In recently issued guidance, the U.S. Departments of Treasury, Labor, and Health and Human Services indicated that they will indefinitely extend relief to colleges and universities that subsidize the cost of individual insurance premiums for student employees.

Under previously issued guidance, a health reimbursement arrangement or other program that pays some or all of the premium for individual health insurance coverage may violate the prohibition against annual dollar limits under the Affordable Care Act (ACA) and the ACA requirement to cover the full cost of certain recommended preventive care items and services. Many colleges and universities have historically reduced the cost of individual student health insurance coverage for student employees, especially graduate students. Guidance issued earlier this year confirmed that subsidies of this nature could violate these ACA rules, but the guidance delayed enforcement until the first plan or policy year that begins on or after January 1, 2017.

Observing that Congress intended to preserve the ability of higher education institutions to continue offering otherwise permissible student health insurance, the new guidance delays enforcement until the departments provide otherwise.

Our Employee Benefits and Executive Compensation Group helps clients design and implement compensation and benefits packages that comply with today's complex regulatory requirements, attract and retain a quality workforce, and maintain fiscal and fiduciary responsibility. Attorneys in Ballard Spahr's Health Care Group counsel clients on regulatory, compliance, privacy and data security, transactional, financing, and labor and employment matters. As the federal health care reform effort gained steam, Ballard Spahr attorneys established the Health Care Reform Initiative to monitor and analyze legislative developments. With federal health care reform now a reality, our attorneys are assisting health care entities, higher education institutions, and other employers in understanding the relevant changes and planning for the future. They also have launched the Health Care Reform Dashboard, an online resource center for news and analysis on developments under the Affordable Care Act.


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