Proposed Rulemaking for Employer-Sponsored Fertility Benefits

On May 13, 2026, the Tri-Agencies—including the Department of Labor, Department of Health and Human Services, and the Department of the Treasury—proposed a Notice of Proposed Rulemaking to introduce a new category of limited excepted benefits for certain employer-sponsored fertility benefits. This rule aims to amend regulations under the Internal Revenue Code, Employee Retirement Income Security Act of 1974 (ERISA), and the Public Health Service Act to categorize fertility benefits as limited excepted benefits. The proposal is linked to Executive Order 14216 from February 2025, which seeks to expand access to in vitro fertilization and addresses issues raised in Frequently Asked Questions from October 2025. Under the Affordable Care Act (ACA), standalone health benefits such as fertility benefits do not meet certain ACA group health plan requirements because they lack first-dollar preventive coverage and comprehensive benefit coverage. However, exceptions for "excepted benefits" are outlined in ERISA. Employers offering standalone benefits must ensure they fit within the excepted benefits definition or integrate them with major medical plans. Currently, excepted benefits categories include general coverage like automobile insurance, limited benefits such as dental and vision, and supplemental benefits like Medicare supplements. The new proposal seeks to establish a specific category for limited excepted fertility benefits. The eligibility criteria for these proposed benefits include that they must be offered under a separate policy or not as part of the primary group health plan. They should primarily cover infertility diagnosis, treatment, or related reproductive health issues, have a lifetime financial cap of $120,000 per participant (adjusted for medical inflation), and provide specified written notification to participants and beneficiaries. Employers or insurers need to provide notices of the fertility benefit to potential participants by the enrollment eligibility date and annually thereafter or upon request. These notifications should be clear, explain the benefits and limitations, detail provider networks, and describe claims submission procedures. A single notification may be used for both participants and beneficiaries unless there are different addresses involved. The NPRM targets employers that do not include fertility benefits in their primary health plans. If implemented, this proposal may provide employers with more standalone benefits options. Stakeholders are encouraged to submit comments by July 13, 2026. The introduction of these AI-driven regulatory solutions could significantly impact payer-provider relationships and streamline compliance processes.