Recent clarifications became available from the HHS and DOL regarding several PPACA regulations. Below are the updates for Expatriate Plans, Fixed Indemnity Policies, and Volunteer Firefighters.
Expatriate Plans
Insured expatriate plans do not need to comply with most PPACA provisions. The FAQ clarifies that a plan is considered an insured expatriate health plan if enrollment is limited to employees and their covered dependents who are expected to reside outside of their home country or outside of the United States for at least six months of a 12-month period. The 12-month period can fall within a single plan year or across two consecutive plan years. Expatriate plans generally will satisfy requirements to obtain or offer minimum essential coverage.
Fixed Indemnity Policies (Individual Market)
A fixed indemnity plan does not need to meet most of PPACA’s requirements and also is not considered minimum essential coverage for purposes of avoiding the individual or employer penalties. Historically, a plan must pay benefits on a fixed period basis to fall within the fixed indemnity exception. The FAQ says that a supplemental policy may qualify as a fixed indemnity policy even though it reimburses on a per service basis, or other basis than a fixed period, if:
- It is sold only to individuals who have other health coverage that is minimum essential coverage,
- There is no coordination between the benefits under the fixed indemnity policy and an exclusion of benefits under any other health coverage,
- The benefits are paid in a fixed dollar amount regardless of the amount of expenses incurred and without regard to the benefits provided under any other health coverage, and
- A notice is displayed prominently in the plan materials informing policyholders that the coverage does not meet the definition of minimum essential coverage and will not satisfy the individual responsibility requirements of PPACA.
Volunteer Firefighters
In a blog posted on January 10, 2014, the IRS stated that it intends to exclude volunteer firefighters and other volunteer emergency medical personnel from those who need to be considered “employees” under the employer-shared responsibility (“play or pay”) requirements. It is not clear from the blog how much a volunteer emergency responder can be paid and still be considered an exempt volunteer. The IRS has promised to provide details in the final play or pay regulations, which it says will be released shortly.
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