Excepted Benefits Rule and EAPs

Rules proposed late last year by the Departments of Labor and Treasury would free employers to offer employee assistance programs (EAPs) without worries about complying with the Affordable Care Act (ACA) and other market health reforms.

The proposed rules would make EAPs “excepted benefits” and thus exempt from certain provisions of HIPAA, COBRA and the ACA, effective immediately.

To be considered excepted benefits, EAPs must be free to employees and not provide “significant” medical care or treatment benefits. EAPs cannot act as “gatekeepers” for receiving benefits under a medical plan.

The regulations would also make an employer’s self-insured vision and dental benefits excepted benefits effective immediately, even if they do not require employee contributions. Insured vision and dental benefits, as well as self-insured vision and dental coverage that requires employee contributions, already qualify as excepted benefits.

Effective for plan years starting in 2015, the proposed rules also would treat as excepted benefits certain limited coverage that “wraps around” an individual market policy. The “wraparound” coverage would be available to employees for whom the employer’s primary group health coverage is not affordable and who get coverage through a non-grandfathered individual market policy.

Stay tuned for more information coming this week on EAPs and contact USI to find out more about how the excepted benefits rule effects other coverages, such as vision and dental.

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