5 “common sense” pandemic provisions that workers lose at the end of the year
With the spread of the omicron variant and increasing number of cases, there is no doubt that the pandemic continues. The same cannot be said, however, of the provisions adopted by lawmakers to help American workers maximize their benefits in dealing with the global health crisis.
“There is very little that has been enacted in the wake of the continuing pandemic,” said Jody Dietel, senior vice president of advocacy and government affairs at HealthEquity.
Several elements related to the benefits of the Coronavirus Aid, Relief, and Economic Security Act and the American Rescue Plan Act are expected to expire at the end of the year. Congress should act quickly to keep the measures it introduced at the start of the pandemic, Dietel told HR Dive in an interview.
The changes can disappoint employers and employees. “A lot of these provisions really made a lot of sense,” Dietel said. “We just failed to get the attention of Congress.”
Unless Congress takes action, these five provisions will disappear at the end of the year:
1. The CARES refuge arrangement
Employers and employees will be saying goodbye to the “safe harbor” provision of the CARES Act in the New Year. The provision allowed high-deductible health plans to cover telehealth and other expenses related to remote care services before individuals reached their deductible.
2. The flexibility of CARES for FSAs
Before the pandemic, employees’ choices towards their flexible spending accounts were irrevocable. The CARES Act changed that, allowing workers to change their elections at any time, for any reason.
“It was a very flexible rule, and it helped people because there was so much uncertainty,” Dietel said. “It was a very sensible flexibility provision of Congress. They did a great job.”
3. Higher ARPA Dependents Contributions
ARPA increased the maximum amount that employees could set aside for dependents, increasing the maximum limit from $ 5,000 to $ 10,500. Congress also allowed employees to change their mid-year dependent reimbursement account elections, so employees can select higher limits.
If Congress does not extend ARPA’s higher exclusion limit, elections for dependents ‘reimbursements will be capped at $ 5,000, plus funds in the unused dependents’ reimbursement account from 2021. .
4. The six-month COBRA grant from ARPA
It can be easy to say goodbye to ARPA’s COBRA grant. “It’s a shame that it took so long to work on this and that it is so difficult to use,” Dietel said. “It didn’t help some of the people he was supposed to help.”
The CARES law allowed workers to get unemployment if they couldn’t risk exposing their cohabitants to the virus by commuting to work. But lawmakers have not applied this philosophy to ARPA’s COBRA grant. To be eligible, workers had to be involuntarily dismissed.
5. Unlimited carry-over of the law on consolidated appropriations
The Consolidated Appropriations Act allowed unlimited carry-overs from DCRA and FSA contributions for the 2020 and 2021 plan years. “At the end of this year, if your employer has adopted these provisions and you have any remaining thing, that can be postponed, ”Dietel said. “At the end of next year, it comes back to regulatory requirements.
Without congressional action, these statutory requirements leave no room for carry-over of funds intended for the care of dependents. For health care, deferrals are limited to 20% of the legal contribution limit, which is $ 570 for next year.
The law also extended the grace period which gave individuals more time to spend the money they set aside. Before the pandemic, this grace period lasted two and a half months. The law extended this period to one year. “If I had any money left from 2020, I could use it anytime in 2021,” Dietel explained. “This provision applied to both health care and dependents. But those two extensions expire at the end of this year.”
What will not change?
There are two enduring vestiges of the coronavirus legislation:
- The IRS will continue to consider the purchase of hand sanitizer and face masks to prevent the spread of COVID-19 as eligible medical expenses and allow reimbursement. None of these elements meet the traditional definition of an eligible medical expense, Dietel pointed out. (The purchase of face masks and hand sanitizer to prevent flu and colds is not eligible, Dietel noted.)
- Under the CARES Act, people will no longer need a prescription for reimbursement for over-the-counter drugs.
What do these changes mean for HR professionals?
As vendors implement the changes, HR professionals will likely need to take charge of communication, Dietel said.
“They should encourage employees to review their spending to make sure they are taking advantage of the tax instruments they can,” she said. HR professionals should be available to help employees review their choices and select the best options when signing up.
Benefits managers can target their communications to employees who have taken advantage of the pandemic arrangements. Dietel suggested that HR professionals “do data mining” to find the employees who most need to understand the changes. Employees who made a $ 10,500 choice for dependents, for example, need to know they can’t make it this year, more than the worker who didn’t care about a choice for dependents. dependents.
As HR professionals develop a communications campaign, they should consider seeking help from their suppliers, Dietel said. Most vendors have tools and resources that employers can use to educate workers about their options.
Employers can also rely on their suppliers for information. Fading provisions are likely to inspire confusion, and a good provider will be able to provide reliable information on the benefits and changes that are – or not – happening to Congress, Dietel said.
Dietel encouraged HR providers to check with their administrative partners to ensure that they are aware of the changes. Next year’s benefit plans should reflect this. “If you start to ask questions [about the provisions] and your salespeople are not sure, that’s a bad thing, ”she said.
“If you’re not sure, ask,” Dietel said. “There are no stupid questions about benefits.”