Experts have weighed in…
Providing proof of eligibility for employees and their dependents enrolled in employer sponsored health benefits plans, will become a standard practice due to new federal legislation coupled with the increased enforcement of existing ERISA and Department of Labor (DOL) regulations.
According to Leah Binder (President & CEO of The Leapfrog Group and Forbes magazine contributor):
“Unlike the earlier reforms that pivoted on the Medicare program, this one (the Consolidated Appropriations Act (CAA) of 2020) focuses on employers and other purchasers of health benefits, so-called “plan sponsors.” Surprisingly, many employers seem unaware of this major upheaval in the laws governing their health benefits programs.
The CAA has the rare distinction of support from both the Trump and Biden administrations, and both parties in Congress…in the short-term employers face daunting hurdles complying with the new regulations. “I feel a little like the dog that caught the car,” said one of the law’s leading employer champions, James Gelfand of the ERISA Industry Committee.
Compliance involves extensive new rules and responsibilities, including the removal of gag clauses from service provider contracts, including health plans, third party administrator, consultants, brokers, pharmacy benefits managers, and any other entity involved in health benefits.
The Department of Labor, charged with enforcing the law, has already begun demanding documentation from select employers, and to date none we know of have been deemed compliant with CAA.”
According to Benjamin J. Conley (Partner at Seyfarth & Shaw):
“An employer’s responsibility in this realm is simple and straightforward: If a plan covers someone who does not meet that definition (under ERISA) of an eligible participant, that’s a breach of fiduciary duty.”
According to Dennis Fiszer (Chief Compliance Officer at HUB International):
“If you allow exceptions, even unintentionally through failure to monitor, you essentially amend eligibility for other participants, making it difficult or impossible to protect your plan later.”
An expert solution…
Utilize Verifi1’s dependent eligibility verification program (DEV)to review your health benefits plans to ensure that only enrolled dependents are eligible to receive – and legally participate in – employer sponsored coverage. When enacted, this service will assist employers in complying with CAA and ERISA laws and regulations related to operating a benefit plan as designed and thereby avoiding costly fines and penalties.
Call us today to discuss how we can help your organization!
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