\n It can be somewhat difficult to keep
\nabreast of the developments regarding
\nthe Affordable Care Act (ACA). Following
\nis some additional information in
\n simple outline form to assist you as
\nyou prepare for these new regulations.\n<\/p>\n
\n Individual Mandate \n The individual mandate originally \n Employer Mandate Delayed \n One of the biggest news items in \n Another uncertainty is exactly when \n For more information, see Tower \n <\/strong>\n<\/p>\n \n Electronic Small Business \n One of the centerpieces of health-care reform is the health-care \n There has been a series of \n Small Employer Tax Credit \n One of the benefits of health-care \n The tax credit can be up to 50% of \n You can also get more information \n Start Preparing for New \n Although the employer mandate has \n There are 2 sets of reporting \n You can read details in the \n • Buck Consultants’ \n • Alston & Bird \n Year-End Notices<\/strong>\n<\/p>\n \n With 2013 having come to a close, it \n • Children’s Health \n • HIPAA Notice of Privacy \n • Medicare Part D Notice of \n • Notice Regarding \n • Summary of Benefits and \n • Women’s Health and \n Many of the notices are distributed www.millerjohns \n Helpful Checklist <\/strong>\n<\/p>\n \n There are so many requirements \n As a practical matter, you should \n Medicare Part D Creditable \n Medicare Part D is the prescription \n Increased Medicare \n One of the ways the government is \n This is a payroll function, but you \n Health Flexible Spending \n Health FSAs have been around for \n It is up to the employer whether \n • “Implementing the \n • “Use It or Lose \n Government Revises \n Employers are required to distribute www
\nPostponed<\/strong>\n<\/p>\n
\nrequired legal residents to obtain
\nhealthcare insurance beginning in 2014
\nor face a tax penalty. The tax escalates
\nfrom
\n $95 per person in 2014 to $695 per
\nperson in 2016. But on December 19,
\n2013, President Obama changed the rules
\nfor people whose health plans were
\ncanceled;
\n the compliance obligation in 2014 is
\nnow vacated. This means that individuals
\nwho lost their insurance plans do not
\nhave to get coverage and do not have to
\n pay any penalty. They are also
\neligible to buy what is known as
\n“catastrophic insurance.”\n<\/p>\n
\nUntil 2015<\/strong>\n<\/p>\n
\nhealthcare reform is that the employer
\nmandate, or
\n“play-or-pay”
\nrules, has been delayed a year. The
\nemployer
\n mandate requires large employers
\n(i.e., those with at least 50 employees)
\nto offer full-time employees (i.e.,
\nthose working at least 30 hours per
\nweek)
\n quality, affordable coverage or pay
\na penalty.\n<\/p>\n
\nthe rules will kick in for employers
\nthat sponsor non-calendar year group
\nhealth plans. For example, assume the
\n employer sponsors a group health
\nplan on a July 1 through June 30 plan
\nyear. It is unclear whether the rules
\nfor this employer become effective
\nJanuary 1,
\n 2015 or July 1, 2015.\n<\/p>\n
\nWatson’s “Employer
\nPlay-or-Pay Mandate Penalties
\nand
\nCertain
\nEmployer Reporting Requirements Delayed
\nUntil
\n 2015.”\n<\/p>\n
\n www.towerswatson.com\/en-
\nUS\/Insights\/Newsletters\/Americas\/health-
\ncare-reform-bulletin\/2013\/Employer-Play-
\nor-Pay-Mandate-Penalties-Delayed-Until-
\n2015<\/em><\/a>\n<\/p>\n
\nHealth Options Program (SHOP)
\nApplication Delayed a Year<\/strong>\n<\/p>\n
\nexchange or
\nmarketplace. This is where
\nindividuals and small employers (i.e.,
\nthose with fewer than 50 employees) can
\ngo to buy health insurance. The
\ngovernment envisioned
\nthat the exchanges or marketplace would
\nbe
\nautomated and that individuals and small
\nbusinesses could enroll for coverage
\nelectronically. However, that has not
\nbeen the
\ncase. In fact, the government announced
\nthat the
\n electronic enrollment system for
\nsmall employers will not be operational
\nuntil November 2014. More information is
\navailable in the following article:
\n “U.S. Delays Online Health
\nInsurance Enrollment for Small
\nBusinesses” by David Morgan,
\nReuters.\n<\/p>\n
\n www.reuters.com\/a
\nrticle\/2013\/11\/27\/us-usa-healthcare-
\nshop-idUSBRE9AQ12I20131127<\/a><\/em>\n<\/p>\n
\ndifficulties and issues with the health-care exchange rollout, but it is widely
\nbelieved that these issues will be fixed
\nand the
\n program will improve over time.\n<\/p>\n
\n<\/strong>\n<\/p>\n
\nreform is a tax credit available to
\ncertain small employers that offer group
\nhealth coverage to their employees. In
\nan
\n effort to encourage certain small
\nemployers (i.e., those with fewer than
\n25 employees) to offer their employees
\nhealth coverage, the government is
\n providing a tax credit to help
\nemployers pay for the cost of the
\ncoverage.\n<\/p>\n
\nthe amount the employer pays in
\npremiums, which can provide significant
\nsavings. You can claim the credit by
\ncompleting
\n IRS Form 8941. Ask your tax
\nprofessional if you qualify for this
\ncredit.\n<\/p>\n
\nfrom the Internal Revenue
\nService’s (IRS’)
\nwebsite—see “Small Business
\nHealth Care Tax Credit for
\n Small Employers—What You Need
\nto Know about the Small Business Health
\nCare Tax Credit.”\n<\/p>\n
\n www.irs.gov\/uac\/Small-
\nBusiness-Health-Care-Tax-Credit-for-
\nSmall-Employers<\/a><\/em>\n<\/p>\n
\nReporting Requirements <\/strong>\n<\/p>\n
\nbeen postponed, employers need to
\nprepare for a host of new reporting
\nrequirements. In addition to the
\nemployer mandate, healthcare reform
\nimposes a penalty on most individuals
\nwho do not have health coverage. The
\ngovernment needs employers to provide
\ncertain information to
\n implement the penalty. Therefore,
\nemployers need to start gathering that
\ndata now.\n<\/p>\n
\nrequirements: 1 set of rules applies to
\nall employers, and the other set only
\napplies to larger employers. The rules
\nare
\n fairly complex. If you use an
\noutside payroll service, check with them
\nto see if they can help gather the
\ninformation needed to comply with the
\nrules.\n<\/p>\n
\nfollowing resources:\n<\/p>\n
\n“IRS Holds Hearings on Employer
\nReporting Requirements under Health Care
\nReform”\n<\/p>\n
\nwww.buckconsultants.com\/portals\/0\/public
\nations\/fyi\/2013\/FYI-2013-1217-IRS-holds-
\nhearings-em-report-reqs-under-
\nHCR.pdf<\/a><\/em>\n<\/p>\n
\nLLP’s “Employee Benefits
\n& Executive Compensation
\nAdvisory”\n<\/p>\n
\n www.alston.com\/Files\/Publication\/7fcf
\n5e0c-4704-454d-907b-
\naccf7954958e\/Presentation\/PublicationAtt
\nachment\/253b695e-c04e-4ad1-ad70-
\n1cc7b1ae7b43\/13-882 Health Care Reform
\nUpdate.pdf<\/a>
\n <\/em>\n<\/p>\n
\nis a good time to ensure that all the
\nrequired notices have been distributed.
\nThe following is a list of those
\n year-end notices.\n<\/p>\n\n
\nInsurance Program Reauthorization Act\n <\/p>\n
\nPractices\n <\/p>\n
\nCreditable or Non-Creditable Coverage\n <\/p>\n
\nGrandfathered Plan Status\n <\/p>\n
\nCoverage\n <\/p>\n
\nCancer Rights Act\n <\/p>\n<\/blockquote>\n
\nby the insurance company—if you
\nmaintain a fully insured plan—or
\nby the third-party administrator (TPA)
\nif you are self-funded. In either case,
\nit is prudent to make sure that the
\nnotices were distributed. For details,
\nsee Miller Johnson’s “Annual
\n Notice Requirements for Employer
\nGroup Health Plans for 2014.”<\/p>\n
\non.com\/pubs\/xprPubDetail.aspx?
\nxpST=PubDetail&pub=2077<\/a><\/em><\/p>\n
\nassociated with sponsoring employee
\nbenefit plans that it can be easy to
\nmiss or forget something. A
\ncomprehensive checklist
\n of all the requirements associated
\nwith offering both retirement and
\nwelfare benefit plans can be found on
\nSibson Consulting’s website. This
\nmaterial
\n was prepared by one of the largest
\nconsulting houses in the country and
\nprovides a good overview.\n<\/p>\n
\n www.sibson.com\/publications-
\nand-resources\/rd-calendar\/<\/a><\/em>\n<\/p>\n
\nlook to your agent, insurance company,
\nor TPA to help in your compliance
\nefforts.\n<\/p>\n
\nCoverage Notices Due<\/strong>\n<\/p>\n
\ndrug benefit under Medicare. The
\nMedicare Part D program was established
\nunder President George W. Bush to help
\nseniors
\n pay for prescription drugs under
\nMedicare. The rules impose a penalty for
\nthose who are eligible for the program
\nbut do not enroll UNLESS the person is
\n covered under a plan that already
\nprovides prescription drug benefits.
\nFrom the employer’s prospective,
\nthere are 2 notice requirements: 1
\nnotice is
\n distributed to the employees, the
\nother notice is submitted to the
\ngovernment electronically. The notice to
\ngovernment is due within 60 days after
\nthe
\n close of the plan year. This means
\nthe information had to be submitted to
\nthe government by March 1, 2014 if you
\nmaintain your group health plan on a
\n calendar-year basis. Hub
\nInternational provides some useful
\ninformation on these notices.\n<\/p>\n
\n www.connects.hubinternational.com
\n\/employee-benefits\/medicare-part-d-
\nreminder-cms-reporting-duty\/<\/a><\/em>\n<\/p>\n
\nWithholdings<\/strong>\n<\/p>\n
\npaying for healthcare reform is through
\nincreased Medicare taxes on certain high
\nearners. The increased tax started in
\n 2013, but the IRS issued some more
\nguidance recently.\n<\/p>\n
\nshould check to make sure your payroll
\ndepartment is up to speed on the rules.
\nFor more information, see McDermott Will
\n & Emory’s “Employer
\nObligations for Additional Medicare
\nTax.”\n<\/p>\n
\n www.mwe.com\/Employer-
\nObligations-for-Additional-Medicare-Tax-
\n12-09-2013<\/a><\/em>\n<\/p>\n
\nAccount (FSA) “Use it or Lose
\nit” Rule Modified<\/strong>\n<\/p>\n
\ndecades, and the “use it or lose
\nit” rule has been part of the
\nhealth FSAs from the beginning.
\nBasically, the
\n rule stipulates that if there is any
\nmoney left over in the FSA after the
\nclose of the year, the money has to be
\nforfeited. Several years ago, the IRS
\n modified the rules to give
\nparticipants a 2½-month grace
\nperiod. This allowed people to incur
\nclaims up to 2½ months after the
\nclose of the plan
\n year to use the money. Healthcare
\nreform limited the amount an employee
\ncan contribute to his or her health FSA
\non a pre-tax basis to $2,500 per year.
\nThe
\n IRS has gone a step further, and
\nparticipants can now carry over $500
\nfrom 1 year to the next.\n<\/p>\n
\nthey want to amend the plan to allow for
\nthis limited carry over. The decision is
\nnot as simple as it may seem. For
\n example, the employer cannot have
\nboth a 2½-month grace period and
\nthe carry over; they must choose 1 of
\nthe options. Note that there is no limit
\non
\n the amount that can be used during
\nthe 2½-month grace period if the
\nemployer adopts this option. On the
\nother hand, the maximum carry over is
\nlimited
\n to $500. For more information on the
\npros and cons of adopting the carry over
\nfeature, see the following articles:\n<\/p>\n
\nHealth FSA Carryover: Tips and
\nTraps”<\/em> by Christine P.
\nRoberts\n<\/p>\n
\n www.eforerisa.wordpress.com\/2013\/
\n11\/22\/implementing-the-health-fsa-
\ncarryover-tips-and-traps<\/a><\/em><\/p>\n
\nIt: New IRS Guidance Permits Carryover
\nfor Health FSAs” <\/em>by Heather
\nB. Abrigo and Dawn E. Sellstrom\n<\/p>\n
\n www.drinkerbiddle.
\ncom\/resources\/publications\/2013\/Use-It-
\nor-Lose-It-New-IRS-Guidance-Permits-
\nCarryover-for-Health-FSAs?
\nSection=Publications<\/a><\/em>\n<\/p>\n
\nChildren’s Health Insurance
\nProgram Reauthorization Act of 2009
\n(CHIPRA) Notices<\/strong>\n<\/p>\n
\na notice each year telling people about
\nthe option certain states offer to help
\npay the premiums for a child’s
\n coverage under the employer’s
\ngroup health plan. The government has
\njust updated that notice. Technically
\nspeaking, employers only have to hand
\nout
\n the notice to those people who live
\nin states that have adopted this option.
\nOhio, for example, does not currently
\nparticipate in the program, but the
\n conservative approach is for
\nemployers to include the notice in the
\nannual enrollment materials. The current
\nnotice will expire in 2016. Marsh &
\n McLennan Agency’s provides a
\nuseful summary.\n<\/p>\n
\n.rjfagencies.com\/Blog\/UpdatedCHIPNoticef
\norUseUntil2016.aspx<\/a><\/em>\n<\/p>\n