Washington D.C. Employment Law Update : Washington D.C. Employment Lawyer & Attorney : Littler Mendelson Law Firm : Virginia, Tyson's Corner

Ending a political stalemate, both the House and Senate on Friday approved a measure that provides a two-month extension of the payroll tax cut, emergency unemployment insurance benefits, and delay in the planned cut of Medicare reimbursement rates to doctors, commonly known as “doc fix” provisions. President Obama signed the Temporary Payroll Tax Cut Continuation Act of 2011 (H.R. 3765) into law hours later. This bill is similar to legislation (H.R. 3630) the Senate approved last Saturday, but includes provisions allowing businesses to use their current accounting structure to process the temporary payroll tax break, and will require the House and Senate to work together to draft a bill that would extend these provisions for all of 2012.

In a press release, bill sponsor Rep. David Camp (R-MI) said that the amended bill “fixes a critical flaw in the hastily passed Senate bill, which failed to provide employers with a workable mechanism with which to implement a partial-year payroll tax holiday.”

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Updated: January 5, 2012

Both the House and Senate have approved a conference report (pdf) to the National Defense Authorization Act for Fiscal Year 2012 (H.R. 1540), a bill that authorizes appropriations for the Department of Defense (DoD). The final measure includes a provision stipulating that in determining whether TRICARE network providers are to be considered subcontractors subject to affirmative action and other requirements governed by the Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP), TRICARE managed care support contracts that include the requirement to establish, manage, or maintain a network of providers will not be considered to be a contract for the performance of health care services or supplies on the basis of that requirement. The conference report also contains provisions extending certain reemployment rights under the Uniformed Services Employment and Reemployment Rights Act (USERRA) to members of the National Guard called to respond to domestic emergencies.

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On December 15, 2011, the Department of Labor’s Wage and Hour Division (WHD) issued its much-anticipated proposed rule (pdf) that could make more than a million domestic caregivers eligible to receive minimum wage and overtime pay under the Fair Labor Standards Act (FLSA). According to the WHD, the home healthcare industry has changed since the FLSA regulations governing home care employees were enacted more than 35 years ago. To that end, the proposal seeks to revise the FLSA’s companionship and live-in worker regulations to limit the types of duties that render a home caregiver exempt from FLSA requirements, clarify the type of activities and duties that may be considered “incidental” to the provision of companionship services, amend the recordkeeping requirements for live-in domestic workers, and specify that the exemption is limited to care givers employed by the individual, family or household using the services only. Third-party employers, including in-home staffing agencies, would not be entitled to claim the exemption even if the worker is jointly employed by the third party and the family/household.

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Multiple Employer Welfare Arrangements (MEWAs) are typically utilized by smaller employers as an alternative to other traditional forms of health insurance. In 2010, the Affordable Care Act amended ERISA to address certain perceived regulatory issues with respect to MEWAs. On Monday, December 5, 2011, the Department of Labor published proposed rules and regulations that clarify these changes to ERISA. The changes concern (1) the Secretary of Labor’s ability to issue “cease and desist” and “summary seizure” orders, and (2) the reporting and disclosure requirements for MEWAs.

Employers participating in MEWAs may wish to provide comments to the Department of Labor, as they may be impacted by these regulatory changes.  Continue reading this entry at Littler's Employee Benefits Counsel.

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Updated:  November 21, 2011

The first portion of President Obama’s jobs package is likely to become law this week after the House unanimously approved a bill the Senate amended (H.R. 674) that contains employer tax incentives for hiring unemployed veterans. The veterans provisions are set forth in the VOW to Hire Heroes Act, added as an amendment to a previously-approved tax bill the House cleared in October. Among other job training and assistance benefits offered to veterans, the measure would provide employers with a tax credit of up to $5,600 for hiring veterans who have been unemployed for at least six months, a $2,400 credit for hiring veterans who have been unemployed for more than four weeks, but less than six months, and a credit of up to $9,600 that would increase the existing Wounded Warriors Tax Credit for employers that hire veterans with service-connected disabilities who have been unemployed for at least six months. These hiring incentives were included in the broader American Jobs Act (S. 1660) that failed to advance in the Senate last month.

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As expected, the U.S. Supreme Court has agreed to review (pdf) cases challenging the constitutionality of the Affordable Care Act. The Court accepted the appeals filed in three cases that question the validity of the healthcare reform law, and will hear more than five hours of arguments during the Court’s spring session. While the petitioners in the three cases presented a number of issues for adjudication, the Court will undertake review of the following issues only:

• Whether the Affordable Care Act’s provisions requiring virtually all individuals to obtain health insurance or pay a penalty as of 2014 –commonly referred to as the law’s individual mandate – is constitutional. Specifically, in enacting the individual mandate, did Congress exceed its enumerated powers under the Constitution?
• If the individual mandate is unconstitutional, do the remaining portions of the law still stand, or is the entire law rendered invalid because it is non-severable?
• Is the law’s expansion of the Medicaid program constitutional?
• Does the Anti-Injunction Act (AIA) bar challenges to the individual mandate?

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The Department of Labor’s Employee Benefits Security Administration (EBSA) has launched a Consumer Assistance Web Page to answer questions for retirement and health benefit plan participants and beneficiaries, and enable them to submit electronically any complaints regarding their plans. The site includes a link whereby a viewer can request assistance from a benefits advisor. This feature will automatically direct such requests to the appropriate EBSA regional office based on the user’s ZIP code. While aimed primarily at benefit plan consumers, the site does link to various resources and tools such as fact sheets, frequently asked questions (FAQs), and other materials that may be helpful for employers and plan sponsors.

In a press release, EBSA Assistant Secretary Phyllis C. Borzi said: “Helping retirement and health plan participants find answers to questions about their benefits and providing assistance when they believe their benefits have been improperly denied is one of our most important responsibilities,” adding: “The new consumer assistance Web page and electronic inquiry/complaint process will provide quick answers to the most frequently asked questions and connect workers to experienced benefits advisers if assistance is needed.”

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Updated:  October 21, 2011

On October 12 the House by a 307-122 margin approved a measure that temporarily and retroactively extends the Trade Adjustment Assistance (TAA) program that was enacted as part of the 2009 stimulus package and expired in February 2011. The TAA is a federal, state-administered program created to provide benefits and services to individuals who become unemployed as a result of international trade. Such benefits include trade readjustment allowance, training, assistance with healthcare premium costs, alternative trade adjustment assistance, and job search and relocation allowances. The bill that has been approved by both houses of Congress – H.R. 2832 – extends the authorization of appropriations for the TAA through December 31, 2013.

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In an informal discussion letter, (pdf) the Equal Employment Opportunity Commission’s Office of Legal Counsel reiterates the position that an employer-provided wellness program that offers financial inducements to provide genetic information as part of a wellness program runs afoul of Title II of the Genetic Information Nondiscrimination Act (GINA). Among other restrictions, GINA limits the ability of health insurers and employers to collect genetic information, which includes family medical history. Whether and to what extent employer-provided wellness programs and health surveys that solicit information about family medical history violate GINA and other statutes and regulations is a rising concern for employers.

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A bipartisan measure introduced in the Senate last week by Sens. Ben Cardin (D-MD) and Mike Enzi (R-WY) would change the tax treatment of employer-provided medical flexible spending arrangements (FSAs). Specifically, the Medical FSA Improvement Act (S. 1404) would effectively eliminate the “use it or lose it” rule applied to such plans and instead allow employees to pay taxes on and withdraw any remaining funds in their FSAs at the end of the year. FSAs enable participating employees to allocate a portion of their income tax-free to pay for out-of-pocket medical expenses, such as co-payments for doctor visits and prescription drugs, medical supplies, and equipment. According to a press release, at the end of the year the average FSA maintains an unused balance of $100, amounting to nearly $400 million in unused funds per year. Said Cardin: “It’s time we stopped penalizing participants for being efficient in the use of their health care dollars and allow for a sensible cash-out option at the end of each program year. It is both fair and sound health policy.”

A companion bill (H.R. 1004) was introduced in the House of Representatives earlier this year, but has not yet advanced. If enacted, the provisions of either bill would apply to plan years beginning after December 31, 2012.

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The Occupational Safety and Health Administration will hold a series of stakeholder meetings on July 29, 2011 to gather information on how best to limit occupational exposure to infectious diseases. According to a notice (pdf) to be published in the Federal Register, the agency is considering the development of a program standard to limit exposure to infectious agents for workers who provide direct patient care or perform tasks other than direct patient care, but are nonetheless exposed to infectious diseases. As discussed in the notice, the latter category might include such tasks as providing patient support services such as housekeeping, food delivery, or facility maintenance; handling, transporting, receiving or processing infectious items or waste; maintaining, servicing or repairing medical equipment that is contaminated with infectious agents; conducting autopsies; performing mortuary services; and performing tasks in laboratories that could result in occupational exposure to diseases.

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Legislation that would amend the Family and Medical Leave Act (FMLA) to permit eligible employees to take up to twelve weeks of unpaid leave to care for a same-sex spouse, domestic partner, grandparent, grandchild, parent-in-law, son- or daughter-in-law, child of a domestic partner, or adult child or sibling who has a serious health condition has been reintroduced in both chambers. The Family and Medical Leave Inclusion Act (H.R. 2364, S. 1283) would not change the terms of the FMLA, but rather expand its coverage to the aforementioned additional family members.

In a statement, the bill’s chief Senate sponsor Dick Durbin (D-IL) said: “Regardless of the make-up of one’s family, all employees should be given the same rights to care for a sick loved one in a time of need,” adding, “For 20 years, we have had a law that provides unpaid leave for families in crisis. As families change, so should the laws designed to help them.”

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Last week Rep. Jackie Speier (D-CA) reintroduced the Equal Access to COBRA Act of 2011 (H.R. 2310), legislation cosponsored by 47 others that would extend COBRA continuation health coverage to covered employees’ same-sex spouses or domestic partners and their dependent children. Under existing law, up to 36 months of continuing health care coverage under COBRA is available to employees, their spouses and dependent children after the employees’ job loss. The Equal Access to COBRA Act would amend the Employee Retirement Income Security Act (ERISA), the Internal Revenue Code, and the Public Health Service Act to extend these entitlements to all individuals who are covered by an employer’s health plan. Generally, this bill would apply to businesses that already offer health coverage to domestic partners and their children. Identical legislation (H.R. 1028, S. 563) was introduced earlier this year in the House by former New York Rep. Anthony Weiner and in the Senate by Barbara Boxer (D-CA).

In a statement, Rep. Speier said: “The recession didn’t discriminate on the basis of sexual orientation and gender identity and neither should our safety net policy,” adding: “This legislation would ensure that eligible LGBT employees and their families have the same access to health care benefits as every other American.”

If signed into law, this bill would apply to plan years beginning 180 days after the enactment date. For collectively bargained health plans, the amendments made by this bill would apply after the plan terminates, or three years after enactment, whichever date is earlier.

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Members of both the House and Senate have introduced legislation that would extend the federal minimum wage and overtime protections of the Fair Labor Standards Act (FLSA) to most home care workers, improve federal and state data collection and oversight with respect to the direct care workforce, and create a grant program to help states recruit and train direct care workers. Among other things, the Direct Care Job Quality Improvement Act (H.R. 2341, S. 1273) would limit the “companionship services” FLSA exemption to those who work fewer than 5 hours per week or are employed in this capacity for fewer than 12 weeks per calendar year.

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On June 21, 2011, the Senate Armed Services Committee approved (pdf) a draft of the National Defense Authorization Act for Fiscal Year 2012 (pdf) that would end efforts by the Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP) to extend federal affirmative action obligations to hospitals that participate in or accept reimbursement through the TRICARE program.

TRICARE is the Department of Defense’s health care program for active duty and retired military and their families. OFCCP has been taking the position that providers participating in TRICARE are government subcontractors subject to various affirmative action and equal employment opportunity compliance requirements enforced by OFCCP. The Senate Bill would reject OFCCP’s position by explicitly excluding TRICARE institutional, professional, and pharmacy network providers from being considered subcontractors for the purposes of Federal Acquisition Regulation (FAR) or any other law, in order to maintain adequate TRICARE provider networks.  Continue reading this entry at Littler's Healthcare Employment Counsel.

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A day after Congress passed a spending bill that will fund the federal government through September 2011, the House of Representatives approved by a 235-193 margin a budget plan (H. Con. Res. 34) for Fiscal Year 2012 that also sets forth appropriate budgetary levels for the next decade.

Among other things, this budget would effectively repeal and de-fund the health care reform law. Specifically, the measure would authorize the Budget Committee Chairman to “revise the allocations, aggregates, and other appropriate levels in this resolution for the budgetary effects of any bill, joint resolution, amendment, or conference report that repeals the Patient Protection and Affordable Care Act or the Health Care and Education Reconciliation Act of 2010.” In addition, the proposal, offered by Rep. Paul Ryan (R-WI), would give block grants to states to run Medicaid and establish a voucher system for Medicare.

The Senate – which has already adjourned for a two-week recess – is not expected to approve this budget. The President, meanwhile, has offered a competing budget plan. Given the divergent views on where and how federal spending cuts must be made, it is likely that another budget showdown will occur before the September 30, 2011 deadline. 

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Update: As expected, on April 14 the House and Senate passed the budget bill, sending the measure to the President for his signature. The Senate rejected a proposed resolution that would have de-funded the Affordable Care Act.

The eleventh-hour budget deal reached on April 8, 2011 would impact a number of healthcare and employment-related programs. Overall, the Department of Defense and Full-Year Continuing Appropriations Act of 2011 (H.R. 1473), (pdf) commonly referred to as the continuing resolution (CR) to fund the federal government though September 30, 2011, cuts approximately $13 billion in appropriations from the President’s funding request for the U.S. Departments of Labor, Education, and Health and Human Services. Some initiatives are extended under the measure, while others are reduced or eliminated entirely. A full list of the program cuts can be found here. (pdf)

Health Care

Among other casualties (pdf) of the budget deal are two programs created by the Affordable Care Act – the Consumer Operated and Oriented Plan (CO-OP) and the Free Choice Voucher programs. The CO-OP program was designed to foster the creation of qualified nonprofit health insurance issuers that would have offered qualified health plans in the individual and small group markets. These plans were intended to compete with the private insurance market.

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Update: On April 14, 2011, President Obama signed this measure into law.

The highly contentious expanded 1099 information reporting requirement is a step closer to becoming law. On Tuesday, the Senate voted overwhelmingly in favor (87-12) of the Comprehensive 1099 Taxpayer Protection and Repayment of Exchange Subsidy Overpayments Act of 2011 (H.R. 4), a bill that repeals the provision included in the health care reform law requiring employers to report all payments to corporations for goods or services of $600 or more. The legislation would also repeal a similar expansion of information reporting for owners of residential real estate who rent out that property, and increase the maximum amount of health care subsidy overpayments that an individual must repay. The House passed this measure last month.

Introduced by Rep. Daniel Lungren (R-CA), this bill has enjoyed a significant amount of bipartisan support. Since the reporting requirement’s inclusion in the Affordable Care Act, representatives of the business community as well as the IRS have criticized the move, claiming the reporting obligation would impose an undue administrative burden on all parties involved. Even President Obama during his State of the Union address called for the provision’s repeal. This legislation is expected to be signed into law within the week.

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On March 10, legislation that would extend COBRA continuing health coverage to many same-sex spouses and domestic partners was reintroduced in the House and Senate. The Equal Access to COBRA Act (H.R. 1028, S. 563) would change federal law to allow same-sex spouses or domestic partners and their dependents the same access to COBRA coverage as enjoyed by other individuals who are covered by an employer’s health plan in the event the covered employee losses his or her job. The measure, which was reintroduced by Sen. Barbara Boxer (D-CA) and Rep. Anthony Weiner (D-NY), would apply to domestic partners as they are defined by the employer’s benefits plan. Under current law, COBRA continuation coverage does not apply to domestic partners or same-sex spouses, even if the employee who was let go worked at a company that offered health coverage to domestic partners. The provisions of this legislation would apply only to companies that already offer health coverage to domestic partners and their children. According to a statement issued by Sen. Boxer’s office, more than half of Fortune 500 companies cover domestic partners in their health plans.

If signed into law, this bill would apply to plan years beginning 180 days after the enactment date. For collectively bargained health plans, the amendments made by this bill would apply after the plan terminates, or three years after enactment, whichever date is earlier.

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In anticipation of developing regulations to implement the new automatic enrollment provisions of the Fair Labor Standards Act (FLSA) established by the Affordable Care Act, the Department of Labor’s Employee Benefits Security Administration (EBSA) plans to hold a public forum to solicit views and share information on the new requirement. The new provision included in the health care reform law adds Section 18A to the FLSA, which requires employers with more than 200 full-time employees to automatically enroll new hires – subject to any applicable waiting periods – in one of the employer’s health benefit plans, and to continue the enrollment of current employees in the plan. The new section also requires employers to provide adequate notice and opportunity for an employee to opt out of such coverage. Affected employers are not required to abide by the new enrollment mandate until final rules on this obligation are issued and effective.  Continue reading this entry at Littler's Healthcare Employment Counsel.

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Rep. Lois Capps (D-CA) and Rep. Steven LaTourette (R-OH) have reintroduced a bill in the House of Representatives that would require Medicare-participating hospitals to establish staffing plans for nursing services, provide certain whistleblower protections for employees and patients, and subject employers in violation of the bill to monetary penalties. Companion legislation to the bipartisan Registered Nurse Safe Staffing Act of 2011 (H.R. 876) was introduced in the Senate earlier this year.  Continue reading this entry at Littler’s Healthcare Employment Counsel.

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On Thursday, the House of Representatives approved by a 314-112 margin the Small Business Paperwork Mandate Elimination Act of 2011 (H.R. 4), yet another measure that seeks to repeal the expansion of the 1099 reporting requirement for payments to corporations for goods or services of $600 or more, which was included in the health care reform law. The Senate had already approved a different version of the 1099 reporting repeal as part of the FAA reauthorization bill it voted in favor of last month.

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Early Saturday morning, the House of Representatives approved by a 235-189 margin the Full-Year Continuing Appropriations Act (H.R. 1) – otherwise known as the Continuing Resolution (CR) – that would fund the federal government through September 30, 2011. For days the House debated more than 150 of the nearly 600 proposed amendments to the legislation, including several that would deny funds to various agencies to implement the new health care reform law.  Continue reading this entry at Littler's Healthcare Employment Counsel. 

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As expected, on Wednesday Senators opposed to the Affordable Care Act failed to gain sufficient votes to include an amendment to the Federal Aviation Administration reauthorization bill that would have repealed the health care reform law in its entirety. While all 47 Republican Senators voted in favor the amendment (S. AMDT. 13), at least 60 votes were needed. Although there was some speculation that a few Democratic senators would cross the aisle and support the amendment, none cast a vote in its favor. Last month, the House approved by a vote of 245-189 the Repealing the Job-Killing Health Care Law Act (H.R. 2), legislation Sen. Majority Leader Harry Reid (D-NV) has said he has no plans to consider in the Senate. Including the repeal language via an amendment to a larger bill that already has significant bipartisan support was a back-door maneuver to force the issue to a vote in that chamber.  Continue reading this entry at Littler's Healthcare Employment Counsel.

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On Wednesday, the House Committee on Education and the Workforce held a hearing to discuss the state of the American workforce. Panelists pointed to a number of factors that they believe hinder job creation and economic growth, and made suggestions to jump-start the economy.

Robert McDonnell, Governor of Virginia, claimed that “excessive federal regulations” and the new health care requirements were imposing significant burdens on small businesses. Specifically, McDonnell criticized the National Labor Relations Board’s proposed rule that would require almost all private sector employers to post in the workplace a notice to employees outlining their rights under the National Labor Relations Act. McDonnell explained that this proposed notice “lists seven bullet points that state employees have the right to organize, form or join a labor union and repetitively state they have the right to negotiate their wages, benefits and working conditions with their employer. This is counterproductive and detrimental to the message we are trying to send in Virginia.”

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On December 16, 2010, OFCCP Director Patricia Shiu signed Directive 293 (pdf) to provide “comprehensive guidance for assessing when health care providers and insurers are federal contractors and subcontractors based on their relationship with a Federal health care program or with participants in a Federal health care program.” This new directive was aimed at clarifying the confusion left by two prior OFCCP directives (Nos. 189 and 262) as to the types of arrangements that would subject medical providers and hospitals to OFCCP’s jurisdiction.  Continue reading this entry at Littler's Healthcare Employment Counsel.

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As expected and after two days of debate, the House of Representatives on Wednesday approved by a vote of 245-189 the Repealing the Job-Killing Health Care Law Act (H.R. 2), legislation that would repeal the Affordable Care Act in its entirety. Although the vote was largely along party lines, Reps. Dan Boren (D-OK), Mike McIntyre (D-NC) and Mike Ross (D-AR) broke rank and voted in favor of the bill. Despite its passage, the repeal legislation has little to no chance of becoming law this session. Sen. Majority Leader Harry Reid (D-NV) has said he has no plans to consider the bill in that chamber – which still enjoys a slim Democratic majority – and President Obama has stated that he would veto any efforts to repeal the health care law. Wednesday’s House vote, therefore, was largely symbolic and likely a means to gain momentum for more piecemeal reform. Continue reading this entry at Littler’s Healthcare Employment Counsel.

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The U.S. Supreme Court has upheld a Treasury Department rule that considers medical residents as full-time employees subject to Federal Insurance Contributions Act (FICA) payroll taxes. In Mayo Foundation v. U.S. (09-837), (pdf) the Court was asked to consider whether the stipends provided to medical residents that perform medical and patient care services for 40 or more hours per week as part of an accredited graduate medical education program are subject to FICA, commonly referred to as “Social Security” taxes, which are imposed on both employers and employees based upon wages paid. Among the many statutory exceptions to this tax requirement is the “student” exception, which exempts “service performed in the employment of. . . a school, college, or university . . . if such service is performed by a student who is enrolled and regularly attending classes at such school, college, or university.” A Treasury Department amended regulation interpreting this student exemption was issued in 2004. The amended regulation clarified, among other things, that:

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Wasting no time, the House of Representatives on Friday voted 236-181 in favor of a rule to consider the Repealing the Job-Killing Health Care Law Act (H.R. 2), (pdf) one of many bills introduced this week to repeal the Affordable Care Act. Only 4 Democrats joined 232 Republicans in voting for the rule. The rule provides for several hours of debate on the measure without any amendments. The vote on whether to pass this legislation is scheduled to take place on Wednesday, January 12. Although the House is expected to approve the bill, it will likely die in the Senate where Democrats still hold a slim majority. Even if the Senate were to clear the repeal measure, President Obama has already stated that he would exercise his veto power to save the health care law. The House’s symbolic gesture, however, now paves the way for the introduction of smaller bills aimed to chip away at the Affordable Care Act and deny funding to implement it.  Continue reading this entry at Littler's Healthcare Employment Counsel.

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During the DOL’s Employee Benefits Security Administration’s (EBSA) live web chat held on Tuesday, EBSA Assistant Secretary Phyllis Borzi responded to questions aimed at the pension and welfare benefit initiatives contained in the DOL’s Semiannual Regulatory Agenda, as well as the interim final regulations outlining the procedures for internal and external review of adverse health benefit claims decisions.  Borzi noted that in the coming months the EBSA will focus on completing its work in pension and welfare plan transparency initiatives.  In particular, the agency plans to finalize the interim final rule relating to reasonable contracts and arrangements under section 408(b)(2) of ERISA. The EBSA will also consider whether and to what extent similar fee and compensation disclosure requirements will be applied to service relationships in the welfare plan context.

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Incoming House Majority Leader Eric Cantor (R-VA) has introduced legislation to repeal the Affordable Care Act, which is scheduled to be voted on next Wednesday. The introduction of the two-page Repealing the Job-Killing Health Care Law Act (pdf) is considered by most to be a largely symbolic gesture, as its chances of becoming law are slim. While the House of Representatives – with 242 Republican members – will likely have sufficient votes to pass this measure, the bill will face a tougher hurdle in the Senate, where Democratic members still hold a majority. In addition, President Obama would surely exercise his veto power in the unlikely event the Senate approves the legislation.  Continue reading this entry at Littler’s Healthcare Employment Counsel.

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Despite two attempts, the Senate on Monday failed to approve amendments to the FDA Food Safety Modernization Act (S. 501) that would have repealed the much-maligned provision in the Affordable Care Act that expands a business’s 1099 information reporting requirements. Specifically, the highly contentious provision requires all businesses, charities, and state and local governments to file 1099 forms if they purchase $600 or more in goods from another business after December 31, 2011. Business interests and the IRS have decried this mandate, claiming the burden of compliance and administration will be too great for all involved.  Continue reading this entry at Littler’s Healthcare Employment Counsel.

Photo credit:  MBPHOTO, INC.

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Tuesday's historic election radically changed the composition of Congress and the balance of power in Washington. While a few election results are still trickling in, Republicans are projected to gain around 60 seats in the House of Representatives, regaining majority control. Democrats will still control the Senate, albeit with a much slimmer margin. Senate Republicans will increase their numbers from 41 to 47 seats, with the outcome of the race in Washington still uncertain. Whether the shift in power in Congress produces compromise or gridlock remains to be seen. What is clear is that this new political landscape will necessarily alter the Obama Administration's labor and employment agenda. For more information on what employers can expect during the remaining weeks of the 111th Congress and the next Congress, continue reading Littler’s ASAP: How Will the Midterm Election Results Impact Labor & Employment Policy?

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The Department of Labor’s Employee Benefits Security Administration (EBSA) has issued guidance in the form of Frequently Asked Questions (FAQs) that explains how the Genetic Information Nondiscrimination Act (GINA) impacts employer-provided group health plans and insurance providers. Among other things, Title I of GINA prohibits group health plans and health insurance issuers from discriminating based on genetic information, and prohibits the collection of such information, including family medical history, prior to or in connection with plan enrollment or for insurance underwriting purposes. As explained in the FAQs, unlike the provisions of Title I of the Health Insurance Portability and Accountability Act (HIPAA) that exempt very small health plans with less than two participants who are current employees, the nondiscrimination provisions of GINA apply to all group health plans.  Continue reading this entry at Littler’s Healthcare Employment Counsel.

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On Wednesday, the Senate voted 40-59 to defeat a motion to begin debate on a resolution of disapproval (S.J. Res. 39) introduced on September 21 by Sen. Mike Enzi (R-WY) that sought to repeal the health care plan grandfathering regulations that exempt certain plans from having to comply with some of the new requirements imposed by the Patient Protection and Affordable Care Act (“Affordable Care Act”). A new internal and external claims review process and the prohibition on discrimination in favor of highly-compensated employees by fully-insured plans are among the requirements that apply to non-grandfathered health plans.  Continue reading this entry at Littler's Healthcare Employment Counsel.

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On Tuesday, the Senate refused to advance two amendments to the Small Business Jobs and Credit Act of 2010 (H.R. 5297) offered by both Democratic and Republican senators that sought to amend or repeal a provision in the newly-enacted Patient Protection and Affordable Care Act (“Affordable Care Act”) that imposes increased tax reporting requirements on businesses. Specifically, the provision requires all businesses, charities, and state and local governments to file 1099 forms if they purchase $600 or more in goods from other entities after December 31, 2011. This reporting mandate has drawn fire from a number of sectors on the grounds that the burden is simply too onerous and will wind up impacting a considerable number of businesses.

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The Department of Labor has withdrawn its proposed rule defining “welfare benefit plan” under the Employee Retirement Income Security Act (ERISA). The rule, which intended to address the impact of state health care plans on ERISA-covered welfare plans, had been proposed before the Patient Protection and Affordable Care Act (“Affordable Care Act”) was signed into law on March 23, 2010. In light of the Affordable Care Act’s enactment, the DOL intends to review “whether and to what extent further regulation in this area is necessary or appropriate in light of a national health care reform program.”

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This week, Rep. Linda Sanchez (D-CA) introduced legislation that would extend the federal minimum wage and overtime protections of the Fair Labor Standards Act (FLSA) to most home care workers, improve federal and state data collection and oversight with respect to the direct care workforce, and create a grant program to help states recruit and train direct care workers. Specifically, the Direct Care Workforce Empowerment Act (H.R. 5902) would limit the “companionship services” FLSA exemption to those who work 20 or fewer hours per week.

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The U.S. Department of Health and Human Services (HHS) published on July 14, 2010, a voluminous Notice of Proposed Rulemaking (NPRM), containing dozens of proposed amendments to three sets of Health Insurance Portability and Accountability Act of 1996 (HIPAA) regulations: the Privacy Rule; the Security Rule; and the Enforcement Rule. The proposed amendments are directed principally at implementing the Health Information Technology for Economic and Clinical Health Act (HITECH Act), which amended HIPAA and went into effect on February 17, 2010. A careful review of the NPRM for its impact on employers who sponsor HIPAA-covered plans reveals that, if the proposed changes were adopted, employers would be required to revise their business associate agreements, their HIPAA notice of privacy practices, and their policies for responding to access requests. The NPRM also provides employers with a roadmap for avoiding civil monetary penalties. To learn more about the NPRM and its implications for employers, please continue reading Littler's ASAP, What Do Employers with HIPAA-Covered Health Plans Really Need to Know About Recently Proposed Revisions to HIPAA Regulations?, by Philip L. Gordon.

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On Friday, President Obama signed into law the Preservation of Access to Care for Medicare Beneficiaries and Pension Relief Act (H.R. 3962), (pdf) legislation commonly known as the “doc fix” bill. This measure reverses a 21 percent payment cut for doctors in Medicare and TRICARE, updates the physician payment formula through November 30, 2010, and provides temporary, targeted funding relief for single employer and multiemployer pension plans that suffered significant losses in asset value due to the 2008 financial downturn. On Thursday, the House of Representatives overwhelmingly approved this measure by a 417-1 vote. The Senate cleared this bill last week after the larger tax extender bill failed to gain sufficient support.

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On Friday, the Senate unanimously approved the Preservation of Access to Care for Medicare Beneficiaries and Pension Relief Act, (pdf) a bill that reverses a 21 percent payment cut for doctors in Medicare and TRICARE, updates the physician payment formula through November 30, 2010, and provides temporary funding relief for single- and multi-employer pension plans that suffered significant losses in 2008. With respect to the pension relief provisions, according to a summary, (pdf) employers that elect the relief would be required to make additional contributions to the plan if they pay compensation to any employee in excess of $1 million, pay extraordinary dividends, or engage in extraordinary stock buybacks during the first part of the relief period. Additional relief would be available to certain plans sponsored by charitable organizations. The legislation now needs approval by the House.

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The federal government and nurses unions have recently increased their focus on nurse-to-patient ratios and providing nurses – and nurses’ unions – with greater influence on nurse staffing levels. Earlier this month a federal agency used its website to advocate increasing hospital nurse-to-patient ratios. Nurses unions also have been rallying, striking, and marching on Washington to push for nurse-staffing legislation and provisions in collective bargaining agreements. Concurrent with these efforts, legislation was introduced in both the House and Senate this week that would require Medicare-participating hospitals to establish staffing plans for nursing services, provide certain whistleblower protections for employees and patients, and subject employers in violation of the bill to monetary penalties.  Continue reading this entry at Littler's Healthcare Employment Counsel blog.

Photo credit:  SmithMaxfield
 

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Employers have anxiously awaited the release of the interim final rules (pdf) relating to “grandfathered” health care plans under the Patient Protection and Affordable Care Act (PPACA). The regulations have garnered a significant amount of controversy in the past couple of days, as a leaked draft version indicated that more than half of employer-sponsored plans would not qualify for the grandfathered status. Under PPACA, health plans that were implemented before the Act was signed into law on March 23rd are exempt from many, but not all, of the law's consumer protections. The regulations seek to clarify how plans may qualify for and/or lose the grandfathered status.  Continue reading this entry at Littler's Healthcare Employment Counsel blog. 

Photo credit:  MBPHOTO, INC.

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As a result of the NLRB’s June 3, 2010 decision (pdf) refusing to review a regional director’s ruling that the interns and residents at St. Barnabas Hospital in the Bronx, New York, are employees, the ballots they cast in a union election on June 18, 2009 will shortly be counted. The results of the vote will determine whether the hospital’s interns and residents will be joining the Service Employees International Union (SEIU). The central issue presented by the election petition filed by an SEIU local in 2009 was whether the hospital’s interns and residents were “employees” with the right to organize, or students not covered by the National Labor Relations Act (NLRA).  Continue reading this entry at Littler's Healthcare Employment Counsel blog. 

Photo credit:  Steve Debenport Imagery

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On Thursday, House Ways and Means Committee Chairman Sander Levin (D-MI) and Senate Finance Committee Chairman Max Baucus (D-MT) introduced a summary of the American Jobs and Closing Tax Loopholes Act, (pdf) joint legislation that, among other things, extends emergency unemployment benefits and COBRA credits through the end of 2010, and provides pension funding relief for single- and multi-employer pension plans. The legislation will be introduced as a House Amendment to the American Workers, State, and Business Relief Act of 2010 (H.R. 4213), which the Senate passed in March as an amendment to the original Tax Extenders Act of 2009 that cleared the House in December.

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The Department of Labor has issued interim final regulations (pdf) implementing the dependent coverage provisions of the Patient Protection and Affordable Care Act, as amended by the Healthcare and Education Reconciliation Act (PPACA) (the dependent coverage provisions are contained in ERISA section 715).

The new regulations provide that effective for plan years beginning on or after September 23, 2010 (effective date), any group health plan or group health insurance issuer (plan), which provides coverage to dependent children must make coverage available to dependent children until they have attained the age of 26. The regulation confirms that the last required coverage date is the day before the child's 26th birthday.  Continue reading this entry at Littler's Healthcare Employment Counsel blog.

Photo credit:  MBPHOTO, INC.

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On Tuesday, the Senate Subcommittee on Employment and Workplace Safety held a hearing to assess the need for safe patient handling and lifting standards. A number of panel members testified that health care workers experience a relatively excessive rate of musculoskeletal injuries due to manual patient handling and called for legislation and regulation to provide a “floor” for minimally acceptable working conditions. Legislation has already been introduced in both congressional chambers to accomplish this end. The Nurse and Health Care Worker Protection Act (S. 1788, H.R. 2381) was introduced in the Senate by Sen. Al Franken (D-MN) in October 2009, and in the House of Representatives by Rep. John Conyers (D-MI) last May.  Continue reading this entry at Littler’s Healthcare Employment Counsel blog.

Photo credit:  AlexRaths

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The Employee Benefits Security Administration (EBSA) is set to publish a notice (pdf) in the Federal Register announcing the availability of model COBRA notices that group health plans and other entities are required to provide to individuals eligible for the premium reductions and additional health care coverage election periods provided by the American Recovery and Reinvestment Act (ARRA), and extended for the third time by the Continuing Extension Act (CEA) of 2010. The CEA extends through May 31, 2010, the 65 % premium COBRA subsidy for eligible individuals who are involuntarily terminated from employment. In addition, the CEA provides retroactive eligibility for individuals who lost their jobs after the prior COBRA subsidy expired on March 31, 2010.

The EBSA has created a webpage that contains links to an updated Model Updated General Notice, Model Notice of New Election Period, Model Supplemental Information Notice, Model Notice of Extended Election Period, and a Model Updated Alternative Notice, in addition to instructions on which notice to provide and to whom.

Longer COBRA extensions are included in the American Workers, State, and Business Relief Act of 2010 (H.R. 4213), which the Senate passed in March. House and Senate negotiators are working to resolve differences so that both Chambers can approve final legislation before Memorial Day.

Photo credit:  MBPHOTO

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The newly enacted Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010 (collectively known as “PPACA”), has set in motion significant changes to this country’s health care system. Many of these changes have and will impose new responsibilities on employers, insurers, benefits administrators, and the health professional community in general. Navigating the legislation and understanding the obligations the new health care law has created is made more difficult by the fact that many of these requirements are to be phased in over the next eight years.

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The Occupational Safety and Health Administration (OSHA) is seeking information and comment (pdf) on occupational exposure to infectious agents in health care and health care-related settings in order to determine whether it will take further regulatory action to limit the spread of occupationally acquired infectious diseases. According to a summary of this request published in the Federal Register, OSHA is interested in strategies that are being used in work settings where health care is provided (e.g., hospitals, outpatient clinics, clinics in schools and correctional facilities) and health care-related settings (e.g., laboratories that handle potentially infectious biological materials, medical examiner offices and mortuaries) to mitigate the risk of occupationally acquired infectious diseases. To that end, the agency seeks to collect “information and data on the facilities and the tasks potentially exposing workers to this risk; successful employee infection control programs; control methodologies being utilized (including engineering, work practice, and administrative controls and personal protective equipment); medical surveillance programs; and training.”

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The U.S. Department of Health and Human Services (HHS) has issued interim final regulations (pdf) to implement the provisions of the Early Retiree Reinsurance Program (ERRP), the temporary cost assistance program instituted as part of the Patient Protection and Affordable Care Act (PPACA). The ERRP provides $5 billion in temporary financial help for employer plans that continue to provide health coverage to “early retirees,” defined as individuals age 55 and older who are neither active employees nor eligible for Medicare, plus their spouses, surviving spouses and dependents. Under the ERRP, the Secretary will reimburse plans for certain claims between $15,000 and $90,000 (with those amounts being indexed for plan years starting on or after October 1, 2011). Funds will be available until the earlier of January 1, 2014 or until the $5 billion is depleted. These plans can receive reimbursement for a portion of medical, surgical, hospital, and prescription drug costs.  Continue reading about this development at Littler's Healthcare Employment Counsel blog.

Photo credit:  Andriy Solovyov

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The IRS has published notice 2010-38, providing guidance as to the application of the new rules permitting favorable tax treatment of health benefits provided to children of covered employees. The Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010, signed into law on March 23 and 30, 2010 (the "PPACA") requires that group health plans and health insurance issuers provide coverage for children of covered until the child reaches age 26. The coverage requirement of the PPACA is effective for the first plan year beginning on or after September 23, 2010, but the new law effectively permits plans and issuers to provide coverage under the new rules, by providing for favorable tax treatment of coverage and health reimbursements for children under age 27, effective as of March 30, 2010.  Continue reading about this development at Littler's Healthcare Employment Counsel blog.

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The Department of Health and Human Services (HHS) has announced the creation of the Office of Consumer Information and Insurance Oversight, a new division that will provide “leadership for implementing the provisions of the health reform bill that address private health insurance.” A notice (pdf) published in the Federal Register identifies the components of this new division and a brief description of the main responsibilities of each office within the division.  Continue reading this entry on Littler's Healthcare Employment Counsel blog. 

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Update: This entry has been updated to reflect that the bill was signed into law.

Late Thursday night, President Obama signed into law legislation that provides another temporary extension of emergency unemployment insurance (UI) benefits and the 65% premium COBRA subsidy, both of which lapsed over the recent legislative recess.  Hours earlier, the Senate voted 59-38 to pass the Continuing Extension Act of 2010 (H.R. 4851) with an amendment (S. Amt. 3721) (pdf) in the nature of a substitute bill introduced by Sen. Max Baucus (D-MT), which will extend UI benefits through June 2, 2010, and premium COBRA assistance through May 31, 2010. The original bill – which cleared the House by voice vote on March 17 but stalled in the Senate over how the measure would be paid for – provided for extensions of these benefit programs through May 5 and April 30, respectively.  Shortly after Thursday's Senate vote, the House approved the bill by a 289-112 margin. 

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While the most recent change to the Fair Labor Standards Act (FLSA) and the attention it may receive might seem small in comparison to Health Care Reform, the FLSA Amendment is significant. The Amendment, which now provides break time to nursing mothers, imposes a new requirement under the FLSA.

Currently, the FLSA does not require employers to provide rest breaks or meal periods to employees. Generally, rest break requirements are the subject of state regulation, and various states do require such breaks. Until this amendment, if rest breaks were not required by state law, then whether they were provided was a matter of agreement between the employer and employee. The amendment to the FLSA, 29 U.S.C. section 207(r)(1), changes that. The amendment will require all employers subject to the FLSA to provide rest breaks to mothers who wish to express breast milk.

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Last week, Sen. Barbara Boxer (D-CA) introduced legislation that would permit many same-sex spouses or domestic partners to take advantage of COBRA continuation health coverage if their partner loses a job. The Equal Access to COBRA Act of 2010 (S. 3182) would change federal law to allow equal access to COBRA coverage for all individuals who are covered by an employer’s health plan, and would apply to domestic partners as they are defined by that plan. As COBRA law currently stands, continuation coverage does not apply to domestic partners or same-sex spouses, even if the employee who was let go worked at a company that offered health coverage to domestic partners. The provisions of this bill would apply only to companies that already offer health coverage to domestic partners and their children. Domestic partners would also be able to take advantage of the premium COBRA subsidies provided by the American Recovery and Reinvestment Act of 2009.

This bill has been referred to the Senate Committee on Health, Education, Labor and Pensions. 

Photo credit:  Ryerson Clark

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As expected, on Tuesday President Obama Signed into law the Health Care and Education Reconciliation Act of 2010 (H.R. 4872), more commonly known as the “reconciliation bill” that makes changes to the Patient Protection and Affordable Care Act (PPACA) (P.L. 111-148), the sweeping health care overhaul legislation Obama signed on March 23. The House approved this bill for the second time on March 25 by a vote of 220-207. The House had initially cleared the bill on March 21, but needed to take up the measure once again after two minor changes were made in the Senate, which also passed the bill on March 25.

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The new health care reform legislation has dramatic implications for all employers. For employers with existing collective bargaining agreements, there are unique considerations, both in the short and long-term. While full implementation of the law is still years away, employers should begin evaluating and preparing for its impact on collective bargaining agreements today.

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Despite last-ditch efforts, the Senate failed to approve the Continuing Extension Act of 2010 (H.R. 4851) before the two-week legislative recess. This bill would have extended the 65 percent premium COBRA subsidy another month, until April 30, 2010, and emergency unemployment insurance benefits until May 5, 2010. Both measures – which were already given one-month extensions by means of the Temporary Extension Act of 2010 (H.R. 4691), are set to expire while Congress is out of session. On March 17, the House cleared the measure by voice vote. The bill stalled in the Senate after Sen. Tom Coburn (R-OK) objected to the fact that the cost of the bill was not fully offset. It is expected that when the Senate reconvenes on April 12, consideration of the temporary extension bill will be the first order of business, and that the provisions of the bill, if approved, would be retroactive.

Photo credit:  Maravic

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After a marathon of all-night Congressional proceedings, the Senate voted 56-43 on Thursday in favor of a slightly amended Health Care and Education Reconciliation Act of 2010 (H.R. 4872), otherwise known as the reconciliation bill containing “fixes” to the recently enacted Patient Protection and Affordable Care Act (P.L. 111-148). The Senate’s consideration of the reconciliation bill hit a snag early Thursday when Republican Senators opposed to the bill were successful in identifying two provisions involving the student loan portion of the measure that do not adhere to the “Byrd Rule,” which prevents the inclusion of provisions in a budget reconciliation bill that lack a budgetary impact. Since the provisions were deleted, the bill will need to return to the House for yet another vote. It is expected that the House will approve the amended version later today, and President Obama will quickly sign it into law. Taken together, the two health care overhaul bills will make significant changes to this country’s health care system, and present new obligations for employers.

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On Tuesday morning, President Obama signed into law the Patient Protection and Affordable Care Act (H.R. 3590), the health care overhaul bill that cleared the House of Representatives by a slim margin on Sunday. The Senate will now begin consideration of the Health Care and Education Affordability Reconciliation Act of 2010 (H.R. 4872), the bill that contains “fixes” to the Patient Protection and Affordable Care Act. Both measures will face intense scrutiny in the coming days.

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In a historic series of votes held on Sunday, the House of Representatives passed both the Senate-approved Patient Protection and Affordable Care Act (H.R. 3590), (pdf) and the Health Care and Education Affordability Reconciliation Act of 2010 (H.R. 4872), (pdf) otherwise known as the reconciliation package of “fixes” to the Senate bill. The legislation, which is expected to provide health insurance to an additional 32 million people, would create state-based health insurance exchanges through which eligible individuals and businesses can purchase health insurance. The legislation would also provide federal government subsidies to help lower-income individuals purchase insurance.

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On Monday, the Employee Benefits Security Administration (EBSA) will publish in the Federal Register an announcement (pdf) that updated model COBRA notices that group health plans and other entities are required to provide to individuals eligible for the premium reductions and additional health care coverage election periods provided by the recently-enacted Temporary Extension Act (TEA) of 2010 are available at the EBSA’s COBRA website. TEA extended until March 31, 2010 the eligibility period for the 65 percent COBRA premium reduction provided by the American Recovery and Reinvestment Act (ARRA). ARRA, as revised, mandates that certain health plan providers send assistance eligible individuals notices about their ability to take advantage of the continued health coverage. The EBSA provides links to a Model Updated General Notice, Model Notice of New Election Period, Model Supplemental Information Notice, Model Notice of Extended Election Period, and a Model Updated Alternative Notice, in addition to instructions on which notice to provide and to whom.

This week, the House passed a bill extending the COBRA subsidy an additional month until April 30, 2010. Congress is also considering longer-term extensions of the program. 

Photo credit: MBPHOTO

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On Thursday, the House of Representatives released the amended Health Care and Education Affordability Reconciliation Act of 2010 (H.R. 4872), (pdf) the reconciliation bill that contains “fixes” to the Senate-approved Patient Protection and Affordable Care Act (H.R. 3590).  Earlier in the day, the Congressional Budget Office (CBO) and the Joint Committee on Taxation (JCT) released their preliminary cost estimate (pdf) of the total health care package, thus triggering the 72-hour waiting period before a vote can be held.

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On March 17, the House of Representatives passed by voice vote the Continuing Extension Act of 2010 (H.R. 4851), legislation that would extend the 65 percent premium COBRA subsidy another month until April 30, 2010, and the emergency unemployment insurance benefits until May 5, 2010. On March 2, President Obama signed into law the Temporary Extension Act of 2010 (H.R. 4691), a bill that extended the COBRA subsidy until March 31, 2010, and emergency unemployment insurance benefits until April 5, 2010. The Senate has already passed the American Workers, State, and Business Relief Act of 2010 (H.R. 4213), a more comprehensive bill that includes provisions continuing both benefits programs through the end of this year. Although it is expected the House will ultimately pass this measure, a vote may not come until after these programs have expired, thus creating the need for another extender bill.

The Senate is expected to take up this measure shortly.

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This week, the House of Representatives will embark on what is widely believed to be the final sprint to health care reform. The House Budget Committee is scheduled to begin markup of a reconciliation bill (pdf) on Monday afternoon.  This 2,309-page bill – the Reconciliation Act of 2010 – is expected to be the vehicle for changes to the Senate-passed health care bill, the Patient Protection and Affordable Care Act (H.R. 3590), negotiated between the White House and House and Senate Democrats. The reconciliation bill also includes changes to the federal student lending program that would switch the program to direct federal loans.

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On Wednesday, the Senate passed by a 62 to 36 margin the Tax Extender Act of 2009 (H.R. 4213), legislation that would extend until Dec. 31, 2010 the 65% premium COBRA subsidies and emergency unemployment insurance benefits, both programs that are set to expire in the coming weeks. The bill also extends several other tax credit initiatives, and includes pension funding relief measures. On Tuesday, the Senate voted 66-34 to limit debate on this bill, which was introduced by Sen. Max Baucus (D-MT) as an amendment (S. Amdt. 3336) in the nature of a substitute to the tax extender bill the House of Representatives passed in December.

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On Tuesday, the Senate voted to end debate on a $150 billion bill that would extend premium COBRA subsidies and emergency unemployment insurance benefits through December 31, 2010, as well as continue certain programs aimed at providing pension-funding relief. Sen. Max Baucus (D-MT) introduced the American Workers, State and Business Relief Act of 2010 (pdf) as an amendment (S. Amt. 3336) in the nature of a substitute to the Tax Extender Act of 2009 (H.R. 4213).  The tax extender bill has been serving as the vehicle to provide extensions to these and other expiring tax credit programs. The premium COBRA subsidy and emergency unemployment benefits were recently given one-month extensions through the Temporary Extension Act of 2010, signed into law on March 2.

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Telling Congress to “finish its work,” President Obama on Wednesday urged both chambers to schedule a vote on final health care overhaul legislation in the coming weeks. While Obama did not outline a specific roadmap for reform, it is widely believed that the plan for going forward involves first having the House of Representatives vote on the Patient Protection and Affordable Care Act (H.R. 3590), the bill the Senate approved in December, and then passing via budget reconciliation a package of changes to that bill reflected in the estimated $950 billion proposal Obama unveiled on February 22.  While Obama did not specifically mention reconciliation, he seemed to sanction this approach, stating that a health care reform bill: “deserves the same kind of up-or-down vote that was cast on welfare reform, the Children's Health Insurance Program, COBRA health coverage for the unemployed and both Bush tax cuts – all of which had to pass Congress with nothing more than a simple majority.” The controversial budget reconciliation process requires a simple majority vote, but is subject to strict limitations about what matters can be included in a reconciliation bill.

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On Tuesday, President Obama signed the Temporary Extension Act of 2010 (H.R. 4691), a bill that will extend the 65 percent premium COBRA subsidy through March 31, 2010, and unemployment assistance benefits through April 5, 2010. The Senate passed this bill by a vote of 78-19 after Sen. Jim Bunning (R-KY) – who objected to how the measure would be funded – abandoned his efforts to block it. The House of Representatives approved this emergency spending measure by voice vote last Thursday.  Both benefits had expired on February 28.

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On February 25, 2010, the White House hosted the much-anticipated bipartisan health care summit. As expected, no final legislation or agreement about how to proceed with health care reform emerged from the 7 ½ hour meeting. Democrats took the position that they would not start from scratch, and Republicans claimed they would not support the proposals that have already been put forth. The disagreements, however, may have given Democrats the public justification they need to proceed with reconciliation as a means to push forward with reform. President Obama stated:

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In advance of Thursday’s much-publicized White House bi-partisan health care summit, President Obama today released his version of health reform.  The estimated $950 billion plan contains many elements from the Senate-approved Patient Protection and Affordable Care Act (H.R. 3590), including the requirement that most Americans obtain health insurance coverage, the creation of a health insurance exchange, penalties on large employers that fail to provide affordable health insurance, the imposition of an excise tax on high-cost “Cadillac” insurance plans, and the lack of a public insurance option included in the more expansive Affordable Health Care for America Act (H.R. 3962), health care legislation that the House cleared in November. Obama’s plan also includes popular elements contained in both bills, such as the ban on preexisting condition exclusions and certain lifetime and annual coverage limits in health insurance plans. The President’s proposal attempts to bridge the gap between the stalled Senate and House bills, which contain significant changes from employer-sponsored health care.

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A reported deal has been reached between the White House and union leaders regarding the proposed 40 percent excise tax on high cost (“Cadillac”) healthcare plans for inclusion in the final healthcare overhaul bill. This tax – first appearing in the Senate version of the legislation – is favored by President Obama, but has been heavily criticized by both House Democrats and organized labor.

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Staff members of the three House committees (Ways and Means, Education and Labor, and Energy and Commerce) involved in crafting the healthcare overhaul bill have put together an 11-page document (pdf) highlighting the similarities and differences between the House and Senate bills. The Senate’s Patient Protection and Affordable Care Act (H.R. 3590) and the House of Representative’s Affordable Health Care for America Act (H.R. 3962) contain some crucial differences that are currently being ironed out in informal talks as opposed to formal conference committee. Resolving the differences this way avoids any anticipated procedural delays in the Senate.

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The American Benefits Council (“the Council”), an advocacy organization for voluntary private employer-sponsored benefit programs, has released a document outlining its recommendations to Congress for crafting the final healthcare bill. Lawmakers are in the process of merging the provisions of the Senate’s Patient Protection and Affordable Care Act (H.R. 3590) and the House of Representative’s Affordable Health Care for America Act (H.R. 3962) to create a unified bill. The bills contain many crucial differences, especially with respect to the provisions regulating employer-sponsored coverage and responsibilities. The Council’s recommendations document – Priority Employer Issues for Consideration of House and Senate Health Care Reform Legislation (pdf) – sets forth a number of suggestions related to health coverage and tax issues that would be affected by both versions of healthcare overhaul legislation.

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The Department of Labor’s Employee Benefits Security Administration (EBSA) has released a fact sheet explaining how the Defense Department’s 2010 appropriations bill (“2010 DOD Act”) extends the Consolidated Omnibus Budget Reconciliation Act (COBRA) premium reduction provided by the American Recovery and Reinvestment Act (“ARRA” or “Economic Stimulus”). In general, the 2010 DOD Act extended the COBRA premium reduction eligibility period for two months until February 28, 2010 and increased the maximum period for receiving the subsidy for an additional six months (from nine to 15 months).  Among other things, the fact sheet outlines who is now eligible for the premium reduction, the new period of coverage, and notice requirements plan administrators must provide in light of the extension. The fact sheet explains that plan administrators are now required to provide notice about the changes made to the COBRA premium reduction provisions to individuals who have already been provided a COBRA election notice, unless the election notice included the updated premium reduction information. These notices must be given to assistance eligible individuals by February 17, 2010. Individuals who have been terminated on or after October 31, 2009 and will lose health coverage must be provided this notice “within the normal timeframes for providing continuation coverage notices.” Those who had reached the end of the reduced premium period before the legislation extended it to15 months must be provided this notice within 60 days of the last day they were eligible to receive COBRA premium assistance under the old rules.

Photo credit:  Andriy Solovyov

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This morning, the Senate voted 60-39 along party lines to approve the Patient Protection and Affordable Care Act (H.R. 3590), the Senate’s healthcare overhaul bill. On Monday, the Senate voted to end debate on the package of amendments to the bill known as the “manager’s amendment,” enabling the amended legislation to be voted on before the Senate recessed for the holidays.

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Early Monday morning, the Senate voted 60-40 to end debate on Senate Majority Leader Harry Reid’s (D-Nev.) complete set of amendments, known as the “manager’s amendment”, (pdf) to the latest version of the Senate healthcare bill, the Patient Protection and Affordable Care Act (H.R. 3590) (pdf). The party-line vote paves the way for Senate passage of the healthcare bill on Christmas Eve. This version of the healthcare overhaul bill includes an employer penalty for failing to offer coverage, tax credits for small employers that do, and a number of plan restrictions on the health insurance industry.

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On Monday, three nursing associations officially merged to form the largest labor union for medical professionals in this country. The new National Nurses United (NNU) combines the members and financial resources from the California Nurses Association, the United American Nurses, and the Massachusetts Nurses Union. With an estimated 150,000 members, this new union will be able to wield a significant amount of influence over the medical industry and healthcare reform efforts.

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The DOL’s Employee Benefits Security Administration (EBSA) has posted on its website new guidance regarding the COBRA health insurance premium subsidy granted by the American Recovery and Reinvestment Act of 2009 (“ARRA” or “Economic Stimulus”). Under ARRA’s COBRA provisions, the government provides certain qualifying unemployed workers with a 65 percent subsidy of their health insurance premiums for up to nine months. Those individuals who first became eligible to receive this subsidy will begin to lose their coverage starting this month.

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The Congressional Budget Office (CBO) yesterday released a report: An Analysis of Health Insurance Premiums Under the Patient Protection and Affordable Care Act (pdf) that focuses on the impact the Senate healthcare bill would have on health insurance premiums. Specifically, the analysis examined the average effects of the Patient Protection and Affordable Care Act (H.R. 3590), as proposed by Senator Reid (D-Nev.), on premiums in 2016 for coverage purchased individually, coverage purchased by small employers, and coverage provided by large employers.

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On Wednesday, Senate Majority Leader Harry Reid (D-Nev.) released a long-awaited version of healthcare overhaul legislation that he intends to submit to the Senate floor. Offered in the form of a substitute bill, the Patient Protection and Affordable Care Act (pdf) is a compromise between two other Senate measures, the America’s Healthy Future Act (S. 1796), which cleared the Senate Finance Committee in October, and the Affordable Health Choices Act (S. 1679), a bill passed by the Senate Health, Education, Labor and Pensions (HELP) Committee this summer. The House passed its own healthcare bill, the Affordable Health Care for America Act (H.R. 3962), earlier this month.

Some key components of this 2,074-page bill include a mandate for most legal residents to obtain health insurance, the establishment of health insurance “exchanges” through which certain individuals and families could receive federal subsidies to help them purchase health insurance on their own, an excise tax on insurance plans with relatively high premiums, regulations of the insurance industry itself, and monetary penalties for large employers that do not offer health benefits.

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Last week Sens. Sherrod Brown (D-Ohio) and Robert Casey (D-Pa.) introduced the COBRA Subsidy Extension and Enhancement Act of 2009 (S. 2730), a bill that would enhance the COBRA continuation health coverage subsidy program created by the American Recovery and Reinvestment Act of 2009 (“ARRA” or “Economic Stimulus”). Under the current program, the government provides certain qualifying unemployed workers with a 65 percent subsidy of their health insurance premiums for up to nine months. Individuals who first became eligible to take advantage of this temporary COBRA assistance in March 2009 will lose their coverage beginning in December 2009. The COBRA Subsidy Extension and Enhancement Act would extend this deadline, as well as increase the amount of the subsidy and the number of individuals who would be able to take advantage of this program.

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During a November 10 Senate subcommittee hearing on the H1N1 influenza virus (“swine flu”) and paid sick leave, Senator Chris Dodd (D-Conn.) announced that he plans to introduce a bill that would entitle most employees to take up to 7 days of paid sick leave to deal with the H1N1 or seasonal flu. According to a press release, under the terms of this bill workers would be entitled to the paid leave for their own flu-like symptoms, medical diagnosis or preventive care, to care for a sick child, or to care for a child whose school or child care facility has been closed due to the spread of flu. The decision to take this leave would be left to the employee’s discretion, although the Department of Labor could issue regulations requiring medical certification. If signed into law, the provisions of this bill would take effect 15 days after enactment, and sunset after 2 years.

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On Saturday, the House of Representatives passed the Affordable Health Care for America Act (H.R. 3962) by a vote of 220-215. Rep. Anh “Joseph” Cao (R-La.) was the only Republican House member to vote in favor of this healthcare overhaul legislation, while 39 House Democrats dissented.

Among other things, this nearly 2,000-page bill requires most individuals to purchase health insurance, and most large employers to either offer their employees health insurance or contribute funds (in the form of an 8 percent payroll tax) on their behalf to help subsidize the coverage they would instead obtain through health insurance exchanges. Smaller employers would either be subject to a smaller annual payroll tax, or be exempt from this “pay or play” requirement entirely. The bill also creates a public health insurance option that would be available within the exchange. Additionally, almost all employer-sponsored health plans would be required to meet essential benefit package requirements beginning in 2018. This legislation also imposes a number of restrictions on insurance providers. For example, this bill would prohibit preexisting condition exclusions in health insurance plans, lifetime limitations on benefits, and the practice of charging higher health insurance rates based on factors such as gender or health status.

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The Department of Health and Human Services (HHS) has published interim final rules that conform the enforcement regulations of the Health Insurance Portability and Accountability Act (HIPAA) to those made by the Health Information Technology for Economic and Clinical Health Act (the HITECH Act) regarding the electronic transmission of health information. Signed into law as part of the American Recovery and Reinvestment Act of 2009 (ARRA or ”Economic Stimulus”), the HITECH Act, among other things, modified the HHS Secretary’s authority to impose civil monetary penalties for violations of HIPAA rules occurring after Feb. 18, 2009. These HITECH Act revisions significantly increase the penalty amounts the Secretary may impose for such violations.

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The Congressional Budget Office (CBO) and the Joint Committee on Taxation (JCT) have issued a preliminary analysis (pdf) of the Affordable Health Care for America Act (H.R. 3962), the new healthcare overhaul bill introduced on October 29, 2009. The CBO estimates that under this bill, approximately six million additional people would obtain health insurance coverage from their employers by the year 2019. In addition, the CBO estimated that by 2019, roughly 21 million people would purchase their own coverage through the new insurance “exchanges” created by the bill.

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Rep. Joe Sestak (D-Pa.) has introduced a bill that would extend by six months the maximum COBRA continuation coverage period for individuals who were involuntarily terminated between April 1, 2009 and December 31, 2009, and amend the American Reinvestment and Recovery Act of 2009 (ARRA or “Economic Stimulus”) by extending the eligibility and maximum assistance periods for the 65 percent COBRA premium assistance available under ARRA. According to a press release, the Extended COBRA Continuation Protection Act of 2009 (H.R. 3930) would extend COBRA benefits in three ways. First, the bill would extend from 9 to 15 months the total allowable time an unemployed worker can receive COBRA premium assistance. Second, the bill extends this assistance to individuals who are involuntarily terminated between January 1 and June 30, 2010. Third, it would extend eligibility for traditional COBRA coverage an additional 6 months, from 18 to 24 months, for individuals terminated at the beginning of the economic recession in 2008. No extended COBRA premium assistance or extended COBRA benefits would extend beyond December 31, 2010.

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Last Thursday, Rep. Nathan Deal (R-GA) introduced two healthcare-related bills applicable to employers. The Improved Employee Access to Health Insurance Act of 2009 (H.R. 3821) would prevent states from enacting any law that prevents an employer from instituting an auto-enrollment process for employee health insurance coverage, so long as the participant or beneficiary has the option to decline coverage.

The second bill introduced by Rep. Deal (H.R. 3822) would allow employers that do not offer health benefits to provide tax-free defined contributions and administrative assistance to employees who opt to buy health insurance coverage on their own. The offer of assistance and tax-free contributions would not be considered a group health plan for Employee Retirement Income Security Act (ERISA) or the Public Health Service Act purposes.

The Improved Employee Access to Health Insurance Act has been referred to the House Committee on Education and Labor. H.R. 3822 has also been referred to this committee, as well as to the House Committees on Energy and Commerce and Ways and Means.
 

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In a closely-watched vote, the Senate Finance Committee approved by a 14 to 9 margin the America’s Healthy Future Act (pdf), a healthcare overhaul bill drafted by committee chairman Max Baucus (D-Mont.). Sen. Olympia Snowe (R-Maine) was the only Republican committee member to cross party lines and vote in favor of the measure. The committee’s final draft of this bill was released on October 2 after weeks of contentious markup by committee members. Now that this bill has been approved, Senators Baucus, majority leader Harry Reid (D-Nev.), and Christopher Dodd (D-Conn.) face the daunting task of combining the provisions of this bill with the Affordable Health Choices Act (S. 1679) (pdf), the healthcare reform bill that has already cleared the Senate Health, Education, Labor and Pensions (HELP) Committee. Among other differences between the two bills, the former contains neither a public health insurance option nor stringent employer mandates, while the latter does.

Meanwhile, the House of Representatives, whose version of the healthcare bill – America's Affordable Health Choices Act (H.R. 3200) – cleared the House Ways and Means, Education and Labor, and Energy and Commerce Committees in July, is reportedly working to meld the proposals from each of these committees to draft a bill that can be brought to the House floor for a vote. Edits to the bill from the House Ways and Means Committee can be found here; those from the House Education and Labor Committee can be found here; and those from the House Energy and Commerce Committee can be found here.

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The Department of Labor (DOL), Internal Revenue Service (IRS), and the Centers for Medicare and Medicaid (CMS) have published in the Federal Register interim final rules (pdf) governing Sections 101 through 103 of Title I of the Genetic Information Nondiscrimination Act of 2008 (GINA). Title I of GINA amended the Employee Retirement Income Security Act of 1974 (ERISA), the Public Health Service Act (PHS Act), the Internal Revenue Code of 1986 (Code), and the Social Security Act (SSA) to prohibit discrimination in health coverage based on genetic information. Sections 101-103 contain provisions banning discrimination based on genetic information in health insurance coverage and group health plans. The EEOC has not yet issued final rules interpreting Title II of GINA, which prohibits discrimination in employment based on genetic information, and limits the acquisition and disclosure by employers and other entities of such information.

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The Senate Finance Committee, after two weeks of much-publicized markup, has released its final version of healthcare reform legislation. Introduced by Sen. Max Baucus (D-Mont.) on September 16, America’s Healthy Future Act (pdf) has been considered the most conservative of the healthcare overhaul bills, as it contains neither a public health insurance option nor an employer mandate requiring the provision of health benefits. The bill does, however, impose on employers certain obligations. Specifically, the latest version of the bill would require the following:

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The Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) (P.L. 110-343) (pdf) and Michelle’s Law (P.L. 110-381) (pdf), two laws that impact employer-sponsored group health plans, will take effect for plan years beginning on or after October 3, 2009 and October 9, 2009, respectively.  Calendar year plans have until January 1, 2010 to comply with both laws. 

The MHPAEA requires private group health benefit plans that provide mental health and/or substance use disorder benefits to offer them on a basis equivalent to the medical and surgical benefits provided.  In order to ensure coverage parity, the act imposes several plan design requirements upon group health benefit plans that offer mental health and/or substance use disorder benefits. The bill exempts certain small group health benefit plans and those that would incur a particular level of increased costs for all benefits due to compliance with the parity rule. These exemptions are specific and narrow.

Michelle’s Law similarly imposes certain coverage requirements on group health benefit plans. In essence, this law extends the health plan benefits coverage to a dependent child who is over the age of 18 and enrolled in college and would otherwise lose coverage in the event a medically necessary leave of absence would cause the child to lose full-time student status.

For more information on these laws, see Littler’s ASAPs: Equal Mental Health and Substance Use Benefits Realized by Russell D. Chapman and Andrea Jackson; and Michelle's Law Extends Group Health Benefit Plan Eligibility for Dependent Students on a Medically Necessary Leave of Absence by Steven J. Friedman and Andrea Jackson.

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After much fanfare, Senator Max Baucus (D-Mont.), Chairman of the Senate Finance Committee, yesterday officially released the America’s Healthy Future Act (pdf) for his committee’s consideration. Although designed to appeal to conservatives in comparison to the House’s Affordable Health Choices Act (H.R. 3200) and a similar measure approved by the Senate Health, Education, Labor and Pensions (HELP) committee, it is uncertain whether Baucus’s bill will draw any Republican support, and enough to reach the 60 votes needed to avoid a filibuster.

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When Congress resumes next week, consideration of the Employee Free Choice Act (EFCA) will likely be pushed aside in favor of healthcare reform. According to an article in the Las Vegas Review-Journal, Senate Majority Leader Harry Reid (D-Nev.) told members of the Las Vegas Chamber of Commerce that senators “have too many other things on our plate” to take up the controversial “card check” bill anytime soon.

As reported in The Hill’s Blog Briefing Room, a few days earlier AFL-CIO Secretary-Treasurer Richard Trumka similarly acknowledged that any deliberation on the divisive bill would not take place until after health reform is dealt with. During a web chat on the blog firedoglake, Trumka claimed that the “President/and [Rahm] Emanuel have both said they dont [sic] intend to bring Employee Free Choice Act up until Health Insurance Reform is done. Which gives us an additional reason to do Health Insurance Reform now!”

While no surprise, these statements are significant in that they are among the first public acknowledgements by supporters that consideration of EFCA will be delayed. However, given President Obama’s upcoming speech at the September AFL-CIO convention, further developments are possible.

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Senator Roland Burris (D-IL) has introduced a bill that would extend temporarily the 18-month period of healthcare continuation coverage required by the Consolidated Omnibus Budget Reconciliation Act (COBRA). The COBRA Coverage Extension Act of 2009 (S. 1488) would provide up to 24 months of continuation coverage under group health plans required under COBRA, the law that amended the Employee Retirement Income Security Act (ERISA), the Internal Revenue Code and the Public Health Service Act to provide continuation of group health coverage for certain qualifying former employees, retirees, spouses, former spouses and dependent children. Specifically, S. 1488 would entitle any individual who is eligible for and has elected continuation coverage under COBRA as of the date of this bill’s enactment, and whose coverage would end before 12 calendar months had elapsed from the date of enactment due to an 18-month continuation limitation, to continue coverage until a full 12 months had passed after the date of enactment, or 24 months after the date of the qualifying COBRA event, whichever is earlier. This bill has been referred to the Senate Committee on Health, Education, Labor, and Pensions.

This bill joins another recent measure aimed at extending COBRA continuation coverage. The House’s much-publicized healthcare bill, America's Affordable Health Choices Act of 2009 (H.R. 3200), includes an amendment that would extend COBRA coverage until the individual becomes covered under another employer’s group health plan or under a health insurance exchange plan, the latter of which would be created under the bill itself. The extension would not apply to certain medical flexible spending arrangements. Offered by Rep. Susan Davis (D-CA), this amendment was approved by voice vote by the House Committee on Education and Labor on July 17. Given the development of the health insurance exchange system would not be established until the year 2013 at the earliest, it is conceivable that if this bill were to pass, COBRA continuation coverage could be extended for years. This healthcare bill has been approved by both the House Committees on Education and Labor, and Ways and Means.

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Chairmen of the House Committees on Education and Labor, Ways and Means, and Energy and Commerce finally unveiled the House Democrats’ massive 1,018 healthcare reform bill on Tuesday. The much-anticipated America’s Affordable Health Choices Act (H.R. 3200) (pdf) was introduced following a number of delays caused, in part, by concern over many of the bill’s more controversial provisions, such as the public health insurance option and employer mandates. These contentious provisions remain in the final bill, albeit with some greater leeway for small employers.

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Rep. Paul Hodes (D-NH) this week introduced the Small Business Health Care Affordability Act of 2009 (H.R. 3115), a bill that would provide small businesses and their employees with tax credits for health insurance coverage. According to the terms of this legislation, employers with 50 or fewer employees would be entitled to a an annual tax credit of up to $1,000 per employee for providing individual health insurance coverage, and up to $2,250 annually for providing family coverage. The plan would also provide healthcare premium assistance for small business employees and their dependents.

This legislation has been referred to the House Committee on Ways and Means. If enacted, the provisions of this bill would apply to taxable years beginning after December 31, 2009.

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On Friday, House Democrats unveiled an 852-page rough draft of a healthcare reform bill prepared by members of the House Ways and Means, Energy and Commerce, and Education and Labor Committees. A copy of the full bill and summaries of its various components can be found here.

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Last week both the House and Senate released details about their respective healthcare plans. The Senate Committee on Health, Education, Labor, and Pensions (HELP) recently unveiled a draft of its massive and contentious healthcare bill.  A press release announcing the publication of the Affordable Health Choices Act and copy of the draft bill can be found here. (pdf)  A brief summary of the legislation can be found here. (pdf)  Although the over 600-page bill is still a work in progress, some key provisions will no doubt stir intense debate in the coming weeks. Notably, the bill would change the regulation of private health insurance plans. For example, the bill would ban preexisting condition exclusions, and prohibit discrimination and premium variance based on health status, medical condition (physical and mental), claims experience, medical history, genetic information, gender, and disability, among other factors. The proposal also includes different options for establishing a public health plan, and permits dependents to stay on their parents’ plans until age 26.

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Senator Russ Feingold (D-Wisc.) has reintroduced the Promoting Health Care Purchasing Cooperatives Act (S. 1165), a bill that would authorize the Secretary of Health and Human Services (HHS) to award grants to certain groups of employers to develop health care purchasing cooperatives. The legislation includes a grant application process for both self-insured and small businesses.

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The Department of Labor’s (DOL) Administrative Review Board (ARB) has upheld an administrative law judge’s (ALJ) finding that three hospitals that receive payments from a Health Maintenance Organization (HMO) for providing medical services to U.S. Government employees are covered federal subcontractors that must comply with the equal employment opportunity and affirmative action obligations imposed by the Office of Federal Contract Compliance Programs (OFCCP).

The three hospitals at issue in OFCCP v. UPMC Braddock had HMO contracts with the University of Pittsburgh Medical Center (UPMC) health plan to provide medical products and services to federal employees. The UPMC health plan, in turn, had contracted with the U.S. Office of Personnel Management (OPM) to provide such medical coverage. The three hospitals, therefore, did not directly contract with the OPM.

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A couple of bills introduced in recent weeks would have significant impact on the health care industry. A bill introduced last week by Rep. John Conyers (D-MI) would require the establishment of a safe patient handling and injury prevention standard for direct-care registered nurses and other health care workers. The Nurse and Health Care Worker Protection Act of 2009 (H.R. 2381) would order the Secretary of Labor to propose a standard under the Occupational Safety and Health (OSH) Act within one year of the bill’s enactment. The final standard – which would, among other things, eliminate manual lifting of patients through the use of assistive patient handling equipment and other mechanical devices – would be issued within two years of this date.

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Last week the Small Business Health Options Program (SHOP Act) (H.R. 2360) was reintroduced by Rep. Ron Kind (D-WI). This bill has bipartisan support, with 25 co-sponsors. In essence, this legislation would amend the Public Health Service Act to create state or nationwide health insurance purchasing pools for small businesses and the self-employed. A small business for purposes of this bill would be one with fewer than 100 employees who work an average of at least 35 hours per week. Self-employed individuals covered by this act must earn at least $5,000 in net earnings or not less than $15,000 in gross earnings from self-employment in the preceding taxable year.

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A number of federal agencies including the Department of Labor’s (DOL) Employee Benefits Security Administration (EBSA) are requesting information in advance of a future rulemaking on group health plans. Specifically, the EBSA’s Request for Information (RFI) seeks input on questions related to the mental health parity provisions made by the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA). The RFI was published in the April 28, 2009 edition of the Federal Register.

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Legislation providing employers with various incentives for promoting employee health may receive serious consideration now that Congress is contemplating major healthcare reform. A recent article published in The New York Times claims that proposals such as the Healthy Workforce Act (H.R. 1897, S. 803), which would provide employers with a tax credit for 50 percent of the costs incurred in implementing “effective and comprehensive” employee wellness programs, could be incorporated into broader healthcare reform. The article also claims Congress may loosen legal restrictions to enable employers to use monetary rewards or penalties to encourage healthy lifestyles.

While many employers currently offer some form of wellness plan or benefits, doing so must be done with care. As the NYT article emphasizes, employers need to be mindful of tax, labor, and insurance laws when implementing such incentive programs. Paid gym memberships, for example, may count as an employee’s taxable income. Moreover, employers must take care not to discriminate on the basis of an employee’s health status or medical history. Critics also argue that the carrot and stick approach to promoting employee wellness may constitute a form of lifestyle discrimination, and could amount to an invasion of privacy. The proposals floating around Congress seek to remove some of these legal landmines to make it easier for employers to establish wellness programs. Given that one of President Obama’s eight principles for health legislation is that it must “invest in prevention and wellness,” such proposals are likely to receive attention in the coming months.  For additional employment law issues associated with wellness initiatives, see Littler’s Report Employer Mandated Wellness Initiatives: The Continuum from Voluntary to Mandatory Plans.

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