The Impact of the Patient
Protection and Affordable Care Act
(PPACA) on EAPs
SOUTH CAROLINA EAPA CONFERENCE
MARCH 6, 2014
STEVEN M. HAUGHT, LCPC, CEAP, CAADC
PRESIDENT, EAPA
LEARNING OBJECTIVES
 Healthcare (HC) Reform = PPACA = ACA=
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Obamacare
Attendees will:
1. Better understand backdrop of PPACA, referred to
as the Affordable Care Act (ACA)
2. Know implementation timelines for key
components of ADA
Discuss ACA challenges and opportunities for EAPs
ACA History
 Passed by Congress, signed by President Obama
3/23/10
 Declared constitutional by US Supreme Court 6/28/12
 Key provisions:
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1. Increase access to affordable health coverage (HC) to 62 million
Americans
32 million uninsured
 20 million will have increased coverage via parity for mental health &
substance abuse treatment services
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Key Provisions (cont.)
 Key provisions:
2. Reduce HC costs & improve quality of care
3. Increase consumer choice & protections
4. Provider consumers with tools to make “informed choice” re.:
HC
5. Hold insurance companies accountable
Rationale for ACA
 Money: control HC costs and increase access
 2011 Federal Gov’t spending:
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25% defense
23% health
21% pensions
13% welfare
18% all other programs
 Estimate: between 2030-2040 mandatory spending will
exceed revenue
 US behind other 1st world countries in mortality rates
amenable to HC
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France, Japan, Australia… US = #19 of 19
ACA Payment Reform
 Shift from pay for service to pay for performance
 Payers’ create capitated contracts with entities
tasked to integrate and coordinate care for a defined
group of Pts.
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Integrated Care Models, Accountable Care Organizations
(ACOs), Medical Homes
ACOs will receive money back from Medicare if they meet predetermined “best practice” quality & outcome standards, cost
benchmarks
Failure to meet goals/outcomes = penalties & reduced
revenues
Involved Governmental Departments
 Issuing rules and regulations:
 1. Department of Health & Human Services
 2. Department of Treasury: Internal Revenue Service
 3. Department of Labor: Employee (Ee) Benefits
Security Administration
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Referred to as “The Agencies”; will also have enforcement
powers
ACA Timeline 2013
 Many provisions already enacted
 Children may remain on parents’ HC plan until 26
 Maximum contribution to Flexible Spending
Accounts capped @ $2,500
 Ers must notify Ees re.: state hlth insurance
exchanges, whether Er plans to meet minimum
coverage requirements, how to access info regarding
premium subsidies available for hlth insurance
exchanges
Timelines 2013 & 2014
 Large Ers must report cost of Er-provided HC on Ees
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W-2s
HC plans must cover women’s preventive services,
including contraception, without co-pays, coinsurance or deductibles
2014
HC waiting periods > 90 days prohibited
States must create exchanges to help small Ers
provide HC to Ees
2014 Timeline (cont.)
 Individual mandate to purchase health insurance
 Ers >200 Ees must auto-enroll FTEs (>30 hrs/wk)
into default hlth plan with “affordable” coverage
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Will impact industries with hourly workers like retail,
restaurants, even academic institutions
Cut Ee hours to <30 or provide HC?
 2015 finalized provisions for EAPs as “excepted
benefits” may be put into effect
Timelines (cont.)
 2016 Ers > 50 Ees must offer HC or pay penalties
 2017- State exchanges may allow large Ers to provide
coverage through exchange plans
 2018- Ers will pay 40% excise tax on “Cadillac”
plans which exceed $10,200 for single coverage,
$27,500 for family coverage
Health Insurance Market Reforms (1)
 Final rules issued 2/20/13
 Insurance plans may not base rates on pre-existing
conditions, health status, claims history, duration of
conditions, gender, occupation, Er size, Er industry
 May base rates on age, tobacco use, family size &
geography
 10 categories “Essential Health Benefits” must be
covered by all exchange offered insurance plans (for
individual and small (50-110 Ees) business
purchasers
Health Insurance Market Reforms (2)
 1 of 10 “Essential Health Benefits” especially relevant
to EAPs : Mental health & substance use disorder
services
 Another EHB of potential relevance to EAPs:
Preventive & Wellness Services & Chronic Disease
Management
 Limits set on cost-sharing, i.e., out-of-pocket
expenses like deductibles, co-pays, co-insurance
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Same as annual High Deductible Health Plan max out-ofpocket; 2013: $6250 individual, $12,500 family
Health Insurance Market Reforms (3)
 ACA will increase coverage of Mental Health &
Substance Use Disorder Services by
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1. Including them in Essential Health Benefits
2. Increases federal parity protections to include individual &
small group markets
3. Increases the number of Americans covered with HC
including these benefits
Impact on EAPs: ERISA
 ERISA (Employee Retirement Income Security Act)
 Are EAPs covered?
 Answer complex due to variation in EAP designs
 Any plan defined as “Ee welfare benefit plan”
(EWBP) is subject to ERISA
 ERISA Opinion letter 88 0004A, “…if a program
provides assistance in dealing with a wide range of
personal problems affecting mental or physical
health through a contractual arrangement with an
independent organization staffed by trained
counselors, the program is covered by ERISA.”
EAPs & COBRA
 Consolidated Omnibus Budget Reconciliation Act
amends ERISA
 Requires offering ongoing coverage to Ees after loss
of eligibility for certain benefits under “ group health
plans” (GHPs)
 GHPs are EWBPs providing “services” including
“diagnosis, mitigation, treatment or prevention of
disease, and any undertaking for the purpose of
affecting the structure or function of the body”
 GHPs must provide “Summary Plan Descriptions” to
users
EAPs & COBRA (2)
 EAPs choosing non-medical descriptions such as
“assessment” vs. “diagnosis” or “short-term problem
resolution” may not successfully avoid falling under
COBRA
 The issue is the function performed, not the
description of the function
EAPs & HIPAA
 Health Insurance Portability & Accountability Act-
national standards for protection of electronically
communicated personal health information (PHI)
by health plan, health care clearinghouses and health
care providers
 HIPAA definition of GHP is same as COBRA and
that’s essentially the same as for ERISA
 So, what about your program?
EAPs & ACA
 ACA regulations issued 2/9/13 require GHPs &
health insurers to provide uniform Summary of
Benefits & Coverage (SBC) to plan participants
 Goal: help consumers compare health plans & HC
options = informed choice
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4 pages, includes glossary of HC options
Ancillary to SPD
 If an EAP provides counseling, even a few sessions:
yes, have to provide SBC
 EAPA website: blank SBC template (editable word
document); instructions for completing SBC for
EAPS, ACA & SBCs
 EAPs; sample completed SBC for with suggested
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language for EAPs
FAQ sheet
When to comply? 1st day of 1st plan year beginning
9/23/12
How often must EAP furnish SBC? On/before (1)
day coverage begins, (2) within 7 days of receipt of
request, (3) 30 days before start of each new plan
year, (4) within 1st 90 days of “special enrollees”
If plan is modified, must issue a new SBC
EAPs, ACA & SBCs (2)
 EAP is responsible for distribution, not the Er
customer
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Unless Er chooses to include EAP SBC in their overall health
plan SBC
 SBC must be distributed to participants,
beneficiaries & special enrollees
 May be distributed by mail or electronically (with
specific requirements)
EAPS as “Excepted Benefits” (EB) - 1
 12/24/13 The Agencies published “Amendments to
EB”, Federal Register/Vol 78, # 247/Proposed Rules,
pp. 77636-7
 Addresses EAPs in Section C
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EB = benefits not considered HC plans under ACA & HIPAA
 An EAP will be excepted IF:
 I. It doesn’t provide “significant” benefits in the
nature of medical care
EAP as EB - 2
 II. EAP benefits can’t be coordinated with group hlth
plan benefits
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A. EAP can’t be required (“gatekeeper” ) pre access to other
hlth plan benefits
B. EAP eligibility must not be dependent on participation in
another grp hlth plan
C. EAP benefits must not be financed by another group hlth
plan
 III. No Ee premiums or contributions can be
required to participate in EAP
EAP as EB - 3
 IV. No cost sharing under the EAP
 Comments were due by 2/24/14
 >100 comments received
 EAPA (4pp), EARF (5 pp), EAR (2 pp), EASNA (3 pp)
 These exceptions are effective until “finalized”, at
least through 2014
I. Doesn’t Provide Significant Medical Benefits
 EAPA – Agree & endorse. Multi-modality service
provision; many services offered, including legal,
financial, etc. “Medical Necessity” not required for
service
 EARF – Agree. Workplace productivity mechanism;
# sessions irrelevant
 EASNA – “…doesn’t support this criterion because…
no standard, accepted definition… regarding
‘significant’ benefits”; # sessions irrelevant
II. EAP benefits can’t be coordinated with group
HP benefits - 1
 A. EAPA agrees with A & B; C is “ambiguous”- EAPA
doesn’t endorse; needs clarity
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If goal is to prevent EA “benefits” from being subsidized by
HP…EAPA supports…subsidization could distort referrals
If goal is to prevent EA cost from being subsidized by or
embedded in hlth plan – EAPA agrees: other EA core
activities like promo, Org. & Supv. Consults, etc., are
minimized and decrease EA effectiveness
If goal is to prevent owners of grp hlth plan from providing EA
under separate contractual agreement, EAPA opposed. This
currently occurs: ownership is not the issue, service is
II. EAP can’t be coordinated with Grp Hlth
benefits - 2
 EARF
 A. Agree
 B. Agree
 C. Disagrees – issue is not financing
 EASNA “…does not support this proposal…”
 A. EAP not HC benefit but a productivity tool, offered to all Ees
 B & C – unlike HC plan, offered free to Ee
III. No Ee premiums or contributions for EAP
 EAPA – agree; EAPs are paid for by Er
 EARF – supports
 EASNA – supports
 IV. No Cost Sharing Under EAP
 EAPA – agrees; cost sharing inconsistent with EA practice
 EARF – agrees
 EASNA - supports
Additional Implications of ACA for EAPs
 Interface with new ACOs
 Increased numbers with access to HC may strain
current provider capacities
 EAPs need to consider technology-based treatment
models
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Video, telephone and internet technologies
 Increase access by web, intranet and internet
 Changes in promotional materials
 Increase focus on outcomes using standardized
definitions and tools, not just utilization
Additional Implications (2)
 Measure impact on productivity (pre/post service
functioning- self report considered valid)
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HC costs, disability claims, absenteeism, presenteeism
 Continued expansion into child & eldercare, legal &
financial, critical incident response, webinars,
seminars and resources via robust web-site info,
assessment tools, links
 Continued research into best practices like Strategic
Brief Intervention, Referral & Treatment (SBIRT)
Additional Implications (3)
 Some express concern that since many EAPs are
being sold under cost, if not as a “give away”, there is
not enough money to provide services to the
organization
 If small employers go to health exchanges, may cut
EAPs, wellness, work-life and other ancillary services
Resources
 Addiction Professional, www.addictionpro.com
 Department of Health & Human Services,
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http://aspe.hhs.gov
Employee Assistance Professionals Association,
www.eapassn.org
Employee Benefit Adviser, http://eba.benefitnews.com
Employee Benefit News, http://ebnbenefitnews.com
Federal Register
The Open Minds Circle, www.openminds.com
Workforce, www.workforce.com
Contact
 Steven M. Haught, LCPC, CEAP, CAADC
 Director, Social Services, Central Region
 The Actors Fund
 8 S. Michigan Ave., #601
 Chicago, Il 60603
 312-372-0989
 shaught@actorsfund.org