Making the First “Gag Clause” Attestations: A Quick Reference Guide

By Allison Richter and Caleb L. Barron - Under the Consolidated Appropriations Act of 2021 (CAA), group health plans and health insurance issuers are prohibited from entering into agreements with service providers restricting certain information that the plan may make available to another party. Plan sponsors and issuers must make a Gag Clause Prohibition Compliance Attestation (GCPCA) annually to confirm their compliance with the prohibition. With the deadline for the first GCPCAs approaching at the end of this year, plan sponsors and issuers should review the requirement, which is outlined in this quick reference guide, and ensure they have a strategy to either fulfill the requirement directly or delegate the responsibility to a service provider. Read Full Article… 

VBA Article Summary

1. Responsibility for Compliance: Even if the reporting task is delegated to a third-party administrator, the self-funded plan sponsor remains legally responsible for compliance with the GCPCA's gag clause prohibition. The delegation does not absolve the plan sponsor from legal obligations or potential civil penalties for violations.

2. Need for Careful Oversight: The delegation of reporting responsibilities requires careful oversight and communication between the plan sponsor and the third-party administrator. Contractual agreements must be clearly defined, and the plan sponsor must ensure that the third-party administrator is aware of the specific requirements, deadlines, and procedures for compliance with the GCPCA.

3. Potential Civil Penalties: Failure to provide the required attestation may result in a civil penalty of $100 per day for each individual affected by a violation. This underlines the importance of timely and accurate reporting. The plan sponsor must work closely with the third-party administrator to ensure that the reporting is done accurately and in accordance with the legal requirements to avoid potential penalties.

What Employers Need to Know About Removing Gag Clauses from Health Care Contracts

By Darren Fogarty - Self-insured employers retain the liability of attesting all gag clauses have been removed from their service agreements, even if a third-party submits the attestation on their behalf. Here’s how employers and purchasers can improve their contracts to demonstrate prudence and good-faith compliance with the CAA’s requirements. Read Full Article… 

VBA Article Summary

1. The Legislation and Requirement for Employers:

   • Consolidated Appropriations Act (CAA): Section 201 of the CAA made it unlawful for gag clauses to exist in employer service agreements, allowing employers to access and use their health care data.

   • Attestation Requirement: Employers are required to attest that their contracts are free of gag clauses by December 31, 2023, covering the entire three-year period since the CAA's passage.

   • Responsibility: This requirement falls solely on employers, and not vendors, also obliging them to use the newly accessible data to improve and make informed decisions for their benefit plans.

2. Challenges and Obstacles for Employers:

   • Prevalence of Gag Clauses: Many contracts with TPAs, PBMs, and other vendors have contained gag clauses, restricting the employers' access to crucial information.

   • Vendor Obstruction: Employers are facing difficulties with vendors taking questionable positions in removing gag clauses, offering to attest compliance without proper discussion, hiding gag clauses in confidentiality agreements, or providing incomplete data.

   • Potential Solution: The Health DATA Act has been introduced, aiming to enhance the gag clause removal part of the CAA, clarifying purchasers' rights, introducing penalties for noncompliance, and allowing employers to provide reasoned explanations instead of attestations.

3. Steps Employers Can Take:

   • Gathering and Reviewing Contracts: Employers must gather all relevant contracts and seek expert help to identify and negotiate the removal of gag clauses.

   • Negotiating Amendments and Vendor Cooperation: Contract amendments can be negotiated to ensure vendors cooperate in fulfilling obligations related to the CAA's gag clause provisions.

   • Facing Uncomfortable Conversations: The process of removing gag clauses may lead to difficult discussions between employers and vendors, questioning longstanding practices and understanding of health care data ownership. The successful navigation of this process will help employers determine if their vendors are aiding or obstructing their fiduciary obligations.

What Is FMLA? Looking at America’s Family and Medical Leave Act

By Monique Wilson - What is FMLA? The United States is one of six countries in the world that doesn't have a national paid family or medical leave policy. It has only the Family and Medical Leave Act, which offers eligible workers up to 12 weeks of unpaid leave to take care of a newborn child, yourself, or a loved one. This means that whether you give birth, adopt a child, fall sick, or need to care for an unwell loved one or family member, there is no national policy that protects your income. Read Full Article… 

VBA Article Summary

1. Inadequate Paid Leave Post-Birth: A significant number of women in the U.S., about one in four, are forced to return to work within just two weeks of giving birth. This is due to a lack of proper paid leave policies, leading to severe consequences for the physical and emotional well-being of the mothers, as well as impairing their ability to bond with their newborns. The situation highlights a financial pressure that prevents these women from taking unpaid time off to recover.

2. Positive Impact of FMLA: The Family and Medical Leave Act (FMLA), enacted in February 1993, was a pivotal piece of legislation that ensured job protection for many American workers needing up to 12 weeks off for family or personal care. This was groundbreaking for working parents, especially women, as it protected them from being replaced or pushed out of the workplace following childbirth or while caring for a family member or covered service member.

3. Need for Further Reform: Although FMLA has played an essential role in protecting workers' rights, the article stresses that it is not sufficient more than three decades after its introduction. The current system still forces many workers to choose between their income and their health or family well-being. The call to #PassPaidLeave emphasizes the necessity for continued advocacy and legislative action to ensure that no worker has to face such a devastating choice. The article makes a clear case for a more comprehensive paid leave policy that reflects the needs of today's workforce.

47% of Employees Say They’ll Quit if Employer Orders Return to Office Full Time, According to Integrated Benefits Institute Analysis

By Jennifer Santisi - After the upheaval of the last three years, employees have shifted their priorities when it comes to work-life balance and flexibility. Employers have had to pivot and change their workplace policies, while juggling company culture, attraction/retention, and cost—sometimes a seemingly impossible task. Read Full Article… 

VBA Article Summary

1. Importance of Flexible Work Models: A majority of employees prefer some form of remote work, with 47% considering leaving their jobs if forced to return to the office full-time. Flexible work schedules enhance well-being, engagement, and commitment, and can lead to increased productivity and satisfaction. There is a significant gap between what employers and employees want regarding full-time office work, with only 15.1% of remote-capable employees desiring to return full-time.

2. Challenges and Benefits of Office Work: Employers cite reasons like empty office space expenditures and concerns over creativity for wanting employees back in the office. Employees value in-office work for socializing (51%) and face-to-face collaboration (47%), but those who work fully onsite are less likely to rate their happiness as high.

3. Guidance and Areas of Focus for Employers: Employers should pay attention to Communication/Technology, Connectedness and Social Interaction, Recognition, Health and Wellbeing, and Modeling the Culture. No one-size-fits-all solution exists; it’s crucial to listen to employee feedback and customize arrangements to fit organizational needs.

U.S. Department of Labor sues UnitedHealth Group over thousands of denied claims

By Christopher Snowbeck - The U.S. Department of Labor is suing a subsidiary of UnitedHealth Group over allegations that the company wrongly denied thousands of claims to pay health care providers for emergency room services and urinary drug screenings. Denial of the ER claims was based solely on diagnosis codes, the government alleges, rather than a "prudent layperson" standard that's required by health plan documents. Read Full Article… 

VBA Article Summary

1. Accusations Against UMR Inc., a UnitedHealth Group Division: The U.S. District Court for the Western District of Wisconsin has received a lawsuit this week that accuses UMR Inc., a Wausau-based division of UnitedHealth Group, of improperly denying claims. The suit alleges that UMR should have applied a medical necessity standard to claims for urinary drug screening but instead denied all the claims. Furthermore, UMR is accused of failing to provide required information for denial documents and implementing a "True Emergency" policy that led to the unjust denial of emergency room claims.

2. Response from UnitedHealth Group and Related Concerns: UnitedHealth Group maintains that the government's complaint deals with administrative processes no longer in use and that they have been in ongoing conversations with the Labor Department, vowing to defend their position vigorously. Dr. Christopher Kang, president of the American College of Emergency Physicians, sees the lawsuit's issues as part of a broader pattern of large insurance companies delaying or reducing payments for emergency care, calling for immediate action to hold insurers accountable.

3. Details of the Alleged Misconduct and Its Implications: The lawsuit details the period during which UMR denied all urinary drug screening claims (August 2015 through August 25, 2018) and the change to its denial policy in August 2018 after a high overturn rate on appeal. It emphasizes that UMR's methods for adjudicating emergency room claims did not consider the layperson's perspective, relying solely on a medical provider's diagnosis at the end of treatment. The lawsuit's allegations point to a systemic problem with the way UMR handled claims, potentially affecting thousands of participants and 371 health plans, reflecting a critical issue in self-insured health plans in the U.S.

Employee Benefits Are Changing With The Workforce

By Financial Advisor - Employers who want to attract and retain the best talent acknowledge that the one-size-fits-most approach to benefits plans and programs will no longer work for a workforce that has become younger and more diverse, according to a workforce benefits study by LIMRA and Ernst & Young. Read Full Article… 

VBA Article Summary

1. Importance of Benefits for Attraction and Retention:

   • 90% of employers see benefits as vital for attracting and retaining talent, with 95% of organizations with 1,000+ employees agreeing.

   • 50% of small employers and 62% of large employers plan to expand their benefits within five years.

   • Benefits like emergency savings programs, career development, and wellness offerings are seen as increasingly valuable.

2. Diverse Preferences Across Generations:

   • Different age groups have different expectations for benefits.

   • Gen Z values mental wellness and career development, millennials highlight emergency savings and financial wellness, while baby boomers and Gen X prioritize physical wellness and health-related benefits.

   • Digital engagement is desired more by younger employees, with 60% of Gen Z wanting mobile app-based benefits information, compared to only 23% of baby boomers.

3. The Role of Technology in Employee Benefits:

   • The report indicates a growing reliance on technology, with most employers leaning on carrier-provided technology in five years.

   • 59% of employers will select carriers based on their ability to integrate with their benefits technology platform.

   • New technology applications, such as AI chatbots, are also seen as valuable tools to educate employees on choosing benefits.

FTC Pulls Back From Prior Support for Pharmacy Benefit Middlemen

By Celine Castronuovo - The FTC on Thursday plans to walk back years of advocacy in support of the entities that manage prescription drug coverage—support that analysts say has helped fuel the growth and market integration the agency is now investigating. Read Full Article… 

VBA Article Summary

1. Shift in Regulatory Stance: The FTC is voting to withdraw prior advocacy statements from the early 2000s that were against state legislation requiring PBMs to disclose specific business practices and financial information. This shift is in response to the PBMs' continued reliance on older FTC materials that opposed mandatory transparency, and it indicates a broader reconsideration of regulatory approaches to PBMs. David Balto, an antitrust attorney and former FTC policy official, emphasizes the necessity to abandon past advocacy now that federal regulation is deemed essential, reflecting a changing perspective on the role of PBMs.

2. FTC's Relationship with PBMs and Market Dominance: PBMs, particularly the three largest controlling nearly 80% of the market, have been under scrutiny for their role in high prescription drug costs. The FTC has previously opposed several state bills aimed at increasing transparency and preventing consolidation within the industry, indicating some support for PBMs' value in reducing drug costs. However, the FTC's investigation into whether PBM practices are anticompetitive and limit access to low-cost medications is signaling a pushback against PBM criticism and an effort to boost the FTC's credibility in the regulation of this industry.

3. A New Direction Under FTC Chair Lina Khan: Under Lina Khan's leadership, the FTC has been taking the agency in a fresh direction, focusing more on real-world facts and exhibiting skepticism towards past economic ideologies. The FTC's ongoing probe now includes an investigation into the six largest PBMs and has expanded to include their related purchasing groups. The goal is to determine whether the vertically integrated structure of these companies is inherently anticompetitive. Advocacy groups and analysts are calling for a breakdown of this structure to restore healthy competition, signaling a broader call for reform and stronger regulation within the pharmaceutical care industry.