Employee Benefits News
2027 Open Enrollment Checklist
To prepare for open enrollment, employers that sponsor health plans should be aware of compliance changes affecting the design and administration of their plans for plan years beginning on or after January 1, 2027. These changes include limits adjusted for inflation each year, such as the Affordable Care Act’s (ACA) affordability percentage for applicable large employers (ALEs) and cost-sharing limits for high-deductible health plans (HDHPs). Employers should review their health plan’s design to confirm that it has been updated, as necessary, for these changes.
In addition, any changes to a health plan’s benefits for the 2027 plan year should be communicated to plan participants through an updated summary plan description (SPD) or a summary of material modifications (SMM).
Health plan sponsors should also confirm that their open enrollment materials contain certain required participant notices, such as the summary of benefits and coverage (SBC), when applicable. Some participant notices must also be provided annually or upon initial enrollment. Employers should consider including these notices in their open enrollment materials to minimize costs and streamline administration.
Gag Clause Prohibition Attestation Required Annually
Employers with a group health plan must submit the Gag Clause Prohibition Compliance Attestation annually. The attestation for the 2026 reporting year is due no later than December 31, 2026.
For Sentara customers with a self-funded plan through BusinessEDGE, please review the attestation requirements carefully.
As noted with Anthem, self-funded and BusinessEDGE clients will receive instructions directly from Anthem regarding the attestation process.
As we receive additional guidance from other carriers and third-party administrators (TPAs), we will share that information in future newsletters and communications.
Sentara
Sentara Health Plans is gathering information to meet the timelines for the required Gag Clause Prohibition Compliance Attestation (GCPCA), due no later than December 31, 2026.
The Gag Clause provision prohibits group health plans and health insurance issuers from entering into agreements with providers that prevent enrollees, plan sponsors, or referring providers from seeing provider-specific cost and quality data.
Plans and issuers must annually attest to CMS that they are in compliance with all requirements.As a courtesy, Sentara Health Plans will attest on behalf of fully insured and self-funded groups.
The requirements for these groups are the following:
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- Fully insured groups – no action is required
- Self-funded and BusinessEDGE ® groups – required to submit a form with group information to Sentara Health Plans. These groups will receive an email with the link below to complete an electronic form to collect the required data points. The form must be submitted by October 15, 2026.
Anthem
The Consolidated Appropriations Act (CAA) gag clause prohibits group health plans and health insurance issuers that offer group coverage from entering into agreements that directly or indirectly restrict the plan or issuer from accessing or disclosing certain price and quality information.
Group health plans and issuers are required to submit an annual attestation confirming compliance with the prohibition on gag clauses.
Anthem will file the Gag Clause Prohibition Compliance Attestation on behalf of fully insured and administrative services only groups by December 31, 2026. No action is required of the employer. However, if an employer receives an inquiry from the Centers for Medicare & Medicaid Services (CMS) regarding the Gag Clause Prohibition Compliance Attestation or has any questions, please contact your benefit consultant at Towne Benefits.
IRS Proposes Rules for Dependent Care FSA Nondiscrimination Testing
On August 11, 2026, the IRS issued proposed rules addressing nondiscrimination testing requirements for dependent care flexible spending accounts (FSAs). This marks the first set of regulatory guidance on the mechanics of nondiscrimination testing for dependent care FSAs. Importantly, the proposed rules do not create any new nondiscrimination requirements for dependent care FSAs; they simply clarify how decades-old statutory rules should be applied.
Employers with dependent care FSAs often struggle to pass nondiscrimination testing, especially the 55% average benefits test, because lower-paid employees are less likely to participate in these plans. The proposed rules would make the following key changes:
- Clarify how the 55% average benefits test applies to dependent care FSAs, including the methodology for calculating average benefits for highly compensated employees (HCEs) and non-highly compensated employees(non-HCEs);
- Allow employers to correct a failed 55% average benefits test by including excess benefits in HCEs’ gross income by the deadline for furnishing Form W-2 for the testing year (i.e., Jan. 31 of the following year); and
- Establish a clear safe harbor for passing the eligibility test through a percentage-based approach, rather than a facts and circumstances analysis.
While the rules have not been finalized, employers may rely on the proposed guidance for plan years beginning before final rules are issued.
Action Items
The proposed rules may make it easier for dependent care FSAs to pass nondiscrimination testing, especially the 55% average benefits test. Employers who have not completed this year’s testing should check in with their vendors to confirm their methodology will take into account the new guidance, while those who already failed testing may want to consider running it again under the proposed rules.
New Leave Laws Are on the Horizon in Virginia. Is Your Business Prepared?
Virginia recently passed two major pieces of legislation that will change how businesses manage leave, payroll, and employee benefits over the next several years—representing a significant operational shift for many employers.
In a new article from our Human Resources Consultant,Barbara A. Jennings, SPHR, we outline the Expanded Paid Sick Leave Law and the Paid Family and Medical Leave (PFML) program, what employers need to know, and how to be prepared before the deadlines beginning in 2027.