 1, 2014, the Connecticut Insurance Department issued Bulletin No. HC-101 in order
to clarify the Department’s policy on insurance benefits payable for work-related
injuries or sicknesses and for policies providing for disability income protection,
accident only benefits or travel health policies. The following provisions must be followed
for such policies:
- Benefits payable as a result of work-related illness or injury under these policies
must be payable on a lump sum or a fixed dollar (indemnity) basis. For example: $75
per/day while hospital confined, $10 per doctor office visit, $50 per day while out of
work due to an accident or sickness and $1,000 death benefit payable to an
employee’s family.
- A policy cannot provide benefits for work-related illness or injury based on the
difference between what an employee was earning prior to a work-related accident or
sickness and what the employee is entitled to receive from workers’ compensation
following the accident or sickness.
- A disability income policy may only provide benefits for work related injuries and/or
sickness on an indemnity or lump sum basis.
- A policy may not provide benefits for work-related illness or injury based on a
percentage of pre-disability income.
- Work-related accident and sickness benefits must be payable in addition to any
workers’ compensation benefits policy approved by the Insurance Commissioner
under § 31-345 of the Connecticut General Statutes. A statement needs to be
included in the policy to the effect that “This policy does not replace or
otherwise effect any statutorily required workers’ compensation insurance
required to be provided to you by law.”
Bulletin
No. HC-101 »
November 18, 2014
On Nov. 3, 2014, the State of Connecticut Insurance Department issued Bulletin No. HC-100,
which addresses health insurance coverage for preventative services. The bulletin clarifies
requirements under the federal health care reform law and reconciles these requirements
with Connecticut mandates for fully insured non-grandfathered group health plans, effective
Jan. 1, 2015. A discussion of the interaction between federal and state mandates follows:
- Clarifying that the term “reasonable medical management” under federal law
should be based upon the statutory definition of “medical necessity” found
in the Connecticut General Statutes Section 38a-482a.
- Clarifying that “breastfeeding support” as required under federal law
should take into account Connecticut mandates found under Connecticut General Statutes
Section 38a-530c(d) and 38a-503c(d) which requires two follow up lactation support
visits occur when a mother is discharged early from the hospital. The first visit must
occur within 48 hours of discharge and the second follow up visit must occur within
seven days of discharge.
- Clarifying that contraceptive coverage must include any prescription contraceptive
method approved by the Food and Drug Administration (FDA). This means that
sterilization procedures for men may not be covered under federal law but may be
covered by an insurance company separately, subject to state law.
- Clarifying that maternity coverage, including prenatal care and ultrasounds, are
covered without cost sharing under federal law. However, services related to maternity
that are not preventative may be subject to cost-sharing, although any preventative
service with no direct guidance may be subject to medical necessity.
Bulletin HC-100 »
August 26, 2014
On Aug. 20, 2014, the Connecticut Insurance Department issued Bulletin HC-99, which
rescinds and replaces Bulletin HC-96 issued earlier this year. This updated bulletin
clarifies that the current dollar limits provided under the state’s autism mandate
are pre-empted by federal law under PPACA. As a result, the insurance commissioner is
requesting that all carriers remove the limits to any applied behavioral analysis benefits.
Employers with fully insured policies issued in Connecticut should note that since this
would be a material modification of plan provisions, employers should ensure that the
issuer will notify plan participants of the removal of the annual dollar limits. If the
issuer is not performing the notification, employers subject to ERISA should provide
notification to plan participants within 210 days of the close of the plan year in order to
comply with the SMM. This SMM should then be attached to the plan’s SPD and provided
in tandem with the SPD going forward for any new plan participants.
Bulletin HC-99 »
July 1, 2014
On June 6, 2014, Gov. Malloy signed SB 10 into law, creating Public Act 14-97. The act
prohibits insured group health policies issued in the state from imposing copayments
greater than $20 for certain comprehensive ultrasound breast screenings. By law, policies
must cover a comprehensive breast ultrasound screening if 1) a mammogram shows
heterogeneous or dense breast tissue based on the American College of Radiology's Breast
Imaging Reporting and Data System or 2) a woman is at an increased risk for breast cancer
because of family history, her own breast cancer history, positive genetic testing or other
indications determined by her physician or advanced practice registered nurse.
The act also prohibits insured group health policies that provide coverage for occupational
or physical therapy from applying copayments greater than $30 per visit for in-network
occupational or physical therapy services.
The act is effective Jan. 1, 2015, for insured policies, including HMO plans, issued in
Connecticut. Due to ERISA, these state insurance benefit mandates do not apply to
self-insured group health plans.
Public
Act 14-97 »
Delaware
July 20, 2021
Coverage for Epinephrine Autoinjectors
Expand/collapse »
On June 15, 2021, Gov. Carney signed HB 95 into law. The new law applies to policies issued or renewed after December 31, 2021. Such policies must provide coverage for medically necessary epinephrine autoinjectors for participants who are 18 years of age or under by including at least one formulation of epinephrine autoinjectors on the lowest tier of the drug formulary developed and maintained by the carrier. Epinephrine autoinjector means a single-use device used for the automatic injection of a premeasured dose of epinephrine into the human body.
Employers should understand the new coverage and work with carriers to revise and distribute the certificate of coverage to covered employees.
HB 95 »
Discrimination Prohibited Related to HIV Preventive Medication
Expand/collapse »
On June 15, 2021, Gov. Carney signed HB 111 into law. Effective immediately, the new law prohibits life insurance disability policies from discriminating against an individual solely because they have been prescribed pre-exposure prophylaxis medication to prevent HIV infection. Specifically, an insurer cannot refuse to renew, refuse to issue, cancel, restrict coverage or add a premium rating factor based on such fact.
Because of privacy issues, an employer likely will not know if an employee is on such medication. However, the employer should work with insurers to make sure that policies comply and any necessary plan document amendments are made.
HB 111 »
April 27, 2021
Nondiscrimination Standards in Insurance Expanded
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On April 13, 2021, Gov. Carney signed SB 32 into law. The new law, effective immediately, expands the nondiscrimination standards in insurance. Specifically, a carrier may not discriminate in the offer of an insurance policy or the premiums charged based on gender identity or race.
For this purpose, gender identity is defined as a gender-related identity, appearance, expression or behavior of a person, regardless of the person's assigned sex at birth. Gender identity may be demonstrated by consistent and uniform assertion of the gender identity or any other evidence that the gender identity is sincerely held as part of a person's core identity; provided, however, that gender identity shall not be asserted for any improper purpose.
For this purpose, race is expanded to include traits historically associated with race, including hair texture and a protective hairstyle (such as braids, locks and twists).
Insurers and plan sponsors should be aware of these changes to the nondiscrimination standards.
SB 32 »
November 10, 2020
Regulations Provide Additional Guidance Related to Telehealth Services
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As reported in the September 1, 2020, edition of Compliance Corner, House Substitute 1 for H.B. 348 expanded covered telehealth services to include services provided without the use of visual communication. The Department of Insurance amended regulation 1409 to conform to that Act.
Effective November 11, 2020, no insurer shall impose any limitation on the ability of an insured to seek medical care through the use of telehealth service solely because the healthcare service is being provided through telehealth. In other words, an insurer cannot impose authorization, medical necessity or homebound requirements on telehealth services that do not equally apply to other medical services.
Although these regulations apply to insurers, plan sponsors should familiarize themselves with these requirements.
Regulation 1409, as amended »
Nondiscrimination Requirements Related to Gender Identity
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The Department of Insurance has revised and reissued Bulletin No. 86 to clarify coverage requirements related to gender identity. Effective September 4, 2020, health insurance policies are:
- Prohibited from denying, cancelling, terminating, limiting, refusing to issue or renew, or restricting insurance coverage or benefits based on an individual’s gender identity or transgender status
- Prohibited from denying, excluding or limiting coverage for medically necessary services based on the patient’s gender identify if the services are otherwise covered
- Prohibited from containing a blanket exclusion for gender dysphoria, gender identity disorder, medically necessary surgeries or other treatments related to gender transition
- Prohibited from imposing different premiums or rates for insurance coverage based on an insured’s gender identity
This bulletin will govern any fully insured policy issued in Delaware, so plan sponsors should familiarize themselves with these rules.
Bulletin No. 86 »
September 1, 2020
Coverage for Telehealth Expanded
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Under existing state law, policies providing hospital, medical and surgical coverage must also provide coverage for certain telehealth services. Effective July 17, 2020, and expiring July 1, 2021, House Substitute 1 for H.B. 348 expands that coverage to include telehealth services provided without the use of visual communication. This would include services provided via non-smart phones and landline connections. The plan cannot require a previously established relationship between the participant and the healthcare provider prior to the telehealth visit. The healthcare provider must be licensed to provide services in Delaware or the state in which they are located. Finally, coverage for telehealth services must include prescribing of controlled substances, including opioids.
The insurer providing the group policy should make the appropriate changes to the plan’s benefits to comply with the law. Employer plan sponsors should revise any plan documentation and communications as necessary to inform participants of the expanded coverage.
House Substitute 1 for H.B. 348 »
March 31, 2020
New COVID-19 Bulletin on Pre-Authorization Requirements, Telehealth, Non-Cancellation for Nonpayment of Premiums, and Catastrophic Plans
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On March 20, 2020, the Department of Insurance published Bulletin No. 116. The new bulletin is meant to provide additional guidance to carriers relating to COVID-19, particularly pertinent to the governor’s March 13, 2020, declaration of a state of emergency. The bulletin requests that carriers suspend cancellations and nonrenewals due to nonpayment of premium during the pendency of the state of emergency. In addition, the bulletin states that carriers should fully reimburse providers who are providing telemedicine services through telehealth, including all telehealth/telemedicine services (not just those relating to COVID-19).
The bulletin also states that early diagnosis and treatment of COVID-19 is imperative, and therefore that prior authorization requirements should be waived relating to the lab testing and treatment of confirmed or suspected COVID-19 patients. Finally, the bulletin states that catastrophic health coverage plans may be amended to provide pre-deductible coverage for services associated with the diagnosis and/or treatment of COVID-19 (normally, such plans may not provide coverage of an essential health benefits before an enrollee meets the plan’s deductible).
The bulletin contains no new employer requirements; employers should work with their carriers in understanding the bulletin’s directives for COVID-19-related coverage items and services.
Bulletin No. 116 »
March 17, 2020
Health Insurance Coverage for Coronavirus
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On March 9, 2020, the Department of Insurance published Bulletin No. 115, which relates to health insurance coverage for the coronavirus (COVID-19). According to the bulletin, small and individual plans must cover essential health benefits (EHBs), which include COVID-19-related laboratory tests.
For all fully insured plans (regardless of size), carriers cannot exclude a service for coverage solely because the service is provided through telemedicine services (which include a variety of platforms, including telephones, remote patient monitoring devices, and other electronic means such as web cameras and mobile video chat). In addition, carriers cannot use pre-authorization requirements as a barrier to access necessary treatment for COVID-19, and should expedite utilization review and appeal process for COVID-19 when medically appropriate.
On prescription drugs, an expedited formulary exception may be requested if the insured is suffering from a health condition that may seriously jeopardize the insured’s health, life or ability to regain maximum function, or if the insured is undergoing a current course of treatment using a non-formulary prescription drug. Additionally, PBMs are prohibited from requiring prior authorization for coverage of a 72-hour supply of medication that is for a non-controlled substance in an emergency. The Department expects insurers to provide for early refills or replacements of lost or damaged medications (even if the potential for quarantine is high). Lastly, consumers must be able to access their necessary prescriptions from a local retail pharmacy, even if their prescription supply is normally provided by mail order, without concern of a penalty.
Lastly, the bulletin states that carriers must cover diagnostic testing and waive patient cost sharing (deductibles, copayments and coinsurance), including for in-person and telemedicine visits.
The new bulletin applies directly to carriers, but are important reminders on coverage of COVID-19-relates services and items.
Bulletin No. 115 »
Coverage for Initial Depression Screenings
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On March 6, 2020, the Department of Insurance published Bulletin No. 114. The bulletin reminds carriers that initial depression screenings are considered a preventive service under the ACA, and therefore an enrollee should not be charged any cost sharing (deductible, copayment or coinsurance) for those screenings. The bulletin points to the American Psychiatric Association’s definition of “depression,” which is a common and serious illness that negatively affects how a person feels, thinks and acts. The bulletin reminds carriers that all people, starting at age 12, should be screened for depression (according to the U.S. Preventive Services Task Force).
The bulletin applies to carriers, but is helpful information for employers with regard to their fully insured plans and with regard to employees who may ask questions on coverage of initial depression screenings.
Bulletin No. 114 »
January 22, 2020
Contraceptive Coverage Mandate
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On December 5, 2019, the Department of Insurance issued Bulletin No. 112 related to the mandated coverage of certain contraceptives. As background, in July 2018, Gov. Carney signed SB 151 into law, which required health insurers to provide coverage for the following with no cost sharing for participants:
- All FDA-approved birth control methods, including intrauterine devices (IUDs)
- 12-months of birth control dispensed at one time
- Emergency contraceptives without a prescription
- Immediate insertion of long-acting reversible contraceptives (LARCs)
Again, this coverage is already required. The department issued the new bulletin to remind insurers of the last requirement related to LARCs, as it appears that insurers and hospitals have not been providing the service and benefit in an in-patient setting.
There is no action required of employers, but as a plan sponsor and fiduciary of a group health plan, they should monitor the performance of their carriers to make sure that the plan is providing the required coverage.
Bulletin No. 112 »
August 6, 2019
Efforts to Improve Efficiency of Claim Submissions and Payments
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On July 17, 2019, Gov. Carney signed HB 146 into law. The new law makes three changes to the relationship between health insurers and health care providers in an effort to make the process of claim submissions and payments more efficient.
First, health insurers must accept electronic claim submissions from non-pharmacy health care providers regardless of network status. Additionally, the insurer must electronically acknowledge the claim within two business days after submission.
Secondly, an insurer may not request medical records related to post-claim adjudication audits in more than 400 instances during a 45 day period per health care provider.
The third provision is the most relevant for group health plan sponsors and participants; an insurer must permit health care providers, regardless of network status, at least 180 days to submit a claim from the date of service. Any contract that imposes a shorter time frame for health care provider submission shall be revised by the insurer.
The effective date of these provisions is January 13, 2020. Although the changes do not require anything of employers, fully-insured plan sponsors should be mindful of these changes in how insurers will have to adjudicate claims.
HB 146 »
Prescription Drug Cost Sharing Limit
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On June 19, 2019, Gov. Carney signed HB 24 into law. The new law prohibits an insurer or pharmacy benefits manager from imposing a copayment or coinsurance for a covered prescription drug that exceeds the lesser of the usual and customary price or the contract price of the drug. The law is effective for policies issued or renewed on or after January 1, 2020.
HB24 »
Step Therapy Protocol Exceptions
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On June 18, 2019, Gov. Carney signed House Substitute 1 for HB 105 into law. The new law requires health plans to grant exceptions to step therapy protocols under specific circumstances. As background, step therapy protocols require patients to try one or more prescription drugs before coverage is provided for a drug selected by the patient’s health care provider.
Effective for policies issued or renewed on or after March 18, 2020, health plans must grant exceptions in the following circumstances:
- The required prescription drug is medically inadvisable, will likely cause an adverse reaction or physical/mental harm to the patient.
- The required prescription drug is expected to be ineffective based on the known clinical characteristics of the patient and the known characteristics of the prescription drug regimen.
- The patient has tried the required prescription drug while under the patient’s current or previous health benefit plan, or another prescription drug in the same pharmacologic class or with the same mechanism of action, and such prescription drug was discontinued due to lack of efficacy or effectiveness, diminished effect, or an adverse event.
- The required prescription drug is not in the best interest of the patient, based on medical necessity.
- The patient is stable, for the medical condition under consideration, on a prescription drug prescribed by the patient’s health care provider or while the patient was insured by the patient’s current or a previous health benefit plan.
HS 1 for HB 105 »
October 30, 2018
Coverage for Treatment of Back Pain
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On Sept. 10, 2018, Gov. Carney signed SB 225 into law, which encourages the use of
non-opioid methods of treating back pain. Effective 180 days from enactment, health
insurance policies may not impose a limit on the number of chiropractic or physical
therapy visits for the treatment of back pain.
SB 225 »
October 16, 2018
Mandated Coverage for In Vitro Fertilization and Other Fertility Services
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On Oct. 9, 2018, the Department of Insurance issued Revised Bulletin 103. The bulletin
clarifies that all individual and group health insurance policies issued in Delaware on
or after June 30, 2018 must provide coverage for certain fertility care services:
- In vitro fertilization services for individuals who suffer from a disease or
condition that results in the inability to procreate or to carry a pregnancy to
live birth
- Standard fertility preservation services for individual who must undergo medically
necessary treatment that may cause iatrogenic infertility (an impairment due to
surgery, radiation, chemotherapy or other medical treatment)
These benefits must be provided to all participants including spouses and dependents.
Bulletin 103 »
Revised Regulations Related to MEWAs
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On Sept. 1, 2018, the Department of Insurance issued emergency regulations related to
multiple employer welfare arrangements (MEWAs). The regulations were effective upon
signing and will apply to any association health plan (AHP) that that covers a Delaware
resident.
A fully insured association must be licensed with the Department. In order to obtain a
license, the association must submit the following to the Department:
- Biographical information of all principals, officers, directors and trustees
- Identification of all participating employers
- Identification of third party administrators
- Eligibility requirements for association membership
- Description of association’s member benefits
- Copy of the association’s by-laws, articles of incorporation or trust instrument
- Copy of contracts between the association and insurers to provide health care
benefits in DE
- Any marketing or advertising materials used by the association
- Most recent audited financial statements
- Copy of the most recently filed Form M-1
- Proof of minimum surplus in the amount of $500,000
- Proof of surety bond in the amount of $500,000 to ensure the association’s
obligations to health plan members
- $1,000 filing fee
Additionally, the association must submit the following to the Department annually:
- Proof of health insurance coverage
- Demographic information of third party administrators
- Notice of any changes to previously filed information (such as changes to trustees,
officers, insurance coverage, plan document, by-laws, marketing material and so on)
- Most recent audited financial statements
- Documentation of preceding year’s and upcoming year’s annual premiums
- Proof of a surety bond sufficient to cover at least 20% of annual premium for DE
members
- $150 filing fee
The association must:
- Exist for at least 5 years
- Be formed and maintained for purposes other than insurance
- Not condition membership on any health status related factor
The member employers must be in the same industry or have their principal place of
business in DE. The AHP can’t restrict membership to a particular part of the state.
The association may be rated on the collective group experience with each subscriber
receiving the same community rate. The following rating factors are prohibited:
- Age
- Gender
- Health status, including pre-existing conditions
- Industry
- Medical underwriting and screening
The AHP must provide coverage for all DE mandated benefits and essential health
benefits. The coverage must be in compliance with the ACA’s cost sharing limits,
prohibition on lifetime and annual dollar limits and 60 percent actuarial value.
The regulations also addressed self-insured AHPs. Until revised regulations are issued,
self-insured AHPs will be subject to all of the state’s insurance requirements
including licensure as an insurer, mandated benefits, financial reserves and reporting.
Emergency Regulations »
September 18, 2018
Stop-Loss Policies Extended to Small Employers
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On Sept. 4, 2018, Gov. Carney signed HB 406 into law, which became effective on the
date of signing. The new law permits stop-loss coverage to be purchased by small
employers with more than five eligible employees, the majority of whom are employed
within Delaware on at least 50 percent of working days in the preceding calendar
quarter. The law previously prohibited insurers from selling stop-loss coverage to
small employers with 15 or fewer employees.
HB 406 »
Pharmacy Gag Clauses Prohibited
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On Aug. 28, 2018, Gov. Carney signed HB 425 into law. The new law prohibits contracts
between pharmacies and pharmacy benefit managers from containing what’s commonly
referred to as a gag clause. A gag clause prohibits a pharmacy from informing a
consumer that they have options related to their prescription — specifically,
purchasing the prescription for a retail price that’s lower than the price offered
through their health insurance plan.
Under the new law, which applies to contracts entered into or renewed on or after Aug.
28, 2018, a pharmacy is permitted to:
- Provide an insured with information regarding the retail price of a prescription
drug or the amount of the cost share under the insured’s health insurance policy;
and
- Discuss with an insured information about a more affordable, therapeutically
equivalent prescription drug and selling that drug to the insured
HB 425 »
Coverage for Pediatric Autoimmune Neuropsychiatric Disorders
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On Aug. 28, 2018, Gov. Carney signed HB 386 into law. Group health insurance policies
issued or renewed on or after that date must provide coverage for the treatment of
pediatric autoimmune neuropsychiatric disorders associated with streptococcal
infections and pediatric acute onset neuropsychiatric syndrome. Treatment coverage must
specifically include the use of intravenous immunoglobulin therapy.
HB 386 »
Prior Authorization Requirements Restricted for Certain Prescriptions
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On Aug. 28, 2018, Gov. Carney signed HB 441 into law, which became effective on the
date of signing. The new law prohibits pharmacy benefit managers from requiring a prior
authorization for an initial prescription for a narcotic or benzodiazepine drug that’s
prescribed in an emergency situation for 72 hours or less. An emergency is defined as a
situation that will result in the loss of life, limb or organ function.
Additionally, the new law prohibits a pharmacy benefits manager from requiring a prior
authorization for a prescription medication related to a chronic or long-term condition
more frequently than once per 12 months. For this purpose, the prescription medication
must be necessary for the life of the patient.
HB 441 »
August 7, 2018
Experimental Treatment Coverage
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On June 13, 2018, Gov. Carney signed HS 1 into law. The new law prohibits group health
policies from denying coverage for a National Coverage Determination Service on the
basis that such service, item or treatment is experimental or investigational. National
Coverage Determination Service is defined as a service, item or treatment which has
been determined to be covered nationally by HHS for Medicare purposes. In other words,
if a service has been determined to be an eligible expense under Medicare, a group
health plan issued or renewed in DE cannot exclude coverage for that service based on
the reason that it is experimental.
The law was effective upon the governor's approval.
HS 1 »
HHS Listing of National Coverage Determinations »
July 24, 2018
Mandated Coverage for Certain Infertility Treatments
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On June 30, 2018, Gov. Carney signed SB 139 into law. The new law requires group health
plans to cover certain services related to fertility. Participants are eligible if they
have a diagnosis of infertility or are at risk of iatrogenic infertility, which is an
impairment of fertility due to surgery, radiation, chemotherapy or other medical
treatment. Subscribers, spouses and non-spouse dependents are equally covered.
The law mandates coverage for sixteen identified services, including cryopreservation
of eggs/sperm/embryos, storage of eggs/sperm/embryos, intrauterine insemination and
embryo transfers. Coverage for in vitro fertilization (IVF) is only available to
participants who have been unable to obtain a successful pregnancy through less costly
treatments. Retrievals must be completed before the participant is age 45 and transfers
must be completed before the participant is age 50. Plans aren’t required to provide
monetary payment to surrogates or provide coverage for reversal of voluntary
sterilization.
The requirement doesn’t apply to self-insured group health plans or plans maintained by
employers with fewer than 50 employees. An exemption is available for religious
employers for whom the coverage conflicts with their bona fide religious beliefs and
practices.
The new law was effective upon the governor’s signature.
S.B. 139 »
October 31, 2017
Coverage of Drug and Alcohol Dependencies
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Effective for plans issued or renewed on or after Jan. 1, 2018, SB 41 amends the
Insurance Code’s provisions on coverage of serious mental illness. The new law requires
insurers that provide major medical coverage to provide inpatient coverage for the
diagnosis and treatment of drug and alcohol dependencies and unlimited medically
necessary treatment for drug and alcohol dependencies provided in residential settings.
A plan that provides prescription drug coverage must provide coverage for the treatment
of alcohol and drug dependencies that includes immediate access, without prior
authorization, to a five-day emergency supply of medicines covered under the health
plan when a medical emergency exists (such as the management of opioid withdrawal or
stabilization, or reversal of an opioid overdose). Coverage may be subject to the
plan’s normal cost-sharing provisions.
Additionally, an insurer may not impose precertification, prior authorization,
pre-admission screening or referral requirements for the diagnosis and medically
necessary treatment, including in-patient treatment, of drug and alcohol dependency.
This new law doesn’t contain any new employer compliance obligations. However, Delaware
employers will want to be aware of the changes to the insurance laws in Delaware should
employees have questions regarding health insurance coverage.
SB 41 »
Coverage for Cancer Treatment
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On Sept. 20, 2017, Gov. Carney signed HB 120 into law, which applies to policies that
provide coverage for the treatment of stage four advanced metastatic cancer. Such
policies are prohibited from mandating that the insured first be required to fail to
successfully respond to a different drug or prove a history of failure of such drug
before providing benefits for a prescribed drug (sometimes called step therapy). The
law is effective for policies issued or renewed on or after Sept. 1, 2017.
This new law doesn’t contain any new employer compliance obligations. However, Delaware
employers will want to be aware of the changes to the insurance laws in Delaware should
employees have questions regarding health insurance coverage.
HB 120 »
January 24, 2017
2018 FFE State Partnership Exchange
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On Jan. 11, 2017, the Delaware Department of Insurance issued Bulletin No. 92, which
proclaims the state’s intention to operate a federally-facilitated exchange (FFE) state
partnership in 2018. The state’s responsibility in the partnership will be to continue
to review and certify qualified health plan options to be offered through the exchange
in both the individual and small group markets.
The remainder of the bulletin outlines the state’s insurance mandates with which the
policies would need to comply, including coverage for essential health benefits, mental
health parity, telehealth services, reimbursement of a licensed midwife and
availability of provider directories for those with limited English proficiency and/or
disabilities. It is worth noting that these mandates generally apply to insurance
policies outside of the exchange as well.
Bulletin No. 92 »
January 10, 2017
Network Disclosure and Transparency
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Effective Jan. 1, 2017, health insurers providing major medical coverage in Delaware
are required to maintain up to date and comprehensive provider directories. The new
requirement was signed into law in July 2016 as part of HB 439 (House Substitute 1),
which also requires health care providers to disclose their network status to a plan
participant. Prior to providing non-emergency health care services to a plan
participant, the health care provider must notify the participant in writing whether
the provider is a participating or out-of-network provider with the participant’s
health insurance policy. If the provider is out-of-network, the written disclosure must
state that the participant may be responsible for additional charges beyond
coinsurance, deductibles and copayments. The written disclosure must also identify the
range of fees charged by the out-of-network provider for the health care services. If
the provider fails to distribute the written disclosure to the participant, the
provider may not balance bill the participant for the services not covered by the
health insurance policy.
The Delaware Department of Insurance (the Department) was expected to issue regulations
prior to the law’s effective date. On Dec. 20, 2016, the Department issued Bulletin No.
90 stating that the regulations would not be effective until Feb. 11, 2017. While the
regulations were delayed, the Department still expects insurers and providers to be in
compliance with the law’s requirements effective Jan. 1, 2017.
There are no requirements for employers, but the law will impact a participant’s
benefits under group health insurance policies issued in Delaware.
HB 439, House Substitute 1 »
Bulletin 90 »
August 23, 2016
Pre-Authorizations
On July 13, 2016, Gov. Markell signed HB 381 into law. The new law requires utilization
review entities (which include health insurers, health benefit plans and health service
corporations) to detail any pre-authorization requirements and restrictions readily
accessible on its website and in written/electronic form upon request for participants,
health care providers, government entities and the general public. Any change in the
procedures must be communicated prior to the effective date.
Utilization review entities must process clean pre-authorizations for non-emergency
pharmaceuticals within two calendar days; three calendar days for those related to
health care services and submitted electronically; and five calendar days for those
related to health care services and not submitted electronically.
A pre-authorization shall be valid for one year from the date that the health care
provider receives the authorization, dependent upon continued coverage and
eligibility of the participant.
There is no requirement of employers, but it is helpful for plan sponsors to
understand how their insured group health plans and participants will be
impacted by the amended procedures.
The new law is effective Jan. 1, 2017.
HB 381 »
April 5, 2016
On March 23, 2016, the Delaware Department of Insurance issued Bulletin No. 86. The
bulletin provides guidance regarding the Gender Identity Nondiscrimination Act of 2013,
which prohibits insurers from discriminating against an individual because of gender
identity. The department interprets the act along with the Unfair Trade Practices Act and
the ACA to prohibit a carrier from excluding, denying or otherwise limiting coverage for
medically necessary services, as determined by a medical provider, based on the
individual’s gender identity if the service would be covered for another participant.
Further, a carrier may not impose a general exclusion for gender dysphoria or gender
identity disorder.
Carriers must provide coverage, including under a group health policy,for medically
necessary surgeries or treatments related to gender transition. Importantly, the 2016 state
benchmark plan includes an exclusion for “change of sex surgery,” which the department
warns is a violation of the law. The bulletin and its guidance are effective immediately.
Bulletin No. 86 »
February 9, 2016
On Feb. 1, 2016, Insurance Commissioner Stewart adopted final regulations related to HB 69,
which was passed July 2015. As background, HB 69, effective Jan. 1, 2016, requires group
health insurance policies issued in Delaware to provide coverage for telehealth and
telemedicine. For this purpose, “telehealth” is defined as the use of information and
communication technologies (including telephone, remote monitoring devices and other
electronic means) to support clinical health care, provider consultation and patient
education. Telemedicine is defined as the delivery of health care services by real time
two-way audio, visual or telecommunications (including video conferencing). The health care
provider must be practicing within his or her scope of practice.
The regulations prohibit an insurer from placing additional restrictions on telehealth
services, such as preauthorization, medical necessity or homebound requirements that are
not placed on similar non-telehealth services. The regulations are effective Feb. 11, 2016.
Final Regulations »
January 12, 2016
On Dec. 10, 2015, the Delaware Department of Insurance amended Bulletin No. 51 regarding
the state’s mini-COBRA requirements for small employers. The amended bulletin includes a
revised model notice for employers to distribute to terminated employees notifying them of
their right to continuation.
Bulletin No. 51 »
Model Notice »
October 20, 2015
On Oct. 15, 2015, Insurance Commissioner Stewart issued Bulletin No. 79 related to the
definition of small group under state law. Delaware insurance statutes define a small group
as an employer with up to 50 employees. Because the federal provision mandating the change
of small group to 100 employees is no longer in effect as a result of the PACE Act,
Delaware will keep the definition of small group at 50 employees. Thus, groups with 51 to
100 employees will continue to be rated as large groups and will not be required to switch
to the small group market in 2016.
Bulletin No. 79 »
On Sept. 29, 2015, Insurance Commissioner Stewart announced the 2016 approved rates for
qualified health plans in the state exchange. The average rate increases for individual
policies range from 16.9 percent to 22.4 percent compared to 2015 rates, depending on the
insurer, and -0.5 to 12.7 percent for small groups. Premium rates for small groups
purchasing coverage through the SHOP will vary by age, but average from $250.48 per month
for a bronze plan to $359.75 for gold. While the individual policy offerings do not affect
employers, it may be helpful for employers to understand what is available through the
exchange when responding to employee questions. Also, small employers with up to 50
employees have the option of purchasing group coverage through the SHOP. Please consult
your advisor with any questions.
Annoucement »
September 22, 2015
On Sept. 1, 2015, the Delaware Department of Insurance issued Bulletin No. 76, which
clarifies the state’s requirements related to individual hospital or other fixed indemnity
policies.. For any policies issued on or after Jan. 1, 2015, the policies must meet the
following criteria to be in compliance with federal and state law:
- The insurance application must include an attestation that the insured has minimum
essential coverage under another policy or plan.
- The application must also include model notice language indicating that the policy is a
supplement for health insurance and is not a substitute for major medical coverage. The
notice must also inform the insured that the lack of minimum essential coverage may
result in a tax penalty.
Employers who make such coverage available to employees should be aware of the new
requirements.
Bulletin No. 76 »
August 11, 2015
On July 7, 2015, Gov. Markell signed HB 69 into law. The new law requires group health
plans to provide coverage for health care services provided through telemedicine.
‘Telemedicine’ is defined as the delivery of health care services by means of real time
two-way audio, visual or other telecommunications or electronic communications and includes
the assessment, diagnosis, consultation, treatment, education, care management and
self-management of a patient’s health care. The plan may not impose a higher deductible,
copayment or coinsurance amount for telemedicine services than would apply if the same
service were provided through in-person consultation. The law is effective for policies
issued or renewed on or after Jan. 1, 2016.
HB 69 »
June 30, 2015
On June 15, 2015, HHS conditionally approved Delaware’s application for a state-based
health insurance marketplace for individual and SHOP coverage. The state’s marketplace is
currently a partnership. If the state meets the conditions outlined by HHS, the state-based
marketplace would be effective for 2016.
HHS Conditional Approval Letter »
June 2, 2015
On May 21, 2015, Insurance Commissioner Stewart announced that Aetna Health, Inc. and
Highmark Blue Cross Blue Shield Delaware will offer employers with 51 to 100 employees the
opportunity to renew their group health insurance policies at large group rates for policy
plan years beginning on or before Oct. 1, 2016. This is in response to Commissioner
Stewart’s Bulletin No. 75 providing carriers with such an option. Employers with 51 to 100
employees who do not take advantage of the opportunity provided by Aetna Health, Inc. and
Highmark Blue Cross Blue Shield Delaware will be switched to a small group policy for plan
years beginning on or after Jan. 1, 2016. The change in the definition of ‘small group’ is
mandated by PPACA and includes modified community rating and mandated coverage for the
essential health benefit categories.
Announcement »
Bulletin No. 75 »
January 13, 2015
On Sept. 2, 2014, Gov. Markell signed HB 294 into law. The new law requires that an
employer take all reasonable steps to destroy personal identifying information that is no
longer to be retained by the employer. The term personal identifying information includes
an employee’s name (or first initial and last name) in combination with his or her
signature, date of birth, social security number, passport number, driver’s license
number, state identification number, insurance policy number, financial services account
number, bank account number, credit card number, debit card number or any other financial
or confidential health information. The employer must shred, erase or otherwise destroy or
modify personal identifying information to make it entirely unreadable or indecipherable
through any means. The law became effective Jan. 1, 2015.
HB 294 »
October 21, 2014
On Sept. 30, 2014, the Delaware Department of Insurance issued Bulletin No. 72, which
reminds insurers that they must provide certain coverage related to tobacco cessation. As
part of PPACA’s preventive service mandate, insurers must provide the following
coverage for non-grandfathered group health plans:
- Screening for tobacco use.
- Two quit attempts per year, consisting of four sessions of individual or group
cessation counseling by telephone lasting at least 10 minutes each per quit attempt.
- All medications approved by the FDA as safe and effective for smoking cessation for 90
days per quit attempt when prescribed by a health care provider.
These services must be provided with no cost-sharing for the participant and without
requiring prior authorization. While the bulletin is directed at insurers, sponsors of
group health policies should be mindful of the tobacco cessation programs that are
available to participants under the plan.
Bulletin No. 72 »
August 26, 2014
On July 31, 2014, Gov. Markell signed SB 185 into law. The new law will prohibit employers
with four or more employees from discriminating against employees based on a disability.
The law previously applied to employers with 15 or more employees, which is consistent with
the federal ADA. Small employers in Delaware will want to review their employment and leave
policies to ensure that they are in compliance by providing reasonable accommodations for
employees who require them. Reasonable accommodations may include making facilities
accessible, modifying equipment and making reasonable changes in schedules or duties. While
there is a posting requirement for applicable employers, the Delaware Department of Labor,
Division of Industrial Affairs, has not yet revised the poster. They are expected to do so
prior to the law’s Jan. 31, 2015, effective date.
SB 185 »
July 15, 2014
On June 30, 2014, Insurance Commissioner Stewart issued Bulletin No. 71. The bulletin
reminds insurers that they must pay clean claims related to emergency services submitted by
non-network providers within 30 days of receipt. The 30-day requirement applies regardless
of whether the insurer or the provider has petitioned for arbitration. Further, the claim
must be paid at the highest allowable charge for each emergency care service permitted by
the insurer for any provider (including both network and non-network providers) during the
12-month period prior to the date of service for the claim in question.
Bulletin No. 71 »
April 8, 2014
On March 13, 2014, Delaware Insurance Commissioner Karen Weldin Stewart issued a statement
related to the March 5, 2014, CMS announcement of a two-year extension to the transitional
policy for non-PPACA-compliant health benefit plans (as covered in the March 11, 2014,
edition of Compliance Corner). Commissioner Stewart stated that Delaware state law
does not allow for the extension of non-PPACA-compliant plans.
Press Release »
District of Columbia
July 7, 2021
Coordination of Short-Term Disability and PFML Benefits
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»
On May 26, 2021, DC Mayor Bowser signed B24-0185 into law. Enacted as Emergency Act 24-0090, which is effective immediately and expiring August 24, 2021, the new law prohibits short-term disability policies issued in DC from offsetting or reducing benefits based on DC Paid Family and Medical Leave payments.
Unfortunately, we have no additional guidance at this time as to how this provision will be administered. It is common for either the short-term disability policy or the state PFL program to offset benefits so that the employee does not receive more than 100% of their normal wages while on leave. In DC, an employer cannot interfere with an employee's right to PFML benefits. Thus, DC PFML benefits do not coordinate with short-term disability policies. In other words, DC PFML pays primary. This has resulted in short-term disabilities policies paying secondary to PFML with reduced benefits. However, the new law prohibits this practice.
We will continue to monitor this issue and report any developments. Employers should work with their advisor and short-term disability insurers to make any necessary changes to leave policies, documents and operations.
Emergency Act 24-0090 »
May 11, 2021
Pregnancy as a Qualifying Event
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The DC Council has adopted an ordinance that creates a new qualifying event for an insured to enroll in coverage mid-year based upon pregnancy. The enrollment period extends to 30 days following the date of pregnancy confirmation, as certified by a healthcare professional. It appears that the event would extend to any individual eligible under the group health plan who becomes pregnant including the employee, domestic partner, spouse or child. After review by Mayor Bowser and the US Congress, the law was effective October 20, 2020.
Importantly, pregnancy is not a recognized qualifying event under Section 125. Thus, if an employee adds coverage mid-year under this event, any associated employee contributions will likely need to be deducted on a post-tax basis.
D.C. Law 23-135. Pregnancy as a Qualifying Event Act of 2020 »
April 14, 2020
Declaration of Emergency Leave
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On March 17, 2020, the City Council approved the COVID-19 Response Emergency Amendment Act. The act added a new category of leave to the existing D.C. FMLA. The declaration of emergency (DOE) leave is available to employees who are unable to work during a period of time where the mayor has declared a public health emergency; and the employee has self-quarantined or isolated due to a recommendation or order by a health care provider, federal/state official, or the mayor.
Unlike existing D.C. FMLA, the DOE leave applies to employers of any size with an employee performing work in the district. Additionally, employees do not have to meet any service requirements to be eligible. The amount of unpaid leave is indefinite for the period of the public health emergency.
COVID-19 Response Emergency Amendment Act »
March 31, 2020
Order on COVID-19 Coverage
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On March 20, 2020, the Department of Insurance published Commissioner’s Order 01-2020, relating to COVID-19 screening, testing and treatment. The order requires carriers to cover all medically necessary screening, testing and treatment for COVID-19 or suspected COVID-19 or respiratory diseases/illnesses detected in the course of seeking screening, testing or treatment for COVID-19 without cost sharing of any kind (including deductibles, copayments and coinsurance). This includes all associated costs, such as processing fees and clinical evaluations. In addition, carriers may not require any preauthorization for any COVID-19-related screening, testing or treatment, and carriers must cover all out-of-network charges (including cost sharing and balance billing) unless the employee was first offered the service in-network without unreasonable delay. Further, if and when an immunization or vaccine becomes available for COVID-19 per CDC guidelines, carriers must immediately cover the cost for those services without cost sharing.
In addition, the order states that carriers must enhance their coverage of telehealth services, and are directed to review their telehealth programs with participating providers; cost sharing for telehealth must not be more than for in-person services. Also, with respect to prescription drug access, carriers must allow enrollees to obtain refills of their prescription medications before the scheduled refill date, and should waive any additional costs associated with accessing prescriptions from a mail-order pharmacy.
The order is directed towards carriers, but employers should be aware of the DC order’s requirements, and should work with their carrier on any questions relating to COVID-19-related coverage.
Commissioner’s Order 01-2020 »
Revised FAQs on Insurance Issues Related to COVID-19
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»
On March 24, 2020, the Department of Insurance published revised FAQs on insurance issues related to COVID-19. The revised FAQs are meant to help employers, carriers and DC residents better understand some of the challenges and questions associated with COVID-19-related coverage. Some FAQs are more aimed toward employees/DC residents, including where an employee/resident can go to get tested for COVID-19, who is responsible for the cost, whether preauthorization is required, and whether testing/treatment for COVID-19 must be done at in-network facilities. The FAQs also address the interaction between COVID-19 testing without cost sharing and an employee’s HSA eligibility.
The revised FAQs contain no new employer compliance obligations, but can serve as a great resource for employees who might have questions on their insurance and generally with respect to COVID-19.
Revised FAQs »
January 22, 2020
Paid Family Leave Poster and Resources Published
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As reported previously, D.C.’s paid family leave law becomes effective July 1, 2020. That is the date that eligible employees will become entitled to up to eight weeks of paid leave to bond with a new child, six weeks to care for a seriously ill family member, or two weeks for their own serious illness. Employers have been submitting the required tax assessment since July 1, 2019, in preparation for the new requirement. As a reminder, the new law applies to any employer with an employee who performs at least 50% of their work within the District.
The Department of Employment Services (DOES) has published a Paid Family Leave Employee Notice. The notice must be posted in the worksite with other employment posters by February 1, 2020. The notice must be provided in electronic or physical form to all existing D.C. employees at least once between February 1, 2020, and February 1, 2021, and annually thereafter. All new employees must receive a copy at the time of hire. Finally, the employer must distribute the notice to any employee who notifies the employer on or after February 1, 2020, of their need for leave for an event that could qualify for PFL benefits.
Further, DOES has posted an Employer Toolkit, which is designed to answer frequently asked questions and assist employers revise their leave policies.
DOES PFL Employee Notice »
DOES PFL Employer Toolkit »
December 10, 2019
Employer Reporting Responsibility Related to Individual Health Insurance Mandate
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»
Since the beginning of 2019, D.C. residents must have minimum essential health care coverage or pay a tax penalty. As a result, employers will have reporting responsibilities to the District. The responsibility will be satisfied by submitting the same IRS Forms 1094-B, 1095-B, 1094-C, and 1095-C to the D.C. Office of Tax and Revenue (OTR). In other words, employers will file them with the IRS to comply with their federal responsibility under the employer mandate. They will then file the same forms with the OTR to satisfy their District responsibility.
The requirement applies to employers with 50 or more employees, one of whom resides in D.C. The forms will need to be filed electronically through the MyTax.DC.gov website. For this first year, the filing deadline for the 2019 forms will be June 30, 2020. In future years, the deadline will be 30 days following the IRS deadline for submitting forms.
There is no mention of the requirement only applying to self-insured employers. It appears that both fully insured and self-insured large employers would need to comply, even though the carrier for a fully insured plan will already be submitting the Forms 1094-B and 1095-B on behalf of the plan. Hopefully, future guidance will be issued prior to June 2020. We will keep you updated on any developments. In the interim, employers should work with reporting vendors and internal personnel to prepare for the new requirement.
D.C. OTR Notice 2019-04 »
October 15, 2019
Enforcement of Employer Commuter Benefit Requirement
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On August 16, 2019, the D.C. Department of Employment Services published final regulations related to the enforcement of the existing commuter benefits requirement.
Since January 1, 2016, employers with 20 or more employees in D.C. must offer access to one or more transit benefit options. All employees working 50% or more of their service time in D.C. are counted. Those options are:
- Employee pays pre-tax contributions for transit benefits
- Employer pays transit benefit costs for employees (either through reimbursement or the provision of pre-paid metro cards)
- Employer provides transportation through a shuttle or vanpool
The employer must:
- Notify employees of the available transit benefit program (read the notice here)
- Provide information to covered employees on how to apply and receive benefits
- Issue benefits to covered employees that request or apply for them
- Maintain records to establish compliance with the requirements
- Record that notice was given to employees
- Records showing that elected benefits were provided
Under the final regulations, effective November 14, 2019, the penalties for failure to comply are: $100 for the first offense; $200 for the second; $400 for the third; and $800 for the fourth and subsequent offenses. Please note: an offense is considered each employee per month that is not offered at least one qualified transportation program benefit.
Notice of Final Rulemaking »
April 16, 2019
Universal Paid Leave
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»
As previously reported, employers with employees who perform at least 50 percent of their work in D.C. will be required to contribute to the Universal Paid Leave Program. Employers must pay 0.62 percent of all wages for such employees to fund the program, which will provide paid leave to eligible employees for leaves on or after July 1, 2020.
The employer contributions are scheduled to begin July 1, 2019. NFP’s Benefits Compliance team has received confirmation from D.C. Department of Employment Services, Office of Paid Family Leave, that the employers will owe the 0.62 percent assessment on the second quarter earnings, which is payable in July. In other words, employers need to be working with their payroll provider now to collect the tax on wages beginning April 1, 2019. The office will release final regulations and further clarification soon. They are exploring the option to include the wage reporting and tax payment in the Employer Self Service Portal, which is used for unemployment insurance reporting.
Department of Employment Services, Paid Family Leave Information
»
February 5, 2019
Protecting Pregnant Workers Notice
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The Office of Human Rights has issued a revised notice regarding The Protecting
Pregnant Workers Fairness Act (PPWFA). The notice must be posted in the workplace in a
conspicuous place. Employers must also provide employees with notice of the law within
10 days of an employee notifying them of their pregnancy or related condition.
As a reminder, the PPWFA requires District employers of all sizes to provide reasonable
accommodation for employees whose ability to perform job duties is limited because of
pregnancy, childbirth, breastfeeding or a related medical condition. Reasonable
accommodations include unpaid time off, modifying work equipment, providing more
frequent or longer breaks and modifying work schedules.
Revised PPWFA Poster »
November 13, 2018
Universal Paid Leave Guidance
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The D.C. Department of Employment Services (DOES) has published guidance on the
Universal Paid Leave (UPL) Act in the form of two FAQs that are divided into employer
and employee questions. As a reminder, the new law will provide employees with paid
leave beginning July 1, 2020. The leave is administered by DOES, but is funded by
employers who will contribute 0.62 percent of payroll starting July 1, 2019. Eligible
employees will be entitled to up to:
- Eight weeks for parental leave (new child)
- Six weeks for family leave (to care for a family member with a serious health
condition)
- Two weeks for medical leave (employee’s own serious health condition)
The employee FAQ clarifies the following issues:
- Employees will be eligible for UPL if they spend 50 percent of their work time for
that employer in D.C. during some or all of the previous 52 weeks. This includes
those who telework/telecommute, temporary employees and seasonal employees.
- UPL may be taken intermittently in one-day increments.
The employer FAQ clarifies the following issues:
- Businesses of any size performing services in D.C. that also pay unemployment taxes
for employees will be required to pay quarterly UPL taxes.
- There is no exemption for employers who currently provide some sort of paid leave
for employees. The employer may choose to coordinate benefit payments during the
period where an employee is eligible for both, but an employee’s UPL benefits will
not be reduced or eliminated by the receipt of paid leave benefits from an
employer.
DOES will be providing a notice that will need to be posted in the workplace. They have
already provided a calculator and a chart to assist employees in estimating paid weekly benefits.
Lastly, a chart comparing the provisions of federal FMLA, DC FMLA, DC UPL
(also called Paid Family Leave or PFL) and Accrued Sick and Safe Leave is also
available.
D.C. Universal Paid Leave, Employee FAQ »
D.C. Universal Paid Leave, Employer FAQ »
May 31, 2017
Coverage of Women’s Preventive Care Services
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On April 24, 2017, Mayor Bowser approved emergency Act 22-0049, Defending Access to
Women's Health Care Services Emergency Amendment Act of 2017. The Act amends D.C.’s
insurance laws to require insurers to provide coverage for certain women’s preventive
health services without cost sharing. A group health plan will be required to provide
such coverage for:
- Evidence-based items or services that have in effect a rating of "A" or “B" in the
recommendations of the United States Preventive Services Task Force; and
- Such additional preventive care and screenings as provided for in comprehensive
guidelines supported by the Health Resources and Services Administration.
While group health plans issued in D.C. are already subject to this requirement because
of the federal requirement under the ACA, this action would require policies to comply
regardless of whether they are grandfathered and regardless of whether the federal law
changes. In other words, it has become a local insurance mandate.
As with all emergency action, it is effective for 90 days and expires on July 23, 2017.
Act
22-0049 »
April 18, 2017
Universal Paid Leave Act
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»
On April 7, 2017, the Universal Paid Leave Act became law in the District of
Columbia. It was originally introduced as Bill B21-0415 in October 2015. It was
approved by the city council on Dec. 20, 2016. Mayor Bowser opposed the bill and
returned it unsigned on Feb. 2, 2017. Unique to the District, any approved acts are
subject to a 30 day review by the U.S. Congress. If no action is taken by Congress,
the act becomes law, which is what happened with this bill. The act became law on
April 7, 2017 after no action from the Mayor or Congress.
The new law establishes a paid leave system for all individuals who work within the
District at least 50 percent of their work time. Employees of the federal
government are excluded from eligibility. Employees will be eligible for up to a
total of 16 weeks of paid leave for absences related to a serious health condition
of the employee (two weeks), serious health condition of a family member (six
weeks) and parental bonding time with a new child (eight weeks). The term family
member includes a biological, adopted, foster or stepchild; a domestic partner and
child of a domestic partner; parent, stepparent, grandparent or parent-in-law; and
sibling. It also includes an individual who stood in loco parentis to the employee
or a child for whom the employee stands in loco parentis.
Benefits will be paid by the Family and Medical Leave Fund, which will be funded by
employers. Beginning in July 2019, employers will contribute an amount equal to
0.62 percent of employee wages. Employees will be eligible to file for claims
beginning July 1, 2020 with a maximum weekly benefit of $1,000.
The benefits run concurrently with FMLA and D.C. FMLA and the new act does not
provide additional job protection beyond that provided by those laws.
Proposed regulations, which will provide greater detail, are to be released by
October 2017. We will report any developments in future issues of Compliance
Corner.
B21-0415
»
Specialty Drug Copayment Limitation Act
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»
On April 7, 2017, B21-0032, the Specialty Drug Copayment Limitation Act, became
law. The new law restricts the amount that a health insurance plan may charge for a
specialty tier drug. The plan may charge no more than $150 per month for a 30-day
supply or $300 for a 90-day supply. A specialty drug for this purpose is defined as
a drug prescribed for a disease or condition that affects fewer than 200,000
persons in the U.S. and has a total monthly cost of $600 or more. The law is
effective for health insurance policies that provide prescription drug coverage and
that are renewed or issued on or after Jan. 1, 2018.
B21-0032
»
July 26, 2016
On March 3, 2016, the District of Columbia (DC) council enacted DC Act 21-324, which
extends temporary provisions of the DC law to permit time off as a reasonable
accommodation for pre-birth complications. The law is meant to protect employees who
are absent from work because of such pre-birth complications or other pregnancy-related
conditions. The extension is temporary, taking effect on April 20, 2016, and expiring
on Dec. 1, 2016. Employers should work with outside counsel in developing and
implementing their leave policies to meet the DC rules for pregnant employees.
DC
Act 21-324 »
March 8, 2016
On Feb. 18, 2016, the District of Columbia (D.C.) Council enacted D.C. Act 21-314. The
new law temporarily amends the Protecting Pregnant Workers Fairness Act of 2014 to
require an employer to make a reasonable accommodation for an employee whose ability to
perform the functions of their job is affected by a pre-birth complication. The new law
prohibits employers from taking adverse action against employees who are absent from
work as a result of pre-birth complications. The new law is effective Feb. 18, 2016,
until May 18, 2016. The council is considering legislation to make the amendments
permanent. While the law does not specifically address benefits, D.C. employers that
have pregnant employees affected by a pre-birth complication should consider state and
federal regulations that may require the employer to continue health coverage during
any leave relating to the pregnancy. Because those situations implicate other areas of
law, including labor and employment, employers should work with outside counsel in
addressing leave and benefit policies with respect to pregnant employees.
D.C.
Act 21-314 »
On Feb. 18, 2016, the D.C. Council enacted D.C. Act 21-322. The new law temporarily
amends the D.C. Accrued Sick and Safe Leave Act of 2008 to clarify that certain
employees (those in the building and construction industry) covered by a collective
bargaining agreement (CBA) are exempt from the paid leave requirements if the CBA
states so. Specifically, to exempt those types of employees, the CBA must expressly
waive the requirements “in clear and unambiguous terms.” The new law is effective for
225 days after Congress approves the law (which is expected on April 29, 2016).
Employers in the building and construction industry that have previously entered into a
CBA should review the CBA to see if the new law has any affect and the employer’s paid
sick leave policies (including continuation of benefits during the leave). If questions
arise, employers should work with outside counsel, since the issue involves other areas
of law, such as labor and employment, which are beyond the scope of benefits.
D.C.
Act 21-322 »
November 3, 2015
On Oct. 20, 2015, the District of Columbia (DC) Department of Insurance published
Bulletin 15-IB-07-10/20. The new bulletin relates to the definition of “small employer”
under DC law, and states that as a result of the PACE Act, DC will retain the
definition of small employer as an employer with 50 or fewer employees. The bulletin
and definition apply for plan years that begin on or after Jan. 1, 2016. The bulletin
also rescinds Bulletin 15-IB-05-04/28, “Small Employer” Transitional Policy for the
2016 Plan Year (issued April 28, 2015, and covered in the May 5, 2015, edition of
Compliance
Corner). The bulletin contains contact information for questions or concerns
relating to the bulletin. Employers in the 51-100 group in DC should also work with
their carriers concerning next steps with regard to the bulletin.
Bulletin 15-IB-07-10/20 »
October 6, 2015
On Sept. 17, 2015, DC Act 21-90 took effect. Enacted June 17, 2015, Act 21-90 is called
the “Healthy Hearts of Babies Act of 2015.” Under the new law, insurers must provide
coverage for critical congenital heart disease screenings for newborns delivered in
hospitals, maternity centers or in homes. Specifically, ‘critical congenital heart
disease’ means a group of heart defects that cause serious, life-threatening symptoms
and require intervention within the first day or first year of life. Under the law,
screening must be performed using pulse oximetry (noninvasive procedures used to
measure blood oxygen levels) until additional alternative tests are adopted by the
American Academy of Pediatrics. The new law contains no new requirements for employers,
but employers should be aware of the changes should questions arise relating to
coverage of newborn congenital heart disease screenings.
D.C. Act 21-90 »
On Sept. 17, 2015, DC Act 21-91 took effect. Enacted June 17, 2015, Act 21-91 is called
the “Access to Contraceptives Amendment Act of 2015.” Under the new law, plans that
provide coverage for prescription drugs must provide coverage for up to a 12-month
supply of such drugs at one time. Specifically, ‘contraceptives’ means drugs or drug
regimens approved by the U.S. FDA for the purpose of preventing pregnancy.
D.C.
Act 21-91 »
May 19, 2015
On May 2, 2015, District of Columbia (DC) Act 20-593 took effect. The act, called the
“Reproductive Health Non-Discrimination Amendment Act of 2014,” amends DC law to ensure
that individuals are protected from discrimination based on an individual’s or
dependent’s reproductive health decisions. As background, DC Code Sec. 2-1401.05
prohibits employers from discriminating against an employee (in employment decisions
and benefits offerings) on the basis of pregnancy, childbirth, related medical
conditions or breastfeeding. Act 20-593 amends that Code section by adding
“reproductive health decisions” to the list of protections. That term is defined as a
decision by an employee or an employee’s dependent (including a spouse) related to the
use or intended use of a particular drug, device or medical service, including those
related to contraception or fertility control or the planned intended initiation or
termination of a pregnancy. The act was originally signed into law Jan. 23, 2015, but
did not take effect until May 2, 2015, due to DC’s legislative process, which requires
U.S. Congressional review.
Act
20-593 »
May 5, 2015
On April 28, 2015, the District of Columbia (DC) Department of Insurance published
Bulletin 15-IB-05-04/28 which relates to the change in the definition of ‘small
employer’ for purposes of group health insurance coverage in DC.
As background, on Jan. 1, 2016, under PPACA that definition changes from 1-50 employees
to 1-100 employees. According to the bulletin, DC has adopted a transitional policy for
small employers, as allowed by the CCIIO (outlined in a March 5, 2014, CCIIO bulletin,
which allows transition relief for non-PPACA-compliant plans with years beginning on or
before Oct. 1, 2016). The CCIIO transitional policy allows small employers with between
51-100 employees to renew their existing policies and remain in the large group market
without violating PPACA. The bulletin is meant to explain the details of DC’s
transitional policy and how it interacts with PPACA.
According to the bulletin, for employers with 51-100 employees the department will
allow insurers to renew their current policies through policy years beginning on or
before Oct. 1, 2016. Employers with 51-100 employees can continue to purchase large
group market policies through Dec. 31, 2015. Under the transitional policy those large
group policies may be renewed by Oct. 1, 2016. Importantly, all new policies sold to
small employers (those with 1-100 employees) after Jan. 1, 2016, must comply with
applicable PPACA and DC requirements. The bulletin includes a reminder that it is up to
the insurer’s discretion as to whether a particular policy will be renewed under the
small employer transitional policy. Thus, DC employers in the 51-100 group should work
with their insurers to determine if they will be allowed to renew under DC’s
transitional policy.
The new bulletin contains no new obligations for employers. However, DC employers,
particularly those with 51 – 100 employees, will want to be aware of the transitional
policy.
Bulletin 15-IB-05-04/28 »
January 13, 2015
On Dec. 17, 2014, the District of Columbia (DC) Department of Insurance, Securities and
Banking published Bulletin 14-IB-01-12/17. The new bulletin is addressed to health
insurers and relates to health insurance coverage sold to associations and MEWAs
located in DC, as well as health insurance coverage sold to small DC employers by
captive insurers domiciled outside of DC.
Regarding association coverage, the federal government (CMS) previously issued guidance
in 2011 relating to PPACA’s individual and group insurance mandates when
insurance is sold to, or through, associations. Under that guidance, CMS states that in
most association situations, the group health plan exists at the individual employer
level and not at the association-of-employers level. Thus, in these situations, the
size of each individual employer participating in the association determines whether
that employer’s coverage is subject to the small or large group market rules
(most PPACA insurance mandates apply only to small groups).
A 'mixed' association is where different members have coverage that is subject to the
individual, small, and/or large group market rules, as determined by each employer
member’s status. According to the bulletin, an association cannot aggregate the
employees of the member employers in an attempt to qualify as a large employer.
Accordingly, each employer member of a mixed association must receive coverage that
complies with the requirements arising out of their own status as an individual, small
employer or large employer. Further, since under DC law individual and small group
health plans must be sold only through DC Health Link (the DC-established health
insurance exchange), each small employer association member must purchase insurance
through DC Health Link.
Regarding MEWAs and captives, if a MEWA solicits or provides health benefits to one or
more employers domiciled in DC, the MEWA is subject to DC insurance laws (regardless of
whether the MEWA is regulated under ERISA or is domiciled in DC). DC law does allow an
exemption for MEWAs maintained or established by a single employer that are
self-insured (and that are not considered a governmental plan). The bulletin further
describes allowable situations for fully insured MEWAs, including requirements for
MEWAs that establish a trust in order to provide group health benefits.
Lastly, the bulletin addresses captive insurers, MEWAs and associations that are acting
as insurers—selling or otherwise issuing or making available health insurance
policies to more than one small employer located in DC. In that situation, the captive
insurer, MEWA or association will be deemed to be engaged in the business of selling
health insurance in DC, and therefore must obtain a certificate of authority from the
Department. In addition, DC law requires a policy, certificate or coverage for a health
benefit plan offered to a DC employer to be filed with the and approved by the
Department—including coverage issues to an out-of-DC trust or association or by a
captive.
Employers considering obtaining coverage through an association, MEWA or captive
arrangement should carefully review the bulletin to better understand their rights and
obligations relating to the coverage.
Bulletin 14-IB-01-12/17 »
December 2, 2014
On Oct. 23, 2014, District of Columbia (DC) Mayor Gray signed into law the Protecting
Pregnant Workers Fairness Act of 2014, creating DC Act 20-458. The new law provides new
protections for employees whose ability to perform job functions is limited by
pregnancy, childbirth or a related medical condition. The new law applies to DC
employers, and requires employers to make modest changes to accommodate the physical
limitations of a normal, healthy pregnancy unless doing so would cause an undue
hardship. Some examples of accommodations include the provision of more frequent or
longer breaks, acquisition or modification of equipment or seating, restrictions on
heavy lifting, a temporary transfer to a light duty position or a modified work
schedule. The law also requires employers to provide a private, non-bathroom space to a
breastfeeding mother to express milk. Importantly, employees may not be forced to use
leave if a reasonable accommodation is available.
The new law also places notice requirements on the employer. Employers must post
information relating to the new protections in a conspicuous place and distribute
notices to new employees upon hire and existing employees within 120 days of the
law’s effective date. Penalties apply for employers that willfully violate any of
the law’s requirements: $1,000 for the first offense, $1,500 for the second
offense, and $2,000 for each subsequent offense.
The new law may impact employee benefit offerings and employer leave policies. DC
employers should work with outside counsel in developing policies and procedures that
comply with the new law, particularly since the new law also affects areas outside of
employee benefits. The new law takes effect after a 30-day Congressional review period
and publication in the DC Register (which has not yet occurred).
DC Act 20-458 »
November 4, 2014
On Oct. 23, 2014, the District of Columbia (DC) Department of Insurance issued Bulletin
06-IB-004-8/29 which addresses summary and disclosure notices for supplemental health
insurance policies marketed in DC. The purpose of the bulletin is to clarify that
limited benefit health plans, hospital indemnity or other supplemental health policies
may not be marketed or represented as substitutes for health benefit plans, and that
such plans do not provide sufficient coverage to qualify as minimum essential coverage
for purposes of PPACA’s individual mandate. According to the bulletin, insurance
carriers may not bundle various benefits or coverages together into a fixed indemnity
plan to be marketed to consumers as meeting the federal requirements of a health
benefit plan, since they do not constitute major medical coverage. Carriers are also
prohibited from representing, naming or including in the name of any new fixed
indemnity health plan the terms “bronze”, “silver”,
“gold” or “platinum” tier level of health coverage or any other
PPACA-compliant health benefit term, such as “essential” benefits. Finally,
the bulletin explains that carriers selling hospital indemnity or other fixed indemnity
policies must provide notice that those policies do not provide the minimum essential
coverage mandated by PPACA, and that consumers may be liable for a federal tax penalty
unless they purchase a plan that does meet the minimum essential coverage requirement.
The bulletin contains a list of plan types that are and are not considered to provide
supplemental benefits. Although the bulletin is directed towards insurance carriers, DC
employers should be aware of the bulletin.
Bulletin 06-IB-004-8/29 »
August 26, 2014
On June 18, District of Columbia (D.C.) Mayor Gray signed into law B20-0776, creating
Act 20-356. As background, under federal and D.C. law, DC Health Link must be
self-sustaining by Jan. 1, 2015 (federal funding is longer available after that date).
Previously, on May 22, 2014, Mayor Gray signed a law (Act 20-329) amending the Health
Benefit Exchange Authority Establishment Act of 2011, which relates to funding DC
Health Link (D.C.'s health insurance exchange). Act 20-329 enacted, on an emergency and
temporary basis, a tax on all health-related insurance products sold in Washington,
D.C., based on a percentage (expected to be around 1 percent) of an insurer's gross
receipts and is assessed annually. The tax is intended to help fund DC Health Link
going forward.
Act Number 20-356 extends the assessment for an additional 225 days. In the meantime,
the D.C. council expects to enact a permanent version of the assessment. Employers
should be aware of the new tax since it may ultimately result in higher premiums, both
on and off the DC Health Link. The new law does not, however, create additional
compliance or other obligations for Washington, D.C., employers.
D.C. Act 20-356 »
July 1, 2014
On May 22, 2014, District of Columbia (D.C.) Mayor Gray signed into law B20-0775,
creating Act Number A20-0329. The new law amends an existing law, the Health Benefit
Exchange Authority Establishment Act of 2011, which relates to funding DC Health Link
(D.C.'s health insurance exchange). Generally, under federal and D.C. law, DC Health
Link must be self-sustaining by Jan. 1, 2015 (federal funding is longer available after
that date). The law enacts a tax on all health-related insurance products sold in
Washington, D.C., which is based on the insurer's gross receipts and is assessed
annually. The tax is intended to help fund DC Health Link going forward.
Employers should be aware of the new tax, since it may ultimately result in higher
premiums through the exchange. The new law does not, however, create additional
compliance or other obligations for Washington, D.C. employers.
Act Number A20-0329 »
March 11, 2014
On Feb. 27, 2014, the District of Columbia (DC) Department of Insurance, Securities and
Banking issued Bulletin 13-IB-01-30/15 REVISED. The bulletin revises a bulletin issued
on March 15, 2013, relating to insurance coverage denials based on gender identity or
expression (covered in the March 26, 2013, edition of Compliance Corner). As
background, DC makes it illegal to refuse to insure, continue insuring or limit the
insurance coverage of an individual based on gender identity or expression. Health
insurers had 90 days (from March 26, 2013) to update policy forms to come into
compliance.
The revised bulletin adds some clarifications relating to discriminatory practices.
First, the Department of Insurance takes the position that “gender
dysphoria” (also known as “gender identity disorder”) is a recognized
medical condition under health insurance policies covering medical and hospital
expenses, regardless of whether explicitly referenced. Second, persons diagnosed with
gender dysphoria fall squarely within the protected class of “gender identity or
expression.” As a result, attempts to limit or deny medically necessary
treatments for gender dysphoria, including gender reassignment surgeries, will be
considered discriminatory. This means treatment for gender dysphoria, including gender
reassignment surgeries, is a covered benefit, and individuals diagnosed with gender
dysphoria are entitled to receive medically necessary benefits and services under
individual and group health insurance policies that cover medical and hospital
expenses.
While the bulletin is directed toward insurers, DC employers will want to be aware of
the department’s positions, particularly if they sponsor fully insured group
plans that are issued in DC.
Bulletin »
February 25, 2014
On Jan. 2, 2014, District of Columbia (D.C.) Mayor Gray signed into law the
“Earned Sick and Safe Leave Amendment Act of 2013.” The new law amends the
Accrued Sick and Safe Leave Act of 2008 by expanding the scope of employees,
strengthening the remedies and establishing an outreach program to inform the public
about the act. Generally, employers must grant covered employees paid leave on an
annual basis; the amount of leave depends on the size of the employer. For example, an
employer with 100 or more employees must provide one hour of paid leave for every 37
hours an employee works (with a seven-day per year cap). Employers with 25-99 employees
must provide one paid leave hour for every 43 hours worked (with a five-day cap), and
those with 24 or fewer employees must provide one paid leave hour for every 87 hours
worked (with a three-day cap).
The new law expands the group of covered workers to include tipped restaurant
employees, regardless of the employer’s size, who can now earn one hour of paid
leave for every 43 hours worked (with a five-day cap). The law also expands the
definition of employer to include any entity that directly or indirectly employs or
exercises control over the wages, hours or working conditions of employment (including
through the use of temporary workers or a staffing agency). The law allows employees to
begin accruing leave on their date of hire (although they do not become eligible to use
the paid leave until after 90 days of employment). Finally, the new law also requires
the employer to reinstate an employee’s leave where the employee is re-hired
within one year of termination or where the employee is transferred out of D.C. and is
later transferred back in to D.C.
The effective date of the new law is unclear. Although it is supposed to take effect by
the end of February 2014, the law will not actually be applicable until a budget
statement regarding the impact of the law is included in an approved D.C. budget (which
could be as late as 2015). D.C.’s Department of Employment Services is expected
to issue more guidance at some point, and has said that the act will not likely take
effect until 2015. Employers, though, should review their employment policies and
prepare to begin tracking leave.
Earned
Sick and Leave Amendment Act of 2013 »
Florida
October 13, 2020
Air Ambulance Coverage Required
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On September 18, 2020, Gov. DeSantis signed HB 747 into law. Effective immediately, the new law requires health insurance policies to provide reasonable reimbursement for air ambulance services. An air ambulance is defined as any fixed-wing or rotary-wing aircraft used for, or intended to be used for, air transportation of sick or injured persons requiring or likely to require medical attention during transport — including both covered nonemergency and emergency services. The participant shall only be required to pay any copayments, coinsurance or deductibles applicable under the policy.
Although this requirement applies to insurers, employers should be aware of this change in insurance mandates.
HB 747 »
April 14, 2020
Premium Payment Leniency Requested
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On March 25, 2020, the Office of Insurance Regulation (OIR) issued Informational Memorandum OIR-20-04M, which provides continued guidance in relation to the coronavirus (COVID-19) emergency. The memo, which is directed at health insurers and other health entities regulated by the OIR, addresses the treatment of policyholders in the state.
As background, prior Executive Orders 20-51 and 20-52 established COVID-19 protocols and declared a state of emergency in the state. The current memo outlines certain measures and accommodations to support the state’s COVID-19 response efforts.
The memo recognizes that social distancing guidelines have resulted in worker displacement and business disruptions. As a result, insurers are encouraged to be flexible with premium payments in order to prevent a lapse in coverage. Suggested measures include relaxing due dates, extending grace or reinstatement periods, waiving late fees and penalties and allowing payment plans. Insurers are urged to consider policy cancellation only if all other possible alternatives have been expended.
The guidance addresses other COVID-19 considerations, including the acceptance of electronic communications from policyholders where handwritten statements would normally be required. It also provides a 30-day extension for annual statements due to be filed with OIR by regulated entities, including insurance administrators and multiple-employer welfare arrangements, on or before May 1, 2020.
Although the memo is directed at insurers, employers may want to be aware of these developments.
Informational Memorandum OIR 20-04M »
Telehealth Guidance
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On April 6, 2020, the Office of Insurance Regulation (OIR) issued Informational Memorandum OIR-20-06M, which provides telehealth and pharmacy audit guidance in relation to the state’s coronavirus (COVID-19) response. The memo is directed at health insurers and other health entities regulated by the OIR, and all pharmacy benefit managers registered in the state.
As background, prior Executive Orders 20-51 and 20-52 established COVID-19 protocols and declared a state of emergency in the state. The purpose of the current memo is to encourage the health care industry to use technology to help combat the spread of COVID-19.
This communication follows actions taken by the CMS to expand access to telehealth services for Medicare beneficiaries. Additionally, the Florida Department of Health temporarily suspended certain restrictions on the use of telehealth services by health care professionals licensed both in and out of state who are providing care to state residents.
The current memo encourages all health insurers, health maintenance organizations, and other health entities to broaden access to telehealth services and to remove any existing impediments for residents seeking to use such services. Furthermore, it requests that these entities change to an electronic pharmacy audit process in order to avoid unnecessary exposure and maintain social distancing.
Although the memo is directed at insurers and pharmacy benefit managers, employers may wish to be aware of these developments.
Informational Memorandum OIR-20-06M »
March 17, 2020
Coronavirus Memo
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On March 6, 2020, the Office of Insurance Regulation released Informational Memorandum OIR-20-01M in response to Executive Order #2020-51, which was issued by Gov. DeSantis to establish coronavirus (COVID-19) protocols. The memo is directed at all health insurers authorized to do business in Florida.
As background, the communication was released as part of the state’s effort to protect Floridians during the COVID-19 public health emergency. The memo recognizes the integral role of insurers in addressing the pandemic.
Accordingly, these entities are instructed to work with public officials and take all possible measures at the prevention level. Specifically, insurers are directed to devote resources to disseminating information to policyholders, agents and providers regarding COVID-19 prevention and treatment. They should also be prepared to respond to insureds’ questions regarding covered benefits and related inquiries.
Additionally, insurers are directed to reduce barriers to cost sharing for COVID-19 testing and treatment during the public health emergency. Emergency services for an emergency medical condition must be covered at the in-network level regardless of which provider performs the service. General preparedness plans should also be reviewed.
Although the memo is issued to insurers, employers should be aware of this development.
Informational Memorandum OIR-20-01M »
Early Prescription Refill Mandate
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On March 10, 2020, the Office of Insurance Regulation issued Informational Memorandum OIR-20-02M in response to Executive Order #2020-52, which declared a public health emergency in the state with respect to the coronavirus (COVID-19) outbreak. The memo is directed at all health insurers, health maintenance organizations and other health entities authorized to do business in Florida.
As background, Florida statutes permit early prescription refills in the event that the governor issues an executive order declaring a state of emergency. As a result, insureds are able to fill prescriptions in advance as part of their emergency preparedness.
Accordingly, the memo reminds insurers and other health entities to waive otherwise applicable time restrictions on prescription medication refills and to authorize payment to pharmacies for at least a 30-day supply of any prescription medication, regardless of the date on which the prescription had most recently been filled. Certain limitations and conditions apply, in accordance with the applicable provisions of the Florida statutes.
Employers should be aware of the memo and direct any related question to their carriers.
Informational Memorandum OIR 20-02M »
September 6, 2017
Civil Air Patrol Leave
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On June 9, 2017, Florida Gov. Rick Scott approved S.B. 370 into law. The new law
requires employers with 15 or more employees to provide at least 15 days of unpaid
Civil Air Patrol leave per year. To be eligible for the leave, the employee must
have been employed by the employer for at least 90 days. Additionally, the employee
must be a Civil Air Patrol member, which is defined as a senior member of the
Florida Wing of the Civil Air Patrol with an emergency services qualification. The
leave may be related to training or a mission.
An eligible employee may elect to use accrued paid leave amounts, but may not be
required to use such during the Civil Air Patrol leave period. An employer may not
discharge, reprimand or otherwise penalize an eligible employee who takes such
leave. At the end of the leave, the employee shall return to work unless certain
conditions are met such as the employment would cause undue hardship on the
employer or the employer has legally sufficient cause to terminate the employee.
The law’s been effective since July 1, 2017.
S.B.
370 »
May 3, 2016
On March 25, 2016, Gov. Scott signed Senate Bill No. 422 into law. This law addresses
the provision of abuse-deterrent drugs. Specifically, plans that provide coverage for
abuse-deterrent opioid analgesic drug products:
- Can only require prior authorization for abuse-deterrent opioid analgesic drug
products if they require the same prior authorization for each opioid analgesic
drug product that does not have an abuse-deterrence labeling claim, and
- Cannot require plan participants to use opioid analgesic drug products that do not
have an abuse-deterrence labeling claim before authorizing the use of
abuse-deterrent opioid analgesic drug products.
The law is effective on Jan. 1, 2017. Employers that sponsor plans that provide such
drug products should work with their insurers to ensure compliance with this law.
Senate Bill No. 422
»
On April 14, 2016, Gov. Scott signed House Bill No. 221 into law. This law requires
plans to provide coverage for treatment of down syndrome when the participant is
younger than age 18 or older than age 18 and attending high school, if they were
diagnosed as having developmental disabilities before reaching age eight.
The law also requires issuers to provide coverage for emergency services regardless of
whether those services are performed by participating or nonparticipating health-care
providers. Additionally, issuers cannot require prior authorization for emergency
services. This portion of the law is very similar to PPACA’s requirement that emergency
services be covered without regard to whether provided in or out of network; note
though, that this requirement would apply to plans insured in Florida whether the plan
is grandfathered under PPACA or not.
This law is effective July 1, 2016.
House Bill No. 221
»
June 16, 2015
Beginning July 1, 2015, Florida employers with 15 or more employees cannot discriminate
on the basis of pregnancy. This prohibition comes after the Florida Supreme Court ruled
in 2014 in Delva v. Cont’l Group, Inc., 137 So. 3d 371 (Fla. 2014) that
pregnancy discrimination is a form of sex discrimination under Florida employment law.
As a result, employers cannot fail or refuse to hire, discharge or otherwise
discriminate in compensation or terms, conditions and privileges of employment on the
basis of pregnancy. The law does allow employers to take an action based on pregnancy
if such action is justified based on a bona fide occupational qualification that is
necessary for job performance. The law also allows employers to abide by the terms of
bona fide employee benefit plans that measure earnings by production as long as the
terms are not designed to evade the pregnancy discrimination laws.
Fla. Stat. 760.10 »
Delva
v. Cont’l Group, Inc. »
January 28, 2015
On Jan. 13, 2015, the DOL and the state of Florida signed a memorandum of understanding
announcing that they will work together to prevent the improper classification of
employees as independent contractors or other nonemployee workers. The agreement states
that the two entities will share information and coordinate enforcement in an effort to
protect employee rights by reducing the practice of misclassification of employees.
The agreement arose as part of the DOL Misclassification Initiative. Sixteen other
states have signed similar agreements: Alabama, California, Colorado, Connecticut,
Hawaii, Illinois, Iowa, Louisiana, Maryland, Massachusetts, Minnesota, Missouri,
Montana, New York, Utah and Washington. Employers should be aware of the increased
attention given to the misclassification issue by the DOL and by state agencies. This
is an important issue for all size employers, but specifically large employers who are
subject to the employer mandate must identify full-time employees and offer them
affordable, minimum value coverage, or else pay a penalty. Misclassification of
employees can significantly impact the potential liability under the employer mandate
for these employers.
DOL
News Release »
DOL
Misclassification Initiative Web Page »
January 13, 2015
On Jan. 5, 2015, the stay on enforcement of same-sex marriages in Florida expired,
making same-sex marriage legal in Florida as of Jan. 6, 2015. As background, in August
of 2014, Federal District Court Judge Hinkle ruled in Brenner v. Scott (999 F.
Supp. 2d 1278, 2014) that the Florida same-sex marriage ban is unconstitutional.
However, at that time, he issued a stay on enforcement of same-sex marriage, pending
appeal. Florida appealed this decision to the 11th Circuit, and on Dec.3, 2014, the
11th Circuit denied a request to extend the stay. On Dec. 19, 2014, the Supreme Court
also refused to issue an injunction that would lift the stay. On Jan. 1, 2015, Judge
Hinkle directed clerks in Florida to issue same-sex marriage licenses beginning Jan. 6,
2014.
Brenner v. Scott »
September 9, 2014
On Aug. 26, 2014, the Florida Office of Insurance Regulation issued Informational
Memorandum OIR-14-05M. The bulletin provides guidance regarding calculation of
composite rates for Florida-issued policies for policy years beginning on or after Jan.
1, 2015. As background, final rules issued by HHS March 11, 2014, provided for a
two-tiered federal calculation method for composite rates (one tier for each covered
adult age 21 or older and a second tier for each covered child under age 21). However,
the same final rule permitted states to substitute their own alternative to the federal
methodology by seeking approval from HHS. This bulletin issued by the Florida Office of
Insurance Regulation is confirmation that the state has sought such alternative
certification and it was approved. In this case, the state requested to use a
four-tiered calculation: employee, employee plus spouse, employee plus children and
employee plus family.
This means that while health insurance carriers issuing small group market plans in the
state will continue to provide per-member billing, they may choose to provide family
composite premiums on an optional basis. If they do so, the carrier must follow the
state's four-tiered approved alternative method. If a carrier offers the family
composite methodology, it must make it available for each small employer in the market.
The bulletin provides definitions for each rating tier, as well as the factors to be
used when determining the final premium charged for each employee. Importantly, the
bulletin does not apply directly to small employers, although this information is
important for all employers to understand. Small employers in Florida may request
composite rates from the insurance carrier, rather than per member rates, to determine
the percentage of the premium paid by the employer versus employee contribution levels
for policies issued in 2015 if the carrier has opted to follow this alternative
calculation method. The bulletin is effective for policy years beginning on or after
Jan. 1, 2015.
Informational
Memorandum OIR-14-05M »
Federal Chart of Approved States with Rating Variations »
August 26, 2014
On Aug. 21, 2014, the U.S. District Court for the Northern District of Florida,
Tallahassee Division, in Brenner v. Scott, 298 F.R.D. 689 (N.D. Fla. 2014),
ruled that Florida’s constitutional and statutory prohibitions against same-sex
marriage are unconstitutional. The court blocked the state from enforcing the
prohibitions, but stayed its ruling until stays have been lifted in three other pending
cases, plus 90 days, allowing time for the state to seek a longer stay or a stay from
the U.S. Court of Appeals for the Eleventh Circuit or the U.S. Supreme Court. The court
did allow one of the plaintiffs to receive a corrected death certificate reflecting a
same-sex marriage spouse no later than Sept. 22, 2014, or 14 days after the information
needed is provided. The court also ordered the clerk of court in Washington County, FL,
to issue a marriage license for another plaintiff within 21 days after the stay of this
order expires. However, for now the same-sex marriage prohibitions in Florida remain in
effect pending the outcome of the appeals.
Brenner v. Scott »
Georgia
July 7, 2021
Paid Parental Leave for State and Public School Employees
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Gov. Kemp recently signed HB 146, which provides paid parental leave to state and public-school employees. The law took effect on July 1, 2021.
Specifically, employees of the state government or local board of education are entitled to 120 hours of paid parental leave after the birth of a child, adoption of a child or placement of a child in foster care in their home. Generally, employees of these entities are eligible for the leave after six continuous months of employment. Hourly employees are required to work a minimum of 700 hours over the six-month period immediately preceding the requested paid parental leave date.
An employee can only qualify for the leave once per rolling twelve-month period but can take the time incrementally over such period. Unused leave does not carry over to the next twelve-month period nor does it have any cash value in the event of employment termination. Employers are prohibited from retaliating against employees for using leave to which they are entitled.
State government and local board of education employers should be aware of the new parental paid leave requirements. Under the law, these employers must produce rules for administering the leave that address whether the leave will run concurrently with other federal leave and documentation requirements. Counsel should be consulted for guidance.
HB 146 »
December 8, 2020
Preauthorization Requirements Suspended for Post-Acute Placements
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On December 3, 2020, the Insurance and Safety Fire Commissioner issued Directive 20-EX-9 to address high demand on inpatient hospital services as a result of the COVID-19 pandemic. The directive is issued to all licensed health insurers in the state.
The directive advises insurers to suspend preauthorization requirements for post-acute placements, including but not limited to skilled nursing facilities, home health, acute rehabilitation and long-term acute care. Under normal circumstances, it may take up to seven days for hospitals to receive the insurer’s authorization to move a patient to the next level of care. Insurers are now asked to respond to such discharge requests within 24 hours. The elimination of the typical delay is intended to alleviate the strain on hospital bed capacity and enable new admissions.
Additionally, insurers should provide hospitals with a current list of all in-network rehabilitation facilities, long-term acute care hospitals and skilled nursing facilities. Hospitals are expected to use their best efforts to transfer insureds to the in-network providers. An insurer can require the rehabilitation facility or long-term acute care hospital to provide notification of the admission.
The preauthorization suspension is effective for 60 days, subject to further evaluation as the COVID-19 situation is monitored.
Group health plan sponsors should be aware of these developments.
Directive 20-EX-9 »
August 18, 2020
Early Prescription Drug Refills During Emergencies
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On August 5, 2020, Gov. Kemp signed the “Early Prescription Drug Refills During Emergencies” Act. This legislation requires health insurers to provide coverage for early refills of a 30 day supply of certain prescription medications under specified emergency situations.
As background, the measure was enacted with recognition of the significant delays experienced by state residents in obtaining necessary prescription drug refills during natural disasters and emergencies. These delays can potentially result in serious health consequences, particularly for those with chronic health conditions.
Accordingly, the legislation requires health insurers licensed in the state that provide prescription drug coverage as part of a contract or policy to waive time restrictions on prescription refills, including the suspension of electronic “refill too soon” limitations. Such waivers will allow insureds to refill prescriptions in advance.
Insurers shall also authorize payment to pharmacies for a 30 day supply of a prescription medication, regardless of the date upon which the prescription had most recently been filled, for a state resident of a county under either a state of emergency declared by the governor or a hurricane warning issued by the National Weather Service. The prescription must have refills remaining and the request must be within 30 days of the origination date of the emergency declaration or until such conditions are terminated by the issuing authority or cease to exist. Certain controlled substances are exempt from this new policy. The insurance commissioner can extend the time restriction waivers in 15 or 30 day increments, as necessary.
The law is primarily directed at insurers licensed in the state. However, employers offering insureds prescription drug benefits may also want to be aware of this development.
Senate Bill 391 »
May 12, 2020
Prior Coronavirus Directives Winding Down
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On April 28, 2020, the Insurance and Safety Fire Commissioner issued Bulletin 20-EX-7 regarding the winding down of prior coronavirus (COVID-19) directives. The bulletin was issued to consumers and insurers in the state.
Following a declaration of a COVID-19 public emergency in the state, policies were enacted to prevent cancellation of insurance coverage, including for reasons of nonpayment, and to extend certain filing deadlines. As a result of the state’s improving conditions with respect to the containment of the spread of COVID-19, expiration dates have been set with respect to these policies and extensions.
For example, the prior instructions to health insurers under Directive 20-EX-5 to refrain from canceling policies due to nonpayment will now expire on May 31, 2020. However, the commissioner encourages insurers to be accommodating to consumers facing financial difficulties. The suspension of nonfederal insurer filing deadlines and waiver of late fees will also expire on May 31, 2020. Additionally, the commissioner’s request to insurers and hospitals to suspend certain utilization and review requirements under Directive 20-EX-7 will expire on May 25, 2020.
Employers may wish to stay apprised of these developments, as the state reevaluates the COVID-19 situation and prior related orders.
Bulletin 20-EX-7 »
April 14, 2020
Consumer Protections During Coronavirus Pandemic
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On March 20, 2020, the Insurance and Safety Fire Commissioner issued Directive 20-EX-5 regarding the coronavirus (COVID-19) crisis. The directive is issued to all licensed insurance companies in the state.
The guidance is provided as part of the state’s public health emergency response to the spread of COVID-19. This directive recognizes the financial hardships and business disruptions resulting from COVID-19 mitigation measures.
Accordingly, insurance companies are directed to refrain from canceling policies due to nonpayment. As applied to health insurance policies, the directive is in effect until further notice. This initiative is intended to ensure those affected by the pandemic retain access to health care.
The directive also suspends regulatory functions requiring in-person interaction, including on-site exams, audits and licensing requirements. Certain non-federal insurer filing requirements and deadlines are similarly suspended.
This communication is directed at insurance companies. However, employers may also wish to be aware of these developments. The directive is accessible at the below link:
Directive 20-EX-5 »
Utilization Review Requirements Suspended
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On March 26, 2020, the Insurance and Safety Fire Commissioner issued Directive 20-EX-7 regarding the coronavirus (COVID-19) pandemic. The directive is issued to all insurers authorized to write accident and health insurance and health benefit plans in the state.
The directive is released as part of the state’s public health emergency response to mitigate the spread of COVID-19. The guidance recognizes that as hospitals face high demands for in-patient services and use available staff to provide direct patient care, administrative functions may need to be limited.
Accordingly, the guidance advises insurers that certain utilization review and notification requirements should be suspended for 60 days, subject to further evaluation as the COVID-19 situation evolves.
Specifically, the directive suspends preauthorization requirements for scheduled surgeries or admissions at hospitals. Instead, hospitals are asked to use their best efforts to provide 48 hours’ notice to issuers after a hospital admission. Similarly, issuers are advised to suspend concurrent reviews for inpatient services as well as retrospective reviews for inpatient services and emergency services at in-network hospitals. In order to allow hospitals to discharge patients to lower levels of care as appropriate, the insurers are further advised to suspend preauthorization requirements for post-acute placements, including skilled nursing facilities, home health care facilities, acute rehabilitation services, and long-term acute care hospitals, following an inpatient hospital admission.
Issuers are asked to pay claims from in-network hospitals that are otherwise eligible for payment as soon as possible and without reviewing for medical necessity. However, a retrospective review may be performed following the suspension and taking into account the circumstances involving the COVID-19 pandemic. Nonessential audits of hospital payments should also be temporarily suspended.
The memo is directed at insurers authorized to write insurance in the state. Additionally, third party administrators are encouraged to apply these provisions to their service arrangements with self-funded plans. Employers should also be aware of these developments.
Directive 20-EX-7 »
March 17, 2020
Coronavirus Preparedness Directive
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On March 9, 2020, the Insurance and Safety Fire Commissioner issued Directive 20-EX-3 regarding coronavirus (COVID-19) preparedness. The directive is issued to all insurers authorized to write accident and health insurance and health benefit plans in the state.
The directive is released as part of the state’s response to the spread of the respiratory illness known as COVID-19 to the United States, including Georgia. The outlined measures are designed to assist individuals and entities in providing the necessary insurance-related services during the public health challenge.
Specifically, the directive is asking health insurers who provide coverage to state residents to consider options to reduce or remove cost and procedural barriers to COVID-19 testing and treatment. These entities should be prepared to provide accurate and timely coverage information to insureds. Additionally, the insurers are instructed to review their internal procedures, telemedicine and in-network services, and access to out-of-network providers to ensure these are adequate to address an increased need for services.
The memo is directed at insurers, who are requested to provide information as to the steps taken in response. Employers should be aware of these developments.
Directive 20-EX-3 »
October 29, 2019
Georgia Telehealth Act
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On May 6, 2019, Gov. Kemp signed SB 118 into law, creating the Georgia Telehealth Act. The bill expands upon existing law in an effort to increase the availability of telemedicine for a broader array of services, and to ensure pay equity for telemedicine providers.
Specifically, the law prohibits insurers from excluding a service from coverage solely because it is provided through telemedicine rather than in-person consultation. The insurer must also reimburse the provider for the diagnosis, consultation, or treatment of an insured delivered through telemedicine on the same basis and at least the rate for the same service provided through in-person contact.
Additionally, the carrier cannot impose 1) any annual or lifetime limits on telemedicine coverage other than those that apply in the aggregate to all items and services covered under the policy or 2) any copayment, coinsurance, or deductible that is not equally imposed upon all terms and services covered under the policy. An insured cannot be required to use telemedicine services in lieu of in-person consultation.
The law goes into effect on January 1, 2020. Although the measures are primarily directed towards insurers, employers with health benefit policies issued in Georgia should be aware of the new coverage requirements.
SB 118 »
September 19, 2017
Insurers Are Encouraged to be Lenient with Deadlines for Policyholders Impacted by
Hurricane Irma
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On Sept. 14, 2017, Commissioner of Insurance Hudgens issued Directive 17-EX-7 to
all Georgia insurers encouraging Georgia insurers to provide relief to Georgia
policyholders in the wake of severe weather due to Hurricane Irma. Noting that over
a million Georgians lost power, that transportation has been severely impacted and
that Gov. Deal has declared a state of emergency, Commissioner Hudgens is
encouraging insurers to be lenient with policyholders that may be impacted by a
disruption of services as a result of the storm. This may be accomplished by
relaxing deadlines or penalties for premium payments that may be tardy. There is no
requirement that carriers must comply, but this signifies the Insurance
Commissioner’s hope that compassion will prevail.
Directive 17-EX-7 »
July 11, 2017
Fire Departments Must Provide Cancer Insurance
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»
On May 4, 2017, Gov. Deal signed HB 146 into law, amending section 25-3-23 of
the Georgia Code relating to general requirements for legally organized fire
departments. The law was passed to mandate insurance coverage for the 19 types
of cancer firefighters contract the most.
Specifically, this law requires such fire departments in Georgia to purchase
and maintain certain cancer insurance coverage for firefighters (including
volunteer firefighters), and the law also requires such departments to provide
income protection for up to three years.
Coverage will need to be provided for firefighters who have served 12
consecutive months. Insurance benefits will include a lump-sum benefit of
$25,000 or $6,250 depending on the cancer’s severity. In addition, for those
unable to perform job duties due to the diagnosis, a monthly benefit equal to
60 percent of the firefighter’s monthly salary, or a monthly benefit of $5,000,
whichever is less, will begin six months after the firefighter’s diagnosis and
continue for 36 months. The monthly benefit for volunteer firefighters unable
to perform their job duties will be $1,500, payable in the same manner as that
for paid firefighters.
This law is effective for legally organized fire departments in Georgia as of
Jan. 1, 2018.
HB
146 »
June 13, 2017
Plans Must Provide Hearing Aids for Children
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»
On May 8, 2017, Gov. Deal signed SB 206 into law, amending section 33-24 of
the Georgia Code. This law requires health plans to provide coverage for
hearing aids to plan participants age 18 or younger, outlines the frequency
with which such hearing aids must be replaced, addresses covered services
and supplies and allows for the option of higher-priced devices.
This law is effective for health plans issued, delivered, executed or
renewed in Georgia on or after Jan. 1, 2018.
SB
206 »
Synchronization of Prescription Drug Refills
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On May 9, 2017, Gov. Deal signed SB 200 into law, amending section 33-24 of
the Georgia code. This law requires plans that provide prescription drug
benefits to permit and apply prorated daily cost-sharing rates for
prescriptions dispensed by pharmacies for less than a 30-day supply, if for
the purpose of synchronizing plan participants' medications.
Synchronization involves coordinating the medication refills of a patient
that is taking two or more medications such that the medications are
refilled on the same schedule. While plans may prorate daily cost-sharing
rates for synchronized medications, they may not prorate dispensing fees,
which must be based on the number of prescriptions filled.
This law is effective for plans providing prescription drug coverage that
are issued, delivered, executed or renewed in Georgia on or after July 1,
2017.
SB
200 »
May 31, 2017
Available Paid Sick Leave Must be Usable to Care for Immediate Family
Members
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On May 8, 2017, Gov. Deal signed SB 201 into law, creating Section 34-1-10
of the Georgia code. This law does not require the provision of paid sick
leave, but allows use of existing or future paid sick leave in order to
care for immediate family members. Specifically, the new law requires
employers that offer paid sick leave to allow employees to use up to five
days of said leave in each calendar year to care for immediate family
members.
The law applies to employers, public and private, that have 25 or more
eligible employees, although an employer that offers an employee stock
ownership plan is exempt from the requirement. An eligible employee is
defined as an employee that works at least 30 hours per week.
An immediate family member is defined as an employee’s child, spouse,
grandchild, grandparent or parent, or any dependents shown on the
employee’s most recent tax return. Leave must be earned before taken and
employees taking leave under this law must comply with the terms of the
employer’s sick leave policy.
The new law is effective July 1, 2017.
SB
201 »
February 7, 2017
IRS Provides Tax Relief for Victims of January Severe Weather in
Georgia
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On Jan. 26, 2017, the IRS announced, in ATL-2017-03, tax filing relief for
taxpayers who reside or have a business in Dougherty County, Georgia.
Dougherty County was declared a federal disaster area following the severe
storms, tornados, and straight-line winds that took place beginning on Jan.
2, 2017. Victim taxpayers in Dougherty County (those who reside or have a
business there) are eligible for postponement of time to file returns, pay
taxes and perform other time-sensitive acts.
Of particular interest as it relates to benefits, the IRS gives victim
taxpayers until May 31, 2017 to perform certain time-sensitive actions
described in the regulations (like filing Forms 5500). Specifically, if an
affected employer has a Form 5500 filing that would have become due between
Jan. 2, 2017 and May 31, 2017, then the due date of that filing is extended
to May 31, 2017.
The IRS automatically identifies taxpayers located in Dougherty County and
applies automatic filing and payment relief. However, affected employers
that have a business located outside the covered disaster area, but were
impacted by the disaster, must call the IRS disaster hotline at
866-562-5227 to request this tax relief.
ATL-2017-03 »
November 15, 2016
Insurance Directive Reinforces No Cost Sharing Related to Preventive
Colonoscopy
On Nov. 2, 2016, Commissioner of Insurance Hudgens issued Directive 16-EX-6 to
all Georgia insurers related to in-network preventive colorectal screenings.
CMS and other federal agencies have provided sufficient guidance to establish
that all services directly related to a preventive colonoscopy are to be
provided without cost sharing. The actual findings of the screening have no
bearing on the cost sharing. Yet, it has come to the Commissioner’s attention
that issues continue to occur as to the breadth of coverage including improper
cost sharing, denials of claims, or improper balance billing.
This directive clarifies that it is the insurer’s responsibility to adjust the
claim promptly, fairly and accurately once it is determined that the claim is
related to the preventive colonoscopy screening. Failure of insurers to make
proper adjustments in a timely manner will be viewed as unfair claims
settlement practices.
Insurers are also tasked with developing educational materials for insureds
highlighting different concepts that include (but are not limited to) the
differences between diagnostic and preventive, cost sharing and no cost
sharing, in or out-of-network, and providing helpful guidance regarding
referrals for preventive colorectal screenings.
Although this directive is aimed at insurers, it is important for employers to
be aware of what insurers may be doing and what they are now directed to do.
Directive 16-EX-6 »
June 1, 2016
On April 27, 2016, Gov. Deal signed HB 965 into law, amending Chapter 24 of
Title 33 of the Official Code of Georgia Annotated. This makes a change to plan
requirements regarding drug treatment for those suffering from stage four
advanced, metastatic cancer.
The amendment provides that health benefit plans issued, delivered or renewed
in Georgia cannot limit or exclude coverage for drugs that are approved by the
federal Food and Drug Administration to treat stage four advanced, metastatic
cancer by requiring that plan participants first fail to respond successfully
to a different drug or drugs or prove a history of failure of such drug or
drugs. “Stage four advanced, metastatic cancer” means cancer that has spread
from the cancer's original or primary sites to nearby tissues, lymph nodes or
other areas or parts of the body.
This law applies to fully-insured plans issued, delivered or renewed on or
after July 1, 2016.
HB
965 »
November 17, 2015
On Nov. 6, 2015, Commissioner of Insurance Hudgens issued Bulletin 15-EX-3
related to the Georgia definition of small group in light of passage of the
PACE act. As background, the PACE act was signed into federal law Oct. 7, 2015,
and repealed PPACA’s mandated small-group expansion. As a result of the PACE
act, the federal government will continue to define small groups as those with
1-50 employees. As Georgia is no longer required to expand the definition of
small group to 1-100 employees, this bulletin confirms that the small employer
definition in Georgia is 1-50 employees and the counting methodology for
grouping purposes is limited to full time equivalent employees (which, while
not entirely clear, would appear to include part-time hours, similar to the
counting procedures that apply under PPACA’s employer mandate). The bulletin
also confirms that insurers will continue to utilize eligible employees for
participation rate purposes.
Bulletin 15-EX-3 »
September 8, 2015
On July 14, 2015, the Georgia Department of Revenue (DOR) issued guidance for
same-sex couples regarding filing tax returns. Effective June 26, 2015, the
state of Georgia authorizes and recognizes same-sex marriages due to the U.S.
Supreme Court decision in Obergefell v. Hodges. Therefore, same-sex
marriages that were previously recognized for federal income tax purposes are
now recognized by Georgia for state income tax purposes. For employers, this
means the cost to cover same-sex partners under employer-provided benefit plans
is not taxable for state purposes.
The guidance states that improper tax treatment will be corrected through the
tax return process and the filing of amended returns. Therefore, while
employers should no longer withhold income tax from amounts that would now be
subject to pre-tax treatment, employers should not have to adjust for
over-withholding of state taxes related to employer-provided benefits provided
to same-sex couples.
GA DOR Guidance »
August 25, 2015
On Aug. 11, 2015, Commissioner of Insurance Hudgens issued Directive 15-EX-3
related to patient access to eye care. The directive reinforces that insurers
must allow covered persons to obtain eye services from providers who are
otherwise licensed to provide such services. Some insurers have been limiting
coverage to services performed or products sold by certain providers only. The
directive points to the recent Georgia Supreme Court case of Spectera, Inc.
v. Wilson (749 S.E.2d 704 (2013)). Based on that case, a provider may
provide all the services for which he or she is licensed and may receive
provider panel reimbursement from an insurer as long as the service is
otherwise covered by the insurance policy. Although this directive is aimed at
insurers, it is important for employers to be aware that insurers cannot
restrict the access to eye care in this manner.
Directive 15-EX-3 »
June 30, 2015
On June 17, 2015, Insurance and Safety Fire Commissioner Hudgens issued
Bulletin 15-EX-2 related to the new autism spectrum disorder coverage
requirement under HB 429, as previously reported in the May 19, 2015 edition of
Compliance Corner. In the Bulletin, Commissioner Hudgens clarifies
that insurers may impose a cap of $30,000 on claims paid for applied behavior
analysis for the purpose of treating a person with autism spectrum disorder.
This cap only applies to applied behavior analysis and does not apply to other
treatments which may be required by HB 429 (such as therapy services or
counseling).
The autism spectrum disorder requirements are effective for fully insured plans
issued or renewed on or after July 1, 2015.
Bulletin 15-EX-2 »
May 19, 2015
On April 29, 2015, Gov. Deal signed HB 429 into law, amending Chapter 24 of
Title 33 of the Official Code of Georgia Annotated. The new law makes two
significant changes relating to health insurance coverage.
First, plans cannot restrict coverage for prescribed, medically appropriate
treatments for participants who are diagnosed with a terminal condition.
‘Terminal condition’ is defined as any physician-diagnosed illness, health
condition or disease that is expected to result in death in two years or less.
The health benefit plan shall not refuse to pay/reimburse for the treatment
(including for any drug or device) as long as such end-of-life care is
consistent with best practices for treatment of the terminal condition and such
treatment is supported by peer-reviewed medical literature.
In addition, plans must provide coverage related to autism spectrum disorders
for any plan participants who are six years of age or younger. Specifically,
plans must provide coverage for any assessments, evaluations or tests by a
licensed physician or psychologist for diagnosis and any treatment for any such
disorders diagnosed. This includes counseling, habilitative, rehabilitative and
therapy services. Coverage for prescription drugs to treat autism spectrum
disorders must be determined in the same manner as coverage for prescription
drugs to treat other illnesses or conditions covered by plans. This provision
does not apply to employers that have 10 or fewer employees. Therefore,
fully-insured Georgia employers with more than 10 employees should be aware of
the new terminal condition and autism spectrum disorder coverage requirements,
and should work with insurers if any issues arise.
These two changes are effective July 1, 2015.
HB
429 »
February 10, 2015
On Jan. 29, 2015, Insurance and Safety Fire Commissioner Hudgens issued
Executive Directive 15-EX-2 related to hospital and other fixed indemnity
insurance products. The state has implemented new procedures and enforcement to
align with federal requirements for such policies. As background, in May 2014,
CMS issued final regulations related to fixed indemnity insurance products. An
individual fixed indemnity policy would be exempt from PPACA's coverage
mandates (regarding, for example, essential health benefits, annual dollar
limits and maximum out-of-pocket limits) if it qualified as a HIPAA-excepted
benefit. To qualify as an excepted benefit:
To qualify as an excepted benefit:
- The policy must only cover individuals who have other coverage considered
minimum essential coverage (MEC).
- There is no coordination of benefits with another health plan.
- The benefits are paid as a fixed-dollar amount per day or service
regardless of the amount incurred.
- The participant is provided with a written notice explaining that the
policy would not qualify as MEC for individual mandate purposes.
For new policies issued with an effective date beginning on or after Jan. 1,
2015, the Georgia Department of Insurance requires that the participant certify
that they have other coverage that qualifies as MEC. There is a safe harbor
extension until no later than May 1, 2015 for issuers that filed policy form
amendments by Oct. 1, 2014 (to allow previously approved amendments to be
finish the their use for the year). For coverage that is already in force or
that will take effect later in 2015, the notice and attestation requirements
would apply to the first renewal application with an effective date on or after
Oct. 1, 2016.
An employer offering fixed indemnity products to employees should review them
carefully for compliance.
Executive Directive 15-EX-2 »
August 12, 2014
On Aug. 1, 2014, Insurance and Safety Fire Commissioner Hudgens issued Bulletin
14-L&H-1 outlining Georgia's small group health composite rating for use in
preparing 2015 small group health rates. As background, in March HHS
established the federal composite rating methodology, a two-tier rating system.
At that time, HHS also authorized states to utilize a different composite
rating strategy, provided they are submitted to and approved by HHS. Georgia
has exercised this option by introducing a four-tier small group rating
methodology. A carrier is not required to provide family composite rates, but
if it does, it must make it available to each small employer in
the market.
The methodology for developing small group premiums in Georgia and allocating
them to participants is as follows:
-
Development of Aggregate Small Group
Premiums — For
each employee and dependent, the premium must be determined
as follows:
- For each covered adult 21 and over, multiply the base rate by the
applicable age and geographic factors without applying any tobacco
factor.
- For each covered child age 0-20, calculate the rate for the three
oldest children by multiplying the base rate by the applicable age
and geographic factors without applying any tobacco factor.
Age and geographic area are determined at the time the coverage is quoted.
-
Allocation of Premium to Small Group
Members — Once
the small group's aggregate premium has been calculated, it must be
allocated back to covered employees based on their tier factor. Georgia has
adopted the following four-tier approach and corresponding factors:
- Employee only = 1
- Employee + spouse = 2
- Employee + children (including all covered children up to age 26) =
1.85
- Employee + family = 2.85
- Final Employee Premium — Final employee
premium = [group aggregate premium] / [weighted employee count] x
[employee's tier factor]
- Recalculation of Average Monthly
Premiums —
The methodology above determines an employee's monthly premium based on a
census of employees (and covered dependents) at the time the policy was
issued. The average monthly premium for each tier must remain the same for
the entire policy period despite changes to the census. The average monthly
premium must be recalculated annually, based on the census at the time the
policy is rated.
- Application of Tobacco Use Factors — The
family composite premiums do not include a tobacco use factor. Any tobacco
use factor must be applied to the specific individual's premium contributed
to the aggregate premium. The additional premium is then added to the
monthly premium for that individual based upon the tier allocation.
Note that the federally facilitated SHOP will not use composite premium methods
for the 2015 plan year. The federally facilitated SHOP plans to use the federal
composite premium method for the 2016 plan year.
Bulletin 14-L&H-1 »
Hawaii
June 22, 2021
Gender Identity Discrimination Prohibited
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On June 10, 2021, Insurance Commissioner Hayashida issued Memorandum 2021-8H, reminding insurers that Hawaii’s insurance laws explicitly prohibit health plan discrimination based on actual or perceived gender identity. Specifically, plans issued in Hawaii may not deny, cancel or limit coverage for services related to gender transition if there is coverage for those same services when treatment is not related to gender transition.
This memorandum confirms that Hawaii law parallels ACA Section 1557. Any employer with a fully insured plan issued out of Hawaii should be aware of this prohibition.
Memorandum 2021-8H »
March 2, 2021
Voluntary Special Enrollment Period for Off-Marketplace Health Plans
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On February 26, 2021, Commissioner Hayashida issued Memorandum 2021-1H, encouraging insurers to offer a special enrollment period (SEP) to permit individuals to enroll in ACA-compliant off-marketplace health plans. This SEP is encouraged as the federal marketplace will reopen for a 90-day SEP pursuant to President Biden’s executive order.
Insurers that choose to provide this parallel SEP to plans outside the marketplace should submit an informational filing with a letter and documents as required by the commissioner.
This information may be of use to employees who have not been able to enroll in other coverage. However, this SEP for non-exchange coverage would likely not give rise to a qualifying event that would allow employees to terminate their employer group health plan coverage. It is also important to note that these private health plans often meet ACA requirements, but consumers would not qualify for premium tax credits to help pay for them.
Employers with employees in Hawaii should be aware of this development.
Memorandum 2021-1H »
September 15, 2020
Extension of Transitional Health Insurance Plans
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On August 31, 2020, Insurance Commissioner Hayashida released Memorandum 2020-10H, extending the ability of health insurance carriers in the individual and small group market to continue transitional health insurance plans through December 31, 2021.
As background, on January 31, 2020, CMS provided guidance for a transition policy extension that allows insurers the option to renew non-grandfathered non-ACA-compliant plans, as long as the state allows for such an extension. Such transition policies are not required to be in compliance with certain ACA mandates including community rating, coverage of essential health benefits, prohibition on pre-existing condition exclusions and the annual out-of-pocket maximum limit. This bulletin applies this most recent federal extension to Hawaii and allows the issuer to renew these non-ACA compliant plans.
Small employers that are interested in renewing their non-ACA-compliant plan should work with their advisors and insurers.
Memorandum 2020-10H »
May 12, 2020
Reiteration of COVID-19-Related Insurance Guidance
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On April 27, 2020, Insurance Commissioner Hayashida issued Memorandum 2020-4A. This memo incorporates and reemphasizes all previous guidance the Insurance Division has provided concerning the COVID-19 crisis. Specifically, among other things, the Insurance Division continues to encourage insurers to waive fees and penalties relating to an insured’s temporary inability to submit premium payments, extend grace periods, grant additional time to policyholders to pay premiums, and encourage policyholders to use electronic payment technology to avoid in-person payments.
This guidance applies to insurers, but employers should familiarize themselves with it should they need to seek leniency from an insurer.
Memorandum 2020-4A »
April 14, 2020
Insurance Division Requests Regarding COVID-19
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On March 27, 2020, the Insurance Division issued Memorandum 2020-23I, encouraging insurers to work with their insureds to ensure health coverage continues during the COVID-19 crises. Specifically, the memorandum encourages insurers to:
- Refrain from cancelling or nonrenewing policies due to nonpayment during this time of hardship and to grant a grace period for premium payments to be made
- Work with insureds on a structured payment plan for late premium payments
- Waive late fees and penalties
- Extend timeframes to complete property and automobile inspections or undergo medical examinations
- Continue working with insureds for a period of 60 days after this health emergency has passed, or as long as reasonably practical
While this guidance is aimed at insurers, employers should review this guidance so that they are aware of some of the ways insurers may be making accommodations for plan sponsors.
Memorandum 2020-3I »
August 20, 2019
Voting Leave Repealed
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On June 28, 2019, Governor Ige signed HB 1248 into law. Effective with the 2020 primary election, the law requires all elections statewide to be conducted by mail. Because of this requirement, an employee’s absence during the day will not be necessary in order to visit a polling location. Thus, the new law also repeals the voting leave law, which provided employees with up to two hours of leave for the purpose of voting.
HB 1248 »
February 5, 2019
Revised Disability Compensation Notice
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The Department of Labor and Industrial Relations has issued a revised
version of the “Disability Compensation Law Notice to Employees,” which
must be posted in the workplace. The poster advises employees of their
right to temporary disability insurance, prepaid health care and workers
compensation benefits.
Revised Disability Compensation Law Notice to Employees
»
August 21, 2018
Medication Synchronization
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On July 11, 2018, Gov. Ige signed HB 2145 into law. The new law allows for
medication synchronization for participants who are taking two or
medications for chronic conditions. The synchronization allows for the
multiple medications to be filled at the same time by the same network
pharmacy, which the new law states increases medication adherence. The new
law specifically requires group health insurance policies to provide
coverage for partial supplies of such medication (less than a 30 day
supply) with prorated cost sharing applied. The law was effective July 1,
2018.
HB 2145 »
Restrictions on Short-Term, Limited-Duration Policies
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On July 10, 2018, Gov. Ige signed HB 1520 into law. The new law prohibits
an insurer from issuing or renewing a short-term, limited-duration health
insurance policy for an individual who was eligible to purchase individual
health insurance through the marketplace during open enrollment or a
special enrollment period in the previous calendar year. Further, insurers
are prohibited from issuing such a policy with a coverage period longer
than 90 days. This law is more restrictive than the recently issued federal
regulations related to short-term, limited-duration health insurance
policies, which permits renewals for up to 36 months.
HB 1520 »
August 7, 2018
Transitional Policies Extended
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Insurance Commissioner Ito announced in Memorandum 2018-2H that insurers
will be allowed to renew noncompliant individual and small group
non-grandfathered plans with policy years beginning on or before Oct. 1,
2019. This is related to the CMS announcement on April 9, 2018 of an
extension to the transitional policy for non-PPACA-compliant health benefit
plans. Such plans must have existed before Oct. 1, 2013 and aren’t required
to be in compliance with certain PPACA mandates, including community
rating, coverage of essential health benefits, prohibition on pre-existing
condition exclusions and the annual out-of-pocket maximum limit. Employers
with non-PPACA-compliant plans should work with their carrier and advisor
in determining whether their plan can be extended.
Memorandum 2018-2H »
July 24, 2018
Adoption of ACA Mandates
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On July 5, 2018, Gov. Ige signed SB 2340 into law. The new law amends
Hawaii’s Revised Statutes to impose the following requirements on group
health insurance policies issued in the state:
- Provide coverage to children until age 26 (if the policy already
provides coverage for children)
- Prohibition on pre-existing health conditions exclusions
- Prohibition on using a participant’s gender to determine premiums or
contributions
This doesn’t currently impact group health insurance policies, as they’re
already required to be in compliance with these provisions under the ACA.
The purpose of this new law is to protect these provisions in case they’re
repealed at the federal level. If that were to happen, policies issued in
Hawaii would still be required to be in compliance with these three
requirements.
The law was effective upon the governor’s signature.
S.B. 2340 »
September 19, 2017
Family Leave Expansion
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On July 10, 2017, Gov. Ige signed HB 213 into law. The new law expands the
state’s existing family leave law. As background, employers who have 100 or
more employees working in Hawaii must provide up to four weeks of unpaid
leave in a 12-month period to eligible employees. Employees are eligible if
they have worked for the employer for at least six months and have a
qualifying reason.
Qualifying reasons include birth, adoption and to care for a family member
(employee’s child, spouse, reciprocal beneficiary or parent) with a serious
health condition. The new law adds a sibling to the list of family members
for whom the employee may take leave. Additionally, the death of the
employee’s child, spouse, reciprocal beneficiary, parent or spouse has been
added as the fourth qualifying reason for leave.
The employer may require certification, such as a statement from a health
care provider when leave is to care for a seriously ill family member or a
death certificate following the death of a family member. The law was
effective July 10, 2017.
HB 213 »
August 8, 2017
Network Access and Adequacy
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On July 12, 2017, Gov. Ige signed SB 387 into law. The new law requires