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DOL Releases FAQs After Federal Court Partially Vacates Preventive Service Requirements

The Department of Labor (“DOL”) issued FAQs following a ruling from a federal judge in Texas on the latest legal challenge to the Affordable Care Act in Braidwood Mgmt. Inc. v. Becerra (Braidwood).

The ruling stated that non-grandfathered group health plans and insurers are no longer required to cover recommended preventive services without cost sharing.

The United States Preventive Services Taskforce (USPSTF), a panel of experts in primary care and prevention, makes recommendations regarding which preventative services should be covered. Often, these are then adopted by the Department of Health and Human Services.

The ruling also stated that employers with religious objections that sponsor health plans are no longer required to cover pre-exposure prophylaxis (PrEP) HIV medications.

The plaintiffs in Braidwood argued that the “Appointments” and “Vesting” clauses of the U.S. Constitution and the “nondelegation” doctrine bar the USPSTF and other groups from making recommendations. The federal court agreed and vacated all coverage requirements related to the “A” or “B” rating recommendations of the USPSTF.

The FAQs

The DOL makes clear that plans and issuers must still continue to cover items and services with an “A” or “B” rating recommended or updated by UPSTF prior to March 23, 2010, without cost sharing.

While the Braidwood decision is in effect, items and services with an “A” or “B” rating on or after March 23, 2010 no longer have to be covered without cost sharing.

Some employers sponsor plans where state law requires coverage similar to the provisions vacated by Braidwood. The DOL states that Braidwood only impacts federal law. Accordingly, employers should continue to follow the laws of their respective states. At a minimum, legal counsel should be consulted before any cost sharing provisions are added.

If plans or issuers wish to add cost sharing mid-year, applicable notice requirements will apply. For example, any material modifications to a plan require notice at least 60 days prior to the modification becoming effective.

Whether or not plan sponsors or issuers add cost sharing to these vacated requirements, the DOL still considers these services as preventative care. For high deductible health plans, this means related HSA eligibility will not be impacted if cost sharing is added.

Finally, the DOL notes that Braidwood does not impact the requirement to cover immunizations recommended by the Advisory Committee on Immunization Practices (ACIP) without cost sharing. This includes qualifying COVID-19 immunizations.

Going Forward

The federal government is currently appealing the Braidwood decision.

As a reminder, even if the decision is upheld on appeal, plan sponsors can still choose to cover these preventative services. It is also possible that Congress responds to the decision by amending the law to require coverage of these services.

If you have additional questions about this decision and how it may impact your organization's health plan, contact your OneDigital consultant. Not a OneDigital client yet? Learn more about our compliance experts.

For more compliance news related to the Affordable Care Act, check out: IRS Announces 2024 ACA Pay or Play Penalties.