Agencies Release FAQs on Issues Surrounding Receiving COVID Vaccinations
|October 4, 2021 |
Today, the Departments of Labor, Health and Human Services (HHS), and the Treasury released Frequently Asked Questions (FAQs) regarding implementation of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), the Health Insurance Portability and Accountability Act of 1996 (HIPAA) and the Affordable Care Act.
These FAQs provide guidance of how receiving COVID-19 vaccinations for eligibility HIPAA nondiscrimination, premium discounts under HIPAA wellness program purposes and for determining affordability of coverage with respect to the employer mandate. The important FAQs are provided below:
Q3: May a group health plan (or health insurance issuer offering coverage in connection with a group health plan) offer participants in the plan a premium discount for receiving a COVID-19 vaccination?
Yes, if the premium discount complies with the final wellness program regulations. A premium discount that requires an individual to perform or complete an activity related to a health factor, in this case obtaining a COVID-19 vaccination, to obtain a reward would be considered a wellness program that must comply with the five criteria for activity-only wellness programs described in paragraph (f)(3) of the final wellness program regulations.
To satisfy these criteria, a wellness program that provides a premium discount to individuals who obtain a COVID-19 vaccination must be reasonably designed to promote health or prevent disease and must provide a reasonable alternative standard to qualify for the discount. For example, the wellness program may offer a waiver or the right to attest to following other COVID-19-related guidelines to individuals for whom it is unreasonably difficult due to a medical condition or medically inadvisable to obtain the COVID-19 vaccination in order to qualify for the full reward. The plan must also provide notice of the availability of the reasonable alternative standard under the wellness program. Further, the reward the plan provides in connection with the vaccine incentive program must not exceed 30 percent of the total cost of employee-only coverage and must give individuals eligible for the program the opportunity to qualify for the reward under the program at least once per year.
Example: A group health plan offers a 25 percent premium discount of the cost of employee-only coverage to all participants who receive a COVID-19 vaccination in accordance with the recommendations of ACIP (and does not offer any other reward under other health-contingent wellness programs with respect to the plan). To help facilitate participants receiving the vaccination, the plan also maintains a toll-free hotline to answer questions about COVID-19 vaccination and offer assistance to schedule appointments to receive a COVID-19 vaccination. The plan provides the same premium discount to individuals for whom it is unreasonably difficult due to a medical condition or medically inadvisable to obtain a COVID-19 vaccination if the individual attests to complying with the CDC’s mask guidelines for unvaccinated individuals. The plan also provides notice of the availability of this alternative to all participants. Participants may qualify annually for this premium discount.
Conclusion: The vaccine incentive program meets the criteria to be an activity-only health-contingent wellness program. The reward the plan provides in connection with the vaccine incentive program does not exceed 30 percent of the total cost of employee-only coverage and the opportunity to qualify is offered annually. The plan provides a reasonable alternative standard to qualify for the reward, in this case the opportunity to attest to complying with the CDC’s mask guidelines, to individuals for whom it is unreasonably difficult due to a medical condition or medically inadvisable to obtain a COVID-19 vaccination, and the plan provides notice of the availability of the reasonable alternative standard. This program is also reasonably designed to promote health and prevent disease (and is not a subterfuge for discriminating based on a health factor), as the program rewards individuals who obtain a COVID-19 vaccination, while the reasonable alternative standard is not overly burdensome, and is also designed to prevent infection with SARS-CoV-2, the virus that causes COVID-19. Further, the plan’s maintenance of a toll-free hotline to provide information about the COVID-19 vaccine and assistance with meeting the underlying standard (in this case, receiving a COVID-19 vaccination or fulfilling the reasonable alternative) are additional facts and circumstances demonstrating that the program is reasonably designed to promote health or prevent disease because they help ensure that the program is not overly burdensome.
Q4: May a group health plan or health insurance issuer condition eligibility for benefits or coverage for otherwise covered items or services to treat COVID-19 on participants, beneficiaries, or enrollees being vaccinated?
No. PHS Act section 2705, ERISA section 702, Code section 9802, and the Departments’ implementing regulations generally prohibit plans and issuers from discriminating against participants, beneficiaries, and enrollees in eligibility, premiums, or contributions based on a health factor.12 The Departments’ implementing regulations state that rules for eligibility include, among other things, rules related to benefits (including rules related to covered benefits and benefit restrictions).13 Benefits under the plan must be uniformly available to all similarly situated individuals and any restriction on benefits must apply uniformly to all similarly situated individuals and must not be directed at individuals based on a health factor.14 Accordingly, plans and issuers may not discriminate in eligibility for benefits or coverage based on whether or not an individual obtains a COVID-19 vaccination. Furthermore, while there is an exception to the general prohibition on discrimination based on a health factor for wellness programs that meet federal standards, this exception is available only for premium discounts or rebates, or modifications of otherwise applicable cost-sharing mechanisms, and not for denying eligibility for benefits or coverage based on a health factor.
Q5:How are premium discounts and surcharges for receiving or not receiving the COVID 19 vaccination, respectively, treated for purposes of determining affordability of coverage with respect to the employer shared responsibility payment under section 4980H(b) of the Code?
Wellness incentives that relate to the receipt of COVID-19 vaccinations are treated as not earned for purposes of determining whether employer-sponsored health coverage is affordable. Although premium incentives are permissible as part of a nondiscriminatory wellness program, premium incentives other than incentives relating exclusively to tobacco use, including wellness programs encouraging vaccinations for COVID-19, are treated as not earned when determining the employee’s required contribution for an offer of health coverage under 26 CFR 1.36B 2(c)(3)(v)(A)(4). Thus, for example, if the individual premium contribution under a COVID-19 vaccination wellness program was reduced by 25 percent, this reduction is disregarded for purposes of determining whether the offer of that coverage is affordable for purposes of assessing liability for the employer shared responsibility payment. Conversely, if an individual’s premium contribution for health coverage under a COVID-19 vaccination wellness program is increased by a 25 percent surcharge for a non-vaccinated individual, that surcharge would not be disregarded in assessing affordability.
To access a copy of the full Frequently Asked Questions (FAQs), please click on the link below: https://www.cms.gov/CCIIO/Resources/Fact-Sheets-and-FAQs/Downloads/FAQs-Part-50.pdf