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A Deeper Dive into Employee Benefits: Navigating Compliance and Effectiveness

June 13, 2023

This will sneak up on an employer like the “quarantine 15” did for many people during the pandemic.

As a responsible employer, you’re cruising along and checking off all the boxes to ensure your employee benefits program is in compliance.

  • Required notifications to employees – check.
  • Rx reports submitted for 2020, 2021, 2022 – check.
  • ACA reporting accurate and timely – check.

But wait, there’s a curveball. What happens when the provisions of the Consolidated Appropriations Act and the Inflation Reduction Act of 2022 are active and accountable for all plan sponsors?

Here are some brief reminders of the many updates now active for employers:

Last year brought a number of significant changes to the reporting responsibilities of employers, particularly those with self-insured medical and prescription programs. The 2022 highlights include:

  • Transparency in Coverage – July 1 Department of Labor, Department of Health and Human Services and the Treasury Department

This rule requires insurance companies and self-insured plans to publicize what they pay providers for medical services and make that information available to the public.

  • Prescription Drug Reporting – December 2022 and June 2023

This requires insurance companies and self-insured plans to submit a series of reports to the Centers for Medicare and Medicaid Services.

  • Inflation Reduction Act of 2022

One of the major components of this bill is to allow Medicare to negotiate for prescription drug prices and extend the expanded Affordable Care Act program through 2025.

The Act also enables Medicare to negotiate drug prices and caps out-of-pocket costs to $2,000, with the potential to lower ACA health care premiums for millions of Americans.

  • Affordability Determination of Coverage

Fixing the family glitch. The IRS final regulations are likely to qualify more spouses and dependents of insured employees for premium tax credits through enrollment in a public exchange.

These changes, most of which were implemented in 2022, have a dramatic impact on the current landscape and the responsibilities of the plan sponsor. While the goals of the changes are to introduce transparency into the various expenses associated with medical and prescription coverage, another result is the increased complexity to the framework of an existing insurance program, particularly for a self-funded plan sponsor.

In addition to the reporting requirements for a plan sponsor, the evolution of prescription benefits, particularly for specialized medications, is outpacing the traditional resources used to assess the various components of a self-insured medical and prescription plan. As highlighted by lawsuits pending in the industry for payment assistance programs, the need for refreshed documentation is more important than ever.

We recommend that the plan sponsor conduct a more sophisticated analysis of the existing benefits and establish a firm foundation to support the future stability of the program. This deeper dive into the overall program will ensure the plan is not only compliant, but also operates effectively for the employer and the covered members.

Oswald has coordinated with key partners to create an assessment of an existing benefits program. The analysis and deliverables will include summary plan descriptions for both medical and stand-alone prescription programs, Medicare Part D Creditable Coverage testing and ongoing support for future changes.

Your Oswald sales and service teams are prepared to coordinate the necessary communications and leverage the positioning of the current and future benefits for you and your employees.

For more information visit our Health Plan Compliance and Legislative Updates page or contact us here.


Note: This communication is for informational purposes only, and is not intended to offer legal, tax, or client-specific risk management advice. Information in this communication is not meant to describe specific coverages that may be advisable or available to you or your company, or to interpret specific coverages that may already be in place. General insurance descriptions in this communication do not include complete insurance policy definitions, terms, and/or conditions, and should not be relied on for coverage interpretation. Actual insurance policies must always be consulted for full coverage details and analysisView our privacy notice.