A new type of supplemental fertility plan may be coming to life in Washington.
Just what the new plans could cover is still to be determined.
Benefits lawyers at Eversheds Sutherland talk about the plans' possible scope of coverage in an analysis of the new draft fertility plan regulations that the administration of President Donald Trump published in the Federal Register May 13.
Officials with the U.S. Treasury Department's Internal Revenue Service, the U.S. Department of Labor's Employee Benefits Security Administration and the U.S. Department of Health and Human Services' Centers for Medicare & Medicaid Services said the policies could provide up to $120,000 in coverage for fertility services through arrangements classified as "excepted benefits," or products that are not subject to the rules for major medical coverage listed in part 7 of the Employee Retirement Income Security Act.
The new fertility plans could cover services such as diagnostic tests and in vitro fertilization, even if, in some cases, those benefits duplicated benefits available from providers of major medical coverage, officials say.
One open question is whether the new plans could "cover elective fertility treatments for those without an infertility diagnosis (for example, elective egg-freezing," according to the Eversheds Sutherland team.
The preamble, or official introduction, to the draft regulations suggests that employers may be able to offer fertility plans that cover extra benefits, but "plan sponsors who wish to rely on this new limited excepted benefit will want to ensure that the benefits provided fit into the final definition of 'fertility benefits' once published," the team writes.
Excepted benefits: The Eversheds Sutherland team says other draft regulation provisions that employers and benefits advisors will have to think about carefully are the sections that classify the proposed fertility plans as excepted benefits.
ERISA part 7 implements the sections in the Health Insurance Portability and Accountability Act, the Affordable Care Act and other federal laws.
Part 7 imposes many of the rules that set major medical plans apart from dental plans and vision plans, such as the requirement that major medical plans policies cover some preventive services without imposing costs on the patients and the requirement that major medical plans cover "essential health benefits" without imposing annual or lifetime limits on the payments.
Laypeople often assume that excepted benefits fall outside the scope of all federal benefits laws, but the Eversheds Sutherland team notes that this assumption oversimplifies how ERISA and the excepted benefits rules really work.
Even if a plan is an "excepted benefit" for purposes of ERISA part 7, "other parts of ERISA may still apply," the team says.
Depending on how a benefit and a plan are structured, an employer may still face an obligation to provide a summary plan description for an excepted benefit and may face an obligation to report the benefit on its Form 5500 filing, the team says.
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