What Do the New ACA Nondiscrimination Rules Mean to You?
    09/28/2016

    On May 18, 2016, we published this Compliance Alert detailing the requirements of the new ACA Nondiscrimination Rules (Section 1557 of the ACA) and to whom the rules apply. Since then, we have received many questions regarding how these rules, specifically those surrounding

    On May 18, 2016, we published this Compliance Alert detailing the requirements of the new ACA Nondiscrimination Rules (Section 1557 of the ACA) and to whom the rules apply. Since then, we have received many questions regarding how these rules, specifically those surrounding discrimination based on gender identity, truly impact health plans, especially self-insured health plans. Remember, the rules apply to health care providers, health insurance issuers, employers, and health care programs/activities that receive federal funding from the Department of Health and Human Services (“HHS”), Health Insurance Marketplaces, and any health program administered by HHS (individually a “Covered Entity”).

    So, the question that remains for employers is how these rules actually impact their group health plans. Based on the list of entities to whom these rules apply, it is clear that many, if not most, employers and their health plans will not be directly subject to the rules. However, that said, many employers that sponsor fully-insured group health plans, with plans purchased and underwritten by insurance carriers, will be offering plans that will be impacted by these rules. For example, gender transition services will likely be a covered service in insurers’ contracts to comply with their obligations under these rules. Additionally, although employers that sponsor self-insured health plans will not be directly subject to these rules, they still may find compliance is necessary to avoid gender discrimination claims by failing to, for example, offer certain services in their health plan that fall under the purview of this rule (e.g. gender transition services).

    Neither an employer who sponsors a self-funded health plan nor the plan itself is considered a Covered Entity under the rules. However, the employer’s self-funded plan may be administered by a third party administrator (“TPA”) that is a Covered Entity and which could indirectly impact the employer’s group health plan. If HHS receives a discrimination complaint about the employer’s group health plan, HHS will determine whether the TPA or the employer is responsible for the alleged discriminatory action or decision.  If the issue is the TPA’s administration of the group health plan, HHS can pursue the complaint against the TPA.  However, if the alleged discriminatory action is a result of a decision by the employer (such as plan design), and HHS does not have jurisdiction over the employer (because the employer is not a Covered Entity under this Rule), HHS can refer the complaint to the EEOC for review and investigation.

    Accordingly, the best course of action for an employer (especially one that sponsors a self-funded plan) is to review its plan design and determine what areas of potential liability may exist in this area. The employer should consider any identified issues and then document decisions made in the capacity of the employer and plan sponsor.  Plans can continue to use reasonable medical management techniques and use neutral standards for the benefits provided, but blanket exclusions of coverage for sexual identity issues may be a target for litigation.

    This will continue to be a hot-button issue since one of the EEOC’s enforcement priorities is discrimination against LGBT individuals. We recommend all plan sponsors review their plans to limit and protect against possible exposure in this area.

    Latest Blogs

    By Cody Wilson, 03/29/2018
    As businesses continue to track more details about customers, products, and sales, it only makes sense that we would begin have more access to these kinds of details about one of the most expensive products we all buy – health insurance. It has been said time and time again, if you are buying something...
    Read

    By Lauren Randall, 02/21/2018
    ‘LessBad’ Put simply, medical trend for the past several years is ‘less bad.’ It might not be the most grammatical term, but relative to a very volatile 2007 where medical trend rose as high as 12 percent, the steady 6-7 percent increase for the past five years seems somewhat more...
    Read

    By Caroline Smith, 03/08/2017
    House Republicans just released the latest version of the ACA repeal and replace legislation. The good news for many of our clients is that the Congress has listened to you and us as your brokers, consultants, agents and administrators.
    Read

    By Caroline Smith, 09/28/2016
    On May 18, 2016, we published this Compliance Alert detailing the requirements of the new ACA Nondiscrimination Rules (Section 1557 of the ACA) and to whom the rules apply. Since then, we have received many questions regarding how these rules, specifically those surrounding
    Read

    By Caroline Smith, 07/29/2016
    The first round of notices from the federally-facilitated health insurance exchange (also known as the Marketplace) have been sent out at the end of June.
    Read

    05/18/2016
    Instead of issuing an option and ruling on the merits of the cases surrounding the Affordable Care Act’s (ACA) contraceptive coverage mandate, the U.S. Supreme Court sent seven related cases challenging said mandate back to the lower courts to be reconsidered.
    Read

    05/18/2016
    Yesterday, the EEOC released its final rule with regard to employer wellness programs and the ADA (and a final rule with regard to those same programs and GINA).
    Read

    05/18/2016
    Employee Benefits News reported that according to Optis Partners’ M&A database there were 109 reported insurance agency M&A transactions in the first three months of 2016. AssuredPartnerswas listed as having 11 transactions in the first quarter, which is the second highest numberof...
    Read

    05/10/2016
    On April 28, 2016,the IRS issuedRev. Proc. 2016-28, whichset forththe 2017 HSA contribution limits, HDHP minimum deductibles, and HDHP out-of-pocket maximums. To summarize,the IRS provided for a mere $50 increase in the amounts that a single person in an HSA-compatible HDHP may defer into his/her Health Savings...
    Read

    03/18/2016
    James Harmon, President of Dawson Consulting Group, An AssuredPartners Company, was interviewed foran Employee Benefits Advisor’s (“EBA”)series regarding the evolution of private exchanges.
    Read