The Consolidated and Further Continuing Appropriations Act, 2015 (H.R. 83) was enacted on December 16, 2014. In addition to funding the federal government through September 2015, the act clarifies the treatment of expatriate health plans under the Patient Protection and Affordable Care Act (PPACA), requires additional PPACA-related disclosures from the Department of Health and Human Services (HHS), and defunds some PPACA provisions. It also reduces appropriations for the IRS, which implements, administers and enforces important provisions of the PPACA. 

The focus on the PPACA suggests that in 2015, the majority-Republican House and Senate may continue to whittle away at funding for the health care law. The expatriate plan provisions enjoyed bipartisan support.   

Expatriate Health Coverage Clarification Act

In 2013 and 2014, the Department of Labor (DOL) and HHS provided temporary relief from some PPACA requirements to expatriate health plans. The Expatriate Health Coverage Clarification Act, which is incorporated into the appropriations act, makes the temporary relief permanent and extends the relief to self-insured expat plans. As long as they meet the conditions set out in the act, expat plans are exempt from most of the PPACA’s market reform requirements, as well as fees and taxes.

Coverage provided under qualifying expat plans will constitute minimum essential coverage (MEC), thus making it easier for such plans to meet the employer play-or-pay mandate and ensuring that expat plan participants meet the individual mandate. The relief is available to expat health plans issued or renewed on or after July 1, 2015.

The relief does not apply to reporting to the IRS and employees under Sections 6055 and 6056,1 although the law allows applicable large employers to default to providing individual statements to expatriate employees electronically (employers must obtain affirmative consent for electronic disclosure to other employees and participants). Further, coverage for certain inpatriates2 will be subject to the Cadillac tax — the excise tax on high-cost group health plans.  
Expat health plans qualify for the relief if they meet the following conditions:

  • Substantially all primary enrollees are qualified expatriates.
  • Substantially all benefits are non-excepted benefits, and the plan covers inpatient hospital services, outpatient facility services, physician services and emergency services.
  • The plan meets minimum value requirements (i.e., an actuarial value of at least 60%).
  • Plans that provide dependent coverage cover children up to age 26.
  • The coverage is issued by an expatriate health issuer or administered by an administrator that, together with any other person in the issuer’s or administrator’s controlled group, is licensed to sell insurance in more than two countries, and the coverage or company in the controlled group meets the following conditions:
    • Maintains network provider agreements that provide for direct claims payments with providers in at least eight countries
    • Maintains call centers in at least three countries and accepts calls in at least eight languages
    • Processes at least $1 million in aggregate claims (in foreign currency equivalents)
    • Makes global evacuation/repatriation coverage available
    • Maintains legal and compliance resources in at least three countries
  • The coverage offers reimbursement for items and services in the local currency of at least eight countries.
  • The coverage meets the mandates for group health plans under the Health Insurance Portability and Accountability Act, the Employee Retirement Income Security Act, the Mental Health Parity and Addiction Equity Act, and similar laws enacted before the PPACA.

Qualified expatriates are generally employees who meet at least one of two conditions:

  • The employee was transferred or assigned to the U.S. for a specific, temporary purpose or assignment, and is reasonably determined to need health insurance or related services and support in multiple countries, and he or she is offered other multinational benefits on a periodic basis.
  • The employee is working outside the U.S. for at least 180 days in a consecutive 12-month period that overlaps with a plan year.

The secretaries of the Department of the Treasury, HHS and the DOL may issue additional regulations to prevent inappropriate expansion of the Expatriate Health Coverage Clarification Act and ensure adequate reporting of expatriate plan enrollees.

PPACA funding transparency, risk corridors and IPAB funding

The appropriations act requires the administration’s 2016 budget submission to identify all funds spent by the Centers for Medicare & Medicaid Services (CMS) on the public insurance exchanges since the PPACA was enacted, as well as proposed spending on the public exchanges for fiscal 2016. HHS also must establish a publicly available website to provide information on how the Prevention and Public Health Fund3 spends its money. 

Funding for risk corridors will be limited to amounts collected from issuers under the program. The risk corridors program, which is scheduled to operate from 2014 to 2016, protects against pricing uncertainty in the individual and small group markets by spreading gains and losses between plans and the federal government.

The act rescinds $10 billion from funds made available for the Independent Payment Advisory Board (IPAB) for fiscal 2015 (the IPAB has not yet been implemented). The IPAB was created by the PPACA to reduce Medicare spending without affecting coverage or quality.


1. Section 6055 requires all providers of MEC to report coverage information to the IRS and furnish a statement to individuals. Section 6056 requires applicable large employers to file information returns with the IRS and provide statements to their full-time employees about their health insurance coverage.

2. An expatriate is transferred from his or her home country to a foreign subsidiary, and an inpatriate is reassigned from a foreign subsidiary to the employer’s home country.

3. The PPACA provided for HHS to create and administer a fund for expanded and sustained national investment in prevention and public health programs to improve health and control the rate of growth in health care costs.