Telemedicine is a brave new frontier in modern healthcare. Your healthcare provider is placed right in your pocket, and medicine is delivered through technology. These advancements in telemedicine make healthcare more accessible and affordable and have significant benefits in improving employee productivity by reducing health related absenteeism.
However, this new frontier is not the Wild West. There are rules when it comes to telemedicine compliance. When implementing a telemedicine benefit, employers should consider the following laws:
• Affordable Care Act (ACA)
• Consolidation Omnibus Budget Reconciliation Act (COBRA)
• Employee Retirement Income Security Act (ERISA)
Tackling Your Telemedicine Compliance
To avoid violating the preventative care mandate of the Affordable Care Act, employers should integrate their telemedicine benefits with their group medical plan coverage. In most cases, a stand-alone telemedicine benefit is a group health plan subject to the Affordable Care Act’s market reforms, including the preventative care mandate. In general, a telemedicine benefit cannot comply with the Affordable Care Act’s preventative care mandate on its own because many preventative care services require in-person visits with healthcare providers.
Telemedicine and ERISA
ERISA sets minimum standards for employee benefit plans maintained by private-sector employers. ERISA exempts true government employers from its requirements.
Employer-sponsored stand-alone telemedicine benefits are considered group health plans that are subject to ERISA requirements. Under ERISA employers are required to take the following steps with respect to their employee benefit plans:
• Adopt an official plan document that describes the plan’s terms and operations,
• Explain the plan’s terms and rules to participants through a summary plan description,
• File an annual Form 5500 for the plan
• Establish a claims and appeals process for participants to receive benefits from the plan.
Employers typically package their telemedicine benefits with their group medical plans and integrating these benefits under one plan allows employers to more easily satisfy ERISA requirements.
Be COBRA Compliant
With respect to COBRA, the regulation generally applies to group health plans maintained by employers that had at least 20 or more employees on more than 50 percent of typical business days in the previous calendar year. COBRA does not cover group health plans attached to small employers with less than 20 employees, or churches. Additionally, there are some special coverage rules for government employers.
Telemedicine benefits are subject to COBRA because they provide medical care and are considered group health plans. As with the ACA and ERISA, it is wise for employers is to bundle their telemedicine benefits with their group medical plans and, when benefits are integrated, design the plan so only qualified beneficiaries who elect COBRA for the group medical plan are eligible for telemedicine.
Your HSA Eligibility
Another area of concern and question is how telemedicine benefits may impact HSA eligibility. While the Internal Revenue Service hasn’t specifically addressed telemedicine, with respect to eligibility, the general rule is that HSA contributions strictly limit the type of coverage that eligible individuals may have. Telemedicine programs that provide free or reduced-cost medical benefits before the HDHP deductible is satisfied disqualify coverage for purposes of HSA eligibility. But, there are some cases where a telemedicine program are excepted from those rules:
• If the telemedicine program is offered as part of the HDHP and the program’s benefits are subject to the deductible (preventative care benefits excluded).
• The telemedicine plan is not considered a “health plan” under the HSA eligibility rules because it does not provide significant benefits for medical care or treatment.
• Benefits under the telemedicine program are limited to preventative care services.
When it comes to providing benefits, compliance pitfalls are always a danger. We know all about that at Boon and we’re here to help.
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