Post-Dobbs Proposals Would Expand Access to ACA Contraceptives

Practical Law Article w-038-3577 (Approx. 13 pages)

Post-Dobbs Proposals Would Expand Access to ACA Contraceptives

by Practical Law Employee Benefits & Executive Compensation

Overview of ACA Contraceptives Coverage Mandate

Under the ACA's contraceptives rules, as background, non-grandfathered health plans and health insurers must cover, without cost-sharing, all FDA-approved contraceptive methods, sterilization procedures, and patient education and counseling for women with reproductive capacity, as prescribed by a health provider (29 C.F.R. § 2590.715-2713A). The proposed regulations note that, for this purpose, women with reproductive capacity include any individual who is potentially able to become pregnant, including:

Cisgender women.
Transgender men.
Non-binary individuals.

In November 2018, the Trump administration issued final regulations addressing the ACA's contraceptives requirement that:

Expanded the types of entities that could claim a religious exemption from the ACA's contraceptives requirements.
Created an exemption from the rules for entities having a non-religious moral objection to covering contraceptives.
Made optional an accommodation process under Obama-era implementing regulations.

(83 Fed. Reg. 57536 (Nov. 15, 2018); 83 Fed. Reg. 57592 (Nov. 15, 2018).)

For more information on the November 2018 final regulations, see Practice Note, ACA Contraceptives: Trump Administration Religious Beliefs/Moral Convictions Exemption and Accommodation. For more information on compliance with the ACA's contraceptives coverage mandate generally, see:

The proposed regulations would maintain the religious exemption under the November 2018 regulations for employers that sponsor insured and self-funded group health plans (see Group Health Plans and Health Insurance Toolkit). Employers and other entities with religious exemptions also could continue to use the optional accommodation for exempt religious-objectors under the November 2018 regulations.

Elimination of Moral Convictions Exemption

The proposed regulations would eliminate the exemption and availability of an optional accommodation for entities that object to providing contraceptives coverage due to their non-religious moral convictions (Prop. 45 C.F.R. § 147.133 (removing moral exemptions provisions); see Practice Note, ACA Contraceptives: Trump Administration Religious Beliefs/Moral Convictions Exemption and Accommodation: Moral Convictions Exemption and Optional Accommodation). In removing the moral convictions exemption, the Departments noted that:

Few entities have invoked the exemption based on a non-religious moral objection.
The Departments were under no legal obligation to provide this exemption.
The Religious Freedom Restoration Act of 1993 (RFRA) does not apply to require this exemption (42 U.S.C. § 2000bb-1).

Citing the Supreme Court's June 2022 Dobbs ruling, the Departments also reasoned that it is:

Now especially important to ensure individuals' access to reproductive health care and contraceptive services without cost-sharing.
Necessary to provide individuals contraceptives coverage directly through their health plans, even if a plan sponsor or insurer has non-religious (as opposed to religious) moral objections to covering contraceptives.

In Dobbs, the Supreme Court held that there is no longer a federal constitutional right to abortion, that the Court's prior decisions in Roe v. Wade and Planned Parenthood v. Casey were overruled, and that the disputed Mississippi law survived constitutional challenge (Dobbs v. Jackson Women's Health Org., 142 S. Ct. 2228 (2022); see Legal Update, Supreme Court's Overruling of Roe v. Wade Raises Health Plan and Employment Implications and Abortion and Contraceptives Services for Group Health Plans Toolkit). The Dobbs ruling led many employers to review their plan design options for coverage of abortion and related services, particularly in states that already have (or will soon impose) significant restrictions on abortion (see Article, Group Health Plan Coverage Considerations for Employers After the Overturning of Roe v. Wade).

The Departments also reasoned that RFRA does not require any exemption for non-religious moral objections that do not substantially burden an individual's exercise of religion. As a result, entities that have only non-religious moral objections to contraception cannot assert a viable RFRA claim. The Departments indicated that entities' non-religious moral objections to contraceptives were outweighed by the public policy interest of making contraceptives coverage as accessible to individuals as possible.

Individual Coverage Arrangements

The proposed regulations also would establish an individual contraceptive arrangement (ICA) option under which individuals who are enrolled in plans sponsored by objecting entities could obtain contraceptive services at no cost directly from a willing health provider or facility that provides contraceptive services. An ICA would be an independent pathway for participants and beneficiaries in insured or self-funded group health plans sponsored by an exempt entity (that does not invoke the optional accommodation) to obtain contraceptive services:

At no cost to the recipient of the services through their own independent actions.
Without the involvement of an objecting employer, group health plan, plan sponsor, or insurer.

(Prop. 29 C.F.R. § 2590.715-2713A(e); Prop. 26 C.F.R. § 54.9815-2713A(e); Prop. 45 C.F.R. § 147.131(d).)

In proposing the ICA option, the Departments noted that there currently is not a way to obtain contraceptive services at no cost for individuals whose employers or health insurers exercise a religious exemption under the November 2018 regulations and either choose not to (or are not eligible to) invoke the accommodation.

Under the ICA option, a provider of contraceptive services would furnish these services to an individual without imposing any fee or charge, directly or indirectly, on an individual (or any other entity) for the cost of the items and services. As a result, the provider would not collect amounts that are commonly associated with an individual's plan coverage (for example, premiums, cost-sharing requirements (copayments or deductibles), or other similar amounts).

As with removal of the moral convictions exemption, the Departments indicated that the addition of the ICA option was necessary, particularly in response to the Supreme Court's Dobbs ruling, to help individuals obtain contraceptive services at no cost because of the public health interest in ensuring their access to reproductive health care and contraceptive services without cost-sharing.

The Departments indicated that the proposed regulations would not impose other additional obligations on health plans or insurers. For example, the ICA provisions would not require exempt entities to provide any additional verbal or written documentation to:

Individuals eligible to participate in ICAs (see Individuals Eligible to Participate in ICAs).
Providers of contraceptive services.
Health insurers, third-party administrator (TPAs), government agencies, or individuals.

Payment Procedures for ICA Reimbursements

A provider that furnishes contraceptive services under an ICA could ask to be reimbursed for its incurred costs from an insurer on an ACA federally facilitated exchange (FFE) (or state exchange on the federal platform (SBE-FP)). The insurer would then be reimbursed by requesting a fee adjustment to the insurer's FFE or SBE-FP fee, using the established user fee adjustment process under implementing regulations (45 C.F.R. § 156.50(d); Prop. 45 C.F.R. § 156.50(d)(1)(iii); see Practice Note, Contraceptives Coverage Under the ACA: Funding Contraceptives Coverage; CMS Guidance for FFE Fees). Administrative costs incurred by providers of contraceptive services would be included in the amounts they submit to insurers for reimbursement. The insurer's fee adjustment also would reflect an administrative allowance for costs and margin. This allowance would be:

At least ten percent of the total dollar amount of the cost of furnishing contraceptives under an ICA.
Specified each year in HHS's benefit and payment parameter guidance or other guidance (for a recent example of this guidance, see Legal Update, Sexual Orientation and Gender Identity (SOGI) Nondiscrimination Proposals Omitted from HHS Final 2023 Benefit and Payment Parameters).

(Prop. 45 C.F.R § 156.50(d)(3)(ii)-(iii).)

To be reimbursed for contraceptives furnished under an ICA, a provider would need to enter into a signed agreement with an insurer (see Signed Agreement Requirement). To claim a user fee adjustment, the insurer would need to provide the following information to HHS:

A copy of the signed agreement between the provider and insurer.
Identifying information for the provider.
The total dollar amount of the payments made to reimburse the provider for the costs of furnishing contraceptive services to individuals under an ICA.

(Prop. 45 C.F.R. § 156.50(d)(2)(i).)

If the insurer's requested adjustment is more than the user fees owed in the month of the initial adjustment (or a later month), any excess adjustment would be carried over to later months (Prop. 45 C.F.R. § 156.50(d)(4)).

Relatedly, HHS did not propose to increase the FFE or SBE-FP user fee rates finalized in its 2023 HHS benefit and payment parameter guidance to offset the FFE and SBE-FP user fee adjustments. HHS anticipates that reimbursements for contraceptive services would represent only a small portion of total FFE user fees.

Timing of ICA Payments

Insurers could pay providers as soon as the contraceptive services are delivered under an ICA. As an outer limit, however, the insurer would need to pay the provider within 60 days of receiving any related adjustment to its user fee. The payment amount would need to at least equal the part of the adjustment attributable to the total dollar amount of payments for contraceptive services submitted by the provider. No payment would be required regarding the insurer's allowance for administrative costs and margin. (Prop. 45 C.F.R. § 156.50(d)(5).)

An insurer and provider could agree that the insurer would reimburse the provider either:

At more frequent intervals (for example, on a monthly or quarterly basis).
Upfront for the full cost of services provided during a benefit year (as opposed to in the following year, if that is when the insurer receives the monthly user fee adjustment).

Signed Agreement Requirement

A signed agreement between a provider and an insurer governing reimbursements for the costs of furnishing contraceptives would be a condition of participating in an ICA (Prop. 45 C.F.R. § 156.50(d)(2)(i)(D)). The insurer would be required to submit a copy of the signed agreement to HHS. HHS would impose this requirement on insurers (as opposed to providers) because insurers are already familiar with how to submit information to HHS under the existing user fee adjustment procedures for arrangements involving TPAs. To further assist providers with ICA compliance, HHS will make available to providers a list of participating insurers that have previously collaborated with TPAs under the existing and optional contraceptive user fee adjustment process (45 C.F.R. § 156.50(d)).

A signed agreement would need to satisfy certain content requirements. For example, the agreement would need to:

Include a provider's identifying information, for example, either:
- the name and contact information for the provider’s practice or facility; or
- the provider's National Provider Identifier (if applicable).
List the signatures of individuals having the authority to legally and financially bind the provider and insurer.
Demonstrate that the provider and insurer have entered into an arrangement through which the insurer will:
- reimburse the provider for the costs of furnishing contraceptives under an ICA; and
- seek a user fee adjustment for the amount of eligible costs and a permitted allowance.
Define the terms of payment to the provider.

A signed agreement could also address other issues (for example, the agreement's term).

A provider could enter into separate agreements with more than one insurer.

Insurers would be required to notify HHS of the total amount of a provider's costs for furnishing contraceptives under an ICA (that is, the amount for which an insurer would request a fee adjustment and administrative allowance). The Departments expect that the cost of furnishing contraceptive services under an ICA would vary based on the specific contraceptive service provided and how long it takes to provide the service. These costs would reflect the provider's actual cost for the contraceptive service and items and services that are integral to furnishing the service (even if the provider would not usually bill for the integral items and services).

ICA Recordkeeping Requirements for Insurers and Providers

The proposed regulations would require an insurer to keep documentation reflecting its timely payments to each provider of contraceptive services under an ICA for which the insurer received a fee adjustment. The insurer would need to retain this documentation for ten years after the calendar year for which the insurer received a user fee adjustment. (Prop. 45 C.F.R. § 156.50(d)(6).)

As a condition of participating in an ICA, a provider would need to maintain records showing:

The actual costs of furnishing contraceptive services under an ICA.
Supporting documentation for the total dollar amount of those costs.

(Prop. 45 C.F.R. § 156.50(d)(8).)

The provider would need to make these records available to HHS on request.

ICA Rules Would Not Apply to ACA Grandfathered Health Plans

In issuing the proposed regulations, the Departments acknowledged that ACA grandfathered health plans are not required to comply with the ACA's preventive health services and contraceptives requirements (see Practice Note, Grandfathered Health Plans Under the ACA). As a result, the ICA rules would not apply to participants in grandfathered health plans. The Departments observed, however, that there are relatively few grandfathered health plans still in existence (and that the number of grandfathered plans will further decline in the future).

Definition of Provider for ICA Purposes

The proposed regulations would define a provider of contraceptive services as "any health care provider (including a clinician, pharmacy, or other facility) acting within the scope of that provider's license, certification, or authority under applicable law to provide contraceptive services" (Prop. 29 C.F.R. § 2590.715-2713A(g)(2); Prop. 26 C.F.R. § 54.9815-2713A(g)(2); Prop. 45 C.F.R § 147.131(g)(2)). The Departments would interpret this definition broadly to include any provider or facility that is authorized to provide any contraceptive services, including services provided using telehealth or mail.

Individuals Eligible to Participate in ICAs

Individuals eligible to participate in ICAs would consist of participants or beneficiaries in a group health plan established or maintained by an objecting employer or other entity that has not invoked an accommodation under the existing regulations. An individual would need to confirm to the provider that the individual is enrolled in a group health plan sponsored, provided, or arranged by an objecting entity that does not offer coverage for all (or a subset) of the required ACA contraceptive services. The individual would make this confirmation either:

By providing documentation that contains the relevant coverage information (for example, a summary of benefits and coverage (SBC) (see Practice Note, Summaries of Benefits and Coverage Under the ACA)).
Using another method (for example, providing an attestation).

(Prop. 29 C.F.R. § 2590.715-2713A(a)(3); Prop. 26 C.F.R. § 54.9815-2713A(a)(3); Prop. 45 C.F.R. § 147.131(a)(3).)

A provider of contraceptive services would:

Need to confirm an individual's eligibility for an ICA.
Have discretion as to what confirmation method it would accept.

Providers could document receiving this representation in numerous ways (for example, by making a notation in an individual's medical chart).

The Departments sought comments on additional sources of information that participants and beneficiaries could provide for this confirmation. For example, this could include documentation that plans and insurers may already be providing to participants and beneficiaries independent of existing federal requirements.

Provider and Insurer Reliance on ICA-Related Representations

If certain reliance requirements are satisfied, the proposed regulations would preserve a provider's ability to be reimbursed for furnishing contraceptive services (and an insurer's ability to receive a user fee adjustment) when an individual's ICA eligibility representation is later determined to be incorrect. This rule would apply if:

A provider of contraceptive services reasonably and in good faith relies on an individual's representation of eligibility to receive contraceptive services under an ICA.
The individual's representation turns out to be incorrect.

In this situation, the provider would:

Be considered to have received a representation from an eligible individual for purposes of being reimbursed for contraceptive services furnished by an insurer.
Meet any requirements related to maintaining documentation of this representation.

(Prop. 45 C.F.R. § 156.50(d)(9).)

A similar rule would apply if:

An insurer reasonably and in good faith relies on a provider's representation that the provider furnished contraceptive services for an eligible individual.
The representation the provider received from (or on behalf of) the individual is later determined to be incorrect.

(Prop. 45 C.F.R. § 156.50(d)(10).)

In this situation, the insurer would meet any requirements involving the provider's receipt of the representation.

If certain requirements are satisfied, the proposed regulations also would preserve an insurer's ability to receive a user adjustment fee if the provider's representation to the insurer that the provider furnished contraceptive services consistent with an ICA is later determined to be incorrect. If an insurer reasonably and in good faith relies on a provider’s representation in this regard but the representation is later determined to be incorrect, then the insurer's good faith reliance on the incorrect representation would meet any requirements involving the representation. (Prop. 45 C.F.R. § 156.50(d)(11).)

However, this proposed rule would only apply if the insurer has already reimbursed a provider for any amount of its costs of furnishing contraceptive services. If an insurer has not yet paid the provider at the time that the provider's representation is determined to be incorrect, the insurer will not have sustained a financial loss (that is, by no longer being able to receive a user fee adjustment).

Provider Involvement in ICAs

ICA participation would be voluntary for providers of contraceptive services. Providers would furnish contraceptive services to individual in a way that is completely independent of any costs associated with the objecting employer's group health plan or health insurance.

Providers would be reimbursed for items and services that are integral to furnishing contraceptive service, in an amount agreed to by the provider and insurer, regardless of whether the provider would typically bill for the item or service separately.

Other Proposed Changes Involving ACA Contraceptives

The proposed regulations would make several other relatively smaller changes to the ACA's contraceptives rules, as implemented. For example, the proposals would clarify the scope of preventive care and screenings that are subject to the ACA's preventive health services rules to provide that these preventive care and screenings would need to be provided for in "evidence-informed" comprehensive guidelines supported by the Health Resources and Services Administration (HRSA). The Departments indicated that this change, which would reverse a change under the November 2022 regulations, more accurately describes the process used to develop the HRSA-supported guidelines.

Issues for Health Insurers

The proposed regulations would clarify that:

Health insurers cannot offer coverage that excludes any contraceptive services to a non-objecting entity or individual.
An insurer's ability to offer a separate policy, certificate, or contract of insurance that omits some or all contraceptive services to an objecting individual is permitted only to the extent allowed under state law.

Direct Liability for Health Insurers for Plans with an Objecting Entity

Under the November 2019 contraceptives regulations:

Health insurers are exempt from complying with the contraceptives mandate if the plan sponsor is an exempt entity (even if the insurer itself is not an exempt entity).
An insurer therefore may exclude coverage of contraceptive services if the coverage is sponsored or arranged by an objecting entity.

In issuing the proposed regulations, however, the Departments requested comments on an approach under which:

A group health plan sponsor or group health plan is an objecting entity that is an insured plan.
The contraceptives mandate continues to apply directly to the health insurer for the objecting employer's plan.

Under this arrangement, the health insurer would still be independently required to provide coverage for contraceptives, unless it has its own religious objections for not doing so. The objecting entity in this arrangement would need to inform the insurer of its religious objections in some manner. Relatedly, the Departments sought comments on whether and how an objecting entity would notify an insurer of the entity's objections to providing contraceptives coverage.

Interaction with ACA Patient Protection Requirements, as Amended

The proposed regulations also reflect a statutory change under the Consolidated Appropriations Act, 2021 (CAA-21) involving the ACA's patient protection rules (Pub. L. No. 116-260 (2020)). Under the November 2018 regulations, if an insured plan uses the regulations' optional accommodation process, the insurer was required to provide separate payments for contraceptive services consistent with the ACA's patient protection requirements under Public Health Service Act (PHSA) Section 2719A (42 U.S.C. § 300gg-15a; see Standard Clause, Notice Regarding Designation of Primary Care Providers (ACA, CAA-21)). Under PHSA Section 2719A, if a plan or insurer requires or permits a participant or beneficiary to designate a participating primary care provider:

Individuals may designate any participating primary care provider available to accept them, including pediatricians.
A plan or insurer could not require authorization or referral for obstetrical or gynecological care.

However, the CAA-21 (which contains the No Surprises Act) included a sunset provision under which PHSA Section 2719A no longer applied effective for plan years beginning on or after January 1, 2022. On this date, PHSA Section 2719A was recodified as PHSA Section 2799A-7 (42 U.S.C. § 300gg-117; see Practice Note, Patient Protections and Clinical Trials Under the ACA and CAA-21).

In the proposed regulations, the Departments concluded that, despite this statutory change, they would continue to require insurers, when making separate payments for contraceptive services using the optional accommodation for insured plans, to make the payments consistent with the PHSA patient protections (as amended). However, the Departments requested comments on:

Situations in which the contraceptive services are emergency services.
Whether to continue to apply the protections for emergency services under former PHSA Section 2719A (and new PHSA Section 2799A-1, which includes different protections) to insurers that make separate payments for contraceptive services using the optional accommodation for insured plans (42 U.S.C. § 300gg-111; see Practice Note, Surprise Medical Billing for Group Health Plans: Overview and Surprise Medical Billing for Health Plans, Health Insurers, and Health Care Providers and Facilities Toolkit).

The proposed regulations would retain the optional accommodation process for self-funded group health plans (29 C.F.R. § 2590.715-2713A(b); 26 C.F.R. § 54.9815-2713A(b)). Under that accommodation, an eligible organization is not required to contract, arrange, pay, or provide a referral for the delivery of contraceptive benefits if the organization objects to providing contraceptives coverage, but does not object to having third parties (for example, a TPA) provide the benefits.

Updated Model Notice Language

The current regulations include model language regarding a written notice of the availability of separate payments for contraceptive services for eligible organizations that use the optional accommodations (see Standard Clause, Notice of Availability of Separate Payments for Contraceptive Services). The model language informs participants and beneficiaries that a plan sponsor has certified that the plan or coverage qualifies for an accommodation to the ACA's contraceptives requirements (29 C.F.R. § 2590.715-2713A(d); 26 C.F.R. § 54.9815-2713A(d); 45 C.F.R. § 147.131(e)). The proposed regulations would redesignate these provisions and amend the language that refers to FDA-approved contraceptive services to refer to all FDA-approved, cleared, or granted contraceptives.

Severability

If any of the provisions in the proposed regulations (if finalized) are held to be invalid or unenforceable, the remaining regulations generally would be construed to give their maximum effect. If a provision of the proposed regulations (if finalized) is found to be utterly invalid or unenforceable, the provision would:

Be severable from the proposed regulations as finalized and the final regulations that they amend.
Not affect the remainder of the regulations or the provision's applicability to persons not similarly situated or to different circumstances.

(Prop. 29 C.F.R. § 2590.715-2713A(h); Prop. 26 C.F.R. § 54.9815-2713A(h); Prop. 45 C.F.R. § 147.131(h).)

Ongoing Enforcement of Contraceptives Requirements

In issuing the proposed regulations, the Departments noted that they continue to receive complaints and reports concerning potential violations of the contraceptives coverage requirements (FAQ guidance (Jan. 10, 2022); see Legal Update, Departments Investigate ACA Contraceptives Noncompliance; Updated HRSA Guidelines). The Departments encouraged entities and individuals with information about potential noncompliance to contact the Departments so that additional oversight and enforcement actions could be taken to ensure that health plans and issuers satisfy the ACA's contraceptive rules, as implemented.

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