<img height="1" width="1" style="display:none" src="https://www.facebook.com/tr?id=1903855569843826&amp;ev=PageView&amp;noscript=1">

How the CARES Act affects employer-sponsored benefits

Posted by HomeWork Solutions on May 28, 2020 4:49:00 PM
Find me on:

04_10_20_971047058_EB_560x292

The Coronavirus Aid, Relief, and Economic Security (CARES) Act isn’t just about easing employers’ tax burdens. It also impacts employee benefits.

How the CARES Act affects employer-sponsored benefits

By now, most employers have presumably read up on the basic tax relief and financial assistance aspects of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. What you may not have heard much about is how the law affects employer-sponsored benefit plans. Here are some highlights of its impact:

Coverage mandates

Under the Families First Coronavirus Response Act, an earlier law passed in response to the outbreak, health insurers and group health plans were required to cover coronavirus (COVID-19) testing and related provider visits without cost-sharing. The CARES Act has extended this requirement to additional categories of COVID-19 tests — even if not FDA-approved.

Health plans and insurers must reimburse the diagnostic testing provider according to any negotiated rate with the provider, or they must pay the provider’s publicized cash price for the diagnostic test in the absence of a negotiated rate. Health insurers and group health plans will have to cover, without cost-sharing, COVID-19 preventive services and immunizations that receive specified recommendations from the CDC’s United States Preventive Services Task Force. This requirement will apply 15 business days after the task force’s recommendation.

Tele-health exemption for high-deductible health plans (HDHPs)

A safe harbor allows HDHPs to cover telehealth and other remote care services without a deductible for plan years beginning on or before December 31, 2021. This provision is effective March 27, 2020, the date of the law’s enactment.

Over-the-counter (OTC) drugs and certain other products 

The CARES Act removes the prescription requirement for OTC drug reimbursements that previously applied to:

  • Health Flexible Spending Arrangements,
  • Health Reimbursement Arrangements,
  • Health Savings Accounts (HSAs), and
  • Other accident and health plans.

In addition, menstrual care products now qualify as medical care for purposes of reimbursement or tax-free distribution. These changes generally apply to expenses incurred after December 31, 2019; however, in the case of HSAs, they apply to amounts paid after that date. (As of this writing, there’s no expiration date.)

HIPAA privacy

The CARES Act aligns the Federal Confidentiality of Alcohol and Drug Abuse Patient Records Act with privacy rules under the Health Insurance Portability and Accountability Act (HIPAA). That is, the law generally allows disclosure and re-disclosure of covered records for treatment, payment or health care operations to the extent permitted by HIPAA after a patient provides initial written consent. The U.S. Department of Health and Human Services (HHS) has been instructed to update its regulations and issue guidance regarding this change.

ERISA deadlines

The law adds public health emergencies declared by HHS to the list of events permitting the U.S. Department of Labor to delay, for up to one year, deadlines under the Employee Retirement Income Security Act (ERISA). Examples include deadlines for filing claims or appeals under a plan’s internal claims procedures.

Employers may need to immediately adjust their benefits administration systems to the many changes occurring because of the COVID-19 emergency. Contact us for help understanding how the CARES Act, or any other actions in response to the pandemic, may affect your family.

 

We are currently offering FREE 2019 filing services for families who wish to catch up with their back household employment tax obligations to insure their nanny's valuable benefits are available without delay. Please contact our customer service for more details!

Make sure to consult our Knowledge Center to stay up to date!

 

 

Topics: nanny, agency, senior, CPA, coronavirus, COVID-19

Real Human Beings Are Standing By

Complete the form below and one of our payroll experts will reach out to you ASAP. You may also call 1-877-899-3004 to speak with our team immediately.


Subscribe to Email Updates

Recent Posts

Posts by Topic

see all