Obama administration announces adjustments to excepted benefits regulations

WASHINGTON — The U.S. Departments of Labor, Health and Human Services, and Treasury today published a final rule that adjusts regulations originally issued under the Health Insurance Portability and Accountability Act of 1996 regarding dental and vision benefits. The new rule also expands the definition of excepted benefits to include employee assistance programs.

Under the HIPAA, excepted benefits are exempt from certain health reform requirements. Following the passage of the Affordable Care Act, employers, employees and other stakeholders expressed their view that past HIPAA definitions should be updated in light of new Affordable Care Act standards.

The final rule amends current regulations to treat EAPs meeting certain conditions as excepted benefits. EAPs are typically free programs offered by employers that can provide a wide-range of benefits to address circumstances that might otherwise adversely affect employees' work and health. Examples include short-term substance abuse or mental health counseling or referral services, as well as financial counseling and legal services. Under the final rule, EAPs are considered excepted benefits if the program is free to employees, if EAP benefits are not coordinated with benefits in a group health plan, and the EAP does not provide significant benefits in the nature of medical care or treatment.

Similarly, under the final rule, vision and dental benefits provided by employers on a self-insured basis qualify as excepted benefits, even if they do not require contributions from employees. Insured vision and dental benefits, as well as self-insured vision and dental coverage that requires employee contributions, already qualify as excepted benefits.

The final rule was published in the Oct. 1 edition of the Federal Register and can be viewed at https://federalregister.gov/a/2014-23323.