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Congress, Administration Serious About Tackling Health Care Costs

As more people struggle with their medical bills, Congress has been introducing a raft of new legislation aimed at cutting costs and making pricing more transparent.

The multi-pronged, bipartisan effort targets the lack of transparency in pricing particularly for pharmaceuticals, as well as surprise medical bills that have left many Americans reeling, and there are also other efforts aimed at reducing the cost burden on payers: the general public and employers.

And since consumers are affected regardless of their political affiliation, congresspersons are reaching across the aisle to push through legislation to address this crushing problem.

There are several draft proposals, but word is a number of bills are expected to be introduced soon.

Surprise medical bills

One of the top priorities seems to be surprise medical bills, which are in the administration’s crosshairs. President Trump in January 2019 hosted a roundtable to air the problems people face when hit with what are often financially devastating surprise bills after they venture out of their network for medical services for both emergency and scheduled medical visits.

After the roundtable, he directed a bipartisan group of lawmakers to create legislation that would provide relief. The House Energy and Commerce Committee in May responded by introducing draft legislation that aims to ban surprise medical bills.

Also, Sen. Maggie Hassan (D-N.H.) and Sen. Bill Cassidy (R-La.) have said they hope to introduce legislation to end the practice of surprise bills. With the White House and both sides of the aisle talking the talk, observers say that there are a number of ways legislation could tackle these surprise bills. That could include:

  • Setting caps on how much hospitals and service providers can charge, or
  • Requiring hospitals and service providers to turn to the insurance company (and not the patient) when they are seeking additional reimbursement.
  • Requiring the insurer to share more of the cost burden for the out-of-network services.

At this point legislation is still being formulated, but chances are good that we could see a bipartisan push to fix this problem. The biggest issue will be how to calculate what are “reasonable” costs for out-of-network services.

Pharmaceutical costs, transparency

The Trump administration has also made it a priority to reduce the costs of medications and tackle pricing transparency in the system.

While both Republicans and Democrats have decried the skyrocketing costs of prescription medications, the inflation for which is outpacing all other forms of medical care, so far there has been only one piece of legislation introduced tackling transparency.

Unfortunately, it’s part of a larger bill that aims to preserve the Affordable Care Act and reverse some recent policy decisions by the Trump administration, so the chances of that measure going anywhere in the Senate are slim to none.

The good news is that members from both parties have been talking about cooperating on legislation, and political observers say the chances are good some type of measure will be introduced this summer.

Other costs

Sen. Ron Wyden (D-Ore.) in February introduced legislation that would require insurers to tell people what they would have to pay out of pocket for any in-network treatment or prescription drug.

On top of that, the Senate Health Committee will soon introduce a number of bills aimed at reducing frictional costs in the system.

In addition, the Senate Finance and Judiciary committees are both in the process of formulating measures aimed at reducing health care costs, as well as prescription drug prices.


Workers’ Comp Audit Mistakes: What to Look For

No company owner wants to undergo a workers’ compensation audit, but they are a fact of life if you run a business and have employees.

Unfortunately, many audits don’t go smoothly and sometimes your insurer may make mistakes. Missouri-based Workers’ Compensation Consultants, which helps employers through the workers’ comp audit process, recently listed the 10 most common audit mistakes that insurance companies make.

The list highlights a common problem and how you can detect the mistakes to avoid being stuck with a massive audit bill. Insurance companies allow you to review the audit with your broker. If you notice that you have received an audit bill that is obviously overstated, you should contact us.

Here are the things to look for when reviewing an audit by your insurance company:

Wrong class code – Misapplication of job classifications occurs in many workers’ comp audits. With hundreds of job classes to choose from, mistakes can happen. Talk to us and review your old policies to see if any of your class codes have changed.

X-Mod is changed – After your insurer finishes the audit, it will use the information to calculate your premium. When that happens, it has to include your X-Mod to get the right rate. But sometimes the insurer may use an incorrect X-Mod. Check carefully.

Subcontractors are counted – Sometimes insurers will include subcontractors as employees, which results in a new audit bill to account for the additional “employees.” But if they are genuine subcontractors, they should not be counted. Often, uninsured contractors will be included as employees. Make sure to use insured contractors only.

Disappearing credits – Most policies will have some sort of premium credits or other modifiers. Sometimes during audits, the insurer will remove them when recalculating the premium they think you owe. Watch out for missing credits and other modifiers if you get an audit bill, like:

  • Premium discount
  • Schedule credits
  • Deductible credits
  • State-specific credits

Audit worksheets missing – If the auditor fails to provide you with audit worksheets, which are used do compile your payroll and other audit information, you should ask to check their work. They will provide you with the information you need to carry out such a check.

Your rates changed – The rates you are charged at the beginning of your policy period must remain the same for the entire policy period. If your base rates have changed, the insurer may have made a mistake.

Separation of payroll – Depending on your industry, you may or may not be able to split your employees’ payroll between job classifications (like cabinet installers and sheetrock hangers). This is a pinch point when errors can occur. If the auditor says you are not allowed to split job classifications even though you have in the past, your audit may be in error.

Unexpected large premium due – If you get a significant bill for your insurance company after your audit, the auditor may have made mistakes, particularly if you know that your employment has remained relatively stable and you’ve had no significant claims, if any. If it seems out of whack, call us.

Payroll data doesn’t match – If there is a discrepancy between your payroll data and what you see on the audit, a mistake may have been made. Try to match the payroll on the audit with that generated from your accountant. If the insurer made a mistake, you could end up paying for phantom payroll numbers.

No physical audit – There are three types of audits:

  • Mail audit
  • Phone audit, and
  • Physical audit

The mail and phone audits are prone to errors since neither you nor your staff likely have any experience in premium auditing. If you have a big bill after a mail or phone audit, mistakes could have been made.


40 States Sue Generic Drug Makers for Collusion

The heat is growing on the pharmaceutical industry after more than 40 US states filed a lawsuit accusing generic drug makers of engaging in a massive price-fixing scheme.

The lawsuit accuses 20 companies of conspiring to fix prices of more than 100 generic drugs, including some that are used to treat cancer and diabetes. The defendants include the largest producer of generic medicine in the world: Teva Pharmaceuticals.

The new lawsuit comes after a five-year investigation that uncovered a scheme through which “coordinated price hikes on identical generic drugs became almost routine,” according to an investigative report by the Washington Post. The suit covers the period from July 2013 to January 2015.

The companies and executives would “routinely communicate with one another directly, divvy up customers to create an artificial equilibrium in the market” to keep generic drug prices artificially high, the lawsuit says.

The scale of the alleged collusion was summed up by Joseph Nielsen, an assistant attorney general and antitrust investigator in Connecticut, whose office has taken the lead in the investigation: “This is most likely the largest cartel in the history of the United States,” he told the Washington Post last December.

In announcing the recent lawsuit, he cited e-mails, text messages, telephone records and testimony from former company executives that indicate a “multi-year conspiracy to fix prices and divide market share for huge numbers of generic drugs.”

This is not the only litigation. Pharmacies and other businesses have filed their own lawsuits against the generic drug makers. One such suit documents huge price hikes – like a 3,400% increase in the price of an anti-asthma medication – and investigators believe that generic drug producers colluded to raise prices in tandem or not make their products available in some markets or through specific pharmacy chains.

Significance of the states’ suit

The multi-state lawsuit is important because generics account for 90% of pharmaceutical spending in the U.S. Despite that, they only account for 23% of the total drug spend in the country, according to the Association for Accessible Medicines.

With so many prescriptions being written, the savings to consumers could be huge if the drug makers are found to have fixed pricing and they subsequently change their ways. What’s not clear, though, is whether it would actually spur changes in pricing by the companies.

According to the lawsuit, the drug companies allegedly conspired to manipulate prices on dozens of medicines between July 2013 and January 2015.

It accuses Teva and others of “embarking on one of the most egregious and damaging price-fixing conspiracies in the history of the United States.”

Connecticut Attorney General William Tong, who filed the suit, said the investigation had exposed why the cost of health care and prescription drugs was so high in the U.S.


Retaliation Cases Against Employers Continue Growing

The federal Equal Employment Opportunity Commission is seeing more and more retaliation complaints by U.S. employees, with such charges accounting for 47% of all charges in 2017. That’s compared with 37% in 2011.

Employment law attorneys say that the increase is in part due to the fact that the employees who bring retaliation charges have a higher degree of success than those that bring a regular discrimination charge.

There is a lower standard of harm that must be proven for a successful retaliation lawsuit thanks to the U.S. Supreme Court case, Burlington Northern & Santa Fe Railroad vs. White.

While an employee alleging discrimination must prove that they suffered a “materially adverse employment action,” a retaliation plaintiff only needs show that the employer undertook some conduct that may dissuade them from making or supporting a charge.

Also, juries inherently distrust employers and they wouldn’t put it past one to retaliate, according to an article written by Daniel A. Kaplan of the law firm of Foley &Lardner.

Kaplan sets out three steps employers can take to avoid retaliation complaints:

Set clear and unambiguous policies

  • Your company policy should clearly state that retaliation is not permitted.
  • The policy should describe the parameters of inappropriate conduct as well as you can define them.
  • Put the policy in writing.
  • Include a reporting and grievance procedure, including the person or persons to whom the employee can report a retaliation complaint.
  • Have employees sign an acknowledgment of receipt of your policy.

Investigate complaints promptly

  • Remember that anyone who participates in an investigation is likely protected from retaliation (not just the employee who makes the complaint, but witnesses as well).
  • Communicate the results of the investigation to the grievant.
  • Take effective remedial measures, including carefully reviewing all disciplinary measures before imposing them. You should also ensure that disciplinary actions are consistent with past practices.

Train management

  • Make sure all of your managers are trained and understand the policy.
  • Ensure they understand who is protected from retaliation (participants, complainants, and even persons related to the complainant in some cases).
  • They should also understand what constitutes retaliatory conduct and, if they are unsure, they should speak to your human resources manager.

Help Your Employees Save Money on Drugs

Most employers are doing all they can to keep their employees’ health insurance and health care outlays to a minimum.

And while most of those efforts are focused on the upfront cost of insurance, co-pays and deductibles, many employers fail to help their employees control the very costs they actually have the most control over and one of those areas is medicine.

Helping your employees become wise consumers of health services can also cut your overall insurance costs as well as help your employees conserve more of their own funds if they have high co-pays and deductibles.

The cost of drugs can vary greatly between pharmacies to a shocking degree. And while your employees may have low co-pays for some drugs, if they go to the most expensive option when the insurance is covering the tab, it basically adds to the cost drivers for your insurance plan.

Here’s how wild the price swings can be. Consumer Reports recently surveyed pharmacies to price out a basket of five popular generic prescription drugs and here are the prices:

  • Healthwarehouse.com: $66
  • Costco:  $150
  • Various independents: $107
  • Sam’s Club: $153
  • Walmart: $518
  • Kmart: $535
  • Grocery stores: $565
  • Walgreens: $752
  • Rite Aid: $866
  • CVS/Target: $928

It also pays to shop around from store to store and ask for discounts.

“A Rite Aid store near our headquarters in Yonkers, N.Y., was able to get the price of atorvastatin, the generic version of Lipitor, down to just $18 from $300 through a combination of in-store and external discount programs,” the report states. “But at another Rite Aid, we were told the cost could only be lowered to $127.”

Consumer Reports recommends that your employees:

  • Use online discounts. There are a number of websites that can provide you with discount coupons or vouchers for drugs, including:
    • GoodRx
    • Blink Health
    • WeRx.org

On these sites you enter the name of the drug, dosage and quantity and where you live and it will provide coupons or vouchers and identify which pharmacies you can use them at.

  • Expand your shopping horizons. As you can see on the list above, prices vary tremendously. And combining shopping around with a good plan for using coupons and your employees can save themselves and your health plan boat loads of money.
    They should also check out their local warehouse discount store as both Costco’s and Sam’s Club’s pharmacies were also quite reasonable.
    Not to be outdone, neighborhood pharmacies and grocery store pharmacies were also much cheaper than the large regional drug store chains. “The absolute lowest prices we found in each city we called were almost always at these kinds of stores,” Consumer Reports wrote.
  • Ask pharmacies if they will honor online coupons. Pharmacies will almost always honor them, Consumer Reports found. But Consumer Reports mystery shoppers had to be persistent in getting the pharmacies to use them, since they often run prescriptions through insurance automatically, even when paying the retail cash price and using discount coupons would cost less.

One last thing

Consumer Reports recommended that once someone settles on pharmacy that consistently gives them good deals on pharmaceuticals, they should fill all of their prescriptions there.

That way it’s easier for them to spot “potentially dangerous interactions and other safety concerns.”

But if your employees notice that their pharmacy bills start rising noticeably, it may be time for them to start shopping around again. To stay on top of this requires regular checks to make sure that they are not seeing prices creep up.


Insurers Will Pay Record Amount of Rebates to Small Group Plans

While most businesses rarely get rebate checks from their group health insurer, this year may be different as insurance companies are expected to pay back record excess premiums, as required by the Affordable Care Act.

The landmark insurance law requires that insurers spend at least 80% of their premium income on medical care and medications, but expected payouts in 2018 came in way below expectations. That means they have to pay out rebates for the overcharge.

Analysts expect that insurers will pay out $1.4 billion in rebates, $600 million of which would be paid to small and large group health plans, according to a report by the Kaiser Family Foundation.

The reason for the sizeable expected rebate is that insurers raised rates substantially for 2018, which was right after Congress had passed a law that eliminated the individual mandate penalty, as well as uncertainty about the law after the Trump administration introduced regulations to expand the use of short-term health plans and association plans.

As mentioned, plans must spend 80% of premiums they collect on medical claims or quality improvements if they are in the individual or small group market. The threshold is 85% in the large group market. The rest can be spent on claims administration, marketing and other overhead, as well as set aside for profit.

Rebates to small group plan and large group plan members have typically overshadowed rebates to those who purchase plans individually on government-run exchanges. In 2017, according to the Centers for Medicare and Medicaid Services, insurers paid out nearly $707 million in ACA rebates, as follows:

  • $132.5 million to individual market enrollees.
  • $309.4 million to small group market enrollees.
  • $264.8 million to large group market enrollees.

But this year, rebates to the individual market are expected to be $800 million, while the remaining $600 million would be paid to enrollees in group plans.

The premium increases that many insurers pushed through led to much higher rates – benchmark premiums were up 34% going into 2018 – because of market uncertainties, such as:

  • In October 2017, the Trump administration ceased payments for cost-sharing subsidies, which led some insurers to exit the market or request larger premium increases than they would have otherwise.
  • The administration reduced funding for advertising and outreach.
  • Congress repealed the individual mandate penalty, effective for 2019.
  • The administration introduced regulations extending the time people could be on short-term plans, and also introduced association health plans as an alternative for the small group market.

But the insurers’ fears didn’t materialize. Despite payments per enrollee growing 26% to $559 in 2017 on exchanges, per person claims increased only 7% to $392 year over year.

Also, the repeal of the penalties and increased premiums did not drive younger, healthier consumers out of the marketplace as had been expected.

How to disburse rebates

If you are one of the employers whose health plan gets to receive a rebate, the big question that always comes up is “how do you distribute the funds?”

ACA regulations require insurers to pay rebates directly to the group health plan policyholder, who will be responsible for ensuring that employees benefit from the rebates to the extent they contributed to the cost of coverage.  

But remember, since you as the employer also contributed to the premiums, you are entitled to your portion of the rebate. Your take should be in the same proportion as the premium you pay compared to your employees.

The way that you disburse the rebate is up to you, but whatever you do, it must be in accordance with ERISA’s general standards of fiduciary conduct.

Typically, if the rebate works out to be small for each participant, it would likely not be worth your time to cut each employee a check.

The preferred method in most cases is to provide the rebate in the form of a premium reduction or discount to all employees participating in the plan at the time the rebate is distributed.


Protecting Your Workers in the Rain

Employees working in the rain face specific hazards, such as poor visibility and wet, slippery surfaces.

When it’s wet and windy, potential hazards at a worksite can be exacerbated. Working in the rain can cause slippery surfaces and limited visibility. It’s also riskier to use heavy equipment in the rain, particularly when moving heavy loads, putting workers on the ground – and even the public – in danger.

However, steps can be taken to mitigate such hazards.

It’s imperative that you as an employer ensure your employees’ safety, especially during this heavy year for rain. When working in the rain, train your employees to:

  • Move cautiously – While workers may be tempted to move fast in the rain to avoid getting wet, this can be dangerous, especially on slippery surfaces. If anything, they should work more slowly and deliberately in all of their tasks.
  • Use the correct equipment – If workers must use electrical tools or equipment, they need to check that they are specifically rated for outdoors. Also, the tools should have textured, no-slip grips and handles.
  • Don proper footwear – Workers should wear footwear with heavy treads that can reduce the chances of slipping.
  • Remember rain gear – Proper rain gear includes rain pants and a raincoat. The best clothing is ventilated to help your workers stay comfortable. If it’s cold and rainy, they should also wear wool or synthetic materials that can stay warm even when wet.
  • Wear non-slip gloves – Workers should wear gloves that provide a sticky grip even when wet. Gloves should be snug and long enough for a jacket sleeve to prevent water from entering.
  • Keep vision clear – Workers who wear glasses (if they must wear goggles for certain jobs) should apply anti-fog spray to them. It’s also advisable to wear a hat to keep rain from their eyes. They shouldn’t use headgear that narrows their field of vision.
  • Work in proper lighting – When working at night, workers should make sure lighting is adequate and the lights used are rated for outdoor use.
  • Ensure visibility – When it’s raining, visibility decreases and it’s easy for motorists and machine operators to have trouble seeing properly. Workers should wear high-visibility clothing, especially in areas with vehicle traffic and heavy machinery. Don’t wear rain gear or vests that have become dull or are no longer reflective.

Cold stress

When it rains, it’s often cold, too – and wet clothing can exacerbate the cold.

Employees working outdoors for prolonged periods of time when it’s cold must be protected from cold stress. Cold stress can cause frostbite, hypothermia and trench foot.

OSHA advises that cold stress is not limited to freezing temperatures, but can occur in outdoor temperatures in the 50-degree Fahrenheit range when rain and wind are present.

OSHA requires addressing this hazard by using protective clothing, in particular the use of layers with an outer material that protects against wind and rain. Although OSHA generally requires employers to pay for their workers’ protective equipment, employers are not required to pay for ordinary clothing such as raincoats.

Heavy-work dangers

Rain makes operating cranes, derricks and hoists more dangerous as well, particularly when moving large and heavy objects. Heavy rain combined with wind speed can make loads difficult to control.

Also, if a rainstorm is accompanied by lightning, equipment such as a crane can become a lightning rod.

If you feel you cannot adequately protect your workers during a storm, you should not conduct operations in the rain.


DOJ Tells Court to Nullify ACA; What’s Next?

After a period of relative stability, the future of the Affordable Care Act has once again been thrown into uncertainty.

In a surprise move, the Department of Justice announced that it would not further pursue an appeal of a ruling by U.S. District Court Judge Reed O’Connor, and instead asked the 5th U.S. Circuit Court of Appeals to affirm the decision he made in December 2018.

O’Connor had ruled that Congress eliminating the penalty for not complying with the law’s individual mandate had in fact made the entire law invalid.

But, even though the DOJ won’t be pursuing defense of the law and challenging the ruling on appeal, a number of states’ attorneys general have stepped up to fight the ruling.

What this means for the future of the employer mandate is unclear, as the court process still has a long way to go. The ruling could be overturned on appeal and invariably whatever the 5th Circuit decides, the case will likely be appealed to the U.S. Supreme Court.

Already there has been fallout in the private health insurance market since the individual mandate penalty was eliminated, but the employer mandate, which requires that organizations with 50 or more full-time or full-time-equivalent workers offer health coverage to their employees, remains intact.

As the case winds on, it will be some time before anything changes. The 5th Circuit has not yet scheduled arguments. The DOJ has asked for a hearing date for July 8, and Democratic states’ attorneys general agreed.

Despite the DOJ’s announcement, the law stands and applicable large employers must continue complying with its requirements.

Analysis

The move was surprising because in the past President Trump had signaled that he wanted to keep parts of the ACA, particularly the barring of insurers from denying coverage based on pre-existing conditions. If the entire law is scrapped, so will that facet – as well as other popular provisions, like allowing adult children to stay on their parents’ policy until the age of 26.

Trump said his administration has a plan for something much better to replace the ACA.

Democrats have introduced some legislation to try to stabilize markets and improve on some ACA shortfalls. Their legislation aims to cut premiums for individuals buying on exchanges by expanding premium tax credits. Another bill would reaffirm the pre-existing condition protections, and restore enrollment outreach resources, which have been cut back under the Trump administration.

But with a divided Congress, the likelihood of anything reaching Trump’s desk are slim to none.

Meanwhile, the success of the ACA has been spotty. In some parts of the country, usually in areas with high population density, competition among plans ensures lower prices for people shopping on exchanges. But in smaller regions, cost increases are rampant.

A new analysis by the Urban Institute, a liberal-leaning think-tank, finds that more than half (271) of the country’s 498 rating regions have only one or two insurers participating in the ACA marketplace. Those regions are disproportionately in sparsely populated areas.

Regions with little competition tend to have much higher premiums. In a region with only one insurer, the median benchmark plan for a 40-year-old nonsmoker is $592 a month. That compares to $376 for the same consumer in a region with at least five plans.


Protect Your Firm from Hacking by Disgruntled Former Employees

While hacking by outsiders is posing a larger and more significant threat to companies of all sizes, the threat of insider jobs – particularly by disgruntled former employees – is often an even bigger one.

These attacks, carried out with malicious intent to hamstring a company’s operations, can cause serious problems. Take, for example, the following recent events:

  • A former employee of Spellman High Voltage Electronics Corp. is facing charges after strange things started happening to the company’s systems after he resigned, due to allegedly being passed over for a promotion.

Shortly after he left, employees at Spellman began reporting that they were unable to process routine transactions and were receiving error messages. An applicant for his old position received an e-mail from an anonymous address, warning him, “Don’t accept any position.” And the company’s business calendar was changed by a month, throwing production and finance operations into disorder.

The mayhem cost his former employer more than $90,000, and he was arrested. “The defendant engaged in a 21st-century campaign of cyber-vandalism and high-tech revenge,” said Loretta Lynch, the United States attorney for the Eastern District.

  • A former employee of McLane Advanced Technologies was sentenced to 27 months in prison and ordered to pay $35,816 in restitution after pleading guilty to hacking into McLane’s systems and deleting payroll files to the point that staff could not clock in and the company could not issue payroll checks.

He was upset after the company had fired him and then refused to help him obtain unemployment benefits.

  • A network engineer, who was fired by the American branch of Gucci, stands accused of breaking into the computer systems of the Italian luxury goods organization, shutting down servers and deleting data.

The New York County District Attorney’s office accuses the former employee of using an account that he had secretly created while employed by Gucci to access the network after his employment was terminated.

He has been charged with computer tampering, identity theft, falsifying business records, computer trespass, criminal possession of computer-related material, unlawful duplication of computer-related material, and unauthorized use of a computer. The intrusion is said to have cost the company some $200,000.

What you can do

With these cases in mind, there are internal steps you can take to avoid this sort of thing happening at your company.

Route all offsite access through a VPN – This can typically prevent someone from entering your system altogether. But, once you have such a system in place, all outside connections need to be logged and monitored for suspicious activity.

Test your disaster recovery plan – You need to have a disaster recovery plan in place that includes backing up data every day, just in case someone deletes it from your servers. That way, if data is deleted you can immediately switch to a back-up IT environment.

A lot of times, organizations do disaster recovery, but unless they practice the actual recovery, they don’t know if it will work, and it doesn’t matter whether they have a physical or a virtual environment. So, don’t forget to test any plans you have.

Block unapproved software – Sometimes your employee hackers will install extra software that makes it easier for them to root through your system and create havoc. You should have systems in place that do not allow anybody to install unapproved software.

Disable ex-employee accounts and passwords – Whenever an employee or contractor ceases to work at your business – or in the case of layoffs, beforehand – you must disable their network access, accounts and passwords. You should regularly review which users have access to your systems, and know that changing passwords and resetting access rights is essential when a member of your staff leaves your employment.

Think like a malicious insider – IT managers must think like an inside attacker, and identify the weak points of their infrastructure that they themselves would exploit were they so inclined. As a senior manager, you should ask your IT managers just what they are doing to thwart any possible insider attacks.

Make suspect behavior cause for concern – Watch for human-behavior warning signs, such as complaining to others about the company and a more than usual amount of time spent accessing company data on your network. Develop a response plan for when such signs get spotted.

Beware resignations, terminations – Most insider attacks occur within a narrow window. Most people who steal intellectual property or destroy systems do so within 30 days of resignation. Accordingly, keep a close eye on departing or departed employees, and what they viewed.

If someone resigns who has had access to your most sensitive company information, including trade secrets, you need to pay special attention to ensure it’s not compromised.

Marshal forces – Businesses that prepare for attacks in advance tend to better manage the aftermath. When it comes to combating cases of suspected insider threat, include human resources, management, upper management, security, legal and software engineering.


Regulators Take Steps to help Grandfathered Plans

Regulators are in the early stages of creating rules that make it easier for health plans that were grandfathered in before the Affordable Care Act took effect to continue providing coverage.

The number of workers enrolled in plans that were in effect before the ACA was enacted in 2010 has been shrinking, and as of 2018, some 16% of American workers who were enrolled in group health plans were in grandfathered plans.

Under the ACA, those plans do not have to abide by the same regulations as plans that took effect after the law’s implementation.

In February 2019, the Internal Revenue Service, the Employee Benefits Security Administration and the Health and Human Services Department issued a request for information from grandfathered plans. The goal is to determine whether there are opportunities for the regulators to assist plans to preserve their grandfathered status in ways that would benefit employers, employees, and their families.

While the effort will only affect a small amount of employer-sponsored plans, the move is significant as it looks like the ultimate goal is to further loosen rules for grandfathered plans.

A plan is considered grandfathered under the ACA if it has continuously provided coverage for someone (not necessarily the same person, but at all times at least one person) since March 23, 2010 and if it has not ceased to be a grandfathered plan during that time.

Grandfathered plans have certain privileges that other group health plans that were created after that date do not have, as the latter are all required to comply with all of the rules under the ACA.

Under the ACA, grandfathered plans do not have to comply with certain provisions of the law.

These provisions include coverage of preventive health services and patient protections (for example, guaranteed access to OB-GYNs and pediatricians).

Other ACA provisions apply to grandfathered plans, such as the ACA’s waiting period limit.

Grandfathered status

Grandfathered health plans may make routine changes to their coverage and maintain their status.

However, plans lose their grandfathered status if they choose to make significant changes that reduce benefits or increase costs for participants.

Some of the questions that the three departments are asking plan administrators are:

  • What actions could the departments take to assist group health plan sponsors and group health insurance issuers to preserve the grandfathered status of a group health plan or coverage?
  • What challenges do health plans and sponsors face regarding retaining the grandfathered status of a plan or coverage?
  • What are your primary reasons for retaining grandfathered status?
  • What are the reasons for participants and beneficiaries remaining enrolled in grandfathered group health plans if alternatives are available?
  • What are the costs, benefits and other factors when considering whether to retain grandfathered status?
  • Is preserving grandfathered status important to group health plan participants and beneficiaries? If so, why?

Responses to the request for information are due by March 27.


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