A recent change in the law has widespread effects on Massachusetts employee benefit plans.
This ruling was issued by the US Employee Benefits Security Administration, also known as EBSA. EBSA is the agency of the federal government that ensures businesses comply with pension and health insurance laws. US EBSA covers most businesses and applies to over 150 million workers in the US.
This ruling extends the expiration date on the Mental Health Parity Act, also known as MHPA. Signed into law in 1996, this law was originally due to expire the end of September, 2001. Instead, the expiration date has been extended 5 times. Under the recent ruling, the act is due to expire on December 31, 2007.
Because of MHPA, lifetime and annual benefit caps cannot be lower for mental health treatments than they are for other types of medical treatments and surgery. The covered mental health treatments may include visits to licensed therapists, psychiatrists, and psychologists. If necessary, a stay in a rehab facility to treat drug or alcohol dependency also should be covered. In addition, in the case of schizophrenia, depression, post-traumatic stress disorder and other ailments, a stay in a mental hospital should be covered.
Not all group health insurance plans cover mental health treatments, and this law does not require them to do so. Instead, this law states that if mental health treatments are covered by the group health insurance plan, then the plan should have the same limit for mental health treatments that it has for other treatments.
MHPA only applies to group heath insurance plans that include treatments for mental health conditions. The Mental Health Parity Act does not mandate that mental health treatments be included in all group health insurance plans.
The MHPA bill, or the Mental Health Parity Act, passed in 1996 included a provision that expired on September 30, 2001. The law has since been amended five times, which extended it. The most recent extension was in February 2007, which continues the act until December 31, 2007. I don’t think we really have t worry about this law expiring permanently any time soon.
The MHPA provides guidelines for those insurance plans that choose to cover mental health treatments. Before 1996, there were many group health care plans that set awfully low annual limits for mental health treatments. Health insurance plans could pay up to $100,000 per year for surgery yet limit coverage for mental health treatment to only $2,000 per year. Now, because of MHPA, that is against the law.
Insurance plans now have to pay the same amount for both medical and mental health treatments. It is required by law that any group health insurance plan that funds mental health treatment, cover it at the same rate as other medical treatments, surgery included.
Massachusetts employee benefits may or may not cover mental health treatment. Even though most employers offer plans that do insure mental health, there are still many that do not cover any type of psychotherapy, or mental treatments. It is also true that inpatient or outpatient treatment in a hospital or mental health facility may not be included in some plans. Since there is no statute claiming employer provided benefits have to insure mental health treatment, not offering this type of coverage is still an option.
The Employee Benefits Security Administration (EBSA) handles the claims and law violations concerning health care and pensions for over 150 million employees. The EBSA is the special agency that the federal government has set aside to enforce the laws that govern employee benefits and pension plans.
What does all this talk about the Massachusetts Health Insurance Connector Board have to do with you, my loyal readers and ardent employers? Well, you Massachusetts employers out there sure should be interested in this Massachusetts health reform plan and its exact details, down to these minimum criteria.
The whole reason that the Massachusetts Health Insurance Connector Board decided to give the extra time for people to get this minimum criteria for their health insurance was to give employers of the state more time to change their health care plans. In other words, if you are an employer in the state of Massachusetts, and you provide your employees with health care coverage or help pay for some of it, then it probably looks like it will fall to you to make sure that your employees meet these minimum criteria requirements of the Massachusetts health care reform law.
Ah, back up—I think I found out what these minimum criteria are after all. All Massachusetts state residents are required to be part of a health care plan that has no annual dollar limits on their covered expenses. The plans cannot also have deductibles for in-network provider services that would be more than $2,000 per year for a single person, or $4,000 per year for a family plan. Also, the annual maximum out of pocket limit for these plans cannot be more than $5,000 for a single person, or $10,000 per year for a family.
High deductible health insurance plans, on the other hand, as long as they were connected to health savings accounts, would be considered coverage that would get credit from the state as being enough.
The board, meanwhile, also suggested that all employers in Massachusetts offer to their employees—even part timers—that they can pay their health insurance premiums with pretax dollars.
Get your personnel files handy, new employers in the state of Massachusetts. The Massachusetts unemployment insurance benefit system requires that all employers in the state file an Employer’s Quarterly Contribution Report, also called a “Form 1.” That equals four times a year for you guys who don’t have your accountants around reading this blog with you (har har! Just kidding!).
Each time you file one of these Employer’s Quarterly Contribution forms, they go straight to the Division of Unemployment Assistance in the Department of Labor in Massachusetts. This Division of Unemployment Assistance values timeliness and accuracy on these forms, and they’re not just saying that, folks.
Being timely with your Employer’s Quarterly Contribution forms makes sure that you get all of the credit due to you in the system, as that you account with the Division of Unemployment Assistance is accurate and properly reflects your experience with the department. Remember, once you start getting charged the experience rate for the unemployment insurance in the state of Massachusetts (and anywhere really), you get charged less the better “experience” you have—meaning the fewer former employees that you have on the unemployment benefits pay out.
These forms are due by the end of April for the first quarter of the year, by the end of July for the second quarter of the year, by the end of October for the third quarter of the year, and by the end of January of the following year for the fourth quarter of the previous year.
Another reason to get these forms in to the Massachusetts unemployment insurance system on time: they will fine you otherwise. The Division of Unemployment Assistance withholds the right to fine you from $2500 to $10000 if you don’t file the proper forms. You can even be put in prison for up to a year for the offense.
Unemployment insurance (UI) provides benefits to Massachusetts’ workers who are unemployed through no fault of their own. Your employees will learn what “through no fault of their own” means by reading the Massachusetts Unemployment Insurance posters. You are required by law to post Massachusetts Unemployment Insurance posters in an area that are clearly visible to your employees.
Funding for UI benefits comes from contributions paid by the state’s employers; no deductions are made from workers’ salaries. Employers pay quarterly contributions to the Massachusetts Division of Unemployment Assistance (DUA). Each employer’s contribution rate is based upon that employer’s experience with layoffs and the UI benefits paid to former workers who collected during the prior year. This is why it is important for you, as an employer, to protest claims for benefits on employees that do not truly qualify for the compensation, such as those that left their job voluntarily or were fired for good cause.
Eligible Massachusetts employers can choose to pay voluntary contributions. This program allows the state’s businesses to manage their unemployment insurance costs by paying additional contributions in order to lower their rate and reduce their UI contributions for the forthcoming calendar year.
Massachusetts employers covered by the Unemployment Insurance Law are also liable for a health insurance contribution. The funds from this contribution provide health insurance for eligible unemployment insurance claimants. This health insurance is called the Medical Security Plan, which is administered by DUA.
Health insurance contributions receipts are deposited in the Medical Security Trust Fund. They are not credited to employers’ UI accounts and are completely independent of the unemployment contribution trust fund.
DUA is responsible for the collection and processing of health insurance contributions which includes employer liability and wage determinations, as well as enforcement and employer auditing.
DUA is responsible for administering the UI program in Massachusetts. All decisions made by DUA staff must be made according to the law as described on the Massachusetts Unemployment Insurance posters.