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Benefits

Are Employer-Provided COVID-19 Testing and Vaccines Subject to ERISA?

EBIA  

EBIA  

QUESTION: Our company is considering offering COVID-19 testing and vaccinations to employees at our offices. Will this arrangement be considered an ERISA plan?

ANSWER: Whether a program offering COVID-19 testing, vaccinations, or both is subject to ERISA depends on how it is structured and how it operates. In general, an arrangement is an ERISA welfare benefit plan if it is a plan, fund, or program established or maintained by an employer to provide ERISA-listed benefits (including medical benefits) to employees. Here are considerations for different ways in which you might provide these services:

  • Existing Plan. Your company could offer COVID-19-related services as part of an existing employer-sponsored group health plan (such as major medical coverage) that is already subject to ERISA. In fact, group health plans and insurers—but not employers themselves—are required to cover certain COVID-19 diagnostic and preventive services, including vaccines. Providing the services through an existing plan means they would be available only to plan participants, not other employees.
  • Stand-Alone Arrangement. You could offer COVID-19 vaccines and testing on a stand-alone basis. In that instance, the program must be evaluated for ERISA status on its own. COVID-19 vaccines and testing are medical care, so whether the arrangement is an ERISA group health plan will depend on whether the other conditions for ERISA plan status are present. A program that does not require an “ongoing administrative scheme” might not be considered a “plan, fund, or program” subject to ERISA. But if ongoing administration is necessary, the arrangement is likely an ERISA plan.

An ERISA welfare plan that provides medical benefits is a group health plan, making it subject to additional ERISA requirements and potentially triggering application of other laws, including the Affordable Care Act (ACA). It may be possible to structure the services to limit your compliance obligations. For example, offering COVID-19 vaccinations and testing through an on-site medical clinic or an employee assistance program may implicate ERISA (including ERISA’s group health plan rules) but be treated as an “excepted benefit” exempted from many ACA requirements and some other group health plan rules.

Employers providing COVID-19 testing and vaccinations directly or through an agent may have heightened obligations under the Americans with Disabilities Act (ADA), since these actions generally involve medical examinations or disability-related inquiries under the ADA. And keep in mind your obligations to maintain the confidentiality of employees’ health information. These obligations apply to the employer under the ADA and to a group health plan under HIPAA. HIPAA also restricts the ability of a group health plan to disclose employees’ health information to the employer sponsoring the plan.

Given the wide array of legal considerations involved in establishing an employment-based COVID-19 vaccination and testing program, you should discuss these issues with legal counsel before making any decisions or communicating with employees.

For more information, see EBIA’s ERISA Compliance manual at Sections VI.A (“Overview of Arrangements Subject to ERISA”), VI.J.3.s (“Flu Shots, Vaccinations, and Health Screenings), and VI.J.3.w (“On-Site Medical Clinics Provide Medical Care”). See also EBIA’s Group Health Plan Mandates manual at Section XVI.C (“Mandated Coverage of Diagnostic and Preventive Services”), EBIA’s Self-Insured Health Plans manual at Section XIII.C.11 (“Coverage Mandates Relating to the COVID-19 Pandemic”), and EBIA’s HIPAA Portability, Privacy & Security manual at Section XXIII.C (“Sharing PHI and Electronic PHI With Plan Sponsors”).

Contributing Editors: EBIA Staff.

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