Michelle's Law, which was signed into law by George W. Bush last year, came into effect Oct. 9, 2009.

Named for Michelle Morse, a student who lost her insurance coverage under her parents’ plan because cancer treatment required her to quit school and lose her full-time student status, the law would allow students to take up to a year of medical leave without losing their health insurance. 

This month, Lafourche Parish School Board in Louisiana was the first group to exploit a loophole in the law which allows for self-insured entities to opt out of Michelle’s Law.  While students of Lafourche Parish School Board employees covered under their parents’ plan will not be guaranteed coverage under Michelle’s Law, the board says that they intend to review each student’s situation on a case-by-case basis.

The Lafourche case is one that needs to be followed closely by those in the Consumer Driven Healthcare market. Their approach to students’ coverage during medical leave could prove to be either a victory for MERPs and self-funding private insurance if handled well or a disaster that could fuel the fires of harsher regulations and reforms that would deliver significant blows to the CDH movement if handled poorly.

The defense-related legislation (National Defense Authorization Act for Fiscal Year 2010, Pub. No. 111-84 (Oct. 28, 2009)) recently signed by the President includes amendments to the FMLA’s provisions regarding qualifying exigency leave and covered service member leave for employees who are relatives of service members.

Qualifying Exigency Leave
The Act redefines the employee’s entitlement to qualifying exigency to reflect that the employee’s spouse, son, daughter, or parent must be on “covered active duty” in the Armed Forces (or have been notified of an impending call or order to such duty).

Covered Service Member Leave
The Act also expands an employee’s entitlement to leave to care for a covered service member with a serious injury or illness. In addition, the definition of serious injury or illness has been expanded.

While no changes have been made to the FMLA’s health benefits, these expanded leave rights may result in more employees taking FMLA leave, and thus will affect group health plan administration.

No effective date has been specified for these provisions. Generally, this indicates that they are effective when signed into law.

The IRS released the 2009-2010 Priority Guidance Plan for the projects to be completed from July 2009 through June 2010.

Click here for the full report.

With the unemployment rate at 10.2%, the highest level since 1983, it is highly likely that the ARRA COBRA subsidy will be extended. As you are aware, the bulk of those who were first eligible for the subsidy will no longer be eligible for the subsidy as of the end of November 2009. It is very possible that Congress could act quickly to avoid any discontinuation of coverage for these participants. As of now, there are three proposed Bills to extend the subsidy (two in the House, one in the Senate):

Senate Bill S 2730

This bill would extend the subsidy by six months, to June 30, 2010 (a total of 15 months) for those who became eligible March 1, 2009. It would also extend the eligibility date to June 30, 2010 and increase the subsidy amount from 65% to 75%. It would also expand eligibility to include workers who lose health coverage as a result of a involuntary reduction in hours. To read the bill in its entirety, click here.

House Bill HR 3930 - "Extended COBRA Continuation Protection Act of 2009"

This bill extends COBRA continuation for involuntarily terminated (or reduction of hours) individuals between April 1, 2009, and December 31, 2009 to 24 months. It also adds six months to the eligibility and assistance periods of subsidy. To read the bill in its entirety, click here.

House Bill HR 3966

This bill would extend the subsidy program for involuntary terminations and loss of coverage occurring through June 30, 2010. To read the bill in its entirety, click here.

The DOL's Employee Benefits Security Administration released additional guidance for compliance with reporting service provider fee and compensation information on the Form 5500 Annual Returns/Reports. These expanded requirements apply to plan years beginning on or after Jan. 1, 2009.

The new guidance is part of 25 FAQs to supplement FAQs published in July 2008 and to provide further guidance including the reporting of:

Click here to view the FAQs.

MHPAEA expands the mental health parity provisions for group health plans in ERISA, PHSA, and the Code by adding new requirements regarding mental health and substance use disorder benefits for plan years beginning after Oct. 2, 2009. (For calendar-year plans, the MHPAEA's effective date is Jan. 1, 2010.)