The Consolidated Appropriations Act, 2023 (CAA, 2023), which Congress passed, and President Biden has now signed into law, contains provisions that impact retirement and group health plan sponsors and advisors. Plan administrators and sponsors must be aware of these provisions and make any adjustments to their plans and policies as needed.
Telehealth / High Deductible Health Plans
Typically, individuals can only make tax-advantaged contributions to a Health Savings Account (HSA) if they are covered by a High Deductible Health Plan (HDHP) and do not have disqualifying non-HDHP coverage. During the COVID-19 pandemic, Congress created exceptions to these rules to allow the use of telehealth and remote care services without disqualifying these individuals from being able to contribute to their HSAs. Those exceptions were temporary, applying only to plan years beginning on or before December 31, 2021, and the last nine months of 2022, regardless of the start date of the plan year.
CAA extends these exceptions so that individuals using telehealth services will retain HSA eligibility during plan years beginning after December 31, 2022, and before January 1, 2025. HDHPs may provide coverage for these remote care services during these plan years before individuals have satisfied their minimum deductible without losing HDHP status. Note that for plans that do not operate on a standard calendar year, some individuals may have a gap without coverage between December 31, 2022, and whenever their new plan year starts. Nonetheless, these individuals may be able to use the “full contribution rule,” which permits them to make a full year’s worth of HSA contributions, even if they are only HSA eligible for part of the year.
Mental Health Parity
CAA, 2021 required that health plans and insurance companies comparatively analyze nonquantitative treatment limitations on mental health or substance abuse disorder coverage, with regular medical coverage. CAA, 2023 provides funding for states to comply with that requirement. The new legislation also eliminates the right of self-insured non-federal government plans to opt out of Mental Health Parity and Addiction Equity Act (MHPAEA) compliance. No new opt-out elections are possible, effective immediately, and elections that expire 180 days or more after December 29, 2022, are non-renewable. Congress stripped provisions instituting civil monetary penalties for non-compliance with the MHPAEA from the legislation before passage.
HBL has experience in all areas of benefits and employment law, offering a comprehensive solution to all your business benefits and HR/employment needs. We help ensure you are in compliance with the complex requirements of ERISA and the IRS code, as well as those laws that impact you and your employees. Together, we reduce your exposure to potential legal or financial penalties. Learn more by calling 470-571-1007.
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