Benefits Buzz: June 2019

This month’s Benefits Buzz discusses the final Notice of Benefit and Payment Parameters for 2020 and the Department of Labor’s opinion letter on gig worker classification.

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Final Notice of Benefit and Payment Parameters for 2020

Recently, the Department of Health and Human Services (HHS) released its final Notice of Benefit and Payment Parameters for 2020. This proposed rule describes benefit and payment parameters under the Affordable Care Act (ACA) that would be applicable for the 2020 benefit year. Standards included in the rule relate to:

• Annual limitations on cost sharing
• The individual mandate’s affordability exemption
• Direct enrollment in the Exchanges
• Special enrollment periods (SEP) in the Exchanges

HHS also sought comments on issues to address in the future, such as the practice of “silver loading,” the automatic re-enrollment process through the Exchanges and any additional measures that would reduce eligibility errors and potential government misspending. HHS noted that it intends to take the comments received in response to the proposed rule into consideration in future rulemaking.

Notable Changes for 2020

The out-of-pocket maximum (OOPM) will increase, and the ACA’s individual mandate affordability exemption threshold will decrease for 2020.

• OOPM: $8,150 for self-only coverage and $16,300 for family coverage
• Affordability threshold: 8.24% of household income

The final rule also enhances direct enrollment through the Exchanges and establishes a new SEP for the Exchanges. For more information on other changes, contact us today.

DOL Issues Opinion Letter on Gig Worker Classification

In the growing “gig economy,” individuals perform jobs on a one-off or short-term basis, typically through an online application or job marketplace. On April 29, 2019, the Department of Labor (DOL) issued an opinion letter addressing whether individuals working for a virtual marketplace company (VMC) are employees or independent contractors under the Fair Labor Standards Act (FLSA).

According to the DOL, the VMC described in the opinion letter provides a referral service—it does not receive services from the workers itself. As a result, the DOL clarifies that workers who use the VMC to provide services are independent contractors.

This opinion letter indicates that the DOL generally classifies gig workers as independent contractors. Opinion letters are specific to the situations presented, but employers can look to them for guidance on the DOL’s interpretation of the law.

The interpretation in this opinion letter may not apply to all gig workers if their circumstances are substantially different from the situation addressed in the letter.