The Consolidated Appropriations Act (CAA) of 2021 expands ERISA’s fiduciary duties, particularly for self-funded employers, requiring them to demonstrate the cost-effectiveness and quality of their healthcare services. Fiduciaries now must evaluate broker and consultant compensation for reasonableness and ensure their health plans comply with mental health parity and pharmacy benefit requirements. This expansion creates a higher risk of litigation and penalties if employers fail to meet their expanded responsibilities. Employers must conduct a health plan risk assessment to identify potential areas of non-compliance and establish processes to mitigate risks.
Take our Fiduciary Risk Assessment to see if you’re exposed.