Categorized as: Blog

Health Care Reform Update: Final “SHOP” Regulations Issued

On June 4, 2013, the Department of Health and Human Services (“HHS”), Centers for Medicare & Medicaid Services (“CMS”), issued final regulations implementing the provisions of the Affordable Care Act (“ACA”) related to the establishment and operation of the Small Business Health Options Program (“SHOP”).  The final regulations delay by one year the implementation of the “employee choice” model under SHOPs and provide for special enrollment periods depending on the nature of the event triggering eligibility for SHOP coverage. Background. Under ACA Section 1311, state health insurance exchanges must create and operate SHOPs to assist “qualified small employers” in offering…

Patient-Centered Outcome Research Institute Fee

By July 31, 2013, most issuers of health insurance policies and plan sponsors of self-insured health plans must pay a fee of $1 per covered life as a result of new provisions in the Patient Protection and Affordable Care Act.  The fee will partially fund the Patient-Centered Outcome Research Institute (“PCORI”), which is a private, nonprofit corporation that is designed to support comparative clinical effectiveness research findings.  The PCORI fee must be paid by issuers and plan sponsors.  This means that the party responsible for paying the fee will typically be the insurance issuer or the employer or employee organization…

Preparing for PPACA – A Readiness Checklist

All employers should be taking steps now to be sure they are prepared for the PPACA requirements that take effect later this year and in 2014.  While some requirements vary based on employer size, other requirements apply to all employers.  The most significant requirements and options for an employer include: 1)    All plans that ended between Oct. 1, 2012 and Dec. 31, 2012 must pay the PCORI fee by July 31, 2013      a)    Self-funded plans (including HRAs) will report and pay this fee on IRS Form 720.  Employers need to complete the introduction, Part II and the signature portion…

Agencies Issue Final Rules on Wellness Programs

On May 29, 2013 the Department of Health and Human Services, the Internal Revenue Service and the Department of Labor jointly issued a final rule that addresses how wellness programs must operate under PPACA beginning in 2014. In many respects the final rules carry forward the rules that have been in effect for wellness programs since 2006, and most of the updates that were proposed last November have been adopted.  The wellness program rules provide an exception to the general rule that employers may not take a person’s health status into account with respect to eligibility, benefits or premiums under…

Health Care Exchanges: Just Five Months Away

Companies Get Aggressive on Wellness: Given that the potential benefits of wellness programs include reigning in runaway health care costs, decreasing turnover and improving productivity, it’s no surprise that companies are eager to increase employee participation. The most popular way of raising participation rates is through incentives. This is primarily done through rewards and prizes, but increasingly companies are using penalties as a way of spurring employees to take part in wellness programs. Penalties, however, don’t come without risk, including negative reactions from employees. To minimize potential dissatisfaction, companies must communicate clearly and regularly about their wellness programs and goals, ensuring…

Exchange Availability Notices

Employers Must Provide Notices Regarding Availability of Exchange Coverage A provision of the 2010 health care reform law requires employers to provide notices, by March 1, 2013, to all employees regarding the availability of health coverage options through the state-based exchanges created pursuant to that law. In January, the Department of Labor had announced delayed enforcement of the exchange coverage notice provision (which added Section 18B to the Fair Labor Standards Act) in light of the reality that, by March 1st, it was unlikely that enough information regarding the exchanges would be available, employers had no way of ascertaining some…

IRS Issues 2014 HSA Limits

                       IRS ISSUES 2014 HSA LIMITS The IRS has issued the 2014 limits for health savings accounts.  PPACA requires that this out-of-pocket limit be the maximum out-of-pocket for all health plans in 2014.  The minimum deductible only applies to high deductible health plans integrated with an HSA. The limits are: Limit 2014 2013 Maximum Out-of-Pocket $6,350 single/$12,700 family $6,250 single/$12,500 family Minimum Deductible $1,250 single/$2,500 family (unchanged) $1,250 single/$2,500 family Maximum Contribution $3,300 single/$6,550 family $3,250 single/$6,450 family Maximum catch-up contribution  – for individuals age 55 or older $1,000 (unchanged) $1,000   The out-of-pocket includes the deductible, coinsurance and co-pays,…

Wellness Incentives, Updated SBCs, and Annual Limits Waivers

The Departments of Labor, Health and Human Services and the Treasury have issued several updates that affect employer-sponsored group health plans. Wellness Incentives, HRAs, Minimum Value and Affordability The IRS has released proposed regulations that address how wellness incentives or penalties are applied to premium affordability (for purposes of the employer shared responsibility/play or pay requirements) and to minimum value. The proposed regulations provide that when deciding if the employee’s share of the premium is affordable (less than 9.5% of the employee’s safe harbor income), the employer may not consider wellness incentives or surcharges except for a non-smoking incentive.  In…

Who are my Employees? The Answer may surprise you!

Below are the topics discussed in our first quarterly newsletter in 2013. Please read the topics you feel are most important to your company. You find the link to the full newsletter below. PPACA 90 Day Waiting Period Requirements: New Proposed Regulations: The Patient Protection and Affordable Care Act (“PPACA”) prohibits group health plans from requiring a waiting period of longer than 90 days following the date that the plan’s eligibility requirements are met. Who are my Employees? Under the Affordable Care Act, the Answer May Surprise You: For a business, the first step to compliance under the Affordable Care Act…

Experts See Future Filled with High Deductibles

As federal agencies continue to release more guidance on the Patient Protection and Affordable Care Act (PPACA), everyone from employees to companies to benefit advisors are taking notice. A new poll by Prudential finds that almost half (46%) of employees expect PPACA to drive up overall health insurance costs. In addition, 31% of workers said they think it is likely that fewer companies will offer health insurance benefits in the future because of the law. To alleviate these worries, employers are turning to skilled benefit advisors to help them grapple with these new challenges created by PPACA. In turn, advisors are working…