Employer Health Plan Flexibility Act

This legislation aims to provide flexibility for employer-sponsored group health plans by exempting those governed by the Employee Retirement Income Security Act of 1974 (ERISA) from the Affordable Care Act's (ACA) Essential Health Benefits (EHB) requirements. It amends both ERISA and the Public Health Service Act to explicitly remove the federal mandate for these specific plans to cover EHBs, directing the Secretary of Health and Human Services to update regulations accordingly. While granting this exemption, the bill carefully preserves several other crucial federal protections and requirements. These include compliance with the portability and nondiscrimination provisions of HIPAA the Mental Health Parity and Addiction Equity Act COBRA ERISA fiduciary duties Internal Revenue Code requirements federal nondiscrimination requirements preventive services requirements . This ensures that a broad range of consumer protections remain in place. To maintain transparency, plans utilizing this exemption must annually provide participants with a notice detailing covered benefits, identifying any Essential Health Benefits not covered, and explaining cost-sharing. The legislation clarifies that employers can still voluntarily offer all or some EHBs and that existing ERISA preemption and state insurance regulation are largely unaffected. These changes will apply to plan years beginning on or after January 1, 2028.