The IAA One Minute Blog

On February 1, 2013, the Obama administration offered an updated compromise to its requirement that employers cover contraception in worker's insurance plans. The proposal was aimed at addressing the argument of Catholic bishops working with religiously affiliated universities, hospitals, and charities, that requiring employers to provide contraception violates their religious freedom.

New Proposal

Under the Patient Protection and Affordable Care Act (PPACA), most health plans must cover women's preventative services, including contraception, without charging a co-pay or deductible. The new rules provide women with coverage for preventative care that includes contraceptive services with no co-pays, while respecting the concerns of religious organizations.

The rules state that non profit religious organizations, such as non profit religious hospitals or institutions of education, which object to contraception on religious grounds, can receive an accommodation. This accommodation would provide the organization's enrollees separate contraceptive coverage with no co-pays and at no cost to the religious organization. The proposed rules define an organization eligible for accommodations as one that:

1. Opposes providing coverage for some or all of, any contraceptive services required to be covered, on account of religious objections.
2. Is organized and operates as a non profit entity.
3. Holds itself as a religious organization.
4. Self certifies that it meets these criteria and specifies the contraceptive services for which it objects providing coverage.

The proposed rules are open to public comment until April 8, 2013.

How the Accommodations Would Work

The updated policy released by Health and Human Services (HHS) still guarantees that workers at religious non profits would get the same coverage as everyone else, but it specifies a way for employers to avoid funding it. Participants would receive contraceptive coverage through separate individual health insurance policies.

For fully insured plans, an eligible organization will need to provide its self certification to the insurance carrier, which would automatically provide separate individual market contraceptive coverage at no cost to participants. The insurer would then notify enrollees that it is providing them with no cost contraceptive coverage through separate individual health insurance policies.

For self insured plans, the self certification would be provided to the third party administrator (TPA), which would then automatically work with an insurance carrier to provide separate individual health insurance policies. The TPA would receive an additional adjustment in the user fee that otherwise would be charged by a federally facilitated exchange in an amount that would offset a reasonable charge by the TPA for performing the service.

What IAA has to Say

Please be sure to remain active and contact your local representatives as they are looking for your comments and suggestions. As your TPA, Insurance Administrator of America is proud to facilitate any and all new requirements that come with the PPACA. If you are working with IAA and are not sure how this new proposal might affect your company, don't hesitate to reach out. IAA would be happy to speak with brokers whose clients might benefit from working with a TPA due to the newly proposed rules. Remember, with IAA one call does it all.

Interested in reading more blog posts about the PPACA? Click here and here.