2026 Employee Benefits Market Outlook 6 analyses of nonquantitative treatment limitations (NQTLs), which include a variety of strategies that gen- erally limit the scope or duration of benefits, such as prior authorization requirements. The 2024 final rule primarily focused on stricter parity requirements for NQTLs. Under the final rule, health plans and issuers would be required to collect and review outcomes data and take reasonable steps to fix any significant differ- ences in access between MH/SUD and M/S benefits. They would also need to make sure their comparative analyses of NQTLs include specific, detailed elements to show compliance. Due to the nonenforcement policy, employer-spon- sored health plans are not required to comply with the 2024 final rule. However, employers should make sure their health plans continue to comply with MHPAEAs statutory requirements, including the comparative anal- ysis requirement for NQTLs. Employers should reach out to the health plans issuer or third-party admin- istrator (TPA) to confirm that comparative analyses of NQTLs will be updated, if necessary, for the plan year beginning in 2026. Employers should also stay alert for any changes to the 2024 final rule. While the U.S. Department of Labor has made MHPAEA compliance a top enforcement priority in recent years, shifting pri- orities and limited resources could change that focus going forward. Ongoing Health Plan Litigation Alongside monitoring legislative and regulatory devel- opments in 2026, employers should also keep an eye on litigation involving several important health plan compliance issues. While a recent U.S. Supreme Court ruling limited the ability of federal courts to issue nationwide injunctions of government policies, fed-eral courts still have the authority to block regulatory actions that are unlawful, arbitrary or beyond an agen- cys authority. In addition, a Supreme Court ruling from 2023 ended the long-standing deference given to fed- eral agencies interpretations of the law, making it more likely that federal rulemaking will be successfully chal- lenged in the courts. In 2026, ALEs should keep an eye on a case now before the U.S. Court of Appeals for the 5th Circuit that could affect how pay-or-play penalties under the ACA are assessed. In April 2025, a federal district court in Texas ruled that the IRS cannot assess these penalties unless the U.S. Department of Health and Human Services (HHS) first issues a certification to the employer. Currently, the IRS relies on Letter 226-J to notify employers of potential liability without any prior certification from HHS. The 5th Circuits upcoming decision may impact how pay-or-play penalties are enforced going forward. Employers should also be aware of the growing number of fiduciary lawsuits tied to health plans. Most private-sector employers must follow the fiduciary duty standards set by the Employee Retirement Income Security Act (ERISA) when managing their employee benefit plans. These standards require fiduciaries to prudently select and monitor plan service providers. Recent litigation has underscored how important it is for employers to meet these obligations when man- aging group health plans. Although many of these cases are focused on prescription drug benefits and the selection of pharmacy benefit managers (PBMs), the same fiduciary responsibilities apply to all plan ser- vice providers. As 2026 approaches, employers should review their fiduciary compliance to limit potential lia- bility, including documenting the process for selecting and monitoring health plan service providers. In addition, employers should be aware of a recent surge of class-action lawsuits involving health plan premium surcharges related to tobacco use. When a health plan imposes a surcharge (or provides a reward) based on a health-related standard (such as not using tobacco or meeting an exercise goal), it must comply with HIPAAs nondiscrimination requirements. These lawsuits generally allege that health plans failed to meet these requirements by not offering a reason-able alternative standard to avoid the surcharge, by only applying the premium reduction on a prospec-tive basis after completing the alternative standard, and by not describing the availability of the alternative