The Affordable Care Act and Employee Assistance Programs
Certain ACA Requirements Do Not Apply to EAPs That Qualify as ‘Excepted Benefits’
Employee assistance programs (EAPs) are programs offered by employers that can provide a wide-range of benefits to address circumstances that might otherwise adversely affect employees’ work and health, such as substance use disorders.
To the extent an EAP provides benefits for medical care, it would generally be considered group health plan coverage subject to the so-called “market reforms” of the Affordable Care Act (including the annual dollar limit prohibition and preventive services requirements), unless the EAP meets the criteria for being excepted benefits.
EAPs as Excepted Benefits
Prior agency guidance explained that through at least 2014, an EAP will be considered to constitute excepted benefits only if the program does not provide significant benefits in the nature of medical care or treatment. For this purpose, employers may use a reasonable, good faith interpretation of whether an EAP provides significant benefits in the nature of medical care or treatment.
Recently issued proposed rules set forth four criteria for EAPs to qualify as excepted benefits for plan years beginning in 2015. Under the rules, benefits provided under an EAP are excepted if:
- The program does not provide significant benefits in the nature of medical care (the definition of “significant” remains yet to be finalized);
- The benefits cannot be coordinated with benefits under another group health plan (three conditions are outlined in the proposed rules to meet this second criterion);
- Employee premiums or contributions are not required to participate in the EAP; and
- There is no cost sharing under the EAP.