Integrated HRAs

A new option exists for employers when it comes to paying for employee health care coverage. On June 13^th, the U.S. Departments of the Treasury, Labor, and Health and Human Services (the Departments) issued a final rule allowing employers to use pretax dollars to subsidize employee premiums in the individual health insurance market. Now, employers of all sizes that do not offer a group coverage plan can fund a new health reimbursement arrangement (HRA) known as individual coverage HRA (ICHRA).

Previously, under the Affordable Care Act, employers were prevented from offering stand-alone HRAs that would allow an employee to purchase coverage on the individual market. That has changed. Employers now have the option to provide their workers and their families with tax-preferred funds to pay all or a portion of the cost of coverage that workers purchase in the individual market. The departments posted an FAQs regarding the new regulation. ICHRAs are advantageous to employers because they maintain the tax favored status that apply to a traditional group health plan. Additionally, another employer-sponsored insurance called Excepted Benefit HRAs (EBHRA) allows employers to finance an additional pretax $1,800 per year to reimburse employees for certain qualified medical expenses (such as premiums for vision and dental insurance) even if the employee opts out of enrollment in the traditional group plan.

Qualified Small Employer HRAs (QSEHRA) are still an attractive alternative to group coverage for smaller employers- those with fewer than 50 full-time employees. Under QSEHRAs, employers can give their employees money tax-free to purchase individual health policies through the ACA exchange, similar to ICHRAs. Employees can use these funds to pay all or part of the insurance plan premium or pay for out-of-packet medical costs. While ICHRAs are void of caps on annual allowance amounts, in 2019, QSEHRAs allowance amounts were capped at $5,150 for self-only employees and $10,450 for employees with a family. While ICHRAs are free of caps, employees who choose ICHRAs will not be able to receive any premium tax credit/subsidy for exchange-based coverage. In some instances, if an employer funds an ICHRA or a QSEHRA coupled with individual-market insurance, this will bar the individual-market coverage from becoming part of the Employee Retirement Income Security Act (ERISA).

If employers choose to offer ICHRAs, then the new regulations require a written notice be issued to all employees who are eligible. In this notice, employers need to include a provision that states the ICHRA may make them ineligible for a premium tax credit or subsidy when buying an Affordable Care Act exchange-based plan. ICHRAs will be available for plan years starting on or after January 1, 2020. Employers offering an ICHRA with a plan year that begins on January 1, 2020 should help eligible employees understand that they must enroll in individual health insurance coverage during the open enrollment period, November 1, 2019 through December 15, 2019, for individual health insurance coverage that takes effect on January 1, 2020.

ICHRAs and EBHRA are two new health insurance arrangements that could provide smaller employers with innovative and more cost-effective ways to finance worker health insurance coverage. The IRS has noted that including safe harbor provisions to ensure employers still satisfy the ACA’s affordability and minimum value requirements with ICHRAs will come out later this year.

© 2019 Vandenack Weaver LLC

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Nebraska Law to Require Employers to Provide Reasonable Accommodations to Pregnant Employees

Legislative Bill 627, enacted on April 13, 2015, modifies the employment laws of Nebraska to require employers to provide reasonable accommodation to pregnant employees and creates protections intended to prevent pregnancy related discrimination.

The new law requires specific reasonable accommodations for pregnant employees similar to those that are required for workers with disabilities.  Reasonable accommodations may including providing a stool or other seating for a pregnant employee to alleviate swelling of the legs caused by standing for long periods, modifying or changing break and work schedules, or providing a temporary transfer to less strenuous work for which the employee is qualified. The requirements only apply to the extent the employee is still able to perform the essential functions of the position with reasonable accommodation. The definition of an essential function of the position is deferential to the employer, and weight is given to the formal job requirement and description.

The scope of the law also requires reasonable accommodations for employees following childbirth and pregnancy related medical conditions.

The new law also makes it illegal to discriminate in the hiring, advancement, discharge, compensation, training, or general terms of employment of a pregnant woman.

The final version of the law as approved by the Governor may be found at the following link: http://nebraskalegislature.gov/FloorDocs/104/PDF/Slip/LB627.pdf.

© 2015 Houghton Vandenack Williams

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EEOC Proposes Rule Regarding Incentives in Employer Wellness Program

On April 20, 2015, the Equal Employment Opportunity Commission (EEOC) published a proposed rule regarding employer wellness programs. Employer wellness programs have been under scrutiny for potential violations of the Americans with Disability Act (ADA) and the Health Insurance Portability and Accountability Act (HIPAA) because of questions regarding the “voluntary” nature of participation.

Previous EEOC regulations define voluntary as when “an employer neither requires participation nor penalizes employees who do not participate.” The EEOC is proposing the regulation to add clarity regarding the size of the incentive that may be offered for participation in the wellness program. The proposed rule limits the incentive to 30% of the total cost of employee-only coverage.

The proposed rule will be open to comment for 60 days from April 20. The proposed rule may be found at the following link: http://www.gpo.gov/fdsys/pkg/FR-2015-04-20/pdf/2015-08827.pdf

© 2015 Houghton Vandenack Williams

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New Required FMLA Poster

Certain employers need to immediately replace their Family and Medical Leave Act poster with a recently released revised new one.  The FMLA poster is generally required to be posted by employers with 50 or more employees and should be displayed in a conspicuous place where employees and applicants can see it. The revised poster implements changes made by recently released FMLA regulations.

The new poster may be found here: FMLA Poster

© 2013 Parsonage Vandenack Williams LLC

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Common FMLA Violations Highlighted in Recent Survey

As part of the Family and Medical Leave Act’s 20^th anniversary, the U.S. Department of Labor recently released the results of a survey on its use and impact.  The results show the generally positive impact the FMLA has had on workers. The survey also highlights several aspects where the FMLA is being misapplied by employers.  Among them include:

• No Fault Attendance Policies.  Many employers reported still using no-fault attendance policies – policies that treat all employee absences the same regardless of the reason – without providing exceptions for FMLA leave.  FMLA-related absences should be excused and may not be used against employees in performance evaluations.

•  Asking Employees on Leave to Perform Work. The survey revealed that when an employee is on leave, the most common method for covering the work is to assign it to other employees.  However, while employees are on longer leaves, 70.5% of employees were asked to perform some work while on leave.  This practice is likely in violation of FMLA’s prohibition from interfering with employees while on leave.

•  Pressuring Employees to Return.  Under the FMLA, employers are not allowed to pressure employees to return to work.  However, the survey shows that 12.4% of eligible employees reported such pressure as a reason why they returned.

The full report may be viewed at Family and Medical Leave in 2012.

© 2013 Parsonage Vandenack Williams LLC

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Health Care Reform to Increase Demand for Specialized Medical Staff

President Obama’s re-election all but guarantees that health care reform is here to stay. With millions of new patients gaining access to healthcare insurance, there is likely to be a significant increase in the demand for primary care.  As physicians are becoming more specialized, an alternative to meeting this demand for primary care is through nurse practitioners (NPs) and physician assistants (PAs).

Healthcare providers need to consider a number of issues prior to hiring PAs and NPs. Providers first need to anticipate the extent to which hiring a PA or NP will provide competitive advantage to market participants. Nebraska providers also need to understand where they can place PAs and NPs in the continuum of care. Recent changes in Nebraska law broaden the scope of practice for NPs giving providers more opportunities to make use of PAs and NPs. Accordingly, NPs and PAs may be valuable tools in meeting your practice needs.

© 2012 Parsonage Vandenack Williams LLC

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Lincoln Nebraska Passes Discrimination Ordinance

The Lincoln, Nebraska City Council recently voted to pass an ordinance prohibiting workplace discrimination based on sexual orientation and gender identity.  The ordinance will take effect on May 29^th unless opponents gather 2,500 voter signatures, which would put the ordinance to a public vote.  The ordinance might also face legal challenges.  The Nebraska Attorney General has argued that it might not be constitutional.

Assuming the ordinance does take effect, it will protect employees’ sexual orientation and gender identity (meaning their appearance and behavior as male or female) in the same way that it protects their race or religion.  The ordinance prohibits making decisions in hiring, firing, promoting, pay, privileges, or terms of employment based on sexual orientation or gender identity. However, the ordinance does not require employers to grant special treatment in hiring based on the existing makeup of their employees.  For example, employers will not be required to hire a certain number or percentage of heterosexual or homosexual employees.

The ordinance exempts religious corporations from its requirements.

Employers can take precautions to avoid violating the discrimination ordinance by evaluating their current employment practices and by updating their company’s discrimination policies.

© 2012 Parsonage Vandenack Williams LLC

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Employer Tips for Complying with GINA

Since laws prohibiting discrimination based on age, race, and gender receive most of the attention, it is easy to overlook similar laws that prevent discrimination based off genetic information.  The federal law commonly known as “GINA” and its corresponding state laws combine to prohibit employers from using genetic information to make decisions in hiring, firing, promoting, pay, privileges or terms of employment.  Genetic information includes all information relating to genetic tests of the employee and the employee’s family members, as well as information about diseases or disorders in the individual’s family medical history.  An employer can take several precautions to avoid violating these laws, including updating its company’s discrimination policies, examining employment forms for certain prohibited questions, and using cautionary language when talking to employees about their health.

For an expanded article on tips for complying with GINA, please click here.

© 2012 Parsonage Vandenack Williams LLC

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Is Your Criminal Background Check Policy Legal?

The Equal Employment Opportunity Commission (EEOC) has determined that use of arrest and conviction records to deny employment may be illegal when such records are not relevant for a particular position. Denying employment based on irrelevant arrest and conviction records may unjustly limit the employment opportunities of individuals based on their race or ethnicity.

When using criminal background checks in employment decisions, the EEOC recommends that employers take into account the “nature and gravity of the offense, the time that has passed since the conviction and/or completion of the sentence, and the nature of the job sought in order to be sure that the exclusion is important for the particular position.”

Employers should not stop using criminal background checks as a way to weed out unqualified candidates. Instead, employers should refrain from using background checks as the sole factor in hiring decisions.  Employers should consider reviewing applicants on a case-by-case basis and take into account the relevancy of the information found to the desired position.  If questions remain, employers can provide the applicant with an opportunity explain the information discovered.

© 2012 Parsonage Vandenack Williams LLC

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Does Your Employee Handbook Need “Technical” Updates?

It is important to remember that employee handbooks should be updated as technology improves and company procedures evolve.  You should make sure that your employee handbook is updated to reflect modern technology and that it appropriately addresses employees’ use of the same. One issue is the use of cell phones. Do your policies clearly address how personal and business cell phones may be used at work? Unclear policies are resulting in employer employee litigation. You need to have a clear policy about cell phone use, including texting, at work. Your policy needs to be one that can be enforced consistently. Clarify expectations. Communicate your policy. Enforce your policy reasonably and consistently.

© 2012 Parsonage Vandenack Williams LLC

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