Welfare Benefit Plan ERISA News
January 2014

Are Dental and Vision Plans subject to PPACA?
Some ERISA health plans, such as dental and vision, may be characterized as "excepted benefits," which are exempt from PPACA obligations. The structure of these plans dictates whether they are subject to PPACA; there is no single answer.
PPACA is not applicable to health plans that are either:
  1. offered under a separate policy, certificate or contract of insurance (i.e., separate from the medical plan), OR
  2. not integral to the medical benefit plan - even if it is included in the medical plan/policy/certificate. An included health benefit is not integral if both:
    • a participant is given the right to decline the benefit, AND
    • a participant must pay an additional premium for the coverage.

If either of condition 1. or 2. is met, the plan is considered "limited in scope" and exempt from federal health care reform law (PPACA).

New Rules Clarify MHPAEA
Federal rules promulgated last month clarify the 2010 mental health parity interim regulations, ending three years of uncertainty. Effective July 1, 2014, parity with other medical benefits is required for in-network and out-of-network inpatient and outpatient care, emergency treatment, prescription drug services, prior authorization requirements, and other utilization management techniques.
Employers with more than 50 full-time workers are not required to provide mental health benefits under federal law, but those that do must comply with it. Small employers were exempt from the parity requirements, but due to the essential health benefits coverage mandate for small-group health plans under the ACA, fully insured small employers will not be able to purchase fully insured coverage that does not contain mental health benefits. (More)
Overview of Recent Health Care Reform
90 Day Waiting Period, Adoption Assistance, Cafeteria Plans, COBRA, Control Groups, Dependent Care FSA, Disclosure, DOMA, Essential Health Benefits, Excepted Benefits, Exchange Notices, Exchanges, FMLA, Grandfathering, Group Health Plans, HCR, HDHP, Health FSAs, Highly Compensated Employees, HIPAA, HSAs, Individual Mandate, Individual Policies, LTC, Minimum Essential Coverage, Minimum Value Standards, Penalties, PPACA, Qualified Parking Expense, Qualified Transportation Expense, Reporting, Retiree Health Benefits, Same Sex Marriage, Shared Responsibility, and Wellness. (Details)
New Attachment Required on 5500s
A new attachment to the 2013 Form 5500 is required for all welfare plans, "Form M-1 Compliance Information." Form M-1 reports compliance by a Multiple Employer Welfare Arrangement (MEWA), an employee welfare benefit plan that provides benefits to the employees (and their beneficiaries) of two or more employers that are not members of the same control group. This new attachment is required whether or not the plan is a MEWA. If the plan is a MEWA, the attachment must specify whether the plan is in compliance with the filing requirement and provide the Receipt Confirmation Code for the 2013 Form M-1 and 2) the plan must now file Form 5500 regardless of plan size or type of funding (including small unfunded or insured welfare plans). Failure to provide the Receipt Confirmation Code risks rejection of the Form 5500 as incomplete, which could lead to penalties. Form M-1 package
ERISA Trivia
Last month we asked for the coverage effective dates in 3 different scenarios for a health plan that is subject to PPACA. The answers are 1) January 1, 2014, 2) February 1, 2014, and 3) March 1, 2014. Here is the reasoning: for Plan Years beginning on or after January 1, 2014, health plans subject to PPACA may not impose a waiting period greater than 90 days of employment, including days employed prior to January 1, 2014. Coverage must commence no later than on the 91st day of employment - whatever combinations of waiting periods and effective dates are elected, and whether or not the waiting period has been satisfied. Kudos to Marty Bryson, Kimberly Jarboe, Paul Pruitt, and Roberta Korntved for submitting all 3 answers correctly!


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© 2017 ERISAPros, LLC, All rights reserved. Information on ERISAPros' website, its newsletter, “News & Views,” and its blog, “ERISA Wonk,” is published as a general informational source. Information and articles are general in nature and are not intended to constitute legal or tax advice in any particular matter. Blog posts and comments reflect the personal views of their respective authors - not those of ERISAPros. Transmission of this information does not create an attorney-client relationship. ERISAPros, LLC is not a law firm and is not giving legal or tax advice. It does not warrant and is not responsible for errors or omissions in the content on its website or in its newsletters. ERISA is a complicated and confusing law. Summary Plan Descriptions (SPDs), Wrap Plan Documents, and Form 5500s require review and updating by qualified ERISA compliance professionals.


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