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Scott AustinDavid MustoneLeslie OkinakaHunton & Williams LLP
Health Care Reform – Employer Update
2010
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L. Scott Austin, PartnerTax & ErisaDallas/Atlanta Offices(214) [email protected]
David Mustone, PartnerTax & ErisaMcLean Office(703) [email protected]
Leslie A. Okinaka, PartnerTax & ErisaNew York Office(212) [email protected]
Presenters
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Hunton & Williams’ Health Care Reform Initiative
The Firm’s Healthcare Reform Group – The Group’s website -- www.Huntonhealthcarereform.com --
is now fully operational Contains –
Final consolidated version of health care reform legislation
All government guidance issued to date, and H&W client alerts and other client updates
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Overview/Introduction
Initial WebinarFocus of this Webinar –
Significant developments since last webinar Other Issues/Items of interest Opportunity for you to ask questions about
matters/issues of concern to you
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Compliance Items
Compliance/Enforcement -- Government’s announced approach on initial compliance
Exempt Programs – Additional Thoughts Retiree plans – Restructure into separate plan (if needed) to
take advantage of exemption Separate dental/vision programs
Upcoming Notice Requirements – Reminder Availability of adult child coverage, elimination of lifetime
limits, maintenance of grandfathered status etc. Chart on notice requirements
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Immediate Reforms/Changes-- Recent Developments
Adult Child Coverage FAQ guidance on covered “children” -- a “safe
harbor” Generally, natural children, stepchildren, adopted
children (including children place for adoption), and foster children
Requirement also applies to minors Adult child health care costs can be reimbursed
under a flexible spending account (even though FSA exempt)
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Immediate Reforms/Changes-- Recent Developments (Cont’d)
Lifetime/Annual Dollar Limits -- Limited to “essential” health benefits What are essential benefits – Scope/application
Ambulatory patient services, emergency services, hospitalization, maternity/newborn care, mental health & substance use disorder services, lab services, prescription drugs, preventive/wellness/chronic disease management & rehab/habilitative services & devices
Pending guidance, reasonable good faith interpretation
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Immediate Reforms/Changes -- Recent Developments (cont’d)
Coverage rescissions -- Recent FAQ guidance on administrative processing & other
delays
Reimbursement of OTC medicines under healthcare FSAs, HSAs and HRAs – Recent government guidance
New W-2 reporting of cost of employer-provided health coverage -- Postponed for 2011 State tax issues
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Grandfathered Status
Maintaining Grandfathered status -- FAQ guidance/clarifications Impact of plan changes on continued grandfathered status
Coverage tier, prescription drug formulary & network changes Roll of wellness programs Impact of “anti-abuse” rule – eliminating a plan option Change in insurance carriers – new gov’t position? Relief for insured/multiemployer plans Application of Notice Requirement
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Immediate Reforms/Changes – Recent Developments for Non-
Grandfathered Plans
Patient protections – Expanded claims review process Must have an internal claims review process that complies
with ERISA claims process rules Compliance with additional standards postponed in some
respects until 7/1/2011 (DOL Tech Rel 2010-02) Must have an external claims review process
For insured (and nonERISA plans) – must comply with applicable state external review rules (that meet certain minimum standards for PYs beg. on/after 7/2011)
All other plans (including self-insured ERISA plans) – must follow federal standards “Safe harbor” requirements in DOL Tech Rel 2010-01
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Immediate Reforms/Changes – Recent Developments for Non-Grandfathered Plans (cont’d)
Patient Protections – No-cost preventive healthcare Limits on usage etc.- reasonable medical management
techniques okay New HHS Reporting Requirements
Effective date? New nondiscrimination rules for insured plans
Generally prohibits providing coverage/benefits for only (or are skewed in favor of) high-paid employees
Outstanding issues
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Retiree Reinsurance Program – Recent Developments
Early retiree reinsurance program – Recent Developments Program now open for reimbursement requests
Recent guidance on reimbursable expenses and submission of eligible retiree lists/cost data
New participant notice requirement Use of reinsurance proceeds
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L. Scott Austin, PartnerTax & ErisaDallas/Atlanta Offices(214) [email protected]
David Mustone, PartnerTax & ErisaMcLean Office(703) [email protected]
Leslie A. Okinaka, PartnerTax & ErisaNew York Office(212) [email protected]
Questions