IRS Provides Transition Relief for 2023 Distributions Characterized as Required Minimum Distributions Under Previous SECURE Act Rules
It’s MLR Rebate Time Again!
The ACA requires insurers to submit an annual report to HHS to account for plan costs. If the insurer does not meet the medical loss ratio standards, this means too large a portion of the premiums charged in the previous year went towards the insurer’s administration, marketing, and profit, rather than going toward paying claims and quality improvement initiatives. In such case, the insurer must provide rebates to policyholders. For 2023, insurers must distribute rebates to employer plan sponsors between August 1, 2023, and September 30, 2023.
Employers should keep in mind that if they receive a rebate, there are strict guidelines as to how the rebate may be used or distributed. Generally, any portion of the rebate that is considered ERISA plan assets (e.g., the portion attributable to participant contributions) must be returned to participants in some form within 90 days of receipt.
For more information, download a copy of our publication, Medical Loss Ratio Rebates: A Guide for Employers.
COVID-19 National Emergency Outbreak Period Has Ended
Based on DOL FAQ guidance and subsequent commentary, the COVID-19 National Emergency Outbreak Period ended on July 10, 2023. This means that the tolling of certain ERISA plan deadlines (e.g., COBRA elections, payments and certain notices, HIPAA special enrollments, and claims and appeals filings) will no longer be required.
Accordingly, employers should work with legal counsel, TPAs, COBRA vendors and other service providers to ensure related plan documents, procedures and systems have been updated to accommodate the Outbreak Period end and subsequent reversion to pre-pandemic election, notice and payment timelines after July 10, 2023. PPI has amended our COBRA QE Notice to reflect the applicable deadlines.
For further information, download a copy of End of COVID-19 Emergency Declarations: A Guide for Employers.
Maine Enacted Mandatory Paid Family and Medical Leave ProgramAugust 01, 2023
On July 11, 2023, Maine enacted its statutory paid family and medical leave (PFML) program, joining 14 other states and Washington, DC, to establish a PFML program. Maine’s PFML program applies to all employers who have at least one employee working in Maine (except the federal government). The payroll withholding of the employees' contributions is scheduled to begin on January 1, 2025, and according to the state’s PFML website, the benefits will be available to eligible employees starting May 1, 2026. Maine Department of Labor is tasked to create rules for the program starting in 2025.
As reflected on the PFML website, below are the key highlights of PFML:
- January 1, 2025: Contributions to the PFML fund will start.
- May 1, 2026: PFML benefits become available to employees.
A private or public employer who employs at least one employee working in Maine (except the federal government).
Funding of the Program
Beginning January 1, 2025, the total premium amount will be no more than a combined rate of 1.0% of employees’ wages capped at the federal Social Security Administration limit.
- For an employer with 15 or more employees, the employer and employees split the share of the total premium (i.e., 50%/50%).
- An employer with fewer than 15 employees is not required to contribute to the program. Therefore, the employer will remit only the employees’ portion of the contribution to the state, which is 50% of the total premium.
Qualified Reasons for Leave
Employees' own serious health condition and for an eligible employee to:
- Care for a family member with a serious health condition
- Bond with a new child (by birth, adoption or fostering) during the first 12 months after the child's birth or placement
- Care for a next-of-kin service member
- Attend to a qualifying exigency arising out of a family member’s military deployment
- Care for a family member of the covered individual who is a covered service member
- Use safe leave for when an employee or employee’s family member is a victim of domestic violence, stalking or sexual assault
- Any reason set forth in Maine’s Family Medical Leave Requirements
Maximum Benefits Duration
- 12 weeks in a benefit year on aggregate of all qualifying reasons
- Leave can be taken continuously or intermittently
Maximum Benefits Amount
- The portion of an employee’s average weekly wage that is equal or less than 50% of the state average weekly wage must be replaced at a rate of 90%
- The portion of an employee’s average weekly wage that is more than 50% of the state average weekly wage must be replaced at a rate of 66% up to the maximum weekly benefit
FMLA and Maine PFML Interaction
Federal FMLA and Maine PFML will run concurrently when both FMLA and Maine PFML are applied.
- Private plan
Notice to Employees
Employers will be required to provide written notice to each covered employee to inform them about Maine PFML program within 30 days from an employee’s hire date. Additionally, employers will need to post a workplace notice provided or approved by the state.
Employers who have at least one employee in Maine should be aware of this new update.
New Statutes Add Step Therapy RequirementsAugust 01, 2023
On July 14, 2023, Commissioner Mulready issued Bulletin No. 4-2023, advising issuers of new requirements imposed by new statutes that are effective on November 1, 2023, (HB 1736 and HB 2748) and on January 1, 2024, (SB 513). These requirements apply to all health plans regulated by the state.
HB 1736 requires health benefit plans that require step therapy protocol for treatment of CRF-COPD to provide a clear and transparent process (readily available on the insurer’s website) by which insureds can request an exception to step therapy protocols. HB 2748 prohibits step therapy requirements for certain prescription drugs that treat advanced metastatic cancer and associated conditions.
SB 513 requires all health benefit plans to provide coverage for biomarker testing for certain purposes when the biomarker test provides clinical utility as demonstrated by medical and scientific evidence.
Employers with plans regulated by the state should be aware of these requirements.
This material was created by PPI Benefit Solutions to provide accurate and reliable information on the subjects covered but should not be regarded as a complete analysis of these subjects. It is not intended to provide specific legal, tax or other professional advice. The service of an appropriate professional should be sought regarding your individual situation. PPI does not offer tax or legal advice. "PPI®" is a service mark of Professional Pensions, Inc., a subsidiary of NFP Corp. (NFP). All rights reserved.