Aon Washington Report
January 16, 2017
Presidential Inauguration Scheduled for January 20, 2017
The presidential inauguration takes place on January 20, 2017, when Donald Trump will be sworn in as the forty-fifth president of the United States.
Congress Passes Budget Resolution Enabling Expedited Repeal of Affordable Care Act
Congress has passed a fiscal 2017 budget resolution providing for a budget reconciliation process that will allow the Affordable Care Act to be repealed on an expedited basis with simple majority votes, if Congress so chooses. The House and Senate passed the budget resolution on January 13, 2017, and January 12, 2017, respectively. The votes were 227-198 in the House and 51-48 in the Senate.
S. Con. Res. 3 is available here.
House Approves Regulatory Accountability Bill
On January 11, 2017, the House passed H.R. 5, the Regulatory Accountability Act, which would make it easier for courts to overturn regulations. The bill, passed by a vote of 238-183, includes a provision that would repeal the Chevron doctrine, which requires court deference to agency interpretations of ambiguous laws. The bill has been sent to the Senate.
H.R. 5 is available here
Thirty-Seventh Set of FAQs on Affordable Care Act Now Available
On January 12, 2017, the Departments of Labor (DOL), Health and Human Services (HHS), and the Treasury released the thirty-seventh set of frequently asked questions (FAQs) on implementation of the Affordable Care Act. The FAQs address Health Reimbursement Arrangements (HRAs) and certain clinical risk-bearing entities.
The following questions are included:
- May a family HRA be integrated with a non-HRA group health plan sponsored by the employer of the employee’s spouse that covers all of the individuals covered by the family HRA if that non-HRA group health plan otherwise meets the applicable integration requirements?
- May a family HRA be integrated with a combination of (1) self-only coverage of the employee by a qualifying non-HRA group health plan sponsored by the employer and (2) qualifying non-HRA group health plan coverage sponsored by the employer of the employee’s spouse that covers all members of the family covered by the family HRA (other than the employee)?
The FAQs are available here.
Thirty-Sixth Set of FAQs on Affordable Care Act Now Available
On January 9, 2017, the DOL, HHS, and the Treasury released the thirty-sixth set of FAQs on implementation of the Affordable Care Act. The FAQs provide guidance on the accommodation for providing coverage for contraceptive services and Supreme Court rulings on the accommodation, including the 2016 Supreme Court ruling in Zubik v. Burwell.
The FAQs are available here.
EBSA Posts FY 2016 MHPAEA Enforcement Fact Sheet
On January 11, 2017, the Employee Benefits Security Administration (EBSA) of the DOL released its second annual Mental Health Parity and Addiction Equity Act (MHPAEA) fact sheet, which summarizes its enforcement activity in fiscal year 2016 (FY 2016). In the last fiscal year, EBSA closed 330 health investigations, 191 of which involved plans subject to MHPAEA that were reviewed for MHPAEA compliance. EBSA cited 44 violations for MHPAEA noncompliance in the 191 investigations.
The FY 2016 MHPAEA Enforcement Fact Sheet is available here.
IRS Provides March 31, 2020, as Last Day of Remedial Amendment Period for 403(b) Plans
On January 13, 2017, the Internal Revenue Service (IRS) released Revenue Procedure 2017-18, which provides that the last day of the remedial amendment period for Section 403(b) plans, for purposes of Section 21 of Revenue Procedure 2013-22, is March 31, 2020. In Revenue Procedure 2013-22, the IRS had reserved the selection of the last day of the remedial amendment period for 403(b) plans for later guidance. The remedial amendment period begins on the later of January 1, 2010, or the plan’s effective date. A plan that does not satisfy the requirements of Code Section 403(b) in form on any day during the remedial amendment period will be considered to have satisfied those requirements if, on or before March 31, 2020, all provisions that are necessary to satisfy Section 403(b) have been adopted and made effective in form and operation from the beginning of the remedial amendment period. The IRS also stated that it intends to issue guidance in the future with respect to the timing of 403(b) plan amendments made after March 31, 2020.
IRS Revenue Procedure 2017-18 is available here.
PBGC’s My PAA Now Ready to Accept 2017 Electronic Premium Filings
On January 9, 2017, the Pension Benefit Guaranty Corporation (PBGC) announced that its web-based application, My Plan Administration Account (My PAA), for electronic premium filings and payments is now ready to accept electronic premium filings for plan years beginning in 2017.
The PBGC announcement, with additional information on premium filings, is available here.
Other HR-Related Topics
EBSA Issues Fiduciary Rule FAQs for Financial Service Providers and FAQs for Consumers
On January 13, 2017, the Employee Benefits Security Administration (EBSA) of the Department of Labor (DOL) issued two separate sets of frequently asked questions (FAQs) related to the fiduciary rule: one for financial service providers and another for consumers.
The 35 FAQs for financial advisers clarify many issues under the final rule, including when communications about retirement accounts rise to the level of a fiduciary recommendation and what constitutes the provision of non-fiduciary investment information and education. The 30 FAQs for consumers explain the consumer protections that take effect under the fiduciary rule on April 10, 2017, including which financial advisers are fiduciaries under the rule and how the best interest standard applies to financial advice. The latter set of FAQs also explain how the rule applies not only to retirement accounts in ERISA plans but also to investment recommendations related to health savings accounts.
“Conflict of Interest FAQs (Part II-Rule)” is available here.
“Consumer Protections for Retirement Investors—FAQs on Your Rights and Financial Advisers” is available here.
DOL Issues Annual Inflation Adjustments to Civil Penalties for 2017
On January 13, 2017, the DOL issued a final regulation with its 2017 annual adjustments for inflation to civil monetary penalties, including penalties under ERISA. The adjusted penalty amounts are effective as of January 13, 2017. Under the regulation, the penalty for failing to file or refusing to properly file the annual Form 5500 has increased to $2,097 per day.
The final regulation is temporarily available here.
(The final regulation will be published in the January 18, 2017, Federal Register.)
EEOC Asks for Public Comments on Proposed Enforcement Guidance on Workplace Harassment
On January 10, 2017, the Equal Employment Opportunity Commission (EEOC) released proposed enforcement guidance on unlawful harassment under federal employment discrimination laws for public input. The EEOC noted that between fiscal years 2012 and 2015, the percentage of private sector charges that included an allegation of harassment increased from approximately 25% of all charges annually to over 30% of all charges. The guidance explains the legal standards applicable to harassment claims under federal employment discrimination laws, which protect individuals from harassment based on race, color, religion, sex, national origin, disability, age, or genetic information. Comments may be submitted on the proposed guidance until February 9, 2017.
The EEOC Press Release on the request for public comments is available here.
Due to technical difficulties, a portion of the following article may have been inadvertently omitted in your copy of last week's Washington Report. The article is being re-posted here in its entirety.
Agencies Issue Final Regulations on Excepted Benefits (Travel Insurance and Supplemental Health Insurance) and Amend Definition of Essential Health Benefits
The Departments of the Treasury, Labor, and Health and Human Services (the Agencies) issued final regulations addressing when travel insurance and supplemental health insurance constitute excepted benefits. Also contained within these final regulations is an amendment to the definition of essential health benefits for purposes of the Affordable Care Act’s prohibition on annual and lifetime dollar limits.
However, two topics addressed in the proposed regulations—hospital and other fixed indemnity insurance and expatriate health plans—were not adopted in the final regulations. The Agencies intend to address hospital and other fixed indemnity insurance and expatriate health plans in future regulations.
The Aon bulletin, which provides a brief overview of the final regulations, is available here.