Compliance Corner
Welcome to Novo Connection's Compliance Corner, where transparency meets expertise in your new benefit program. We understand the evolving nature of compliance and how it can quickly become complex. At Novo Connection, our commitment to transparency ensures that you receive accurate and actionable information. Our webpage serves as a reliable resource for groups and advisors, offering insights, updates, and solutions tailored to navigate new compliance laws effortlessly.
Quarter 3 Compliance Updates
Mental Health Parity & Addiction Equity Act (MHPAEA)
June 2025
On May 12, a federal court granted a request from the Departments of Labor, Health and Human Services, and Treasury (“the Departments”) to pause litigation regarding the 2024 Mental Health Parity & Addiction Equity Act (MHPAEA) final rule while the Departments reconsider whether to modify or rescind the rule through new proposed rulemaking. Then on May 15, the Departments announced a temporary non-enforcement period for the 2024 MHPAEA final rule that will remain in place until a final court decision is made plus an additional 18 months, giving employers time to comply accordingly. See the non-enforcement statement can be found below:
While enforcement efforts for the 2024 MHPAEA final rule are paused, employers do not have to comply with the new fiduciary certification requirement, certain new definitions, the requirement to provide meaningful benefits, and the requirement to collect and analyze relevant data as part of the written comparative analysis. However, the Departments have made it clear that the framework for MHPAEA that existed prior to the 2024 MHPAEA final rule is unaffected, including:
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The 2013 final rule (e.g., classifications for benefits, substantially all and predominant level tests for financial requirements and quantitative treatment limitations, and the concept of parity for non-quantitative treatment limitations (NQTLs);
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Guidance and FAQs issued since the 2013 final rule; and,
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The written comparative analysis for NQTLs added by Congress in the Consolidated Appropriations Act of 2021.
Therefore, employers should continue with efforts to design and administer their group health plans in accordance with MHPAEA and to maintain a current NQTL written comparative analysis in case of agency audit or participant request. We will continue to carefully monitor this situation.
Upcoming Deadlines
Form 5500 - July 31, 2025
Each year, employers that are subject to the Employee Retirement Income Security Act of 1974 (ERISA) must electronically file an annual report (Form 5500) for each employee benefit plan they maintain unless a filing exemption applies.
Employers with employee benefit plans that operate on a calendar year basis must file their annual reports for 2024 with the U.S. Department of Labor (DOL) by July 31, 2025. An employer may extend this deadline by 2.5 months (until Oct. 15, 2025) by filing Form 5558 with the IRS by July 31, 2025.
Small welfare benefit plans (fewer than 100 covered participants) that are unfunded or fully insured (or a combination of unfunded and insured) are exempt from the Form 5500 filing requirement.
Additionally, employers that are required to file a Form 5500 must provide participants with a summary of the information in the Form 5500, called a summary annual report (SAR) within nine months of the close of the plan year or by Sept. 30, 2025 for calendar year plans.
PCORI Fee - due July 31, 2025
The Affordable Care Act (ACA) requires health insurance issuers and self-insured plan sponsors to pay Patient-Centered Outcomes Research Institute fees (PCORI fees). The fees are reported and paid annually using IRS Form 720, the Quarterly Federal Excise Tax Return.
Form 720 and full payment of the PCORI fees are due by July 31 of each year and generally covers plan years that end during the preceding calendar year. For plan years ending in 2024, the PCORI fees are due by July 31, 2025.
Calculating the PCORI Fee Payment
In general, the PCORI fees are assessed, collected and enforced like taxes. The PCORI fee is imposed on an issuer of a “specified health insurance policy” and a plan sponsor of an “applicable self-insured health plan” based on the average number of lives covered under the plan. Final rules outline a number of alternatives for issuers and plan sponsors to determine the average number of covered lives. Please work with your Client Experience team with any questions on the average number of lives calculation.
2026 Deductible & Out-of-pocket limits
The IRS has announced the inflation-adjusted contribution and related amounts for health savings accounts (HSAs) and HSA-compatible high-deductible health plans (HDHP) for 2026.
Qualified High Deductible Health Plans | 2026 |
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Self-Only Coverage: | |
Minimum annual deductible | $1,700 |
Maximum out-of-pocket limit | $8,500 |
Maximum annual contribution limit | $4,400 |
Family Coverage: | |
Minimum annual deductible | *$3,400 |
Maximum out-of-pocket limit | $17,000 |
Maximum annual contribution limit | $8,750 |
*Please remember that for there to be an individual embedded deductible amount under the family deductible, it must be greater than or equal to the minimum family deductible amount ($3,400 in 2026)
In addition, HDHPs have a different annual out-of-pocket (OOP) limit than the annual limit under the ACA. HDHPs must use the lower of the OOP limits (ACA limit vs. HDHP limit).
Non-Qualified High Deductible Plans | 2026 |
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Self-Only Coverage: | |
Maximum out-of-pocket limit | $10,600 |
Family Coverage: | |
Maximum out-of-pocket limit | $21,200 |