Update: President Biden signed legislation on April 10, 2023, announcing the end of the National Emergency on April 11, 2023, instead of the originally planned and announced date of May 11th. See the prior Leavitt Group article How the End of the National and Public Health Emergencies Will Impact Health Plans | Leavitt Group News & Publications.
This latest development to end the National Emergency a month earlier follows Congressional bipartisan actions voting to terminate the National Emergency earlier despite President Biden’s opposition. The change to terminate the National Emergency a month early does not impact the unwinding of the Public Health Emergency (PHE). See the Department of Health and Human Services (HHS) Fact Sheet on COVID-19 PHE Transition Roadmap.
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On March 29, 2023, the Departments of Labor (DOL), Health and Human Services (HHS) and Treasury (collectively Departments) released Frequently Asked Questions (FAQs) addressing the impact of the unwinding of rules implemented during the COVID-19 pandemic. Rules passed as part of the Families First Coronavirus Response Act (FFCRA), the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), and the Health Insurance Portability and Accountability Act (HIPAA), were intended to ease the burden of deadlines typically imposed by health plan regulations. Also see the previous FAQs.
These FAQs do not address other sources of authority that may also impact coverage of these items and services, including state, Tribal, local, and other Federal laws or the terms of applicable contracts. Be sure to contact your Leavitt Group Trusted Consultant should you have questions related to non-ERISA, government, tribal, healthcare settings and school requirements.
COVID-19 Diagnostic Testing
FFCRA, enacted on March 18, 2020, generally requires group health plans and health insurance issuers offering group or individual health insurance coverage, including grandfathered health plans, to provide benefits for certain items and services related to diagnostic testing for the detection of SARS-CoV-2 (the virus that causes COVID-19) or the diagnosis of COVID-19. This requirement applies to items or services furnished during any portion of the PHE beginning on or after March 18, 2020. Plans and issuers must provide this coverage without imposing any cost-sharing requirements (including deductibles, copayments, and coinsurance), prior authorization, or other medical management requirements.
Section 3201 of the CARES Act, enacted on March 27, 2020, amended section 6001 of the FFCRA to include a broader range of diagnostic items and services that plans and issuers must cover without any cost-sharing requirements, prior authorization, or other medical management requirements. Under section 3202(a) of the CARES Act, if a provider of diagnostic testing has a negotiated rate with a plan or issuer for COVID-19 diagnostic testing, the plan or issuer must reimburse the provider an amount that equals the negotiated rate. If the plan or issuer does not have a negotiated rate with such provider, the plan or issuer must reimburse the provider the cash price for the service that is listed by the provider on a public website. (The plan or issuer may negotiate a rate with the provider that is lower than the cash price.)
Q1: Do the COVID-19 testing coverage requirements under section 6001 of the FFCRA apply to items and services furnished after the end of the PHE?
No. Section 6001 of the FFCRA requires plans and issuers to cover COVID-19 diagnostic tests that meet statutory requirements and certain associated items and services without imposing any cost-sharing requirements, prior authorization, or other medical management requirements. However, that requirement is applicable only to diagnostic tests and associated items and services furnished during any portion of the PHE beginning on or after March 18, 2020. Therefore, a plan or issuer is not required under section 6001 of the FFCRA to cover COVID-19 diagnostic tests and associated items or services furnished after the PHE ends.
Any plan or issuer that provides coverage for COVID-19 diagnostic testing furnished after the PHE ends, including over-the-counter (OTC) COVID-19 diagnostic tests purchased after the PHE ends, is not prohibited from imposing cost-sharing requirements, prior authorization, or other medical management requirements.
Q2: Must plans and issuers notify participants and enrollees if they change the terms of their coverage for the diagnosis or treatment of COVID-19 after the end of the PHE?
The Departments encourage plans and issuers to notify participants, beneficiaries, and enrollees of key information regarding coverage of COVID-19 diagnosis and treatment, including testing. This includes the date when the plan or issuer will stop coverage if the plan or issuer chooses to no longer cover COVID-19 diagnostic tests or when the plan or issuer will begin to impose cost-sharing requirements, prior authorization, or other medical management requirements on COVID-19 tests, to the extent applicable under the plan or coverage. The Departments also encourage plans and issuers to continue covering benefits for COVID-19 diagnosis and treatment and for telehealth and remote care services after the end of the PHE.
In addition, if a plan or issuer makes a material modification to any of the plan or coverage terms that would affect the content of the summary of benefits and coverage (SBC), that is not reflected in the most recently provided SBC, and that occurs other than in connection with a renewal or reissuance of coverage, the plan or issuer must provide notice of the modification to participants and enrollees not later than 60 days prior to the date on which the modification will become effective.
Notwithstanding the above, if a plan or issuer made changes to increase benefits or reduce or eliminate cost sharing for the diagnosis or treatment of COVID-19 or for telehealth or other remote care services and revokes these changes upon the expiration of the PHE, as previously explained in guidance, the Departments will consider the plan or issuer to have satisfied its obligation to provide advance notice of the material modification if the plan or issuer:
- previously notified the participant, beneficiary, or enrollee of the general duration of the additional benefits coverage or reduced cost sharing (such as, that the increased coverage applies only during the PHE), or
- notifies the participant, beneficiary, or enrollee of the general duration of the additional benefits coverage or reduced cost sharing within a reasonable timeframe in advance of the reversal of the changes.
However, with respect to notices that were issued pursuant to the previous guidance, the Departments clarify that a notification provided with respect to a prior plan year will not be considered to satisfy the obligation to provide advance notice for coverage in the current plan year.
Q3: Do the reimbursement and cash price posting requirements under section 3202 of the CARES Act apply to COVID-19 diagnostic tests furnished after the end of the PHE?
No. Section 3202(a) of the CARES Act requires plans and issuers providing coverage for COVID-19 diagnostic tests under section 6001 of the FFCRA to reimburse any COVID-19 diagnostic test provider the cash price listed on the provider’s website if a negotiated rate was not in effect before the PHE. This applies only to COVID-19 diagnostic tests furnished during the PHE beginning on or after March 27, 2020.
Similarly, section 3202(b) of the CARES Act, which requires COVID-19 diagnostic test providers to make public the cash price of a COVID-19 diagnostic test on the provider’s public internet website, applies only during the PHE beginning on or after March 27, 2020.
However, providers of diagnostic tests for COVID-19 are encouraged to continue to make the cash price of a COVID-19 diagnostic test available on the provider’s public internet website for a sufficient time period (e.g., at least 90 days) after the end of the PHE. This will help plans and issuers process claims for tests furnished prior to the end of the PHE in accordance with the cash price reimbursement requirements.
Rapid Coverage of Preventive Services and Vaccines for Coronavirus
Section 3203 of the CARES Act requires non-grandfathered group health plans and health insurance issuers offering non-grandfathered group or individual health insurance coverage to cover, without cost-sharing requirements, any qualifying coronavirus preventive service pursuant to section 2713(a) of the Public Health Service Act (PHS Act) and its implementing regulations (or any successor regulations). Under the statute, the term “qualifying coronavirus preventive service” means an item, service, or immunization that is intended to prevent or mitigate COVID-19 and that is:
- An evidence-based item or service that has in effect a rating of “A” or “B” in the current recommendations of the United States Preventive Services Task Force (USPSTF); or
- An immunization that has in effect a recommendation from the Advisory Committee on Immunization Practices (ACIP) of the Centers for Disease Control and Prevention (CDC) with respect to the individual involved.
Coverage of a qualifying coronavirus preventive service must begin 15 business days after the date on which an applicable recommendation is made by USPSTF or ACIP.
The November 2020 interim final rules additionally require that a plan or issuer must cover a qualifying coronavirus preventive service without cost sharing regardless of whether it is provided by an in-network or out-of-network provider. If a plan or issuer does not have a negotiated rate for the service, the plan or issuer must reimburse the provider for the service in an amount that is reasonable, as determined in comparison to prevailing market rates for the service.
As set forth below, under section 3203 of the CARES Act, plans and issuers are required to provide coverage for COVID-19 vaccines and their administration after the end of the PHE. Although section 3203 of the CARES Act is not limited to the duration of the PHE, the November 2020 interim final rules include a sunset provision under which certain regulatory provisions will not apply to qualifying coronavirus preventive services furnished after the end of the PHE.
Q4: Do the statutory requirements related to rapid coverage of preventive services for coronavirus under section 3203 of the CARES Act apply to qualifying coronavirus preventive services furnished after the end of the PHE?
Yes. The statutory provisions will continue to apply. However, the regulatory requirements under the November 2020 interim final rules will not apply for qualifying coronavirus preventive services furnished after the end of the PHE. Therefore, after the end of the PHE, plans and issuers subject to section 3203 of the CARES Act must continue to cover, without cost sharing, qualifying coronavirus preventive services, including, consistent with the applicable ACIP recommendation, all COVID-19 vaccines within the scope of the Emergency Use Authorization (EUA) or Biologics License Application (BLA) for the particular vaccine and their administration, pursuant to section 2713(a) of the PHS Act and its implementing regulations. This coverage must be provided within 15 business days after the date on which an applicable recommendation is made by USPSTF or ACIP regarding the qualifying coronavirus preventive service.
After the end of the PHE and the sunset of the November 2020 interim final rules, nothing in the preventive services regulations requires a plan or issuer to provide benefits for qualifying coronavirus preventive services delivered by an out-of-network provider if the plan or issuer has a network of providers. Similarly, nothing precludes a plan or issuer that has a network of providers from imposing cost sharing for qualifying coronavirus preventive services delivered by an out-of-network provider. However, if a plan or issuer does not have a provider in its network who can provide a qualifying coronavirus preventive service, the plan or issuer must cover the item or service when furnished by an out-of-network provider and may not impose cost sharing with respect to the item or service.
Extension of Certain Timeframes for Employee Benefit Plans subject to ERISA and the Code, Participants, and Beneficiaries Affected by the COVID-19 Outbreak
On March 13, 2020, the COVID-19 National Emergency was declared, effective March 1, 2020.(21) On May 4, 2020, in response to the COVID-19 National Emergency, DOL, the Department of the Treasury (Treasury Department), and the Internal Revenue Service (IRS) issued the Joint Notification of Extensions of Certain Timeframes for Employee Benefit Plans, Participants, and Beneficiaries Affected by the COVID-19 Outbreak (Joint Notice) in the Federal Register.(22) The Joint Notice stated that certain time periods and dates for HIPAA special enrollment, COBRA continuation coverage, and internal claims and appeals and external review must be disregarded (disregarded periods) when determining the due dates for certain elections and other actions by employee benefit plans subject to ERISA and the Code, and participants and beneficiaries of these plans during the COVID-19 National Emergency.(23)
On February 26, 2021, DOL, with the concurrence of HHS, the Treasury Department, and the IRS, issued Employee Benefits Security Administration (EBSA) Disaster Relief Notice 2021-01 (EBSA Notice), which clarified that the disregarded periods apply from the date each individual or plan was first eligible for relief under the Joint Notice until the earlier of (a) 1 year from the date they were first eligible for relief, or (b) 60 days after the announced end of the COVID-19 National Emergency. On October 6, 2021, the IRS released Notice 2021-58, which clarified that the disregarded period for an individual to elect COBRA continuation coverage and the disregarded period for the individual to make initial and subsequent COBRA premium payments generally run concurrently.
For the events or circumstances listed below, the relief generally continues until 60 days after the announced end of the COVID-19 National Emergency or another date announced by DOL, the Treasury Department, and the IRS (the “Outbreak Period”). However, as clarified in the EBSA Notice, ERISA(25) and the Code(26) limit the disregarded period for individual actions “required or permitted” by statute to a period of 1 year from the date the action would otherwise have been required or permitted.
Therefore, timeframes to complete elections or other actions subject to the Joint Notice, EBSA Notice, and Notice 2021-58 (together, the emergency relief notices) are extended until 1 year from the date the participant, beneficiary, or plan was first eligible for relief or 60 days after the announced end of the COVID-19 National Emergency (i.e., 1 year after the date they were first eligible or the end date for the Outbreak Period), whichever is earlier. In no case will a disregarded period exceed 1 year. All disregarded periods will end as of the last day of the Outbreak Period.
The disregarded periods extend the following periods and dates:
- the 30-day period (or 60-day period, if applicable) to request special enrollment,
- the 60-day election period for COBRA continuation coverage,
- the date for making COBRA premium payments,
- the date for individuals to notify the plan of a qualifying event or determination of disability,
- the date within which individuals may file a benefit claim under the plan’s claims procedure,
- the date within which claimants may file an appeal of an adverse benefit determination under the plan’s claims procedure,
- the date within which claimants may file a request for an external review after receipt of an adverse benefit determination or final internal adverse benefit determination,
- the date within which a claimant may file information to perfect a request for external review upon a finding that the request was not complete, and
- the date for providing a COBRA election notice.
The anticipated end of the COVID-19 National Emergency is May 11, 2023. Consistent with previous guidance, DOL, the Treasury Department, and the IRS are also announcing that the disregarded periods under the emergency relief notices will end 60 days after the end of the COVID-19 National Emergency. DOL, the Treasury Department, and the IRS are issuing this FAQ to clarify how the requirements under the emergency relief notices related to disregarded periods for individual actions will change after the COVID-19 National Emergency ends.
Q5. Following the anticipated end of the COVID-19 National Emergency, on what date does the Outbreak Period end?
DOL, the Treasury Department, and the IRS anticipate that the Outbreak Period was to end June 9, 2023 (60 days after the anticipated end of the COVID-19 National Emergency). That time has now been moved up as of April 10, 2023 when President Biden signed an early end to the National Emergency. Now, the Outbreak Period ends on June 9, 2023.
As of the last day of the Outbreak Period, the extensions under the emergency relief notices for timeframes that began during the COVID-19 National Emergency no longer apply. There are several examples show how these rules work. The examples in the FAQs assumed that the Outbreak Period would end July 10, 2023, as originally planned, and that the group health plan is using the minimum timeframe that the statute permits for individuals to complete certain elections or other actions. With the recent change, those timeframes in the example would now be a month earlier.
Nothing in the Code or ERISA prevents a group health plan from allowing for longer timeframes for employees, participants, or beneficiaries to complete these actions, and group health plans are encouraged to do so.
Special Enrollment in Group Health Plan and Group or Individual Health Insurance Coverage after Loss of Eligibility for Medicaid or Children’s Health Insurance Program (CHIP) Coverage or after Becoming Eligible for Premium Assistance under Medicaid or CHIP
Group health plans and health insurance issuers providing group health insurance coverage are required to provide an opportunity to enroll under the terms of the plan (regardless of any open enrollment period) in certain circumstances (referred to as special enrollment). This opportunity must be provided to current employees and dependents who previously declined health coverage when it was offered due to having certain other types of coverage, and who then lose eligibility for that other coverage. Accordingly, a special enrollment period must be offered for circumstances in which an employee or their dependents lose eligibility for state Medicaid or CHIP coverage. A special enrollment period must also be offered when an employee or their dependents become eligible for state premium assistance under Medicaid or CHIP for group health plan coverage.
Since the onset of the PHE, with limited exceptions, state Medicaid agencies generally have not terminated the enrollment of any Medicaid beneficiary who was enrolled on or after March 18, 2020, through March 31, 2023 (referred to as the continuous enrollment condition). As state Medicaid and CHIP agencies resume regular eligibility and enrollment practices and after the continuous enrollment condition ends on March 31, 2023, many consumers may no longer be eligible for Medicaid or CHIP coverage and will therefore need to transition to other coverage, such as coverage through a Marketplace or coverage through an employer-sponsored group health plan. Nationwide, tens of millions of people will have their Medicaid or CHIP eligibility redetermined in the coming months.
Q6: Following the expiration of the continuous enrollment condition, if an individual loses Medicaid or CHIP coverage due to a loss of eligibility for such coverage, is the individual entitled to a special enrollment period to enroll in an employer-sponsored group health plan for which they are otherwise eligible and had previously declined to enroll, or a special enrollment period in the individual market?
Yes. Employees and their dependents are eligible for special enrollment in a group health plan and group health insurance, if:
- they are otherwise eligible to enroll in the plan,
- the employee or dependent was enrolled in Medicaid or CHIP coverage, and
- the Medicaid or CHIP coverage was terminated as a result of loss of eligibility for that coverage.
Under these circumstances, the employee typically must request coverage under the group health plan (or health insurance coverage) within 60 days after termination of Medicaid or CHIP coverage. However, under the emergency relief notices issued by DOL, the Treasury Department, and the IRS, individuals who lose Medicaid or CHIP coverage from March 31, 2023 (the end of the continuous enrollment condition) until July 10, 2023 (the anticipated end of the Outbreak Period) are eligible for relief and can request special enrollment in a group health plan governed by ERISA and the Code until the date that is 60 days after the end of the Outbreak Period.
Nothing in the Code or ERISA prevents a group health plan from allowing for a longer special enrollment period (i.e., a period that extends beyond the minimum 60-day statutory requirement) for employees, participants, or beneficiaries to complete these actions, and employers and group health plans are encouraged to do so.
Benefits for COVID-19 Testing and Treatment and Health Savings Accounts (HSAs)/High Deductible Health Plans (HDHPs)
In March 2020, the Treasury Department and the IRS issued Notice 2020-15, which provides that a health plan that otherwise satisfies the requirements to be an HDHP under section 223(c)(2)(A) of the Code will not fail to be an HDHP merely because the health plan provides medical care services and items purchased related to testing for and treatment of COVID-19 prior to the satisfaction of the applicable minimum deductible. As a result, the individuals covered by such a plan will not fail to be eligible individuals under section 223(c)(1) of the Code who may contribute to an HSA merely because of the provision of those health benefits for testing and treatment of COVID-19.
Notice 2020-15 was issued due to the PHE. The notice states that the relief provided would continue until further guidance is issued. The notice further states that it does not modify previous guidance with respect to any of the HDHP requirements, other than with respect to the relief for testing for and treatment of COVID-19. The notice also reiterates that vaccinations continue to be considered preventive care under section 223(c)(2)(C) of the Code for purposes of determining whether a health plan is an HDHP. No further guidance regarding the treatment of an HDHP providing testing for and treatment of COVID-19 prior to the satisfaction of the applicable minimum deductible has been issued.
Q8. May an individual covered by an HDHP that provides medical care services and items purchased related to testing for and treatment of COVID-19 prior to the satisfaction of the applicable minimum deductible contribute to an HSA?
Yes. An individual covered by an HDHP that provides medical care services and items purchased related to testing for and treatment of COVID-19 prior to the satisfaction of the applicable minimum deductible may continue to contribute to an HSA until further guidance is issued. The Treasury Department and the IRS are reviewing the appropriateness of continuing this relief given the anticipated end of the PHE and COVID-19 National Emergency and anticipate issuing additional guidance in the near future. Any future modifications to the guidance previously provided in Notice 2020-15 will not generally require HDHPs to make changes in the middle of a plan year in order for covered individuals to remain eligible to contribute to an HSA.
Conclusion
Health plans will primarily be impacted by the removal of some mandates to cover certain COVID-19 treatments, whereas vaccinations would still be covered at no cost to the participant as a preventive service, so long as within network. Many rules related to the delay in having to elect COBRA or claims appeals will unwind 60 days after the end of the PHE, which is still slated to end on May 11th. The “Outbreak Period” ends 60 days after the PHE.
Plans are encouraged to notify participants of any changes to the terms of the plan’s coverage wherever the changes are “materials modifications”, or significant. This could mean needing to provide updated summary of benefits and coverage (SBC) no later than 60 days before the modification’s effective date (NOW!). It is most common, that plans provided advanced notice of the temporary nature of the benefits or reduced cost-sharing for COVID-related items and services. In those cases, it is not mandatory, but is advised to provide notice of the change soon to occur.
ERISA requires that a “Summary of Material Modification” (SMM) be provided to plan participants no later than 60 days after (versus above where it is 60 days before) adoption of a material reduction in a plan’s covered services or benefits.
It is expected that additional guidance will be released providing additional clarity. Be sure you are subscribed to the Leavitt Group newsletter to stay on top of the latest developments. Have questions on how these changes impact your plan? Contact your Leavitt Group Trusted Advisor. We have subject matter experts who are here to help!
Resources
Department of Labor Blog Post What Does the End of the COVID-19 Public Health Emergency Mean for Health Benefits?