COVID Vaccine Requirements for Federal Employees Ended May 11, 2023

               On May 1, 2023 the White House announced the end of the COVID-19 vaccine requirements for Federal employees, Federal contractors, and international air travelers effective May 11, 2023.

Also in early May, the Office of Personnel Management (OPM) told Federal Employee Health Benefit (FEHB) Carriers they must continue to cover benefits for the diagnosis, prevention, and treatment for COVID-19 even after the expiration of the emergency.   OPM said the Carriers:

Must continue to cover laboratory and over-the-counter (OTC) COVID19 diagnostic tests including associated items and services for furnishing those tests. Carriers may impose, but are encouraged to waive, cost-sharing (including deductibles, copayments, and coinsurance) and medical management (including prior authorization) for COVID-19 diagnostic tests and associated items and services furnished after the end of the PHE.

OPM also encouraged Carriers to provide notice to covered individuals about changes to key information about their COVID-19 benefits (e.g., date when the Carrier would begin to impose cost-sharing requirements).  And Carriers must continue to cover, without cost-sharing, COVID-19 vaccines (including their administration), and any other qualifying coronavirus preventive services intended to prevent or mitigate COVID-19 on an in-network basis.

               The end of the COVID-19 emergency means that Agencies should pause any efforts to require, request, or collect vaccination status information for the purposes of implementing agency COVID-19 workplace safety protocols. Agencies with employee COVID-19 vaccination requirements pursuant to agency-specific authorities—i.e., requirements that are not premised on Executive Order 14043—may continue to require that employees provide information about their vaccination status.

When agencies pause requiring, requesting, and collecting vaccination status information, such agencies must continue to preserve their vaccination information collection systems and the information collected to date from employees in accordance with the Federal Records Act and other records requirements.  Verification of a Federal employee’s COVID-19 vaccination status is not required as a condition to enter GSA-controlled facilities.

The latest guidance states that agencies still should grant administrative leave of up to four hours for employees who are receiving a vaccine dose or to accompany certain family members for that purpose, as well as up to two days of administrative leave for recovery from any adverse side-effects.  Employees generally now must use sick leave or other personal time off if they are isolating because they have COVID-19 symptoms and do not feel well enough to telework.

Highlights of the SECURE Act 2.0

Automatic enrollment increased. Beginning in 2025, the law expands automatic enrollment in retirement plans with the aim of prompting more people to save for retirement. With some exceptions for small businesses, the bill requires 401(k) and 403(b) plans to automatically enroll eligible participants, starting at a minimum 3 percent contribution and increasing annually to at least 10 percent but no more than 15 percent. Employees who do not wish to enroll will be required to opt out.

Withdrawals allowed for emergency expenses. Beginning in 2024, qualified plan participants will be able to take a penalty‐free distribution of up to $1,000 once per year, which won't be subject to the usual additional 10 percent tax that applies to early distributions. However, if you do not repay the distribution within a certain time frame, you will have to wait three years before being allowed to take another emergency distribution.

Matching contributions extended to those paying student loans. Beginning in 2024, employers will be permitted to make qualified retirement plan contributions to employees who are not contributing to the plan if that employee is making qualified student loan payments.

Required minimum distribution age raised. Currently, you generally must take required minimum distributions (RMDs) from your retirement plan beginning at age 72. But beginning January 1, 2023, the bill will increase the required minimum distribution age to 73 to better reflect current life expectancies. In 2033, the RMD age will move to 75.

However, as currently presented, there appears to be a drafting error in which those born in 1959 meet both the age 73 and age 75 definitions. This will need to be corrected in future legislation, although we do not yet know what form the correction may take.

Catch-up contribution limits boosted. Right now, people who are 50 or older can make additional contributions to their qualified retirement plans. Beginning in 2025, that would be increased to $10,000 per year or 50 percent more than the regular catch‐up contribution amount — whichever is greater — for those who turn age 60, 61, 62 or 63 during a given year. After 2025, those amounts will be indexed for inflation.

The catch-up contribution amount for individual retirement accounts (IRAs) is currently set at $1,000 and does not adjust for inflation. Beginning in 2024, the legislation would index the IRA catch-up contribution for inflation in $100 increments.

Beginning in 2024, required minimum distributions from designated Roth accounts will be eliminated and all catch‐up contributions to qualified retirement plans will be treated as Roth contributions. An exception is available for employees with compensation of $145,000 or less (indexed for inflation). The ability for taxpayers to decide whether they want to fund any or all their retirement accounts with pre-tax or Roth contributions is a definite positive.

Qualifying longevity annuity contracts. Effective for contracts purchased or received in an exchange on or after its date of enactment, the bill will repeal the requirement that qualifying longevity annuity contracts’ (QLAC) premiums be limited to 25 percent of the account balance. It also increases the QLAC premium dollar limitation from $125,000 to $200,000 (indexed for inflation).

Qualified charitable distributions. Beginning in 2024, the bill will expand qualified charitable distributions (QCDs) to allow a one‐time, $50,000 distribution to certain split‐interest giving trusts. The act also indexes the $100,000 IRA qualified charitable distribution limit for inflation.