On March 18, 2020, President Trump signed the Families First Coronavirus Response Act into law. A summary of the key provisions is included below.
COVERAGE FOR COVID-19 TESTING
The new law requires health insurance providers to cover diagnostic testing for COVID-19 at no cost to the insured. Insurance companies are also required to provide coverage and care for COVID-19 without charging copayments, coinsurance or deductible requirements for diagnostic care. Additionally, any visits to a doctor, including telemedicine, urgent care and emergency room visits, must be fully covered if they trigger a need to be tested. The law also provides provisions excluding requirements for prior authorization and medical management.
COVID-19 SICK LEAVE
The Families First Coronavirus Response Act also requires covered employers with fewer than 500 employees to provide employees with two weeks of paid sick leave if they are unable to work or telework due to reasons related to COVID-19. This coverage includes time off taken to:
- Self-quarantine under the advice or order of a doctor or health professional
- Obtain diagnostic testing
- Care for a child whose school or dependent care provider closes due to the coronavirus
The newly required sick leave by the new law must be in addition to any existing employer provided sick leave and does not carry over into 2021. The law also provides that up to 80 hours of time can be reimbursed at 100% of pay with a $511 maximum if the employee is quarantined or seeking care (including diagnosis) for COVID-19. The law allows up to 80 hours of time to be reimbursed at 100% of the employees pay with a maximum daily amount of $511 ($5,100 aggregate) if the employee is quarantined, self-isolated or seeking care and diagnosis for COVID-19. Other circumstances may be reimbursed at a rate of 2/3 of pay $200 per day ($2,000 aggregate). Part-time employees are eligible at a pro-rated amount based on the regularly scheduled hours.
What does this mean for employers?
The good news is that employers are not required to bear the cost of this leave since payments are reimbursable via a tax credit against the employers Social Security taxes on a quarterly basis. If the amount of the tax credit exceeds the employer’s aggregate Social Security tax liability for the quarter, the excess may be refunded directly to the employer.
Are there Exceptions?
Employers of health care providers or emergency responders may opt-out of these rules. In addition, the Department of Labor is authorized to issue emergency regulations to exempt individual companies with fewer than 50 employees from this requirement, if compliance with the regulation would “jeopardize the viability of the business as an ongoing concern.”
EXPANSION OF THE FAMILY MEDICAL LEAVE ACT (FMLA)
The new law broadens the Family Medical Leave Act for employers with fewer than 500 employees. A new qualifying event for any employee who has been employed for at least 30 days follows the below guidelines:
FMLA will apply only if an employee is unable to work or telework due to a need to care for child(ren) under age the age of 18 who cannot attend school or childcare due to coronavirus-related closures.
This is in addition to providing 12 weeks of protected FMLA leave for these individuals, and providing a portion of that leave to be paid.
After the first ten days of unpaid (or using accrued paid leave), Employers must pay their Employees the FMLA of 2/3 of their normal rate of pay. This is up to a maximum of $200 per day and $10,000 aggregate leave payment. These payments are reimbursed in the same manner as emergency sick leave – via reimbursable tax credits.
Also, as with the emergency sick leave provisions, employers of health care providers and first responders have the option to opt-out of these rules and there is the possibility of future regulations that will relax the rules for employers with fewer than 50 employees.
Lastly, while businesses with fewer than 25 employees are subject to these new FMLA requirements, they are not required to maintain a position for an employee on return from leave. However they are asked to make a reasonable effort to do so (and to notify that individual if a position subsequently becomes available under certain circumstances).
The paid leave provisions described above will take effect no later than April 2, 2020 and expire on December 31, 2020.
WHEN TO CALL KELLER STONEBRAKER?
Your Keller Stonebraker Risk Management Partners can help guide you in how the above law pertains to your business as well as your existing coverage in place. As we move forward in this unprecedented situation, we are prepared to assist you with uninterrupted high quality service that you’ve come to expect of us. Please refer to our other Recent News Articles pertaining to COVID-19, as well as other breaking news as it occurs.