Category: Health Care Law

COBRA Premium Assistance Period Ends September 30, 2021

On September 30, 2021, the COBRA premium assistance period established by the American Rescue Plan Act (“ARPA”) will come to an end. ARPA requires, among other things, that employers provide 100 percent COBRA premium subsidies to assistance eligible individuals (“AEIs”) and their qualified beneficiaries, if they are eligible for COBRA during the six-month period beginning April 1, 2021 through September 30, 2021. Employers must notify all AEIs that their subsidy period is going to end by sending the Notice of Expiration of Premium Assistance at least 15 days, but no more than 45 days, before the expiration of the premium assistance. With the COBRA premium assistance period less than two weeks away, employers should have already sent their final Notices of Expiration. Employers that have not done so, however, should send the notices now.

©2021 Epstein Becker & Green, P.C. All rights reserved.

Article By Gretchen Harders and Jenna D. Russell of Epstein Becker & Green, P.C.

For more articles on COBRA assistance, visit the NLR Administrative & Regulatory section.

Health Care Settings Subject to New COVID-19 Requirements Issued by New Jersey and OSHA

Health care settings continue to be at the center of testing and treatment for COVID-19 and are the focus of new safety requirements implemented to minimize risks of transmission. Last month, Governor Murphy issued an Executive Order related to vaccination management, COVID-19 testing, and data collection, which mandates “covered health care and high-risk congregate settings” to establish a policy requiring “covered workers” to either submit proof of full vaccination or to submit to weekly COVD-19 testing. This requirement goes into effect on September 7, 2021.

In addition, the Occupational Health and Safety Administration (OSHA) has implemented an emergency temporary standard (ETS) applicable to certain health care settings, which includes extensive safety and health measures. The ETS provides for certain exceptions for coverage, and while the precise definitions are complicated and must be consulted, the focus appears to be on those settings where employees are interacting with patients who are suspected or confirmed for COVID-19. Unlike the Executive Order, the OSHA ETS does not include vaccine or testing requirements; however, certain New Jersey health care providers will be covered by both measures.

Which health care and high-risk congregate settings must comply with the Executive Order?

The scope of this Executive Order is quite broad and will impact most health care settings across New Jersey, both in terms of the covered health care settings and the covered workers to which the vaccine or testing requirements will apply.

The Executive Order defines “health care facility” extremely broadly as including:

acute, pediatric, inpatient rehabilitation, and psychiatric hospitals, including specialty hospitals, and ambulatory surgical centers; long-term care facilities; intermediate care facilities; residential detox, short-term, and long-term residential substance abuse disorder treatment facilities; clinic-based settings like ambulatory care [which would include all private medical offices], urgent care clinics, dialysis centers, Federally Qualified Health Centers, family planning sites, and Opioid Treatment Programs; community-based healthcare settings including Program of All-inclusive Care for the Elderly, pediatric and adult medical day care programs, and licensed home health agencies and registered health care service firms operating within the State.

High-risk congregate settings under the Executive Order include:

State and county correctional facilities; secure care facilities operated by the Juvenile Justice Commission; licensed community residences for individuals with intellectual and developmental disabilities (“IDD”) and traumatic brain injury (“TBI”); licensed community residences for adults with mental illness; and certified day programs for individuals with IDD and TBI.

“Covered workers” is defined to include full and part time employees and independent contractors, as well as individuals with operational, custodial and administrative support roles.

How to Comply and Penalties for Violations

Covered workers are not required to provide proof of having been fully vaccinated under the Executive Order, but those who do not submit proof of full vaccination must submit to COVID-19 testing one to two times per week. The settings covered by this Executive Order may choose to impose more frequent testing as well. A covered worker will not be considered fully vaccinated until two weeks have elapsed since receipt of the second dose of a two-dose series, or a single dose of a one-dose.

Acceptable proof of full vaccination includes: (1) CDC COVID-19 Vaccination Card; (2) Official record from the New Jersey Immunization Information System or other State immunization registry; (3) Record from a health care provider portal/medical record system on official letterhead signed by a physician, nurse practitioner, physician’s assistant, registered nurse or pharmacist; (4) Military immunization or health record from the U.S. Armed Forces; or (5) Docket® mobile phone application record or any state specific application that produces a digital health record. Records of such proofs must be maintained confidentially.

Those employees who do not submit proof of vaccination must submit to weekly testing, which can be either antigen or molecular tests with Emergency Use Authorization from the Food and Drug Administration or operating pursuant to the Laboratory Developed Test requirements by the U.S. Centers for Medicare and Medicaid Services. Covered settings may provide onsite COVID-19 tests, which can be either an antigen or molecular test. Covered settings must have a policy for tracking test results and are required to report results to the local public health department. However, in all other respects, vaccination and testing information must be kept confidential and separate from the employees’ personnel records.

The penalties for violations are stringent. Pursuant to N.J.S.A. 9:49, a violation may be considered a disorderly conduct offense, which can carry a penalty of a fine of up to $1,000 or 6 months imprisonment.

It should be noted that the requirements of the Executive Order with respect to screening and testing of unvaccinated workers do not override any requirement imposed by the covered setting regarding the testing and screening of symptomatic workers or vaccinated workers.

OSHA’s COVID-19 Emergency Temporary Standard (ETS) for Health Care Settings

Published on June 21, 2021[1] and in further effort to ensure the safety of health care workers, the OSHA ETS for health care and related industries provides that, unless an exception applies, in settings where employees provide health care services or health care support services, employers must develop and implement COVID-19 plans.

The analysis to determine whether an exception applies is complicated, and OSHA offers a flowchart to assist with this analysis. Among these exceptions are:

  • Private medical practices, where (i) the office is in a non-hospital setting, (ii) ALL non-employees are screened prior to entry, and (iii) anyone with suspected or confirmed COVID-19 is not permitted to enter the premises.
  • Well-defined hospital ambulatory care settings where all employees are fully vaccinated and all non-employees are screened prior to entry and people with suspected or confirmed COVID-19 are not permitted to enter those settings.
  • Home health care settings where all employees are fully vaccinated, all non-employees are screened prior to entry, and people with suspected or confirmed COVID-19 are not present.
  • Well-defined areas where there is no reasonable expectation that any person with suspected or confirmed COVID-19 will be present, the requirements in the ETS for personal protective equipment (PPE), physical distancing, and physical barriers do not apply to employees who are fully vaccinated.

For those covered health care settings with more than 10 employees, the COVID-19 plan must be in writing. It is not practicable to list every requirement in this alert without making it quite lengthy, but the following will highlight some of the notable plan requirements:

  • A designated safety coordinator who understands and is able to identify COVID-19 hazards in the workplace, is knowledgeable in infection control and has the authority to ensure compliance with the COVID-19 plan
  • A workplace hazard assessment (including involvement of non-managerial employees)
  • Policies and procedures to minimize the risk of transmission of COVID-19 to employees, which are extensive and include but are not limited to:
  • Limiting points of entry for patients and screening patients, clients and visitors at entry
  • Social distancing when indoors
  • Physical barriers between fixed work stations in non-patient areas
  • Cleaning and disinfecting surfaces and equipment in patient areas and in high touch areas at least once per day
  • Providing hand sanitizer with a minimum of 60% alcohol or easily accessible handwashing facilities
  • Providing Personal Protective Equipment (PPE) to employees with close contact exposure (within six feet in same room) to a person with suspected of confirmed COVID-19
  • Ensuring HVAC systems are used per manufacturer instructions and utilize Minimum Efficiency Reporting Value of 13 or higher if the system permits
  • Screening employees each workday/shift
  • Employees required to promptly notify employer of positive COVID-19 test, a suspected COVID-19 case or of COVID-19 symptoms

When an employee who has been physically present in the workplace tests positive, that employee must notify a designated employee within 24 hours

Employees should be trained on COVID-19 transmission and informed of their right not be retaliated against for exercising their rights under this ETS. Finally, health care settings with more than 10 employees must retain records of positive COVID-19 cases and all covered health care settings must report any COVID-19 fatalities and in-patient hospitalizations to OSHA.

ETS Requires Employers Pay Employees Forced to Quarantine or Isolate Under Defined Circumstances

Significantly, the ETS requires covered employers with ten or more employees to provide employees with substantial “medical removal protection benefits” if the employee must be removed from the workplace when the employer knows that the employee:

  1. Is COVID-19 positive, meaning that the employee was confirmed positive for or was diagnosed by a licensed health care provider with COVID-19;
  2. Has been told by a health care provider that they are suspected to have COVID-19;
  3. Is experiencing recent loss of taste and/or smell, with no other explanation; or is experiencing both fever (≥100.4° F) and new unexplained cough associated with shortness of breath; or
  4. Is required to be notified by the employer of close contact in the workplace to a person who is COVID-19 positive, UNLESS the employee has been fully vaccinated against COVID-19 (i.e., 2 weeks or more following the final dose), or had COVID-19 and recovered within the past 3 months, AND the employee does not experience the symptoms listed in item 3.

When an employee must quarantine or isolate under the aforementioned circumstances, medical removal benefits entitle the employee to regular pay the employee would have received had the employee not been absent from work, up to $1,400 per week until the employee is able to return to work. After three weeks of this leave, employers with 500 or less employees may reduce the benefits paid to two thirds of the employee’s regular rate of pay (up to $200 per day). If an employee removed from the workplace is too ill to work remotely, OSHA directs the employer to provide the employee with sick leave or other leave in accordance with the employer’s policies and applicable law. The employer’s payment obligation is reduced by the amount of compensation the employee receives from any other source, such as a publicly or employer-funded compensation program. Employers may also be entitled to an American Rescue Plan tax credit if they pay sick and family leave for qualified leave from April 1, 2021, through September 30, 2021. More information on the tax credit is available from the IRS.

Resources for Compliance

OSHA provides a lengthy COVID-19 plan template to assist health care providers, which may be customized for each workplace. There are additional resources available to health care providers including worksite checklists, sample employee screening questionnaires, an employee training presentation on the Health care ETS and a sample COVID-19 log. OSHA also offers an FAQ on the ETS standard.

Enforcement and Penalties

Violations of the OSHA ETS may carry a maximum penalty of $13,653 per serious violation or per day for failure to abate beyond the abatement date. Willful or repeated violations carry a penalty of $136,532 per violation. OSHA will use its discretion to determine whether an entity’s failure to comply with the ETS standard despite its best efforts warrants relaxation of the enforcement penalties. However, the agency expects that most employers should be able to achieve compliance within the stated deadlines. When addressing penalties for violations, the agency will also consider the size of the company and any past violations.

Takeaways

Health care settings continue to be at the frontline as we battle COVID-19. State and Federal guidelines and mandates are evolving, extremely complicated and can be difficult to navigate. As a threshold matter, it is critical to determine which measures apply to the health care setting. Compliance is critical to minimize the risks to patients and employees and to avoid penalties for non-compliance. Clear communication with employees is crucial to ensure that they are familiar with the requirements and expectations, as well as to understand the employer’s efforts to keep them safe.

[1] Covered health care employers must comply with all provisions in the ETS as of July 6, 2021  except those requirements related to ventilation, physical barriers, and training, which had a  compliance deadline of July 21, 2021

© Copyright 2021 Sills Cummis & Gross P.C.

Article By Jill Turner Lever, Stacy L. Landau, Patricia M. Prezioso, and Charles H. Newman with Sills, Cummis & Gross PC.

For more COVID-19 updates, visit the NLR Healthcare Law section.

Surprise Billing Regulations: Out-Of-Network Providers at In-Network Facilities

On 1 July 2021, the Department of the Treasury, the Department of Labor, and the Department of Health and Human Services (the Departments) issued an interim final rule (IFR)1 implementing certain provisions of the No Surprises Act (the Act).2 Congress enacted the Act in 2020 to protect patients from “surprise medical bills” and to limit so called “out-of-network” cost sharing bills for patients receiving care from providers who are not “in-network” participating providers in the patient’s health plan. The Act is applicable to emergency services, non-emergency services furnished by out-of-network providers at certain in-network health care facilities, and air ambulance services furnished by out-of-network providers. The IFR provides additional guidance to health care providers and facilities, including hospital and freestanding emergency departments, for complying with the Act. Comments on the IFR are due on 7 September 2021. Assuming no further changes from the Departments following the comment period, the requirements for providers as outlined in the IFR will be effective as of 1 January 2022.

For in-network providers and facilities, the Act and the IFR will require advance planning with respect to certain public and patient-specific disclosures. In-network providers and facilities will also need to prepare patient notice and consent forms in order to comply with updated surprise billing protections. Further, such providers will need to be actively coordinating with plans and insurers prior to seeking payment in order to determine whether notice and consent and/or balance billing prohibitions are triggered.

Key takeaways include:

  • The IFR extends surprise billing protections to non-emergency services furnished by an out-of-network provider at in-network health care facilities.
  • Out-of-network providers may not bill patients for an amount that exceeds in-network cost sharing, as determined in accordance with the balance billing provisions, when furnishing services at an in-network health care facility.
  • Such balance billing prohibitions will not apply if the patient has been provided with adequate notice as has agreed to waive such requirements pursuant to a valid consent, with certain enumerated exceptions.
  • Providers and facilities will further be required to make certain additional disclosures regarding protections against balance billing, including written disclosures to patients and prominent public displays on-site and online.

BACKGROUND

The Act provides protections from surprise medical bills for certain emergency and non-emergency services. The Act protects patients from surprise medical bills for emergency services from the point of evaluation and treatment until the patient can be stabilized and can consent to transfer to an in-network facility. Such protections apply to three emergency categories (1) emergency services received at an out-of-network facility, (2) emergency services rendered by an out-of-network individual provider, such as an emergency physician, regardless of whether the facility is in- or out-of-network, and (3) emergency services provided by out-of-network air ambulances. Additionally, patients will be protected from surprise medical bills for non-emergency services (1) provided by an out-of-network provider at an in-network facility and (2) out-of-network air ambulance services.3 For services subject to these protections, the Act limits cost sharing for out-of-network services to in-network levels and requires such cost sharing to count toward any in-network deductibles and out-of-pocket maximums.4

The Act effectively repeals the “Greatest of Three Rule” framework. Prior to the Act, the Affordable Care Act (ACA) enacted provisions requiring that insurance companies hold out-of-network patients harmless as if they were in-network. The ACA’s implementing regulations required insurers or private health plans to reimburse providers at the greatest of three enumerated amounts (the Greatest of Three Rule): (1) the rate generally reimbursed by the plan of insurance for out-of-network providers (i.e., the usual, customary, and reasonable amount); (2) the median in-network rate; or (3) the Medicare rate. The Act will effectively repeal the Greatest of Three Rule framework and replace it with a new reimbursement regime for emergency and certain non-emergency out-of-network services. The Act directs the Departments to establish through rulemaking the methodology that a group health plan or health insurance issuer offering group or individual health insurance coverage must use to determine the “qualifying payment amount” used to determine a patient’s coinsurance. For provider reimbursement where there is no governing state law or agreement between the payor and the provider, the Act establishes a baseball style arbitration that takes into account the qualifying payment amount. To learn more about how the No Surprises Act and IFR address reimbursement, please see our prior alerts here and here.

IMPACT FOR OUT-OF-NETWORK PROVIDERS AT IN-NETWORK FACILITIES

In the IFR, the Departments contend that surprise billing is a significant issue across all types of coverage and throughout the country, particularly certain specialties that are not “actively shoppable by consumers,” such as anesthesiology or laboratory providers, which often bill as out-of-network at in-network facilities.5 While the IFR focuses in part on emergency services, it also focuses on non-emergency services in certain circumstances, specifically extending surprise billing protections to non-emergency services furnished by an out-of-network provider at an in-network health care facility.6 Specifically, if a health plan provides benefits for certain non-emergency items and services at a facility, the plan must cover items and services furnished to a plan enrollee by an out-of-network provider with respect to a visit at an in-network health care facility, including meeting requirements regarding cost-sharing, payment amounts, and processes for resolving billing disputes. For providers, the IFR clarifies the Act’s requirement that out-of-network providers or facilities may not bill patients for an amount that exceeds in-network cost sharing. This cost-sharing is determined in accordance with the balance billing provisions. The balance billing prohibition is applicable when an out-of-network provider furnishes services at an in-network health care facility. The prohibition specifically includes those off-site out-of-network providers, such as laboratories, who furnish items or services that a patient receives as part of a visit to the in-network facility.7 The prohibitions on balance billing do not apply if certain notice is provided to the patient and the patient waives the balance billing protections with respect to the particular out-of-network provider.8

NOTICE AND CONSENT REQUIREMENTS

The IFR details the following specific standards around the notice and consent requirements for out-of-network providers providing items or services at in-network facilities.

  • The notice must be tailored to the individual patient in each circumstance, including identification of the provider or facility and a good faith estimate of the amount to be billed.9
  • A facility may provide a single notice for multiple out-of-network providers, provided that (1) each provider’s name is specifically listed, (2) each provider includes an individual estimate of the items and services they are individually furnishing, and (3) the patient has the option to consent to waive balance billing protections with respect to each individual provider separately.10
  • The notice and consent forms must be provided together and cannot be attached to or incorporated into any other documents.11
  • The notice be provided within an appropriate timeframe for the patient to make an informed decision. For example, for appointments scheduled in advance, notice should be made at least 72 hours before the date of the appointment, or if an appointment is made on the day of, notice should be given at least three hours prior to furnishing the items or services.12
  • The notice must make clear that the good faith estimate and patient consent do not constitute a contract or a binding commitment to the estimated charge.13
  • The notice must include information regarding whether prior authorization or other care management limitations may be required prior to the provision of services.14
  • The notice must clearly state that the patient is not required to consent to receive such items and services, and that the patient may instead seek care from an available in-network provider or facility and that in such cases, in-network cost-sharing amounts will apply.15
  • For post-stabilization services furnished by an out-of-network provider at an in-network emergency facility, the notice must include a list of in-network providers at the facility who are able to furnish the same items or services and state that the patient may be referred at their option to such provider(s).16
  • The Departments also clarified that an in-network facility may provide the notice on behalf of an out-of-network provider.17
  • Notice must be available in any of the 15 most common languages in the geographic region in which the facility is located. If an individual cannot understand any of the provided languages, the provider or facility must obtain a qualified interpreter.18
  • A patient may demonstrate consent by signature of the consent form, and may revoke consent by notifying the provider or facility in writing prior to the furnishing of items or services.19
  • Obtained consent must be maintained for a minimum of seven years.20

EXCEPTIONS TO NOTICE AND CONSENT REQUIREMENTS

In limited circumstances under the Act and as outlined in the IFR, notice and consent requirements do not apply for certain types of non-emergency items or services. In these situations, the prohibition on balance billing and in-network cost-sharing requirements will continue to apply. Specifically, notice and consent requirements do not apply to (1) ancillary services, including items and services related to emergency medicine, anesthesiology, pathology, radiology, and neonatology; (2) items and services provided by assistant surgeons, hospitalists, and intensivists; (3) diagnostic services, including radiology and laboratory services; and (4) items and services provided by an out-of-network provider where there is no in-network provider who can furnish such item or service and the applicable facility.21 Further, notice and consent requirements do not apply for items or services furnished as a result of unforeseen, urgent medical needs arising when post-stabilization services are furnished and the out-of-network provider or facility has already satisfied the notice and comment criteria.22

DISCLOSURE REQUIREMENTS

In addition to notice and consent requirements, the Act also requires providers and facilities to provide general public disclosures regarding patient protections against balance billing, including written disclosures to patients and postings both physically displayed in a prominent location at the location of the provider or facility and on a public website. These requirements will apply for plan years beginning on or after 1 January 2022. The disclosure provided to patients must include clear and understandable information about applicable state requirements and how to contact appropriate federal and state authorities if the patient believes the provider or facility has violated any applicable requirements for balance billing.23 This disclosure may be on a one-page form and should be provided no later than at the time the provider requests payment from the patient (or if no payment is requested from the patient, at the time a claim for payment is submitted). The Departments suggest that this disclosure may be provided earlier, such as at the time when an individual schedules an appointment or when other standard notice disclosures, such as the Notice of Privacy Practices, are provided.24 The IFR states that the Departments will separately issue a model disclosure notice for providers and facilities. Notably, providers that do not furnish items or services at a health care facility or in connection with visits at a health care facility are not required to make such disclosures, and disclosures are only required for patients who are participants, beneficiaries, or enrollees of group health plans or insurance coverage offered by an insurer.25 Further, in order to streamline the documents provided to patients, the IFR clarifies that a provider may satisfy the above disclosure requirements if it has a written agreement with the facility that requires the facility to provide a single disclosure including information about balance billing requirements that are applicable to both the facility and the provider.26

ENFORCEMENT AND COMPLIANCE

The Act authorizes states to enforce certain requirements of the Act and requires the Department of Health and Human Services (HHS) to enforce if a state fails to substantially enforce the requirements.27 Failure to meet the requirements of the Act may result in civil monetary penalties in states where HHS directly enforces balance billing requirements. Accordingly, out-of-network providers and facilities should take necessary precautions to ensure that their billing practices are in alignment with the Act and IFR guidance. For example, the Departments recommend that out-of-network providers that furnish non-emergency services confirm whether the facility at which they are providing such services is in-network or not to determine whether balance billing protections will apply. Additionally, out-of-network providers should be in communication with applicable plans and insurers when limitations on cost-sharing do not apply, including when proper notice and consent have been obtained. The Departments further emphasize that out-of-network providers providing non-emergency services may need to alter current billing practices to ensure they are not running afoul of the Act’s requirements. In particular, out-of-network providers may need to bill a health plan or insurer before billing an individual directly, in order to determine whether the plan covers the applicable non-emergency services at issue and thus triggers the applicable requirements.28

CONCLUSION

Out-of-network providers who furnish services at in-network facilities, as well as in-network facilities that allow out-of-network providers to furnish services at their facilities, should be prepared to operationalize notice, consent, and disclosure requirements for out-of-network providers providing services in their facilities. Before providing services at a given location, out-of-network providers that furnish non-emergency services should confirm whether the facility at which they are providing such services is in- or out-of-network to determine whether balance billing protections will apply. Additionally, providers may need to alter current billing practices to meet the requirements of the Act. In particular, providers will need to proactively communicate with plans and insurers when limitations on cost-sharing do not apply, including when proper notice and consent have been obtained.

Our health care practice routinely assists health systems, hospitals, and other providers and suppliers with legal advice and strategic considerations, including providing advice on reimbursement matters and preparing clients’ public comments on proposed and final rulemakings.

Footnotes

1 Requirements Related to Surprise Billing; Part I, Office of Personnel Management, Dep’t of Treasury, Dep’t of Labor, Dep’t of Health and Human Serv., 86 Fed. Reg. 36,872 (July 13, 2021) (Interim Rule).

2 The No Surprises Act was signed into law as part of the Consolidated Appropriations Act of 2021 (H.R. 133; Division BB – Private Health Insurance and Public Health Provisions).

3 See Interim Final Rule at 36,878, 36,882-83.

4 Interim Rule at 36,877.

5 Id. at 36,922.

6 Id. at 36,882.

7 Id. at 36,904-05.

8 Id. at 36,905.

9 Id. at 36,906.

10 Id. at 36,907.

11 Id. at 36,906.

12 Id. at 36,907.

13 Id. at 36,908.

14 Id.

15 Id.

16 Id.

17 Id. at 36,906.

18 Id. at 36,909-10.

19 Id. at 36,909.

20 Id. at 36,911.

21 Id.

22 Id. at 36,910.

23 Id. at 36,912.

24 Id. at 36,914.

25 Id.

26 Id. at 36,915.

27 Id. at 36918.

28 Id. at 36,905.

Copyright 2021 K & L Gates
For more articles about healthcare coverage, visit the NLR Healthcare Law section.

U.S. Supreme Court Rejects Latest Challenge to ACA in 7-2 Ruling

On June 17, 2021, the U.S. Supreme Court rejected a long-anticipated challenge to the Patient Protection and Affordable Care Act, known as the “Affordable Care Act” (ACA). This was the third case in a trilogy of challenges to the ACA. See California et al. v. Texas et al., No. 19-840.

In a 7-2 decision, the Court held that the state of Texas (along with over a dozen states and two individuals) simply lacked standing to challenge the constitutionality of a statutory mandate with no consequences. Justices Alito and Gorsuch dissented, and Justice Coney Barrett joined the majority.

The Court did not reach the merits of the appeal, which concerned whether the individual mandate provision of the ACA, previously determined to be unconstitutional, may be severed from the rest of the law or whether the entire law must be struck down. Basically, the plaintiffs argued that if the individual mandate provision was unconstitutional, the entire ACA was unconstitutional.

Instead, the Court determined that the plaintiffs lacked standing, explaining that the plaintiffs could not demonstrate any actual injury traceable to the penalty for violating the individual mandate, which was established in 2017 at an amount of $0.

From its inception, the status of this case has been of concern to a wide variety of stakeholders in the health care industry. Beginning with the ruling by a federal district court in Texas that invalidated the ACA in its entirety, to the Fifth Circuit Court of Appeal’s ruling that only the individual mandate was unconstitutional while the rest of the ACA should remain intact, onlookers have eagerly anticipated the Supreme Court’s decision on this matter.

For now, the ACA remains the law of the land.

©2021 Greenberg Traurig, LLP. All rights reserved.
For more articles on the Supreme Court, visit the NLR Litigation / Trial Practice section.

IRS Guidance Clarifies “Involuntary Termination” for the COBRA Subsidy

In Notice 2021-31, the Internal Revenue Service (IRS) provides broad guidance in a question-and-answer format on the application of the American Rescue Plan Act of 2021 (ARP) regarding premium assistance under the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) continuation coverage provisions. Perhaps most critical for group health plan administrators and insurers, the IRS has defined and illustrated the use of the term “involuntary termination of employment,” which is the primary trigger (the other is a reduction in hours) for premium assistance obligations under the ARP.

Background

Section 9501 of the ARP provides for a temporary 100%reduction in the premium otherwise payable by certain individuals and their families who elect continuation coverage due to a loss of coverage as the result of a reduction in hours or involuntary termination of employment under COBRA (and, in certain cases, under state “mini-COBRA” laws). Such persons may be “Assistance Eligible Individuals” for whom group health plan administrators and insurers must provide certain notices and facilitate a premium reduction, if elected. For more background regarding the premium subsidy under the ARP, see our prior article.

What is an involuntary termination of employment?

The notice generally defines an involuntary termination of employment as follows:

a severance from employment due to the independent exercise of the unilateral authority of the employer to terminate the employment, other than due to the employee’s implicit or explicit request, where the employee was willing and able to continue performing services

Ultimately, however, the determination of whether a termination is involuntary is based on the facts and circumstances.

What are some examples of an involuntary termination of employment?

  • Good Reason – An employee-initiated termination of employment is involuntary if it occurred for good reason due to employer action that results in a material negative change in the employment relationship for the employee analogous to a constructive discharge.
  • Impending Termination – An employee-initiated termination of employment is involuntary if the employee was willing and able to continue performing services, but the employee initiated termination having knowledge that the employee would have otherwise been terminated by the employer.
  • Illness or Disability – An employer-initiated termination resulting from the employee’s absence from work due to an illness or disability is an involuntary termination if before the action there is a reasonable expectation that the employee would have returned to work after the illness or disability has subsided. However, mere absence from work due to illness or disability before the employer has taken action to end the individual’s employment is not an involuntary termination.
  • Cause – An employer-initiated termination of employment for cause is involuntary. However, if the termination is due to gross misconduct, the termination is not a qualifying event under COBRA and will not result in premium assistance.
  • Change of Work Location – An employee-initiated termination as the result of a material change in the geographic location of employment for the employee is involuntary.
  • Window Program – An employee-initiated termination of employment through a window program that is offered in connection with an impending termination and that meets the requirements of Treas. Reg. § 31.3121(v)(2)-1(b)(4)(v) is involuntary. Such a window program is generally one that provides an early retirement benefit, retirement-type subsidy, Social Security supplement, or other form of benefit for a limited period of time (no greater than one year) to employees who terminate employment during that period or to employees who terminate employment during that period under specified circumstances.
  • Nonrenewal – An employer’s decision not to renew an employee’s contract if the employee was otherwise willing and able to continue the employment relationship and was willing either to execute a contract with terms similar to those of the expiring contract or to continue employment without a contract is generally an involuntary termination. However, if the parties understood at the time they entered into the expiring contract, and at all times when services were being performed, that the contract was for specified services over a set term and would not be renewed, the completion of the contract without it being renewed is not an involuntary termination.

What are some examples of terminations of employment that are not involuntary?

  • Retirement – An employee’s retirement generally is not an involuntary termination. However, if the facts and circumstances indicate that, absent retirement, the employer would have terminated the employee’s employment, that the employee was willing and able to continue employment, and that the employee had knowledge that the employee would be terminated absent the retirement, the retirement is an involuntary termination.
  • Workplace Safety – An employee-initiated termination due to general concerns about workplace safety typically is not involuntary. However, if the employee can demonstrate that the employer’s actions (or inactions) resulted in a material negative change in the employment relationship analogous to a constructive discharge, the termination is involuntary.
  • Childcare – An employee-initiated termination resulting from the employee’s child being unable to attend school or because a childcare facility is closed due to COVID-19 generally is not involuntary.
  • Death – The death of an employee is not an involuntary termination of employment.

© 2021 Bradley Arant Boult Cummings LLP

ARTICLE BY B. David Joffe and Caleb L. Barron of
Bradley Arant Boult Cummings LLP
For more articles on free COBRA premiums, visit the NLR Coronavirus News section.

Brain Interfaces Bring Us Closer to a Life of the Mind

As we learn more about the human brain, we can begin to wonder if the rest of the body is necessary. Improved brain-machine interfaces are showing us how much can be accomplished by tapping directly into our thoughts.

While brainwaves can be read and interpreted through electrodes placed on the scalp, this method lacks the spatial detail of implanted electrodes. The recent action in practical thought-to-action science has taken place with direct physical connections.

For example, last summer brain researchers in Australia and the U.S. showed promising results by mounting electrodes on an expandable stent and threading it through blood vessels that lead to the brain. The sensors in the stent could sense when people’s brains signaled an intention to move, the sensors wirelessly sent this information to a computer which interpreted the signals. The interface allowed ALS patients to combine use of an eye tracker to move a cursor plus a thought-controlled click, making their communication faster and easier without surgery to implant electrodes.

Electrode-based therapy is still the gold standard, and Elon Musk’s company Neuralink has announced testing of a wireless implant that could provide a broadly useful direct interface between human brains and computers. Neuralink’s small implants include more than 1000 electrodes designed to send wireless signals to anything digital, like prosthetic hands or automotive controls.  According to a story in Wired last year, “The reason that excites neuroscientists is that right now their tools are relatively crude. The standard is the “Utah array,” a single chip with 64 electrodes on it. Just putting it in or taking it out can damage the tissue around it, and it’s not good at isolating single neurons or covering a large area … At the Neuralink presentation, Musk said that his prototype included sensors for motion, temperature, and pressure and 1,024 thin, flexible wires to pick up the electrical signals neurons put out while they’re neuron-ing.” Currently, this array can be wirelessly connected to a computer to learn to associate outbound signals with specific intentions.

Computer-aided brain-driven prosthetics have been improving by adding an element of touch feedback to the process.  Until recently, a person using a brain-computer interface would use visual cues to pick up objects with prosthetic arms. However, according to this week’s Ars Technica, researchers working with people paralyzed from the neck down added tactile feedback to the systems, allowing the test participants to drastically improve performance. The biggest improvements involved tasks requiring grasping an object. “While we may not always be consciously aware of them, touch and pressure play a major role in everything we do with our hands. By targeting the right area of the brain, the implant takes advantage of the systems the brain already has for managing this kind of sensory input.” As we understand more about these regions of the brain, the Brain/computer/ prosthetic interaction becomes easier and more efficient.

One of the most impressive recent achievements arrives this month out of Stanford and Brown Universities allowing a paralyzed person to type out about 90 characters per minute by imagining that he was writing the characters out by hand. This drastically beats the efficiency of earlier efforts that involve virtual keyboards and cursors. As noted by Wired, “there are other possible routes to getting characters out of the brain and onto the page. Somewhere in our writing thought process, we form the intention of using a specific character, and using an implant to track this intention could potentially work. . . Downstream of that intention, a decision is transmitted to the motor cortex, where it’s translated into actions. Again, there’s an intent stage, where the motor cortex determines it will form the letter (by typing or writing, for example), which is then translated into the specific muscle motions required to perform the action. These processes are much better understood, and they’re what the research team targeted for their new work.”

By placing implants in the premotor cortex, researchers were able to capture the base intentions of the thinker at an earlier, clearer stage than simply the intentions of movement to effectuate the underlying ideas. Conceptually, this is an interesting advance. We had been focused on tapping into the same neurons that allow a person to type a message, but we are finding that, if we can catch the thought before the brain has converted it into a specific physical action, then we can skip a step in the brain’s process and make the brain-computer interface much more efficient. It makes one wonder whether stripping the process back even further, capturing thoughts of entire words, rather than letters, would create further efficiencies.  Right now we can turn intentions toward physical action into the actions themselves.  But this is an advance toward capturing the initial desire before it can be processed further by the action portions of the brain.

As the Wired article stated, “the system shows a very significant speed boost compared to previous implant-driven systems, and the accuracy is quite good. The system also has the potential to be similar to touch-typing, in that a user doesn’t have to actually visually focus on letter production, allowing more normal interactions with the user’s surroundings.” So we proceed closer to the holy grail of brain-computer interface: allowing a person’s brain to drive direct actions without involving the rest of the body at all.

This would be a clear victory for those with bodily impairments, but it also would be an excellent step toward systems that allowed us to manage all parts of our world without needed a body to manipulate our environment.  We could speak to our home temperature control system or direct our automobile without touching anything. Arriving in the midst of a pandemic, the possibility of touchless control of our environments has a special allure. Maybe someday in the not-so-distant future, all we will need is an operational brain to be a fully functioning human.

Copyright © 2021 Womble Bond Dickinson (US) LLP All Rights Reserved.

ARTICLE BY Theodore F. Claypoole of Womble Bond Dickinson (US) LLP

For more articles on the human brain, visit the NLRBiotech, Food, Drug section

CDC: Masks Are No Longer Required in Most Settings for Vaccinated People

On Thursday, May 13, 2021, the Centers for Disease Control (CDC) announced new guidance stating it is safe for fully vaccinated people to not wear masks or physically distance in any non-health care setting.1

Per this guidance, fully vaccinated people can now resume most activities without wearing a mask or physically distancing. Unvaccinated people, however, should still consider the risks of particular indoor and outdoor activities now deemed safe for vaccinated people, such as restaurant dining, exercising indoors, or attending a crowded outdoor event, and take necessary precautions.

This is only guidance. Individuals may still be required to wear masks, and businesses may still be required to enforce mask-wearing as required by federal, state, or local law. For example, travelers will still be required to wear masks on all forms of public transportation and in public transportation hubs within the United States.

Additionally, in this latest guidance, the CDC recommended that fully vaccinated people can refrain from testing and self-quarantining before and after domestic and international travel and following a known exposure if asymptomatic, unless the individual lives or works in a high-congregated setting, such as a correctional facility or homeless shelter.

As the country continues to emerge from the pandemic, individuals and businesses should be mindful of this changing landscape as federal and state agencies begin to loosen pandemic requirements. For specific questions concerning national and state COVID-19 legal developments, please contact your Dinsmore attorney.

[1] Guidance for Fully Vaccinated People, Centers for Disease Control, May 13, 2021, https://www.cdc.gov/coronavirus/2019-ncov/vaccines/fully-vaccinated-guidance.html.

ARTICLE BY Faith C. Whittaker of Dinsmore & Shohl LLP
For more articles on CDC mask guidance, visit the NLR Coronavirus News section.

Twisting Arms to Get Jabbed, White House Says: ‘Vaccination Incentives All Around!’

On April 21, 2021, in a further push to encourage COVID-19 vaccinations for those individuals who have been hesitant, the White House issued a fact sheet titled, “President Biden to Call on All Employers to Provide Paid Time Off for Employees to Get Vaccinated After Meeting Goal of 200 Million Shots in the First 100 Days.” This announcement further signals the administration’s dedication to vaccinating the U.S. population and its willingness to offer incentives to employers that support their employees in becoming vaccinated. Employers that have remained neutral on this issue could be persuaded to “take up arms” and join the fight against COVID-19.

Specifically, the fact sheet calls on employers “to offer full pay to their employees for any time off needed to get vaccinated and for any time it takes to recover from the after-effects of the vaccination.” To aid in this, the fact sheet announces a new tax credit for nonprofits and businesses with fewer than 500 employees. This tax credit is an extension and expansion of the tax credits initially provided by the Families First Coronavirus Response Act (FFCRA) in 2020 and that were subsequently extended until September 30, 2021, by the recent passage of the American Rescue Plan Act of 2021 (ARPA). The tax credit as amended by the ARPA allows qualifying businesses to recoup the costs of providing paid leave to employees who cannot work or telework as a result of “obtaining immunization related to COVID-19 or recovering from any injury, disability, illness, or condition related to such immunization,” in addition to the other qualifying reasons for emergency paid sick leave.

IRS Guidance on ARPA Tax Credits

Also on April 21, 2021, the Internal Revenue Service (IRS) issued a news release elaborating on the White House’s fact sheet. The IRS news release largely summarizes its earlier April 2021 guidance, which details the procedural aspects of the tax credit. As the IRS explained in its earlier guidance, the “refundable” tax credits under the ARPA provide an offset “against the employer’s share of the Medicare tax.” This means that “the employer is entitled to payment of the full amount of the credits if it exceeds the employer’s share of the Medicare tax.” The IRS guidance further explains:

The tax credit for paid sick leave wages is equal to the sick leave wages paid for COVID-19 related reasons for up to two weeks (80 hours), limited to $511 per day and $5,110 in the aggregate, at 100 percent of the employee’s regular rate of pay. The tax credit for paid family leave wages is equal to the family leave wages paid for up to twelve weeks, limited to $200 per day and $12,000 in the aggregate, at 2/3rds of the employee’s regular rate of pay. The amount of these tax credits is increased by allocable health plan expenses and contributions for certain collectively bargained benefits, as well as the employer’s share of social security and Medicare taxes paid on the wages (up to the respective daily and total caps).

According to the IRS guidance, to claim the tax credits, eligible employers must “report their total paid sick leave and family leave wages (plus the eligible health plan expenses and collectively bargained contributions and the eligible employer’s share of social security and Medicare taxes on the paid leave wages) for each quarter on their federal employment tax return, usually Form 941, Employer’s Quarterly Federal Tax Return.” The IRS guidance further provides:

In anticipation of claiming the credits on the Form 941, eligible employers can keep the federal employment taxes that they otherwise would have deposited, including federal income tax withheld from employees, the employees’ share of social security and Medicare taxes and the eligible employer’s share of social security and Medicare taxes with respect to all employees up to the amount of credit for which they are eligible.

For additional information, interested employers can review the Form 941 instructions.

Finally, the guidance states the following:

If an eligible employer does not have enough federal employment taxes set aside for deposit to cover amounts provided as paid sick and family leave wages (plus the eligible health plan expenses and collectively bargained contributions and the eligible employer’s share of social security and Medicare taxes on the paid leave wages), the eligible employer may request an advance of the credits by filing Form 7200, Advance Payment of Employer Credits Due to COVID-19. The eligible employer will account for the amounts received as an advance when it files its Form 941, Employer’s Quarterly Federal Tax Return, for the relevant quarter.

Key Takeaways

The expansion of qualifying reasons to provide paid sick leave and obtain tax credits is an important development for all eligible employers because it provides another tool for many employers seeking to incentivize employees to get vaccinated. Now employers are not fighting this incentive battle alone when trying to encourage employees to become vaccinated; the government is upping the ante to incentivize employers to provide further relief and rewards to employees for getting vaccinated.

Of course, there are numerous other ways that both eligible and ineligible employers can incentivize employees to get vaccinated, and there are both pros and cons to mandatory vaccination policies. While a thorough discussion of these issues is beyond the scope of this brief update, employers interested in learning more about the legal and practical considerations for implementing vaccination policies (whether mandatory for an entire workforce, mandatory for a subset of employees based on job duties and exposure risk, or completely voluntary), can review our articles on vaccination policies and vaccine passports.

© 2021, Ogletree, Deakins, Nash, Smoak & Stewart, P.C., All Rights Reserved.

ARTICLE BY Michael K. Mahoney,  James M. Paul  and Colin H. Hargreaves of Ogletree, Deakins, Nash, Smoak & Stewart, P.C.
For more articles on coronavirus vaccinations, visit the NLR Coronavirus News section

The Ongoing US Vaccine Passport Debate

One main principle among public health measures is to use the least restrictive method necessary to protect the population, or to do the greatest good. From the public health perspective, requiring COVID status credentials (“Credentials”) makes sense because it allows people who present a low risk to others to not be subject to unnecessary restrictions. However, implementation and use of Credentials will require careful consideration of individual privacy concerns, as well as the ethical questions related to access and additional privilege.

In late March, the Biden administration announced that vaccination credentials or “passports” would not be mandated at the federal level and that there would be no centralized universal federal vaccinations database. Instead, the federal government’s role will be to develop standards for such solutions so they are designed to protect people’s privacy and are “simple, free, open source, and accessible both digitally and on paper,” according to White House coronavirus coordinator Jeff Zients.

To date, federal standards for the interoperability, security, or privacy of Credentials have not been published. Despite this fact, smartphone apps are already popping up that allow individuals to upload their COVID-19 test results and vaccinations that create a digital QR code, which can be scanned to validate a person’s COVID status.  A few companies are also developing a “smart card” option that does not require a smart phone.

Despite the lack of federal standards, these digital Credential solutions are already being implemented by health care providers administering the vaccine and others who are looking to meet “reopening” requirements. Reason being, while federal and state governments are not willing to require vaccination, proof of COVID status will otherwise be required in order for people to enter certain places. For example, in California the rules for reopening indoor live events require proof of vaccination or a negative test result from individuals before they are allowed to enter the venue. In New York, some state employees reportedly are required to use the state’s Credential solution, the Excelsior Pass, when returning to work.

While Credentials make sense from a public health perspective, concerns remain. Politicians in multiple states have proposed anti-passport legislation, citing privacy and civil liberty violations created by public and private entities requiring proof of vaccination.

One concern is the lack of comprehensive federal legislation that would protect the information that could be collected from individuals in connection with digital Credentials. While health care providers, health plans, and their contracted technology providers are generally subject to the Health Insurance Portability and Accountability Act (HIPAA) and its implementing regulations – which impose certain security requirements and limit how health information may be used without a patient’s consent – HIPAA may not always apply to the data involved. For example, a patient could authorize their health care provider to disclose their test results and/or vaccine record to the Credentials vendor, who would then generate and maintain the passport credentials. The customer in this case is the patient, not a health care provider or health plan, which means that HIPAA would not apply.

While it seems like HIPAA applicability is a minor distinction, the privacy and security implications can be significant. Under HIPAA, patients may share their health information however they choose, and health care providers and plans are required to send records to third parties upon a patient’s request. The sending of such records does not, in itself, make the third party recipient subject to HIPAA.  Digital Credential vendors and the public and private entities verifying testing/vaccination status thus may bypass HIPAA’s privacy and security requirements.

Businesses who collect COVID status and other consumer information may still be regulated by the Federal Trade Commission (FTC). However, generally speaking, fewer privacy protections apply in this kind of situation, and the applicable security standards are less specific. At the state level, digital Credential vendors may be subject to laws that are similar to, or even more stringent than, HIPAA, but this is not always the case.

As a result, the door is potentially left open for companies to collect substantial amounts of electronic health and other data without the privacy and security protections that exist in a traditional health care environment. Due to the potential value of the data and the fact that the Credentials will be offered for free, some skeptics believe companies will want to monetize the data collected to the fullest extent possible. Additionally, the potential for government agencies to collect data using Credentials and utilize it for other purposes beyond public health (e.g. monitoring and law enforcement) is a legitimate concern.  If either of these things happen, there will still be a “cost” to people in using these Credentials, and in the absence of a reasonable alternative people may have little choice but to pay it.

The use of Credentials raises ethical concerns as well. Ultimately, Credentials should be available and accessible by all, via a variety of mechanisms. In practice, the use of Credentials raises the question of equal access and the further divide that could be created in society.  Reports indicate that vaccine availability still varies greatly among communities, and that the rate of vaccination among racial minorities and low-income populations remains low. As a result, requiring or allowing use of a Credential becomes a privilege for those who have been vaccinated, which could lead to significant bias toward anyone without a Credential. Implementation and use of Credentials also needs to account for the subset of the population who are unable to receive a vaccine for medical reasons and those who may object to a vaccine based on religious or philosophical beliefs. Without some form of accounting in the implementation of Credentials, these groups may be unnecessarily penalized.

For the moment, individual users of digital Credentials are trusting the recipients of their data. Private and public entities are left to make tough decisions about the development and use of Credentials from a legal and ethical perspective while trying to anticipate the guidelines that might be articulated by the Biden administration.

©1994-2021 Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. All Rights Reserved.

ARTICLE BY Lara D. Compton and Bridgette A. Keller of Mintz
For more articles on vaccine passports, visit the NLR Coronavirus News section.

COBRA Alert: Enhanced Benefits for Those Eligible

On March 11, 2021, President Biden signed into law the American Rescue Plan Act (ARPA), which provides important health insurance benefits to certain eligible individuals. Specifically, the ARPA requires employers to cover 100% of Consolidated Omnibus Budget Reconciliation Act (COBRA) premiums from April 1, 2021, through September 30, 2021, for former employees who:

  • Became COBRA-eligible in or after November 2019;
  • Lost employer-sponsored health insurance because of an involuntary termination of employment or because of an involuntary reduction in hours; and
  • (1) Elected COBRA; (2) elected COBRA but let the coverage lapse; or (3) did not elect COBRA.

Former employees are not eligible for the ARPA COBRA subsidy if they:

  • Resigned voluntarily, or voluntarily reduced their hours;
  • Were terminated for gross misconduct;
  • Are now covered under another group health plan; or
  • Are Medicare-eligible.

Note, if COBRA coverage is set to expire before September 30, 2021, ARPA does not extend the expiration date; and many questions remain. For instance, does the ARPA COBRA subsidy extend to those who left employment per a mutual decision, for “good reason” under an employment agreement, or pursuant to a voluntary exit incentive plan? The Department of Labor is currently drafting regulations and guidance that should help answer these questions.

What Do Eligible Former Employees Need To Do?

For anyone who is covered by COBRA as of April 1, 2021, nothing needs to be done. It is up to the employer or the employer’s health insurance carrier to ensure that the premiums are paid for the relevant period. For those who let COBRA lapse or had not elected COBRA, the employer or the health insurance provider must provide notice of the new benefit and of a new enrollment period. The new enrollment period begins on April 1, 2021 and ends 60 days from delivery of the ARPA COBRA notification.

If you believe you may be entitled to coverage, are interested in receiving the benefits, and are not contacted by your former employer or their provider in the next few weeks, consider reaching out to the employer’s Human Resources Department or the insurance carrier to ask for information about your COBRA benefits under ARPA, or contact your employment lawyer.

© 2020 SHERIN AND LODGEN LLP

ARTICLE BY Gavriela M. Bogin-Farber of Sherin and Lodgen LLP
For more articles on COBRA, visit the NLR Corporate & Business Organizations section.