The Consolidated Appropriations Act, 2021 (CAA) is designed to increase transparency in employee health benefit plans. As fiduciaries of the benefit plan, Government agencies like the Department of Labor, the Department of Health and Human Services, and the Treasury will hold employers responsible and accountable for the CAA. What does this mean for employers and how should CEOs meet their fiduciary obligation to their employees/plan members?
By the end of this year, employers must attest to the Department of Labor that they have received a full and complete disclosure of compensation from their plan service providers (broker, TPA, PBM, etc). Failure to get your hands on this information means that you will not qualify for ERISA’s prohibited transaction exemption. Transparency will not benefit everyone, but it is going to be great for employers and employees.