Required Contraceptive Coverage under the ACA and Exceptions | Practical Law

Required Contraceptive Coverage under the ACA and Exceptions | Practical Law

An overview of compliance relief available from the contraceptives coverage requirement under the Affordable Care Act's (ACA's) preventive services rules. The relief featured in this resource is a temporary enforcement safe harbor available for certain nonprofit employers.

Required Contraceptive Coverage under the ACA and Exceptions

Practical Law Legal Update 2-525-1025 (Approx. 4 pages)

Required Contraceptive Coverage under the ACA and Exceptions

by PLC Employee Benefits & Executive Compensation
Published on 11 Mar 2013 • USA (National/Federal)
An overview of compliance relief available from the contraceptives coverage requirement under the Affordable Care Act's (ACA's) preventive services rules. The relief featured in this resource is a temporary enforcement safe harbor available for certain nonprofit employers.
The Affordable Care Act (ACA) requires plans and insurers to provide coverage for certain preventive services without cost-sharing (copayments, coinsurance or deductibles). In July 2010, the Departments of Labor, HHS and Treasury (the Departments) issued interim final regulations addressing this requirement. Subsequent regulations have interpreted specific aspects of the preventive services rules, including a controversial requirement to cover contraceptive services.
For women, the preventive services rules require coverage for preventive care and screenings under binding comprehensive health plan coverage guidelines supported by the Health Resources and Services Administration (HRSA). Under August 2011 guidelines issued by the HRSA, plans and insurers must provide benefits without cost-sharing for, among other things, contraceptives and contraceptive counseling approved by the Food and Drug Administration (FDA). However, exceptions to the contraceptive coverage requirement include:
  • An exemption for religious employers.
  • A temporary enforcement safe harbor for certain nonprofit employers.
  • Accommodations for coverage established or maintained by certain nonprofit employers.
This resource provides an overview of one aspect of the available exceptions: the temporary enforcement safe harbor for nonprofit employers. For complete analysis of the contraceptives requirement, including the range of available exceptions, see Practice Note, Coverage of Preventive Health Services under the ACA.

Temporary Enforcement Safe Harbor for Certain Nonprofit Employers

In February 2012, HHS issued final regulations and a bulletin that included a temporary enforcement safe harbor for certain nonprofit employers from the requirement to cover contraceptive services. The safe harbor, which was amended and reissued in August 2012, did not expand the general exemption for religious employers. Rather, the safe harbor provides certain nonprofit employers (for example, colleges and hospitals) that do not offer contraceptive coverage because of their religious beliefs, additional time (until August 1, 2013) to comply with the contraceptive coverage requirement. Employers, group health plans and insurers that satisfy the safe harbor will not be subject to enforcement action by the Departments for failing to cover required contraceptive services.
The temporary enforcement safe harbor, as reissued in August 2012, applies to entities that satisfy all of the following requirements:
  • The entity is organized and operates as a nonprofit entity.
  • From any point on or after February 10, 2012, the entity's group health plan has consistently not provided all (or the same subset of) the contraceptive coverage otherwise required, consistent with governing state law, because of the entity's religious beliefs. The August 2012 bulletin provides an exception from this requirement under which a group health plan will not be considered to have provided all (or the same subset of) contraceptive coverage otherwise required if:
    • it took some action to try to exclude or limit the contraceptive coverage; and
    • that action was unsuccessful as of February 10, 2012. As a result, the coverage would not disqualify the employer, group health plan or insurer from eligibility for the safe harbor.
  • The plan (or an insurer or third-party administrator (TPA) on the plan's behalf) provides participants a standardized notice stating that contraceptive coverage will not be provided under the plan for the first plan year beginning on or after August 1, 2012.
  • The entity:
    • self-certifies that it has satisfied the above three requirements; and
    • documents its self-certification consistent with the HHS bulletin.
Plans that do not qualify for the safe harbor must provide contraceptive coverage for plan years beginning on or after August 1, 2012.

August 2012 Clarifications to Temporary Enforcement Safe Harbor

In August 2012, HHS reissued a bulletin addressing the temporary enforcement safe harbor for coverage, which was originally issued in February 2012. The reissued bulletin clarifies that:
  • Group health plans that tried unsuccessfully to exclude or limit contraceptive coverage as of February 10, 2012, are not for that reason barred from eligibility for the safe harbor.
  • The safe harbor is available to nonprofit organizations with religious objections to some, but not all, contraceptive coverage.
  • The safe harbor can be "invoked without prejudice" by non-profit organizations that are uncertain whether they qualify for the religious employer exemption.

Notice Requirement and Certification for Temporary Enforcement Safe Harbor

Nonprofit employers wishing to take advantage of HHS's temporary enforcement safe harbor must also satisfy notice and certification requirements. For a complete discussion, see Practice Note, Coverage of Preventive Health Services under the ACA.