The $2.2 trillion Coronavirus Aid, Relief, and Economic Security Act (CARES) was signed into law on March 27, 2020 with the purpose of helping employees out with benefit-related items during the COVID-19 crisis. The CARES Act repeals the Affordable Care Act’s exclusion of over-the-counter (OTC) medications from the definition of “qualified medical expenses”. The bill is over 880 pages long, but to review the new rules regarding OTC provisions, see Sec. 3702 of the CARES Act.
The new California Law, SB 1375, was signed by Governor Brown on September 22, 2018 and will affect many small firm’s group health insurance. SB 1375 changes the Health Insurance Code to reclassify certain small employer groups as individuals. The affected firms will have to obtain individual health insurance in 2019, rather than the small employer group plans they currently have. Individual health insurance is typically more expensive with less provider network and benefit plan choices than small group plan offerings.
Fortunately, for CalCPA members and their firms, CalCPA Health received certain exemptions from SB 1375, which generally allows us to treat the affected firms as groups, and not as individuals. Commercial carriers (Blue Shield, UnitedHealthcare, Anthem, etc.,) must comply with the new regulations and reclassify these groups as individuals.
SB 1375 defines groups that consist entirely of owners/partners, and/or W-2 employees that are spouses of owner/partners, as not eligible for group health coverage. Even though these entities may be classified as employer/employees by other regulations, (e.g. Workers’ Comp, payroll tax, etc.,) SB 1375 specifically states they do not qualify for group health coverage and may only purchase individual plans.