2022 Health Insurance Outlook, Changes

As we enter 2022, there are a number of changes on the horizon that plan sponsors need to be aware of as they will affect group health plans as well as employees enrolled in those plans.

Some of the changes concern temporary rules that were implemented during the COVID-19 pandemic. In addition, new rulemaking is likely to be introduced in 2022 that will affect health plans, including non-discrimination rules for wellness plans and new rules governing what must be included on insurance plan ID cards.

Here’s a list of what to expect in 2022.

HDHP telehealth services — The CARES Act, signed into law in 2020 after the pandemic started, temporarily allowed high-deductible health plans to pay for telehealth services before an enrollee had met their deductible.

That comes to an end Dec. 31, 2021, and for plan years that start on or after Jan. 1, 2022, HDHPs must charge enrollees for telehealth services if they have not yet met their deductible. 

Mid-year election changes — The Consolidated Appropriations Act of 2021 (CAA) and ensuing guidance from the IRS relaxed a number of rules that will come to an end for plans incepting on or after Jan. 1, 2022. These rules were all not mandatory and employers could choose whether to relax them or not.

Here are the rules that will sunset at the end of 2021:

• Allowing employees who had declined group health insurance for the 2021 plan year to sign up for coverage.
• Allowing employees who had enrolled in one health plan option under their group health plan to change to another plan (such as switching insurance carriers or opting for a silver plan instead of a bronze plan).
• For health flexible spending accounts (FSAs), allowing participants to enroll mid-year, increase or decrease their annual contribution amount, or pull out of the plan altogether and stop contributing.
• For plan years ending in 2020 and 2021, permitting employers to modify their FSAs to include a grace period of up to 12 months to spend unused funds from the prior policy year.
• Allowing for a higher FSA carryover amount than the typical $500.

Any plans that allowed these changes would have to have been amended to reflect that, and for 2022 they’ll have to be amended to reflect reverting to the old rules that forbid such changes.

Affordability level falls — Under the Affordable Care Act, employers with 50 or more full-time or full-time equivalent workers are required to provide health coverage to at least 95% of their full-time employees. The ACA requires that the coverage is “affordable” for the worker, which is set as a percentage of their household income.

For 2022, the affordability level will be 9.61% of their household income, down from 9.83% in 2021.

Electronic filing threshold drops — Starting in 2022, employers with 100 or more workers will be required file their 2021 ACA-related tax forms with the IRS electronically, as a result of changes brough on by the Taxpayer First Act. That’s a change from the prior threshold of 250. This applies to forms 1094-C, 1095-C, 1094-B and 1094-B.

While the IRS has yet to release guidance for this change, it’s expected it will do so by the end of 2021.

More guidance coming

The CAA created a number of new requirements that affect health insurance and coverage. Look for various government agencies, chiefly the Centers for Medicare and Medicaid Services, to provide new guidance on:

Insurance plan identification cards — Part of the CAA requires health plans and issuers to include information about deductibles, out-of-pocket maximum limitations and contact information for assistance on any ID cards issued to enrollees on or after Jan. 1, 2022.

Continuity of care requirements — The CAA also requires insurers to offer anyone who is a “continuing care patient” of a provider or facility the option to elect to continue to receive care for up to 90 days from the provider or facility, even when there’s a change in that provider’s contract status with a health plan that could normally result in a loss of covered benefits.

If certain conditions apply, this transitional care would be provided as if the contractual relationship with the provider had not changed.

Wellness program incentives — The Equal Employment Opportunity Commission is expected to issue new regulations on what kind of incentives are permissible for employer-sponsored wellness programs. The main focus is on incentives and if they are discriminatory to some workers.