As open enrollment for the 2020 plan year is just around the corner, there are a few things that employers with group plans should know so they can work with us to take any necessary actions. 

As always, new rules are taking effect and some employers’ plans will be more affected than others. In addition, if you’ve made changes to your plans in any way, you should read this to make sure your plan is compliant with relevant laws and regulations.

ACA health provider fee

When the Affordable Care Act was signed into law it contained provisions to collect a 2.5% “health provider fee” on all group health plans to help fund other parts of the law, including subsidies to help people purchase policies on health care exchanges.

The fee was waived for the 2017 and 2019 policy years and will return for 2020 policies. The fee, now close to 4%, is assessed on group medical, dental and vision insurers, but they typically pass it on to employers.

The fee, however, is tax-deductible for businesses that pay it as a pass-through from their insurers. The fee only applies to fully insured plans and does not apply to most self-funded arrangements.

Getting set up with vendors

Because of all the uncertainty and escalating costs, many companies are trying to defray costs by incorporating new plan components like pharmacy benefit managers and bill-review companies. Many vendors need earlier notification in order to factor in any benefit changes and amendments to plans.

Take new preventative care expenses into consideration

New rules issued by the Trump administration add new preventative care expenses for individuals with certain chronic conditions to the services that health plans can cover without copay by the covered individual.

Now, individuals with high-deductible health plans (HDHPs) with attached health savings accounts (HSAs) can access the following with no out-of-pocket expenses:

  • Angiotensin-converting enzyme inhibitors for congestive heart failure, diabetes and/or coronary artery disease
  • Beta-blockers for congestive heart failure and/or coronary artery disease
  • Inhaled corticosteroids for asthma
  • Insulin, glucose meters, and glycated hemoglobin testing for diabetes
  • Selective statin reuptake inhibitors for depression
  • Statins for heart disease and/or diabetes.

The regulations took effect immediately, but health plan documents must be updated to reflect the changes. Check with us to see if your insurer has incorporated these changes for the benefit of your workers.

Make sure your HSAs are compliant

It’s not easy to make sure that HDHPs with HSAs remain compliant. There are a number of things you should check with us to ensure that your plans in compliance to ensure they do not become disqualified, which would, in the end, hurt your employees who are enrolled in these plans:

  • Ensure in-network plan deductibles meet the 2020 minimum threshold of $1,400 for single coverage and $2,800 for family coverage.
  • Ensure the out-of-pocket maximum meets the 2020 requirements of $6,900 for self-only coverage and $13,800 for family coverage.
  • Ensure that your HSA contribution limits meet the 2020 maximums of $3,550 for self-only coverage and $7,100 for family coverage.

Finally, a word about HSA disqualification. Make sure you haven’t introduced any new stand-alone benefits for 2020 that could disqualify your HSA.

Disqualifying coverage, for purposes of HSA eligibility, is coverage that pays for or reimburses medical expenses before the individual’s HDHP minimum deductible has been met. This could include:

Telemedicine – Telemedicine benefits will not prevent HSA eligibility when the services provide only preventive services or otherwise do not provide significant benefits for medical care or treatment.

But, if the benefit provides significant medical care – such as diagnosis, treatment plans or prescriptions – at no cost or at a reduced cost before the HDHP deductible is satisfied, the benefit is disqualifying coverage for purposes of HSA contributions. 

On-site clinics – On-site health clinics that provide significant medical benefits for free or at reduced cost may disqualify employees from making or receiving HSA contributions. 

Medicare – Enrollment in Medicare, including Parts A, B and D, prevents eligibility for HSA contributions. Individuals intending to enroll in Medicare Part A should discontinue making or receiving HSA contributions at least six months before enrollment.