Insights

As briefly mentioned in a recent Vorys’ client alert, the Consolidated Appropriations Act, 2021 (CAA), signed December 27, 2020, requires that a group health plan and issuers that cover mental health/substance abuse disorder (MH/SUD) “perform and document” a comparative analysis of any non-quantitative treatment limitations that apply to the plan.

The Consolidated Appropriations Act (CAA), signed December 27, 2020, will bring significant changes to group health plans in 2022.

The Consolidated Appropriations Act (CAA), signed December 27, 2020, will bring significant changes to group health plans in 2022.

The Consolidated Appropriations Act (CAA), signed December 27, 2020, will bring significant changes to group health plans in 2022, including new limits on surprise medical billing, reporting and disclosures.

In early 2020, the CARES Act created a refundable payroll tax credit (the Employee Retention Tax Credit, or the “ERTC”) for eligible payroll costs of certain employers who were negatively impacted by COVID.

Yesterday evening, the President signed into law the Bipartisan COVID-19 Emergency Relief Act of 2020 (the “Relief Act”).

Earlier this month, the U.S. Equal Employment Opportunity Commission updated its COVID-19 technical assistance with new information on vaccinations.

On December 20, 2020, Congress passed the Emergency Coronavirus Relief Agreement, which, if approved by the president, will be signed into law as the COVID-related Tax Relief Act of 2021 (CTRA). The CTRA offers approximately $900 billion in relief and stimulus provisions (discussed in more detail here). However, not included in the CTRA is an extension of the mandatory leave provisions of the Families First Coronavirus Response Act (FFCRA), which are set to expire on December 31, 2020. Instead, the CTRA extends the tax credits available to covered employers that continue to offer paid leave under the FFCRA framework through March 31, 2021.

On November 9, 2020, the Supreme Court announced that it would not reconsider the case of Retirement Plans Committee of IBM v. Jander, which the Court remanded to the Second Circuit in its last term.

On October 2, 2020, the IRS published Notice 2020-76 , announcing an automatic 30-day extension of the deadline to distribute 2020 Form 1095-Cs to employees.

On September 9, 2020, California Governor Gavin Newsom signed Assembly Bill 1867, which requires private employers with 500 or more employees nationwide to provide COVID-19 supplemental paid sick leave benefits to qualifying employees.

The clock has starting ticking for defined contribution plans to begin to provide a “lifetime income disclosure” on at least one benefit statement a year.

The DOL expanded the option for electronic delivery of retirement plan notices and documents.

This is the second part of our three-part series reviewing ERISA cases decided this term by the U.S. Supreme Court.

The IRS released proposed regulations on June 11, 2020 regarding the excise taxes imposed under Code Section 4960.

In response to the COVID-19 pandemic, Congress enacted the Families First Coronavirus Response Act (FFCRA).

Section 1557 of the ACA prohibits discrimination on the basis of race, color, national origin, sex, age, or disability by health programs and activities funded or administered by HHS. On June 12, 2020, the U.S. Department of Health and Human Services (HHS) announced a 2020 Rule (2020 Rule) on Section 1557 of the Affordable Care Act (ACA).

Earlier this month, the Supreme Court issued its opinion in the case of Thole v. U.S. Bank, holding that participants in defined benefit pension plans do not have standing to bring breaches of fiduciary duty claims under ERISA unless and until their own benefit has actually been impacted. 

The IRS temporarily waived the physical presence requirement for spousal consent to participant benefit elections in a qualified retirement plan.

On May 12, 2020, the IRS issued Notices 2020-29 and 2020-33.  Notice 2020-29 provides employers with more flexibility for mid-year changes under cafeteria plan as well as permits the extension of grace periods and carryovers of unused 2019 FSA amounts through the end of 2020.

The Department of Labor (DOL) and Internal Revenue Service (IRS) recently issued a Joint Notice extending the time frames for a wide range of group health plan participant related events.

The IRS has issued FAQs providing additional guidance on several aspects of the CARES Act Employee Retention Tax Credit.

As with all aspects of Federal COVID-19 relief, guidance on claiming federal tax credits and deferring payroll tax liability is rapidly evolving and is subject to change.  The following provides an outline of guidance on these issues as of the date of this alert.

The Coronavirus Aid, Relief, and Economic Security Act (CARES Act) was enacted on March 27, 2020 and contains many provisions that affect employee benefit plans.

Following days of often tense negotiations, the United States Senate has passed the third phase of federal coronavirus relief legislation, the Coronavirus Aid, Relief, and Economic Security Act (the CARES Act), which will provide $2 trillion in economic aid to individuals and businesses impacted by the coronavirus public health emergency.

Since the first known case of COVID-19 in the United States was discovered in late January, the federal government has taken several steps to both fight the spread of the disease and blunt its economic impact on the American economy.

On March 18, 2020, the Families First Coronavirus Response Act was approved by Congress and signed by President Trump. There are a number of provisions in the law that will directly impact many employers. Key portions of the bill are discussed in this alert.

The Families First Coronavirus Response Act (FFCRA) expands coverage for and reimbursement of coronavirus testing and related services by state and federal health care programs, private insurers, and self-insured group health plans. 

Jennifer Dunsizer, a partner in the Columbus office, authored a Lexis Practice Advisor^® Practice Note titled “Participant Investment Advice and Education Considerations for Retirement Plan Fiduciaries.”

On December 18, 2019, the U.S. Court of Appeals for the Fifth Circuit held in Texas v. U.S. that the provision in the Affordable Care Act (ACA) that requires individuals to maintain health insurance or pay a “shared responsibility payment” (i.e., the individual mandate) is unconstitutional.

The Tax Cuts and Jobs Act generally eliminated the exception to the $1M deduction cap imposed under Code Section 162(m).

The Vorys Employee Benefits Team has drafted alerts covering an array of regulatory and legislative changes throughout the year.

On December 2, 2019, the IRS published Notice 2019-63, announcing a 31-day extension of the deadline to distribute 2019 Form 1095-Cs to employees.

Starting January 1, 2020, a new California state law will require employers to notify employees in California of any deadline to withdraw funds from a flexible spending account (FSA) prior to the end of the plan year.

On October 23, 2019, the U.S. Department of Labor (DOL) published proposed regulations on a new safe harbor for electronic disclosures for retirement plans governed by ERISA.

On October 23, 2019, the U.S. Department of Labor (DOL) published proposed regulations on a new safe harbor for electronic disclosures for retirement plans governed by ERISA.

Now that PBMs are able to track copay coupons using copay accumulator programs, additional guidance is needed from the IRS to determine whether plan sponsors are required to implement copay accumulator programs for HSA-compatible HDHPs. 

On September 23, 2019, the Treasury Department published final regulations affecting hardship distributions for 401(k) and other retirement plans.

In our labor and employment alert on September 25, 2019, we outlined the final regulations narrowing the FLSA exemption and expanding the number of workers eligible for overtime.

In order to contribute to a health savings account (HSA), an employee must be enrolled in a high deductible health plan (HDHP) and not have disqualifying health coverage.

The new regulations (published June 13, 2019) preserve preceding exceptions from the ACA prohibition on annual dollar limits and create two more: (1) an excepted benefit HRA and (2) an individual coverage HRA.

On May 30, 2019, JPMorgan Chase agreed to pay $5 million to settle a class action lawsuit brought by male employees who requested paternity leave under company policy and were granted less leave than their female counterparts.

In 1990, Congress enacted the Federal Debt Collection and Procedures Act.  One feature of that law allows a federal court to issue a “writ of continuing garnishment” to access a convicted participant’s retirement plan benefits to satisfy a restitution order entered as part of the participant’s criminal sentencing. 

In December 2018, Michigan enacted its Paid Medical Leave Act (PMLA), which becomes effective in March 2019.

On November 29, 2018, the IRS announced a 32-day extension of the deadline to distribute 2018 Form 1095-Cs to employees.

A Texas Court of Appeals recently ruled that the City of Austin’s paid sick leave law is unconstitutional under Texas law.

New hardship distribution regulations have been proposed for 401(k) and 403(b) retirement plans. Clients will need to make decisions about what changes they want to adopt and when.

With open enrollment approaching for many employers, we thought it might be helpful to provide a list of the various notices and disclosures generally required to be provided to participants around this time of year.

On August 17, 2018, the Internal Revenue Service (IRS) published Private Letter Ruling 201833012, which directly addressed an employer’s ability to provide a student loan repayment benefit in its 401(k) plan.

We previously wrote about the changes to 162(m) under the “Tax Cuts and Jobs Act” which significantly expanded the $1,000,000 deduction cap on compensation paid by publicly traded companies to certain executive officers.

On April 23, 2018, the Department of Labor (DOL) published a second draft of a model form, the Disclosure Template, that a group health plan participant (or his or her representative) may use to request documentation of compliance with the Mental Health Parity and Addiction Equity Act (MHPAEA).

Less than two months after announcing a $50 reduction in the 2018 limit on HSA contributions for employees with family high deductible health plan coverage, the IRS backtracked and reinstated the original limit.

The Tax Cuts and Jobs Act changed the indexing of numerous dollar amounts under the Internal Revenue Code effective in 2018.

On December 22, 2017, the PBGC issued final regulations that expand their acceptance of benefits for missing participants.

Maryland is now the eighth state (behind Arizona, California, Connecticut, Massachusetts, Oregon, Vermont and Washington) to require sick leave for employees.

After postponing the effective date of Obama-era regulations on claims and appeals for disability benefits, the Department of Labor announced on January 5, 2018 that it would allow the regulations to go into effect for claims filed after April 1, 2018. 

On December 22, 2017, tax reform became official. There were several changes in the final version, including renaming the “Tax Cuts and Jobs Act” to the “Act.” The Act will have significant impact on business. This alert focuses on the impact of the Act on employee compensation and benefits programs.

On December 22, 2017, the IRS announced a 30-day extension of the deadline to distribute 2017 Form 1095-Cs to employees.

The U.S. House and Senate have both passed tax reform proposals, which are currently being reconciled. These proposals will have significant impact on compensation and benefit programs.

We have become aware that the Department of Labor (DOL) has started to take issue with the standard processes used by retirement plans to identify and locate lost participants in ongoing plans.

On November 2, 2017, the IRS updated FAQs 55-58 on the ACA employer pay or play penalties to explain how it intends to assess and collect 2015 penalties under Code Section 4980H.

After years of anticipation, sponsors of 403(b) plans have finally received guidance from the IRS regarding preapproved 403(b) prototype and volume submitter documents.

Unfortunately, sometimes an employer needs to end an employment relationship. In many situations, it is in the best interests of the parties to enter into an agreement that defines the terms of the separation. Whether called a “separation agreement,” “severance agreement,” “retirement agreement” or any other name, the issues remain the same.

A federal court recently ordered an employer, WellStar Health System Inc., to pay $750,000.00 to a former employee’s widow for breaching its fiduciary duty in administering its group life insurance plan.

In January 2017, the last regular determination letter applications will be filed for sponsors of individually designed retirement plans. After that last Cycle A determination letter application, individually designed plans will no longer be able to get a ruling from the IRS that the plan terms comply with law (except for the initial ruling on formation of the plan and a final ruling at plan termination), although the IRS may specify other ruling opportunities in the future.

On December 13, 2016, President Obama signed the 21st Century Cures Act (H.R. 34) into law. The 21st Century Cures Act contains two provisions that relate to group health coverage.

On November 18, 2016, the IRS announced a 30-day extension of the deadline to distribute 2016 Form 1095-Cs to employees.

For now, stay the course and stay tuned…

At the end of June, the federally-facilitated health insurance exchanges (as known as the Marketplace) sent out the first batch of Marketplace Notices to employers.

You hired a summer intern who is eager to work as many hours as possible. If you allow the intern to work 30-plus hours per week during the summer, at what point would you have to offer medical coverage in order to avoid the risk of Affordable Care Act (ACA) pay or play penalties?

If your company sponsors a wellness program, you are undoubtedly familiar with IRS and DOL rules for participatory, activity, and outcomes-based wellness programs.

A recently decided case from an Ohio Court of Appeals breathes life into that proverb, teaching companies the importance of having a properly drafted employee handbook.

In August 2015, the City of Pittsburgh, Pennsylvania, enacted a paid sick leave law (see our previous Labor and Employment Alert on the ordinance). The ordinance would have required all private employers in the City of Pittsburgh to provide their eligible employees with at least one hour of sick leave for each 35 hours worked.

In a welcome development, the IRS announced on December 28, 2015 (IRS Notice 2016-04) the following extensions of Form 1095-C and Form 1095-B deadlines:

	Original Deadline	New Extended Deadline
Distribution to employees	February 1, 2016	March 31, 2016 (2-month extension)
Electronic filing with IRS	March 31, 2016	June 30, 2016 (3-month extension)
Paper filing with IRS*	February 29, 2016	May 31, 2016 (3-month extension)

* Paper filing is only permitted if an entity is filing fewer than 250 Forms 1095-C or 1095-B.

The Bipartisan Budget Act of 2015 (11/2/2015) includes a rare bipartisan amendment to the Affordable Care Act (ACA). The ACA would have required that employers with 200 or more full-time employees auto-enroll their full-time employees in health coverage.

On Labor Day, President Obama signed an Executive Order establishing paid sick leave for employees of federal contractors and subcontractors. This is similar to what several states and cities have mandated for private employers (including Oregon; Montgomery County, Maryland; and Pittsburgh, Pennsylvania). The Executive Order’s requirements apply to all covered federal contracts that are solicited or awarded on and after January 1, 2017.

Following Oregon’s recently enacted state-wide paid sick leave law, Montgomery County, Maryland, and Pittsburgh, Pennsylvania, are the latest locales to require that employers provide paid sick leave to their employees. This further complicates the growing patchwork quilt of federal, state and local leave laws that employers have to contend with.

Oregon is now the fourth state, after Connecticut, California, and Massachusetts, to mandate that employers provide their employees with sick leave benefits. Oregon’s new sick leave law goes into effect on January 1, 2016, applies to all private- and public-sector employees, and in most cases, requires that the sick leave be paid.

Jackie Ford, a partner in the Vorys Houston office and a member of the labor and employment group, authored an article titled “Same-Sex Marriage Decision a Win for Employers?” for Texas Lawyer.

The IRS announced the 2016 indexed amounts for health savings accounts (HSAs) and high deductible health plans (HDHPs).

For years, the Equal Employment Opportunity Commission declined to provide formal guidance on the application of the ADA to wellness programs. It has now issued rules.

The IRS will need detailed information from employers to enforce three Affordable Care Act (ACA) tax provisions. The IRS must determine whether: (1) an employer owes a pay or play penalty for failing to offer affordable, minimum value health coverage to its full-time employees; (2) employees and/or their family members are entitled to tax credits (subsidies) for the purchase of health insurance in the public exchanges; and (3) employees and/or their family members owe penalties for failing to maintain health coverage.

The federal Family and Medical Leave Act (FMLA) provides eligible employees of covered employers with unpaid, job-protected leave for specified family, medical, and military family reasons. On February 25, 2015, the Department of Labor (DOL) issued a Final Rule that revises the FMLA’s regulatory definition of “spouse.”

Starting in 2015, a large employer will be subject to pay or play penalties if it fails to offer affordable health coverage that provides at least minimum value to its full-time employees. A health plan provides “minimum value” if it is designed to pay at least 60% of the total cost of medical services for a standard population. This is generally equivalent to a bronze level plan sold in the public health insurance Exchange.

The Centers for Medicare and Medicaid Services (CMS) had set November 5, 2014 as the deadline for all but the smallest self-insured health plans to obtain a health plan identification number (HPID). On October 31, 2014 – less than a week before that deadline (and three days after publishing new FAQs on the process) – CMS announced an indefinite delay in the requirement that health plans get HPIDs.

Although the Internal Revenue Service (IRS) and the Department of Labor (DOL) have agreed on standards for wellness programs, and Congress seemed to have blessed those standards when it authorized higher levels of incentives in wellness programs as part of the Affordable Care Act (ACA), the Equal Employment Opportunity Commission (EEOC) has long expressed concerns about those standards.

Effective January 1, 2015, Ohio’s minimum wage will increase to $8.10 an hour for non-tipped employees, and $4.05 for tipped employees. The increase applies to employers with more than $297,000 in annual gross receipts.

If your company sponsors a self-insured health plan, there are two November deadlines you may have overlooked in the midst of preparation for the ACA’s pay or play penalties and 2015 open enrollment.

Jolie Havens, a partner in the Vorys Columbus office and chair of the firm’s health care group, authored an article for Columbus C.E.O. titled “Employers Should Move Ahead Despite ACA Questions.”

Several Vorys attorneys authored an article titled “Mental Health Parity and Addiction Equity Act Parity Analysis is Fine Tuned” for National Bar Association's Health Law Section July 2014 Newsletter.

In a unanimous decision that was a surprise to most in the benefits community, the Supreme Court, in Fifth Third Bancorp v. Dudenhoeffer, rejected the commonly accepted rule that fiduciaries of employee stock ownership plans (ESOPs) are entitled to a “presumption of prudence” in connection with their decision to buy or hold employer stock.

The employer pay or play penalties were originally scheduled to apply in 2014 but the IRS gave employers a one-year reprieve. Final regulations and FAQs published February 10, 2014 explain how the penalties will work in 2015 and provide several helpful transitional rules.

Summary: ACA mandates don’t apply to health plans classified as “excepted benefits.” The government has proposed regulations expanding the definition of excepted benefits to include self-insured dental and vision coverage even if that coverage is provided without employee contributions.

New final regulations under the Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) apply to group health plans in plan years beginning on or after July 1, 2014 (January 1, 2015 for calendar year plans). The regulations generally incorporate the 2010 interim final regulations and subsequent FAQs, with some notable clarifications.

The IRS has added a second exception to the use-or-lose rule for health flexible spending accounts (FSAs). Employers now have three alternatives for end-of-year health FSA credit balances...

The IRS and DOL issued new guidance prohibiting the application of pre-tax funds to the payment of individual health insurance premiums and imposing new conditions on health flexible spending accounts and health reimbursement arrangements.

On September 23, 2013 the IRS issued Notice 2013-61. The Notice sets forth streamlined refund procedures for overpayments of federal employment taxes paid by employers and employees relating to health benefits provided to legally married same-sex spouses. The Notice addresses health benefits provided both in 2013, and prior open years. The IRS had previously released Revenue Ruling 2013-17 setting forth its position that same-sex partners legally married under the laws of any state would be considered married for federal tax purposes regardless of where the couple resides. Under this state of celebration standard, the laws of the state where the marriage was celebrated (rather than the state of domicile) governs marital status for federal income tax purposes.

Jolie Havens authored a column for the Houston Business Journal outling 7 possible strategies that large Texas employers can consider to comply with the Affordable Care Act’s employer cost-sharing mandate.

Marriages between same-gender spouses will be recognized for federal income tax purposes if valid where performed (the state of celebration) regardless of whether the state in which the spouses live (the state of residence) recognizes the marriage.

The postponement of the pay or play penalties and related reporting from 2014 to 2015 gives employers a welcome opportunity to reassess their compliance strategies and plan for a more measured implementation of new systems. However, the pay or play penalties are related to the availability of federal premium assistance for the purchase of health insurance on an exchange. The absence of pay or play penalties and related reporting in 2014 may increase the number of employees buying health insurance on an exchange with federal premium assistance in 2014.

New final regulations for wellness programs apply to plan years beginning on and after January 1, 2014. If you have a wellness program and a health plan operating on a calendar year, you will want to consider the new requirements in preparing for 2014 open enrollment.

Employers must distribute a new Notice of Coverage Options to all employees (full-time and part-time, regardless of eligibility for benefits). The initial distribution of the Notice must be before October 1, 2013. Thereafter, the Notice must be given to each new employee within 14 days after work begins.

Under the pay-or-play penalties going into effect next year, an employer is subject to penalties if it does not offer "affordable" health coverage to its full-time employees (using the new 30-hour federal standard). The IRS has now proposed that premium discounts and other rewards for participation in an employer-sponsored wellness program not be taken into account in determining whether the health coverage offered by your company is affordable.

Recent government guidance addresses permissible employee cost sharing under your company's group health plan. This Vorys Client Alert summarizes what you need to know about out-of-pocket limits, annual and lifetime dollar limits, first dollar preventive care, and tobacco surcharges.

In Revenue Procedure 2013-12, the IRS recently updated the Employee Plans Compliance Resolution System (EPCRS). The EPCRS program permits a retirement plan sponsor to correct operational, coverage and plan documentation errors in certain prescribed ways so as to preserve the tax-qualified status of the retirement plan.

IRS proposed regulations (published December 28, 2012) are a roadmap to the employer pay-or-play penalties going into effect in 2014 under the Patient Protection and Affordable Care Act (the ACA). Employers may rely on the proposed regulations until further guidance or final regulations are published.

The regulatory agencies (the IRS, DOL, and HHS) have started to fill in some (but by no means all) of the gaps in the Affordable Care Act guidance needed to implement the transformation of health coverage that is supposed to happen in 2014.

The 2012 elections are just less than a month away. Many states allow employees to take time off, sometimes with pay, so that they can vote. The chart below provides a general overview of each state’s law as to time off, pay, and what, if any, advance notice is required before taking time off to vote.

On October 1, 2012, New York Stock Exchange LLC (NYSE) amended the proposed listing standards it issued on September 25, 2012 implementing the requirements imposed by Section 10C of the Securities Exchange of 1934 and Exchange Act Rule 10C-1.

On September 25 and 26, 2012, respectively, New York Stock Exchange LLC (NYSE) and The NASDAQ Stock Market LLC (NASDAQ) proposed amendments to their listing standards to comply with the requirements of Section 10C of the Securities Exchange Act of 1934 (the Exchange Act), as set forth in Exchange Act Rule 10C-1, relating to the independence of compensation committees and compensation advisers.

The most significant changes under the Patient Protection and Affordable Care Act (ACA) are scheduled to go into effect in 2014. One of those changes is the imposition of shared responsibility penalties on large employers that fail to offer health coverage to all of their full-time employees (or offer health coverage to full-time employees that is deemed to be unaffordable or inadequate).

On June 20, 2012, the Securities and Exchange Commission (SEC) adopted a new final rule and amendments to current proxy disclosure rules regarding compensation committees. The new rule implements compensation committee listing requirements.

The future of the Patient Protection and Affordable Care Act (ACA) will be determined by the Supreme Court decision expected this month. In the meantime, the regulatory agencies have continued to develop guidance that will apply to employers' group health plans – assuming health care reform survives intact.

The Patient Protection and Affordable Care Act (PPACA) established the Patient-Centered Outcomes Research Institute to study the effectiveness of various treatments. The Institute's work will be supported by the Patient-Centered Outcomes Research (PCOR) fee.

An SBC is a standardized explanation of health coverage intended to help individuals make apples-to-apples comparisons of their options for health coverage. The Internal Revenue Service, Department of Labor and the Department of Health and Human Services (the Departments) published proposed SBC rules and an SBC template on August 22, 2011.

The IRS issued Notice 2012-9 on January 3, 2012, clarifying some of its earlier guidance in Notice 2011-28 on reporting the cost of health coverage on Form W-2. The aggregate cost of health coverage will be reported in Box 12 with Code DD, starting with 2012 Form W-2s (distributed in January 2013).

Starting in 2014, every non-grandfathered individual health insurance policy and insured small employer group health plan will have to cover essential health benefits.