TrumpRx.gov is a direct-to-consumer (DTC) website operated by the federal government where patients can pay cash prices for certain prescription drugs. The website is part of a broader Trump administration initiative focused on bringing American drug prices closer to prices paid in other developed countries. This is being referred to as most-favored-nation (MFN) drug pricing.

A health flexible spending account (FSA) is an employer-sponsored benefit that allows eligible employees to pay for qualifying medical expenses on a tax-advantaged basis. Employees elect an annual amount that may be used to reimburse qualifying medical care expenses incurred during the plan’s coverage period. Health FSAs are offered under an employer’s cafeteria plan and are subject to specific design, eligibility, and compliance requirements under federal law.

Health flexible spending arrangements (FSAs) are subject to the use-or-lose rule, meaning that any unused funds remaining in the health FSA at the end of its plan year are generally forfeited by the participant, subject to limited plan design exceptions. The forfeited funds are referred to as “experience gains,” and become available to the plan sponsor for restricted use. This article will describe the exceptions to the use-or-lose rule and how plan sponsors may use experience gains.

Background Information

• Employers offering prescription drug benefits within Group Health Plans are required by the Medicare Part D regulations to distribute a notice of Creditable or Non-Creditable prescription drug coverage to Medicare-eligible employees and retirees by October 14 each year. Creditable means the coverage is “as good as” and comparable to Medicare Part D coverage.

• In addition to this notice to Medicare-eligible employees, employers must also report to the Centers for Medicare and Medicaid Services (CMS) as to their plan(s)’ Creditable or Non-Creditable status.

• Reporting is due to CMS within 60 days of the beginning of the plan year; within 30 days after termination of a prescription drug plan; or within 30 days after any change in Creditable or Non-Creditable coverage status.

  CMS Online Reporting Form
  

CMS REPORTING REFERENCE CHART

Timeline To Report Creditable Or Non-Creditable Rx Coverage to CMS Online

Please contact your representative with any questions.

Unison Risk Advisors Compliance Team | benefitscompliance@unisonriskadvisors.com

Disclaimer: Materials are solely for informational purposes as an educational resource. Please contact counsel to obtain advice with respect to any specific issue.

Certain employers, plan sponsors, and insurers are required to report health plan information and participant coverage data to the IRS each year. The IRS uses this information to administer and regulate various aspects of the Affordable Care Act (ACA), including an individual’s eligibility for a premium tax credit when purchasing health insurance through a public Marketplace and the §4980H employer shared responsibility rules. Failure to report complete, accurate, timely information can result in significant reporting penalties up to $340/form.

Determining whether an employer is an Applicable Large Employer (ALE) under the Affordable Care Act (ACA) is critically important as it directly affects whether the employer is subject to the ACA employer mandate that requires an offer of medical coverage to full-time employees and their dependents and its associated ACA reporting obligations.

Background

As healthcare costs continue to rise, more and more employers are considering implementing eligibility carve-outs, premium surcharges, and other incentives to waive coverage as a strategy to reduce costs. Some employers may choose to completely exclude spouses and/or dependents from eligibility, but others take a less aggressive approach, excluding only certain spouses or dependents (e.g., those who are eligible for or enrolled in other group health coverage), or imposing surcharges for those who choose to enroll. In addition to attempts to reduce costs, other employers may be looking to offer more variety and flexibility in their plan offerings. For employees who do not need coverage for family members through the employer’s plan, the employer can still provide value beyond the employee’s normal compensation by providing an opt-out credit or spousal incentive HRA (SIHRA).

Recent agency FAQs clarify that employers may offer fertility-related benefits (e.g., in-vitro fertilization) as an excepted benefit, provided the coverage is offered under a separate, fully insured policy and is not coordinated with another group health plan maintained by the same plan sponsor. The benefit would be treated similarly to a specified disease or fixed indemnity policy. Because excepted benefits are exempt from many ACA coverage mandates, they do not need to be integrated with the employer’s major medical plan and do not affect HSA eligibility.

The Affordable Care Act (ACA) created a nonprofit corporation, the Patient-Centered Outcomes Research Institute (PCORI) to support clinical effectiveness research for healthcare. The institute is funded in part by fees paid by health insurers and sponsors of self-funded health plans (PCORI fees), which are reported and paid annually in the second quarter using Form 720.

Last December, the Paperwork Burden Reduction Act was signed into law allowing employers to meet Form 1095 distribution requirements for 2024 and future reporting years by posting a notice of availability and then only distributing upon request. Then the IRS released Notice 2025-15 providing further details on how to satisfy the notice requirement.