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June HR News Worth Review

Transparency in Coverage Requirement to Post Machine-Readable Files Begins July 1, 2022

As we have been discussing since last year through multiple webinars and compliance updates, the Transparency in Coverage Final Rules (TiC Final Rules) require group health plans and health insurance issuers to disclose on a public website detailed pricing information in three separate machine-readable files (MRFs). Specifically, the following information must be disclosed:

  • First file: In-network provider negotiated rates for covered items and services (the “In-network Rate File”);
  • Second file: Historical payments to and billed charges from out-of-network providers (the “Allowed Amount File“);
  • Third file: In-network negotiated rates and historical net prices for covered prescription drugs (the “Prescription Drug File”)—this particular MRF requirement is delayed until further notice.

The files must be publicly available and accessible free of charge without any restrictions.

Employer Takeaway
Most employers have already been contacted by their carrier or third-party administrator (TPA) and will rely on their insurance carriers or TPAs to provide the MRFs. In fact, UnitedHealthcare has launched a very informative website with a lengthy FAQ section.

The TiC Final Rules allow fully-insured employers to shift legal responsibility for the MRFs to their carriers if this arrangement is described in a written agreement. However, it is recommended that employers make the link to these files available to their employees alongside their benefit information, whether through a website, intranet site, benefit administration platform or through printed materials.

Self-insured (including level-funded) employers can use their TPAs (or other service providers) for the MRFs if this is set forth in a written agreement. Still, these employers remain legally liable for compliance under the TiC Final Rules. The TiC Final Rules suggest that self-insured employers relying on their TPAs to post the MRFs on their behalf may still be required to post a link on their websites to where the MRFs are publicly available, but this is not clearly addressed in the Final Rules. At this point, regulations merely state that files must be publicly available and accessible to any person, free of charge and without conditions, such as the establishment of a user account, password or other credentials, or submission of personally identifiable information to access the file, such as name, email address or telephone number. The Departments do not prescribe a specific location where the information must be disclosed, but since a company intranet or benefit administration system likely require a login and password, those sites would not be considered fully accessible. In the absence of additional guidance, the cautious approach would be for employers with self-insured plans to post a link to such files on their public company website, perhaps alongside their privacy policy or on a page within their website such as “Contact Us,”  “About Us,” “Legal/Compliance” or “Careers.” Additional guidance from federal agencies on this topic would be helpful.

Employers should confirm that written agreements addressing MRFs are in place with their carriers and TPAs and that these files will be available and links posted by the applicable deadline.

PCORI Fees Due Aug. 1, 2022

The Affordable Care Act (ACA) requires health insurance issuers and self-insured plan sponsors to pay Patient-Centered Outcomes Research Institute fees (PCORI fees). The fees are reported and paid annually using IRS Form 720 (Quarterly Federal Excise Tax Return).

Issuers and plan sponsors are generally required to pay the PCORI fees annually by July 31 of each year. However, the PCORI fee payment for plan years ending in 2021 is due Aug. 1, 2022, since July 31, 2022, is a Sunday.

The PCORI fees were scheduled to expire for plan years ending on or after Oct. 1, 2019. However, a federal spending bill enacted at the end of 2019 extended the PCORI fees for an additional 10 years. As a result, these fees will continue to apply for the 2020-2029 fiscal years.

Calculating the PCORI Fee Payment
In general, the PCORI fees are assessed, collected and enforced like taxes. The PCORI fee applies separately to “specified health insurance policies” and “applicable self-insured health plans,” and is based on the average number of lives covered under the plan or policy (see more information here ). As a reminder, the fee is paid based upon on the month in which your plan year ended, not the date it started (for example, a plan that renewed on Jan. 1, 2022 technically ended on Dec. 31, 2021). See the helpful due date and rate chart from the IRS below.

Policy or plan ending date in month of: File return no later than:
Applicable rate:
January 2021 July 31, 2022 $2.66
February 2021 July 31, 2022 $2.66
March 2021 July 31, 2022 $2.66
April 2021 July 31, 2022 $2.66
May 2021 July 31, 2022 $2.66
June 2021 July 31, 2022 $2.66
July 2021 July 31, 2022 $2.66
August 2021 July 31, 2022 $2.66
September 2021 July 31, 2022 $2.66
October 2021 July 31, 2022 $2.79
November 2021 July 31, 2022 $2.79
December 2021 July 31, 2022 $2.79


Employer Takeaway
Using Part II, Number 133 of Form 720, issuers and plan sponsors are required to report the average number of lives covered under the plan separately for specified health insurance policies and applicable self-insured health plans. That number is then multiplied by the applicable rate for that tax year ($2.66 for plan years ending on or after Oct. 1, 2020, and before Oct. 1, 2021, or $2.79 for plan years ending on or after Oct. 1, 2021, and before Oct. 1, 2022). The fees for specified health insurance policies and applicable self-insured health plans are then combined to equal the total tax owed and submitted prior to August 1.

DOL Issues Guidance on FMLA and Mental Health Conditions

The Wage and Hour Division of the U.S. Department of Labor (DOL) has released new resources on workers’ rights to leave under the federal Family and Medical Leave Act (FMLA) for mental health conditions. In a press release, the DOL said the publication of the new guidance was in recognition of Mental Health Awareness month.

The new guidance includes:

Employer Takeaway
The new resources make clear that mental health conditions are considered serious health conditions under the FMLA if they require inpatient care or continuing treatment by a health care provider, such as an overnight stay in a treatment center for addiction or continuing treatment by a clinical psychologist. Chronic conditions such as anxiety, depression, or dissociative disorders that cause occasional incapacitated periods and require treatment at least twice a year fall under the “continuing treatment” definition.

The FAQs provide additional examples of situations that qualify for FMLA leave, including treatment sessions for anorexia nervosa and caring for an adult child with a mental health condition that meets the definition of disability under the Americans with Disabilities Act. Please contact your Higginbotham representative if you are interested in learning about adding a mental health component to your company’s Health Risk Management Program.

EEOC Extends EEO-1 Deadline Again for 2021 Workforce Data Reports

Following up on our update from last month, employers subject to equal employment opportunity reporting (EEO-1) requirements now have extra time to file their workforce data from 2021, the EEOC announced shortly after the original May 17, 2022, deadline passed. That initial deadline had already been delayed from the usual March 31 deadline due to the COVID-19 pandemic.

The new deadline for 2021 submissions is June 21, 2022. According to the EEOC, no additional 2021 EEO-1 reports will be accepted after that date.

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