New Supreme Court ruling reverses 40-year precedent

Chevron deference likely to lead to additional challenges to agency guidance

In a recent base, Loper Bright Enterprises vs Raimondo, etc., The Supreme Court of the United States reversed a 40-year precedent that favored interpretations of law made by Federal agencies when deciding court cases. In this reversal of previous doctrine, the Supreme Court has declared the Chevron Deference as “fundamentally misguided.” This overturned the belief that where there is ambiguity in regulations, that the various agencies are intended to provide interpretations and direction. The Loper Bright ruling opens the door for a likely increase in court challenges to agency guidance where not expressly addressed in the law. 

Impact of Employee Benefits: Because many aspects of employee benefits process come from agency guidance and direction, there is a likelihood that future challenges arising as a result of this ruling may impact guidance that helped shape employee benefits processes. Employers should keep an eye on future court cases that may challenge previously issued guidance.

Changes to Medicare Part D may require updates to Medicare Part D Creditable Calculations and Notices 

With the upcoming changes to Medicare Part D that will increase benefits for many Part D participants, employers are encouraged to review the impact this will have on their Medicare-eligible plan participants and notices. These changes may cause some employer or retiree plans to no longer meet the criteria deemed creditable or may require the plan to shift the method of determining creditable status. If an employer’s active or retiree plan is not deemed creditable, that may shift the notice that is required for the enrolled population and may create a situation where employers will want to determine if additional communications and educational materials are warranted to prevent plan participants from receiving late enrollment penalties when they later enroll in Medicare. 

Impact on Employee Benefits: Employers need to determine if their 2025 plans will be considered Creditable for Part D purposes and, if not, adjust their Notices of Creditable/Non-Creditable Coverage. Some employers may elect to provide additional communications explaining the impacts of remaining in a non-creditable plan.