On May 13, 2026, the U.S. Departments of Labor, Health and Human Services, and the Treasury (the Departments) issued a proposed rule that would create a new category of limited excepted benefits that employers can use to offer fertility benefits. The proposed rule builds on Executive Order 14216 and the Departments’ October 2025 guidance, which clarified that employers may offer fertility benefits through three existing excepted benefit pathways: a fully insured independent, noncoordinated excepted benefit policy; an excepted benefit HRA; and an employee assistance program offering coaching and navigator services.
The proposed rule would establish a new category of limited excepted benefits for fertility benefits. The new category would apply restrictions like those already in place for other limited excepted benefits, with the following main requirements:
- Substantially all benefits must be for the diagnosis, mitigation, or treatment of infertility or related reproductive health conditions;
- Benefits are capped at a combined lifetime maximum of $120,000 for the participant and their beneficiaries, indexed for inflation for plan years beginning after 2027;
- The benefits must be provided under a separate policy or otherwise not be an integral part of the plan maintained by the same plan sponsor; and
- The plan or insurance issuer must provide a written notice to participants and beneficiaries that clearly describes the coverage, including its benefits and limitations, how to access in‑network providers and how to submit claims. This notice must be provided at the first opportunity to enroll, annually thereafter, and upon request.
If finalized, the proposed changes would apply for plan years beginning on or after Jan. 1, 2027. However, the Departments have asked for feedback on whether the proposed changes should take effect sooner to allow plan sponsors and issuers the flexibility to offer this benefit immediately after the changes are finalized.
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