Expanding access to fertility benefits: Tri-Agencies’ proposed rule would create limited excepted benefit for fertility benefits

Background

Under the Affordable Care Act (ACA), stand-alone health benefits such as fertility benefits do not comply with certain ACA group health plan mandates because they do not cover preventive benefits first-dollar and do not provide full coverage of all required benefits. There is an exception for “excepted benefits”, as defined under part 7 of Title I of ERISA. As a result, employers who want to provide certain stand-alone benefits need to ensure that the benefits either meet the definition of an excepted benefit or are integrated with its medical plan. There are four categories of “excepted benefits”: (1) benefits that are excepted in all circumstances (e.g., automobile insurance, workers; compensation, and accidental death and dismemberment coverage), (2) limited excepted benefits (e.g., dental, vision, long-term care coverage), (3) independent, noncoordinated excepted benefits (e.g., insurance coverage for a specified disease, such as a cancer-only policy), and (4) supplemental excepted benefits (e.g., Medicare supplemental health insurance). The NPRM proposes to create a new type of limited excepted fertility benefit.

Currently, to qualify as a limited excepted benefit, the benefit must meet the following requirements: 

1. Be provided under a separate policy, certificate, or contract of insurance, or

2. Otherwise not be an integral part of a group health plan

Employers have typically relied on this exemption in structuring “excepted benefit HRAs”. However, the excepted benefit HRA rules are fairly restrictive and prior guidance has limited maximum coverage to $2,200 annually (for 2026). The 2025 FAQs did not loosen the restrictions on excepted benefit HRAs.

NPRM

Under the NPRM, the Tri-Agencies propose creating a specific limited excepted benefit that applies to fertility benefits, for plan years beginning on or after January 1, 2027. To qualify, a fertility benefit would need to meet the following requirements: 

1. The fertility benefit must be provided under a separate policy, certificate, or contract of insurance, or not otherwise be an integral part of the plan. 

• The benefit is not an integral part of the plan if the participant is offered other group health plan coverage (that is not an excepted benefit, or an HRA or other account-based group health plan), and the participant may decline the other coverage and still enroll in the fertility benefit

2. Benefits must be substantially all for the diagnosis, mitigation, or treatment of infertility or infertility-related reproductive health conditions.

3. The total lifetime dollar limit per participant and their beneficiaries cannot exceed $120,000 (indexed for medical inflation). 

4. The plan or insurance carrier must provide a specific written notice to participants and beneficiaries. 

Notice Requirement

Under the NPRM, the employer or insurance carrier must provide participants and beneficiaries with a notice of the fertility benefit no later than the first date on which the participant or beneficiary is eligible to enroll in coverage. Notices must be provided annually thereafter, and upon request of the participant or beneficiary. 

The notice must satisfy the following content requirements: 

1. Be written in a manner calculated to be understood by the average plan participant. 

2. Provide a description of the coverage, including a summary of benefits and limitations of the coverage (including lifetime dollar amount limits).

3. Explain how to identify and utilize a network provider (if applicable).

4. Explain how to submit a claim for reimbursement (including whether the benefit uses the same claims procedures as the employer’s other group health plans). 

The same notice can be provided to both a participant and beneficiary, unless the beneficiary has a different address than the participant. 

As drafted, the NPRM appears to be targeted at employers who do not currently cover fertility benefits under their major medical plan. However, if the NPRM is finalized, it may result in additional stand-alone options through which employers may offer fertility benefits. Comments on the NPRM are due by July 13, 2026.

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