Families First Coronavirus Response Act

On March 18, 2020 the President signed into law the Families First Coronavirus Response Act (FFCRA), which takes effect April 2, 2020 April 1, 2020.  The FFCRA includes several provisions that impact employers with less than 500 employees, with allowable exemptions for affected employers with fewer than 50 employees.  This blog post addresses the three (3) main aspects of the FFCRA: 1. Mandated waiver of health insurance related cost sharing for COVID-19 testing; 2. New paid leave entitlements;  and 3. Employer tax credits.  

UPDATE: Here’s a link to access the required, FFCRA employee notice – 

https://www.dol.gov/sites/dolgov/files/WHD/posters/FFCRA_Poster_WH1422_Non-Federal.pdf

Importantly, the leave related benefits expire on December 31, 2020, and the COVID-19 testing benefit last – “until the Secretary of Health and Human Services determines that the public health emergency has expired“. Here’s an overview of what the FFCRA requires from a health insurance coverage, expanded paid leave, and tax credit aspect:


COVERAGE (COVID-19 TESTING)

Last week, I wrote about a meeting between the Vice President and leaders of the nation’s largest health insurers that led to a voluntary agreement to waive health insurance cost sharing for COVID-19 testing.  See – https://smstevensandassociates.com/coronavirus-health-insurance-benefits/

The FFCRA now compels virtually all health insurance plans to cover FDA approved testing for COVID-19 without imposing any plan related cost sharing (e.g., copays, deductibles, coinsurance).  The ban on cost sharing (or the provision of 100% coverage) also applies to virtual health (aka tele-health, tele-medicine, tele-doc).  This benefit expansion applies to covered testing provided by both PPO and Non-PPO providers, and also eliminates the requirement for plan members to preauthorize COVID-19 testing with their health plan. Note that the ban on cost sharing applies both to the actual testing, and any associated office visit charge, including Urgent Care Centers and Emergency Rooms.

Importantly, the waiver of cost sharing applies to all styles of health insurance plans, including HSA qualified high deductible health plans (HDHPs).  The IRS issued guidance allowing HSA HDHPs to maintain their qualified status while waiving the plan cost sharing for COVID-19 testing.  Lastly, the FFCRA allows members to get necessary prescription drug refills, irrespective of otherwise applicable quantity or refill limits.

PAID LEAVE

There are two (2) separate paid leave provisions in the FFCRA.  It’s important to keep in mind that currently, the FMLA applies only to employers with 50+ employees. The FFCRA applies to employers with less than 500 employees, but does allow exemptions for certain, affected employers with less than 50 employees.

1.)The Emergency Family and Medical Leave Expansion Act – amends the Federal and Medical Leave Act (FMLA) to allow employees paid time off for childcare purposes related to COVID-19.

  • – For employees forced to take leave for certain child care services related to COVID-19
  • – Requires partial compensation to eligible employees after a 10-day period.
  • – Eligible employees are those who have worked for their current employer for at least 30 days.
  • – Eligible employees are allowed up to 12 weeks of FMLA leave if unable to work (or tele-work) because of the need to care for a child less than 18 years of age.
  • – The need for leave must be associated with the closing of the child’s school or place of care, or the unavailability of the child’s day care provider due to a declared, COVID-19 public health emergency.
  • – Affected employers are required to compensate eligible employees at a rate of 2/3 of the employee’s regular rate of pay, up to a maximum of $200/day, capped at $10,000 per employee.
  • – There are additional job protection aspects similar to FMLA.

2.) Emergency Paid Sick Leave Act 

  • – Available to all affected employees, regardless of start date or time employed with the employer.
  • – Eligible employees are entitled to up to 80 hours of paid sick time.
  • – Employees are eligible for their full rate of pay, capped at $511/day, $5,110/employee.
  • – Benefits are available immediately, with no elimination period.
  • – Part-Time employees are also eligible for benefits.
  • – Paid sick time is available if the employee is:
    • — subject to a federal, state, or local quarantine or isolation order related to COVID-19
    • — advised by a health care provider to self quarantine due to concerns related to COVID-19
    • — experiencing symptoms of COVID-19 and is seeking a medical diagnosis
    • — caring for an individual who is subject to a federal, state, or local quarantine or isolation order related to COVID-19, or who has been advised by a health care provider to self quarantine
    • — caring for a child if the child’s school or place of care is closed, or the child’s care provider is unavailable, because of COVID-19
    • — is experiencing another substantially similar condition specified by the Secretary of Health and Human Services (HHS)

Tax Credits

Employers may qualify for reimbursement through tax credits for all qualifying wages paid under the FFCRA, on a dollar for dollar basis. Qualifying wages are those paid to an employee who takes a qualified leave under the FFCRA, up to the stipulated per diem and aggregate payment limits.  Importantly, applicable tax credits also extend to premiums/fees paid or incurred to maintain health insurance coverage during a qualified leave.

As of the time of this blog post, regulations have not yet been promulgated for the FFCRA, but are expected soon.  In the mean time, the Dept. of Labor has a great resource to assist employers in understanding the FFCRA and its impact on their companies and organizations.  See – https://www.dol.gov/agencies/whd/pandemic/ffcra-employer-paid-leave

UPDATE: Here’s an excellent resource chart addressing the various forms of sick leave – 

Summary of Paid Sick Leave & COVID-19 Laws 4846-1501-3048 v.1

 

#####