Sunday, July 7, 2013

U.S. federal laws on Health Care Reform, Patient Protection and Affordable Care, Employee Retirement Income, and Pension Benefit Guaranty issues.

Last Updated: July 6 2013
Article by Eugene M Holmes and Justin S Alex
Benefit Issues In Puerto Rico: Impact Of The ACA, ERISA And The PBGC - Employment and HR - United States:
american justice system

This article highlights some recent developments that employers with Puerto Rico employee benefits arrangements should consider concerning compliance with U.S. federal laws on health care reform and the Patient Protection and Affordable Care Act ("ACA"), fiduciary duties under the Employee Retirement Income Security Act of 1974 ("ERISA"), and Pension Benefit Guaranty Corporation ("PBGC") coverage issues.  A failure to comply with applicable U.S. federal laws in Puerto Rico may result in costly litigation and civil penalties as well as criminal penalties

Health Care Reform
Parts of health care reform apply in Puerto Rico because the ACA amends the Public Health Service Act ("PHSA") and the Social Security Act ("SSA"), both of which apply in Puerto Rico.  The ACA's applicable requirements become effective over time and certain requirements do not apply to "grandfathered" plans.  Some of the new requirements that are already in effect are that employers must ensure their health insurance plans:
  • do not set lifetime dollar limits on the value of essential health benefits;
  • do not set annual limits on the dollar value of essential health benefits below a minimum threshold;
  • do not exclude individuals under the age of nineteen for pre-existing conditions;
  • offer preventive care without any cost to insured individuals;
  • cover dependent children until the age of twenty-six;
  • provide an effective appeals process for insured individuals to challenge adverse benefit determinations;
  • only retroactively rescind coverage in limited circumstances;
  • provide annual quality of care reports; and
  • provide uniform summaries of benefits and coverage.
In 2014, additional requirements will become effective and will be applicable in Puerto Rico.  Among them are prohibitions of exclusions for pre-existing conditions and annual limits on the dollar value of essential health benefits.  In addition, employers must limit their new hire waiting period for insurance coverage to ninety days.