Key Updates for 2024 Open Enrollment: What Employers Need to Know

Did you know that only 44% of employees express satisfaction with their employer-provided health benefits? This statistic underscores the significance of streamlining the open enrollment process for employees.

Employers facing budgetary constraints often scuffle with the demanding endeavor of furnishing all-encompassing employee benefits. However, it remains a non-negotiable imperative for organizations to deliver a top-tier, tailor-made benefits package to sustain their competitive edge.

In the contemporary job market, characterized by many unfilled positions and a proliferation of remote work opportunities, prospective employees display heightened discernment when assessing an employer's benefits portfolio before committing. Beyond the conventional health insurance domain, employees seek benefits that comprehensively address their mental and behavioral well-being, significantly bolster overall job satisfaction, and actively promote a balanced equilibrium between work and personal life.

As the open enrollment season approaches, it presents an opportune moment for employers to scrutinize their compensation packages and ensure they align seamlessly with these evolving expectations among their workforce.

This comprehensive article provides in-depth coverage of crucial updates for the 2024 open enrollment season, delivering vital insights that employers must be well-acquainted with to navigate this evolving landscape effectively. Stay ahead of the curve and ensure your organization is well-prepared for the upcoming open enrollment season.

Strategic Steps for 2024 Open Enrollment: A Professional Approach

As the upcoming open enrollment period approaches, employers offering group health plans must stay informed about legal changes affecting plan design and administration, particularly for plan years commencing on or after January 1, 2024. These changes encompass annual adjustments, such as modifications to the Affordable Care Act's affordability percentage and cost-sharing limits for High Deductible Health Plans (HDHPs). Employers must ensure that their health plans must adhere to these updates.

Furthermore, any alterations to a health plan's benefits for the 2024 plan year must be effectively communicated to plan participants through an updated Summary Plan Description (SPD) or a Summary of Material Modifications (SMM). Employers must also confirm that their open enrollment materials incorporate required participant notices, including the Summary of Benefits and Coverage (SBC), as applicable. Integrating these notices into your open enrollment materials streamlines administration and helps manage costs effectively.

Compliance Check: Limits for Deductibles and Out-of-Pocket Maximums

Employers need to be diligent in reviewing their health plans regularly to ensure they meet deductible and out-of-pocket maximum limits as mandated by relevant regulations. Keeping benefits aligned with legal requirements facilitates compliance and provides employees access to the best coverage. This commitment to adherence during open enrollment enhances the overall experience for employers and employees, offering peace of mind and financial security.

Streamlining Your Plan Design Update

To optimize cost-efficiency and administrative efficiency, employers should contemplate the inclusion of these notifications within their open enrollment materials.

• Understanding ACA Affordability Standard Changes

  Under the Affordable Care Act (ACA), it is incumbent upon employers to provide affordable health coverage to their employees. Affordability is defined as the employee's contribution not exceeding 9.5% (adjusted to 9.12% in 2023) of their household income for the taxable year. While the affordability percentage for 2024 awaits release, employers should maintain vigilance, staying attuned to updates and ensuring strict compliance with these regulations.

• Navigating Out-of-Pocket Maximum Limit Adjustments

  Non-grandfathered health plans are mandated to adhere to cost-sharing limits for Essential Health Benefits (EHB). Starting on January 1, 2024, the specified limits for cost-sharing on EHB are $9,450 for self-only coverage and $18,900 for family coverage. Employers should diligently undertake the following actions to ensure compliance:

  • Employers should thoroughly review their health plan's out-of-pocket maximum limits to confirm compliance with the ACA's 2024 limits.
  • Notably, out-of-pocket maximum limits for High Deductible Health Plans (HDHPs) compatible with Health Savings Accounts (HSAs) must be lower than the ACA's limits. For 2024, the HDHP limits are $8,050 for self-only coverage and $16,100 for family coverage. Employers must verify that their High Deductible Health Plans (HDHPs) adhere to these limits.
• Taking Charge of Your Health with Preventive Care

  The Affordable Care Act (ACA) requires non-grandfathered health plans to provide coverage for designated preventive health services without imposing cost-sharing responsibilities when in-network healthcare providers administer these services. These services comprise evidence-based items rated as A or B by the US Preventive Services Task Force, CDC-recommended immunizations, and HRSA-guided preventive care for infants, children, adolescents, and women. Health plans must incorporate coverage for newly recommended preventive services one year after issuance. This regulatory framework ensures that individuals access essential preventive care services, promoting overall well-being and healthcare quality.

• Ongoing Litigation's Unforeseen Consequences

  Given the ongoing legal dispute concerning the ACA's preventive care mandate, employers should maintain coverage of the most up-to-date recommended preventive care services without imposing cost-sharing requirements in their non-grandfathered health plans. Furthermore, it is essential to exercise diligence in monitoring developments pertaining to the 5th Circuit Court's anticipated decision on the mandate, expected by the conclusion of 2023. Depending on the court's ruling, employers should be prepared to engage their advisors in evaluating potential ramifications for their health plans.

• COVID-19 Coverage for Vaccines, Testing, and Treatment

  Following the conclusion of the COVID-19 public health emergency, specific changes regarding health plans and coverage have come into effect.

  • Health plans can no longer provide coverage for COVID-19 diagnostic tests and related services without cost-sharing.
  • Health plans must maintain coverage for recommended preventive services, including COVID-19 immunizations, without cost-sharing. However, this coverage may now be limited to in-network providers.
  • Beginning with plan years concluding after December 31, 2024, High Deductible Health Plans (HDHPs) compatible with Health Savings Accounts (HSAs) are prohibited from offering COVID-19 testing and treatment benefits unless they meet the annual minimum deductible requirement.
• Optimizing Health FSA Benefits Through Contributions

  The ACA establishes a maximum dollar threshold for pre-tax contributions to health Flexible Spending Accounts (FSAs), with annual adjustments to account for changes in the cost of living. Employers can set their contribution limit for health FSAs, provided it falls within the ACA's maximum limit for the given plan year. In 2023, the health FSA limit stands at $3,050, while the limit for 2024 is awaiting determination.

  In addition, the IRS has issued a memorandum underscoring stringent substantiation requirements for tax-advantaged FSAs. Notably, health FSA expenses cannot be adequately substantiated through methods like employee self-certification, sampling, limiting substantiation to amounts above a specific threshold, or excluding the substantiation of charges from preferred providers. Employers should proactively take the following measures:

1. Stay informed about updates regarding the 2024 health FSA limit.
2. Ensure full compliance with the 2024 limit for health FSA pre-tax contributions.
3. Include information about the health FSA limit during the open enrollment process.
4. Conduct a review of health FSA substantiation procedures to guarantee IRS compliance.

Planning Ahead: 2024 HDHP and HSA Limit Insights

As we prepare for 2024, it is crucial to remain well-informed about potential changes affecting Health Savings Accounts (HSAs) and High Deductible Health Plans (HDHPs). In this context, let's delve into essential insights regarding HDHP and HSA limits for the upcoming year.

• Integrating Telehealth into HDHP Design

  At the onset of the COVID-19 pandemic, Congress temporarily eased High Deductible Health Plans (HDHPs) regulations, allowing them to cover telehealth and remote care services before plan deductibles without impacting Health Savings Account (HSA) eligibility. This flexibility remains in effect until plan years commencing before January 1, 2025.

  Consequently, HDHPs have the option to waive deductibles for telehealth services during 2023 and 2024 without affecting participants' HSA eligibility.

  Employers should take into account the following considerations:

  • Determine whether HDHPs will waive telehealth service deductibles in the 2024 plan year.
  • Communicate any plan adjustments for the upcoming year to participants through updated Summary Plan Descriptions (SPD).
• NQTL Comparative Analysis in Mental Health Parity

  The Mental Health Parity and Addiction Equity Act (MHPAEA) mandates parity between a group health plan's medical/surgical benefits and its mental health or substance use disorder (MH/SUD) benefits. This includes financial requirements, treatment limits, and Non quantitative Treatment Limitations (NQTLs) such as prior authorization, step therapy protocols, network adequacy, and medical necessity criteria for MH/SUD benefits.

  MHPAEA also requires health plans and issuers to conduct comparative analyses of NQTLs for medical/surgical benefits versus MH/SUD benefits. These analyses must include a detailed explanation of plan terms and practices and the rationale for compliance with MHPAEA. Plans and issuers must make these comparative analyses available to relevant authorities upon request.

Exploring the Summary of Benefits and Coverage

The ACA mandates health plans and issuers to provide an SBC annually during open enrollment or renewal. Employers should ensure updated SBCs are included with enrollment materials.

• Medicare Part D Notice Essentials

  Group health plan sponsors must provide Medicare Part D-eligible individuals with notices regarding prescription drug coverage. These notices are required at specific times, including before October 15 each year.

• Annual CHIP Notice Highlights

  Employers in states with premium subsidies for low-income children must send CHIP notices to their employees in those states, informing them about available assistance.

• Decoding Initial COBRA Notices

  COBRA applies to employers with 20 or more employees. Administrators must provide an initial COBRA notice to new participants and certain dependents within 90 days of plan coverage beginning.

• SPDs and Compliance

  Plan administrators must furnish SPDs to new participants within 90 days of plan coverage initiation. Updates should be reflected in an updated SPD booklet or shared through an SMM (Summary of Material Modifications).

• Notices of Patient Protections

  Plans requiring the designation of a primary care provider must permit participants to choose from available providers with certain protections in place. Employers obligated to provide this notice should incorporate it into their open enrollment materials.

• Grandfathered Plan Notices

  Employers with grandfathered plans should include information about the plan's status in materials describing coverage.

• Notifying Participants with HIPAA Privacy Notices

  Covered entities must provide a Notice of Privacy Practices (Privacy Notice) to individuals subject to Protected Health Information (PHI). Health plans must provide the Privacy Notice on specific occasions, including when new enrollees become members.

• WHCRA Notice Exploration

  Plans and issuers are obligated to furnish notices regarding participants' rights to mastectomy-related benefits under the WHCRA.

• Summary Annual Report Details

  Plan administrators must provide participants with a Summary Annual Report (SAR) summarizing Form 5500 information.

• Key Information for Wellness Program Notice

  Wellness programs may require notices when communicated to employees before collecting health-related data or conducting medical exams.

• Customized Health Plan With ICHRA Notice

  Employers with Individual Coverage HRAs (ICHRAs) must notify eligible participants about the ICHRA, its interaction with the ACA's premium tax credit, and other relevant details. This notice should be provided at least 90 days before the plan year begins.

Concluding Insights: Custom Benefits Consultants (CBC) Perspective

For a streamlined and professional approach to managing your employee benefits offerings, such as Employee Benefits Plans or Comprehensive Benefits Plans, trust Custom Benefits Consultants, Inc. (CBC) as your reliable partner. At CBC, we specialize in delivering a comprehensive suite of employee benefit services designed to enhance your benefits administration process, particularly during the open enrollment season in 2024.

Our team comprises dedicated and licensed insurance agents committed to providing you with the highest service and expertise. Here is an overview of the premium services we offer:

1. Tailored Benefits Solutions:

   We recognize that each organization has its unique requirements. CBC collaborates closely with your company to craft personalized benefits packages that align seamlessly with your corporate objectives and cater to your employees' needs.

2. Employee Education:

   Well-informed employees are more satisfied and engaged. CBC conducts informative and educational sessions to ensure your workforce comprehensively understands their benefit options, facilitating a smoother selection process.

3. Compliance Expertise:

   Staying compliant with evolving regulations is paramount. CBC informs you about the latest legal requirements and ensures that your benefits plans remain fully compliant with all relevant laws and regulations.

4. Open Enrollment Support:

   Our dedicated team provides hands-on assistance during the open enrollment period. We guide your employees in making informed decisions, addressing inquiries or concerns, and ensuring a seamless enrollment experience.

5. Cost-effective Strategies:

   CBC is committed to helping you optimize your benefits spending without compromising the quality of coverage. Our goal is to identify cost-saving opportunities while preserving the value of your benefits offerings.

By partnering with Custom Benefits Consultants, Inc., you can elevate your open enrollment process in 2024, ensuring it is both efficient and professional for your organization and your valued employees.

Reach out to us today to explore how CBC can elevate your benefits administration process and enhance the overall employee experience. Ensure your benefits program is managed professionally by selecting CBC as your trusted partner.

Take the initial step toward a polished and successful open enrollment season in 2024. Don't hesitate to reach out to Custom Benefits Consultants right away!