Post-Fireside Chat Questions
Assistant Secretary Gomez also volunteered to answer several follow-up questions after the fireside chat:
1. During the fireside chat, you emphasized the importance of mental health parity under MHPAEA. What caused EBSA to revisit MHPAEA 15 years after its passage? What is EBSA’s goal(s) in enacting the proposed rules regarding MHPAEA?
Despite the passage of MHPAEA almost 15 years ago, true parity in coverage for mental health and substance use disorder care is not yet reality. We are facing a mental health and substance use disorder crisis in the United States that was made worse by the pandemic and President Biden has given a mandate to the entire federal government to address the crisis with urgency. It is essential that America’s workers and their families do not face barriers to accessing care for their mental health. This includes behavioral therapies as well as care for substance use disorders, eating disorders, autism, and a variety of other conditions that millions of America’s workers and their families are living with today.
Through the Consolidated Appropriations Act, 2021, Congress made it clear that more needed to be done with respect to mental health parity, and EBSA took Congress’s action as a clear directive to ramp up its efforts with respect to parity compliance, education assistance, awareness and enforcement. EBSA has committed unprecedented resources to bringing plans into compliance and investigating the barriers that participants and their families are facing in accessing mental health care. These barriers can be very straightforward in some cases but can also be buried in the complexities of how provider networks are developed or wrapped up in various other kinds of red tape. Therefore, EBSA has also proposed new rules related to MHPAEA that will eliminate many of the remaining obstacles that are making it so difficult for folks to get both preventative and even life-saving care and require plans to look not only at the written provisions in their documents but also the outcomes of these provisions to work towards making parity a reality not only on paper, but in practice.
2. You had mentioned a few other health insurance-related priorities, including regulations regarding the “no surprise act,” independent dispute resolution and preventative health services. Are you able to elaborate on EBSA’s plans within those respective are?
Workplace-based health plans play an essential role in the American health care system, and millions of America’s workers and their families rely on their plans to ensure that they are covered so that they can both stay healthy and have security in case someone gets sick or is experiencing an emergency.
Unfortunately, despite the protections that are in place under ERISA, there are still plenty of ways that workers and their loved ones can be taken advantage of or put at risk. President Biden has pledged to be the most pro-worker President in history, and EBSA has been hard at work to implement relevant laws and introduce new regulatory actions that safeguard the rights of individuals across the country and make sure that they are not being exposed to undue financial or health risks by no fault of their own.
Our regulatory agenda indicates many areas in which we are working towards greater protections with respect to health care. We recently worked with the Departments of Health and Human Services and Treasury on proposed regulations regarding short-term limited duration insurance to ensure this type of coverage does not undermine the Affordable Care Act and that both employers and other plan sponsors and their employees and participants understand what coverage they are buying when exploring this type of coverage option. We also worked with the Departments in issuing a proposed rule earlier this year on coverage of certain preventive services under the ACA, which proposed amendments to the final rules regarding religious and moral exemptions and accommodations regarding coverage of certain preventive services, in support of the Biden-Harris Administration’s continued efforts to make contraceptive coverage more accessible, particularly in light of the Supreme Court’s decision in Dobbs and the state legislation and court decisions that have followed restricting access to reproductive health care. EBSA is also continuing to work with the Departments on implementation of the No Surprises Act, as reflected in the regulatory agenda’s references to proposed rulemaking on the independent dispute resolution process and other provisions.
3. In addition to MHPAEA, you stated that the SECURE 2.0 Act was one of EBSA’s top priorities. What major updates are included in the 2.0 version? You mentioned that EBSA was working on about 20 different projects regarding the SECURE 2.0 Act. Are you at liberty to elaborate on a couple of those?
When SECURE 2.0 was signed into law by President Biden, we knew here at EBSA that we had our work cut out for us, but we immediately sprang into action to implement this law, which includes much needed action to bring more Americans into the retirement saving system and provide essential protections to those who have built a nest-egg, big or small.
There are dozens of projects associated with the package, and our team is committed to implementing those as swiftly as possible. Some of the projects to highlight are 1) the directives to review, revise and consolidate various retirement disclosures, and generally to improve participant engagement and the effectiveness of disclosures, 2) the establishment of emergency-savings accounts linked to individual account plans, so that participants can more readily access needed financial support in an emergency situation, 3) review of EBSA’s 1995 pension risk transfer interpretive bulletin to determine whether any revisions should be considered, and 4) establishment of a participant lost and found database, to work alongside EBSA’s ongoing efforts to reunite participants and beneficiaries with pension savings that they may have lost track of. In addition, EBSA is working to develop and lift its new Employee Ownership Initiative, so that it can educate employers and employees about options for employee ownership, and also provide guidance with respect to valuation of employer stock in employer stock ownership plans.
4. What is the ‘conflict of interest rule’? And why is it one of EBSA’s top priorities?
The conflict-of-interest rule, also referred to as the “fiduciary rule,” relates to the circumstances under which someone who is providing investment advice to a participant or beneficiary for a fee will be considered a fiduciary under ERISA and therefore will be subject to ERISA’s fiduciary duties in providing that advice. The rule is all about ensuring that individuals who are planning for retirement are protected when they seek investment advice. In general, Americans are right to expect that when they seek advice from experts on complex topics that those individuals should be held to a high standard of care when providing that consultation. While the law has historically explicitly required this of professionals such as doctors and lawyers, investment advisors have enjoyed much more flexibility and less rigorous oversight. This can lead to situations where those advisors may be incentivized to give advice that is not necessarily in the best interest of the client or the plan but instead is in their own best interest or the interest of their firm. This leaves those who are seeking advice vulnerable to making risky or unsound investment decisions that could put their financial future in jeopardy.
The Biden-Harris administration is implementing an unprecedent pro-worker agenda to ensure that Americans are protected from those who seek to take advantage of them. This commitment is reflected in the fact that our regulatory agenda includes new rulemaking to close the gaps in protections outlined above. As we have noted in our most recent regulatory agenda, EBSA intends to publish a proposed rule regarding conflicts of interest in investment advice to address these issues.
5. What is environmental, social and governmental investing (“ESG”)? And what does EBSA hope to accomplish via its endorsement of ESG?
ESG investing occurs when investors take specific factors into account when they select retirement investments and exercise shareholder rights. This can include consideration of how certain entities and industries are positioned with regard to things such as our changing climate, diversity in the workforce or ethical best practices in corporate governance, among other things.
EBSA issued updated rules related to prudence and loyalty with respect to plan investments and proxy voting so that investors would have more flexibility and are able to take all relevant factors into account when investing the hard-earned savings of America’s workforce. In publishing these rules, EBSA did not endorse ESG or any other investing strategy; rather, it took its thumb off the scale and left it to retirement plan investors to determine whether to consider ESG factors while making it clear that fiduciaries can never subordinate the interests of plan participants and beneficiaries to the consideration of these factors. In doing so, we hope to provide additional flexibility for investors to make decisions that work best to protect the hard-earned retirement savings of America’s workers and their families.
6. You said your personal goal as Assistant Secretary was to make sure that people are not only aware of EBSA, but that EBSA can also assist plan participants, beneficiaries and sponsors in a number of ways. What would you like those groups to know EBSA is available to help with? What types of outreach and education programs is EBSA currently working on? And what are their respective goals?
EBSA is well known for our regulatory and enforcement work, but it is my goal as Assistant Secretary to expand the impact of our direct-to-the-public services as well. As a part of our staff, EBSA has over 120 full-time Benefits Advisors who offer a truly remarkable service to plan participants and beneficiaries. Our Benefits Advisors are available at our toll-free number, 866-444-3272, to talk to folks about their benefit plans, what rights individuals and families have under the law, and how to exercise those rights to ensure that you are receiving the full benefits that you have been promised by your plan. If you have been wrongfully denied a claim, the Benefits Advisors can help you understand how to get that claim paid. If you have retirement assets from a former employer that you are having trouble accessing, the Benefits Advisors can help you track those down. The list goes on and on, and I know that so many people across the country could benefit from this service if they only knew it was available.
For that reason, we are implementing aggressive new outreach tactics to get EBSA’s name out there and help folks understand that we are here to help. In addition to outreach programs and publications, we are working on updating our website, increasing use of social media, and working on speaking engagements, interviews and other opportunities to spread the word about everything EBSA has to offer.
7. What is EBSA doing to reach underserved communities?
President Biden has made it clear that every agency across the federal government needs to be doing more to reach underserved communities and that it is essential for us to build equity into everything that we do. Regarding race, retirement savings and health are two areas where massive inequities remain, and huge systemic barriers exist that continue to widen the gaps between the average outcomes for white families and those for black and brown families.
It is a top priority at EBSA for us to help narrow those gaps, and we are doing that through policymaking but also through outreach. Since the start of the Biden-Harris administration, EBSA has shifted significant resources in our Office of Outreach, Education, and Assistance to better reach and better serve communities that have historically been left out. This includes communities of color, but also women, low-wage workers and workers with disabilities. We are focusing our activities on determining how to better access these communities through targeted educational materials and outreach, and by incorporating other languages in our publications and other outreach materials. We were excited to have the opportunity to participate in radio and television interviews in other languages and that focus on underserved communities so that we can have a broader reach and let folks know who we are and how we can help.