What Your HR Team Must Know About Obamacare Final Excepted Benefits Rule

by | Oct 7, 2014 | Our Blog

There are a number of benefits — such as dental and vision coverage — that the Affordable Care Act addresses in the “excepted benefits” rules. HR will most definitely want to take a look at the final rule on this subject. The Department of Labor (DOL), Health and Human services (HHS) and Treasury recently published the final rule on excepted benefits under the healthcare reform law. Below is a summary of what’s covered in the final rule:

Amended to include EAPs

Under the Health Insurance Portability and Accountability Act (HIPAA), excepted benefits are generally exempt from the Affordable Care Act (ACA) provisions.

The final rule amended the current regulations to add Employee Assistance Programs (EAPs) that treat certain conditions as excepted benefits under the ACA. Many employers offer EAPs at no cost to help employees with personal problems that are negatively impacting their job performance, health and overall well-being — e.g., substance abuse, mental health issues, etc.

The final rules spell out the following four criteria EAPs must meet in order to qualify as excepted benefits:

  • they don’t provide significant benefits in the nature of medical care
  • the EAP benefits can’t be coordinated with the benefits under another group health plan
  • the EAP can’t require employee premiums or contributions as a condition of participation, and
  • they can’t impose cost-sharing requirements.

It’s worth noting that some EAPs may be subject to the ACA if they include coverage for medical sessions.

Vision, dental and long-term care

The feds also clarified how to treat limited-scope vision, dental and long-term care benefits.

According to the feds, those benefits don’t have to be offered in connection with a separate offer of major medical or “primary” healthcare coverage under a plan “to meet the statutory criterion that such benefits are ‘otherwise not an integral part of the plan.’”

However, in order to qualify as “excepted,” these benefits must meet one of the following two criteria:

  • participants in an employer’s primary healthcare plan can decline the benefits, or
  • the claims for the benefits are administered under a separate contract from claims administration for any other benefits under the plan.