All posts in ACA

DOL Asks for MHPAEA Related Comments; Clarifies Eating Disorder Benefit Requirements | Ohio Benefit Advisors

Categories: 21st Century Cures Act, ACA, Mental Health, Team K Blog, UBA, UBA News
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Earlier this month, the Department of Labor (DOL) provided an informational FAQ relating to the Mental Health Parity and Addiction Equity Act (MHPAEA) and the 21st Century Cures Act (Cures Act). This is the DOL’s 38th FAQ on implementing the Patient Protection and Affordable Care Act (ACA) provisions and related regulations. The DOL is requesting comments on a draft model form for participants to use to request information regarding nonquantitative treatment limitations, and confirms that benefits for eating disorders must comply with the MHPAEA. Comments are due by September 13, 2017.

The MHPAEA amended various laws and regulations to provide increased parity between mental health and substance use disorder benefits and medical/surgical benefits. Generally, financial requirements such as coinsurance and copays and treatment limitations for mental health and substance use disorder benefits cannot be more restrictive than requirements for medical and surgical benefits. Regulations also provide that a plan or issuer may not impose a nonquantitative treatment limitation (NQTL) unless it is comparable and no more stringent than limitations on medical and surgical benefits in the same classification.

On December 13, 2016, President Obama signed the 21st Century Cures Act into law. The Cures Act has numerous components including directing the Secretary of Health and Human Services, Secretary of Labor, and Secretary of the Treasury (collectively, the Agencies) to issue compliance program guidance, share findings with each other, and issue guidance to group health plans and health insurance issuers to help them comply with the mental health parity rules.

The Agencies must issue guidance to group health plans and health insurance issuers; the guidance must provide information and methods that plans and issuers can use when they are required to disclose information to participants, beneficiaries, contracting providers, or authorized representatives to ensure the plans’ and issuers’ compliance with the mental health parity rules.

The Agencies must issue the compliance program guidance and guidance to group health plans and health plan issuers within 12 months after the date that the Helping Families in Mental Health Crisis Reform Act of 2016 was enacted, or by December 13, 2017.

In the June 2017 FAQ, the DOL reiterated its request for comments on the following questions, originally asked in the fall of 2016:

  1. Whether issuance of model forms that could be used by participants and their representatives to request information with respect to various NQTLs would be helpful and, if so, what content the model forms should include. For example, is there a specific list of documents, relating to specific NQTLs, that a participant or his or her representative should request?
  2. Do different types of NQTLs require different model forms? For example, should there be separate model forms for specific information about medical necessity criteria, fail-first policies, formulary design, or the plan’s method for determining usual, customary, or reasonable charges? Should there be a separate model form for plan participants and other individuals to request the plan’s analysis of its MHPAEA compliance?
  3. Whether issuance of model forms that could be used by States as part of their review would be helpful and, if so, what content the model form should include. For example, what specific content should the form include to assist the States in determining compliance with the NQTL standards? Should the form focus on specific classifications or categories of services? Should the form request information on particular NQTLs?
  4. What other steps can the Departments take to improve the scope and quality of disclosures or simplify or otherwise improve processes for requesting disclosures under existing law in connection with mental health/substance misuse disorder MH/SUD benefits?
  5. Are there specific steps that could be taken to improve State market conduct examinations and/or Federal oversight of compliance by plans and issuers?

The DOL is also asking for input on a draft model form that participants, enrollees, or representatives could use to request information from their health plan or issuer regarding NQTLs that may affect their MH/SUD benefits.

The Cures Act also requires that benefits for eating disorders be consistent with the requirements of MHPAEA. The DOL clarified that the MHPAEA applies to any benefits a plan or issuer may offer for treatment of an eating disorder.

By Danielle Capilla
Originally Posted By www.ubabenefits.com

What Employers Need to Know about the Senate Proposed Healthcare Bill | Ohio Benefit Advisors

Categories: ACA, ACA Repeal, Benefits, Blog, Health Care Reform, UBA News
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On June 22, 2017, the United States Senate released a “Discussion Draft” of the “Better Care Reconciliation Act of 2017” (BCRA), which would substitute the House’s House Resolution 1628, a reconciliation bill aimed at “repealing and replacing” the Patient Protection and Affordable Care Act (ACA). The House bill was titled the “American Health Care Act of 2017” (AHCA). Employers with group health plans should continue to monitor the progress in Washington, D.C., and should not stop adhering to any provisions of the ACA in the interim, or begin planning to comply with provisions in either the BCRA or the AHCA.

Next Steps

  • The Congressional Budget Office (CBO) is expected to score the bill by Monday, June 26, 2017.
  • The Senate will likely begin the voting process on the bill on June 28 and a final vote is anticipated sometime on June 29.
  • The Senate and House versions will have to be reconciled. This can be done with a conference committee, or by sending amendments back and forth between the chambers. With a conference committee, a conference report requires agreement by a majority of conferees from the House, and a majority of conferees by the Senate (not both together). Alternatively, the House could simply agree to the Senate version, or start over again with new legislation.

The BCRA

Like the AHCA, the BCRA makes numerous changes to current law, much of which impact the individual market, Medicare, and Medicaid with effects on employer sponsored group health plans. Also like the AHCA, the BCRA removes both the individual and the employer shared responsibility penalties. The BCRA also pushes implementation of the Cadillac tax to 2025 and permits states to waive essential health benefit (EHB) requirements.

The BCRA would change the excise tax paid by health savings account (HSA) owners who use their HSA funds on expenses that are not medical expenses under the Internal Revenue Code from the current 20 percent to 10 percent. It would also change the maximum contribution limits to HSAs to the amount of the accompanying high deductible health plan’s deductible and out-of-pocket limitation and provide for both spouses to make catch-up contributions to HSAs. The AHCA contains those provisions as well.

Like the AHCA, the BCRA would remove the $2,600 contribution limit to flexible health spending accounts (FSAs) for taxable years beginning after December 31, 2017.

The BCRA would allow individuals to remain on their parents’ plan until age 26 (the same as the ACA’s regulations, and the AHCA) and would not allow insurers to increase premium costs or deny coverage based on pre-existing conditions. Conversely, the AHCA provides for a “continuous health insurance coverage incentive,” which will allow health insurers to charge policyholders an amount equal to 30 percent of the monthly premium in the individual and small group market, if the individual failed to have creditable coverage for 63 or more days during an applicable 12-month look-back period.

The BCRA would also return permissible age band rating (for purposes of calculating health plan premiums) to the pre-ACA ratio of 5:1, rather than the ACA’s 3:1. This allows older individuals to be charged up to five times more than what younger individuals pay for the same policy, rather than up to the ACA limit of three times more. This is also proposed in the AHCA.

The ACA’s cost sharing subsidies for insurers would be eliminated in 2020, with the ability of the President to eliminate them earlier. The ACA’s current premium tax credits for individuals to use when purchasing Marketplace coverage would be based on age, income, and geography, and would lower the top threshold of income eligible to receive them from 400 percent of the federal poverty level (FPL) to 350 percent of the FPL. The ACA allowed any “alien lawfully present in the US” to utilize the premium tax credit; however, the BCRA would change that to “a qualified alien” under the definition provided in the Personal Responsibility and Work Opportunity Reconciliation Act of 1996. The BCRA would also benchmark against the applicable median cost benchmark plan, rather than the second lowest cost silver plan.


By Danielle Capilla
Originally Posted By www.ubabenefits.com

This morning, Senate Republicans released their proposal to repeal and replace the Affordable Care Act (ACA). Called the Better Care Reconciliation Act of 2017 (BCRA), the Senate proposal adopts H.R. 1628, the bill narrowly passed last month by the House of Representatives, but replaces all the text. The Senate proposal was released without going through committee review or being scored by the Congressional Budget Office (CBO). Next week, after the CBO provides cost and impact estimates, the full Senate will begin debating and amending the proposed legislation.

As was the case with the House bill, the Senate’s BCRA primarily focuses on funding for Medicaid and other state programs, maintaining stability in the individual insurance markets, and giving individual states more flexibility in opting out of insurance reforms. Also included are a number of provisions offering relief to employers and reducing the scope of requirements on group health plans. Below are highlights of provisions of the most interest to employers.

Employer Highlights:

  • Employer Mandate: The BCRA would repeal the ACA’s employer shared responsibility provision, that is the so-called “employer mandate” or “play or pay,” as of 2016. The rules for 2015 would not change, which would still be an issue for certain large employers that did not qualify for transition relief that year.
  • Employer Reporting: The existing rules requiring completion of Forms 1094 and 1095 would continue to apply, although the IRS may have the ability to soften them in the future.
  • Taxes and Fees: The Cadillac tax on high-cost health plans would be delayed six years, then take effect in 2026. The PCORI fee would continue as previously scheduled for plan years through September 2019. The additional Medicare tax on high earners would be repealed starting in 2023.
  • Health Plan Requirements: Current ACA rules regarding eligibility for children to age 26, limits on waiting periods, prohibitions against annual or lifetime dollar limits, and most other provisions would continue unchanged. Coverage for pre-existing conditions generally would be protected, at least for persons that maintained continuous coverage.
  • Essential Health Benefits (EHBs): The ACA currently requires broad coverage of all EHBs in the small group insurance market (unless grandfathered or grandmothered). The BCRA would give the individual states broad flexibility to determine EHBs and to change or reduce any coverage standards.
  • Health Savings Accounts (HSAs): The annual HSA contribution limits would be increased significantly for years after 2017.
  • Health Flexible Spending Accounts (HFSAs): The annual contribution limit, currently $2,600 per 12-month period, would be repealed for years after 2017.
  • Over-the-counter (OTC) medications: The ACA prohibits HSAs, HFSAs, and other reimbursement accounts from covering OTC medications (unless prescribed or insulin). The BCRA would repeal this provision for years after 2017.

Summary

The Senate proposal is similar to the House bill in most areas that directly affect employers, such as relief from the employer mandate, repeal of various health plan fees and taxes, and fewer restrictions on group insurance and benefit plan designs. Those sections, however, are part of a large piece of legislation that may face obstacles in the Senate due to the proposal’s significant impact on Medicaid funding and the individual insurance markets. Without support from at least 50 of the 52 Senate Republicans, the legislation will fail. At this time, at least four of those Senators are withholding their support.

Originally Posted By www.thinkhr.com

Workplace wellness programs have increased popularity through the years. According to the most recent UBA Health Plan Survey, 49 percent of firms with 200+ employees offering health benefits in 2016 offered wellness programs. Workplace wellness programs’ popularity also brought controversy and hefty discussions about what works to improve population health and which programs comply with the complex legal standards of multiple institutions that have not really “talked” to each other in the past. To “add wood to the fire,” the Equal Employment Opportunity Commission (EEOC) made public some legal actions that shook the core of the wellness industry, such as EEOC vs. Honeywell International, and EEOC vs. Orion Energy Systems.

To ensure a wellness program is compliant with the ACA, GINA and the EEOC, let’s first understand what each one of these institutions are.

The Affordable Care Act (ACA) is a comprehensive healthcare reform law enacted in March 2010 during the Obama presidency. It has three primary goals: to make health insurance available to more people, to expand the Medicaid program, and to support innovative medical care delivery methods to lower the cost of healthcare overall.1 The ACA carries provisions that support the development of wellness programs and determines all rules around them.

The Genetic Information Nondiscrimination Act of 2008 (GINA) is a federal law that protects individuals from genetic discrimination in health insurance and employment. GINA relates to wellness programs in different ways, but it particularly relates to the gathering of genetic information via a health risk assessment.

The U.S. Equal Employment Opportunity Commission (EEOC) is a federal agency that administers and enforces civil rights laws against workplace discrimination. In 2017, the EEOC issued a final rule to amend the regulations implementing Title II of GINA as they relate to employer-sponsored wellness program. This rule addresses the extent to which an employer may offer incentives to employees and spouses.

Here is some advice to ensure your wellness program is compliant with multiple guidelines.

  1. Make sure your wellness program is “reasonably designed” and voluntary – This means that your program’s main goal should be to promote health and prevent disease for all equally. Additionally, it should not be burdensome for individuals to participate or receive the incentive. This means you must offer reasonable alternatives for qualifying for the incentive, especially for individuals whose medical conditions make it unreasonably difficult to meet specific health-related standards. I always recommend wellness programs be as simple as possible, and before making a change or decision in the wellness program, identify all difficult or unfair situations that might arise from this change, and then run them by your company’s legal counsel and modify the program accordingly before implementing it. An example of a wellness program that is NOT reasonably designed is a program offering a health risk assessment and biometric screening without providing results or follow-up information and advice. A wellness program is also NOT reasonably designed if exists merely to shift costs from an employer to employees based on their health.
  2. Do the math! – Recent rules implemented changes in the ACA that increased the maximum permissible wellness program reward from 20 percent to 30 percent of the cost of self-only health coverage (50 percent if the program includes tobacco cessation). Although the final rules are not clear on incentives for spouses, it is expected that, for wellness programs that apply to employees and their spouses, the maximum incentive for either the employee or spouse will be 30 percent of the total cost of self-only coverage. In case an employer offers more than one group health plan but participation in a wellness program is open to all employees regardless of whether they are enrolled in a plan, the employer may offer a maximum incentive of 30 percent of the lowest cost major medical self-only plan it offers. As an example, if a single plan costs $4,000, the maximum incentive would be $1,200.
  3. Provide a notice to all eligible to participate in your wellness program – The EEOC made it easy for everyone and posted a sample notice online at https://www.eeoc.gov/laws/regulations/ada-wellness-notice.cfm. Your notice should include information on the incentive amount you are offering for different programs, how you maintain privacy and security of all protected health information (PHI) as well as who to contact if participants have question or concerns.
  4. If using a HRA (health risk assessment), do not include family medical history questions – The EEOC final rule, which expands on GINA’s rules, makes it clear that “an employer is permitted to request information about the current or past health status of an employee’s spouse who is completing a HRA on a voluntary basis, as long as the employer follows GINA rules about requesting genetic information when offering health or genetic services. These rules include requirements that the spouse provide prior, knowing, written, and voluntary authorization for the employer to collect genetic information, just as the employee must do, and that inducements in exchange for this information are limited.”2 Due to the complexity and “gray areas” this item can reach, my recommendation is to keep it simple and to leave genetic services and genetic counseling out of a comprehensive wellness program.

WellSteps, a nationwide wellness provider, has a useful tool that everyone can use. Their “wellness compliance checker” should not substituted for qualified legal advice, but can be useful for a high level check on how compliant your wellness program is. You can access it at https://www.wellsteps.com/resources/tools.

I often stress the need for all wellness programs to build a strong foundation, which starts with the company’s and leaders’ messages. Your company should launch a wellness program because you value and care about your employees’ (and their families’) health and well-being. Everything you do and say should reflect this philosophy. While I always recommend companies to carefully review all regulations around wellness, I do believe that if your wellness program has a strong foundation based on your corporate social responsibility and your passion for building a healthy workplace, you most likely will be within the walls of all these rules. At the end, a workplace that does wellness the right way has employees who are not motivated by financial incentives, but by their intrinsic motivation to be the best they can be as well as their acceptance that we all must be responsible for our own health, and that all corporations should be responsible for providing the best environment and opportunities for employees to do so.

By Valeria S. Tivnan
Originally Posted By www.ubabenefits.com

 

On April 18, 2017, the Department of Health and Human Services’ (HHS) Centers for Medicare & Medicaid Services (CMS) published its final rule regarding Patient Protection and Affordable Care Act (ACA) market stabilization.

The rule amends standards relating to special enrollment periods, guaranteed availability, and the timing of the annual open enrollment period in the individual market for the 2018 plan year, standards related to network adequacy and essential community providers for qualified health plans, and the rules around actuarial value requirements.

The proposed changes primarily affect the individual market. However, to the extent that employers have fully-insured plans, some of the proposed changes will affect those employers’ plans because the changes affect standards that apply to issuers.

The regulations are effective on June 17, 2017.

Among other things impacting group plans, the rule provided clarifications to the scope of the guaranteed availability policy regarding unpaid premiums. The guaranteed availability provisions require health insurance issuers offering non-grandfathered coverage in the individual or group market to offer coverage to and accept every individual and employer that applies for such coverage unless an exception applies. Individuals and employers must usually pay the first month’s premium to activate coverage.

CMS previously interpreted the guaranteed availability provisions so that a consumer would be allowed to purchase coverage under a different product without having to pay past due premiums. Further, if an individual tried to renew coverage in the same product with the same issuer, then the issuer could apply the enrollee’s upcoming premium payments to prior non-payments.

Under the final rule and as permitted by state law, an issuer may apply the initial premium payment to any past-due premium amounts owed to that issuer. If the issuer is part of a controlled group, the issuer may apply the initial premium payment to any past-due premium amounts owed to any other issuer that is a member of that controlled group, for coverage in the 12-month period preceding the effective date of the new coverage.

Practically speaking, when an individual or employer makes payment in the amount required to trigger coverage and the issuer lawfully credits all or part of that amount to past-due premiums, the issuer will determine that the consumer made insufficient initial payment for new coverage.

This policy applies both inside and outside of the Exchanges in the individual, small group, and large group markets, and during applicable open enrollment or special enrollment periods.

This policy does not permit a different issuer (other than one in the same controlled group as the issuer to which past-due premiums are owed) to condition new coverage on payment of past-due premiums or permit any issuer to condition new coverage on payment of past-due premiums by any individual other than the person contractually responsible for the payment of premiums.

Issuers adopting this premium payment policy, as well as any issuers that do not adopt the policy but are within an adopting issuer’s controlled group, must clearly describe the consequences of non-payment on future enrollment in all paper and electronic forms of their enrollment application materials and any notice that is provided regarding premium non-payment.

By Daniella Capilla
Originally Posted By www.ubabenefits.com

One might describe the series of events leading to the death of the American Health Care Act (Congress’s bill to repeal and replace the Affordable Care Act) as something like a ballistic missile exploding at launch. The Patient Protection and Affordable Care Act (ACA) repeal debate began nearly a decade ago with former President Barack Obama’s first day in office and reemerged as a serious topic during the 2016 presidential election. Even following the retraction of the House bill, repeal of the ACA remains a possibility as the politicians consider alternatives to the recent bill. The possibility of pending legislation has caused some clients to question the need to complete their obligation for ACA reporting on a timely basis this year. The legislative process has produced a great deal of uncertainty which is one thing employers do not like, especially during the busy year end.

While the “repeal and replace” activity is continuing, it is imperative that employers and their brokers put their noses to the grindstone to fulfill all required reporting requirements. To accomplish this, employers will need brokers that can effectively guide them through this tumultuous season. We recommend that employers ask their brokers about their strategies for

  • Implementing the employer shared responsibility reporting
  • Sending all necessary forms to the employer’s employees
  • Submitting the employer’s reporting to the IRS
  • Closing out the employer’s 2016 filing season

Employers should also inquire about any additional support that the broker provides. They should provide many of the services that we at Health Cost Manager provide to our clients: They should apprise their clients of the latest legislative updates through regular email communication and informational webinars. Brokers should also bring in experts in the field that have interacted with key stakeholders in Washington. And most important, they should remain available during this uncertain period to answer any questions or concerns from clients.

We know employers would prefer not to have to comply with these reporting obligations – many have directly told us so. We understand this requires additional work on their part to gather information for the reporting and increased compliance responsibility. Knowing how stressful the reporting season can be for employers, brokers should go out of their way to help their clients feel confident that they can steer through the reporting process smoothly. The broker’s role should be to take as much of the burden off the employer’s shoulders as possible to enable them to reach compliance in the most expedient manner possible. Sometimes this involves stepping in to solve data or other technical issues, or answering a compliance-related question that helps the client make important decisions. It’s all part of helping employers navigate through the ACA’s strong headwinds during these uncertain times.

Audit-proof your company with UBA’s latest white paper: Don’t Roll the Dice on Department of Labor Audits. This free resource offers valuable information about how to prepare for an audit, the best way to acclimate staff to the audit process, and the most important elements of complying with requests.

The IRS updated its longstanding Q&A guidance on codes that employers should use when completing Forms 1094-C and 1095-C. For information on the IRS’ updated guidance, including COBRA reporting information that had been left pending in earlier versions of the IRS guidance for the past year, view UBA’s ACA Advisor, “IRS Q&A About Employer Information Reporting on Form 1094-C and Form 1095-C”.

By Michael Weiskirch
www.ubabenefits.com

On Friday, Republicans in the U.S. House of Representatives pulled pending legislation, known as the American Health Care Act, from further consideration. The bill had been scheduled for a vote on the House floor Friday afternoon but, recognizing that it was headed for defeat, the House leadership cancelled the vote.

It is now unlikely that Congress will pursue any legislation to repeal or replace the Affordable Care Act (ACA) this year. That does not mean, however, that we will not see changes in how the ACA is enforced. President Trump has directed the Departments of Labor (DOL), Treasury (including the IRS), and Health and Human Services (HHS) to review all existing regulations and to initiate steps to revise or eliminate burdensome rules. Congress also may use authority under the Congressional Review Act (CRA) to overturn, with a simple majority, certain regulations if they had been finalized only recently.

As the focus moves from the legislative to the regulatory arena, ThinkHR will continue to monitor and report on ACA developments that impact employers and their group health plans.

By Laura Kerekes
Originally published by www.thinkhr.com

Under the Patient Protection and Affordable Care Act (ACA), individuals are required to have health insurance while applicable large employers (ALEs) are required to offer health benefits to their full-time employees.

In order for the Internal Revenue Service (IRS) to verify that (1) individuals have the required minimum essential coverage, (2) individuals who request premium tax credits are entitled to them, and (3) ALEs are meeting their shared responsibility (play or pay) obligations, employers with 50 or more full-time or full-time equivalent employees and insurers will be required to report on the health coverage they offer. Similarly, insurers and employers with less than 50 full time employees but that have a self-funded plan also have reporting obligations. All of this reporting is done on IRS Forms 1094-B, 1095-B, 1094-C and 1095-C.

Final instructions for both the 1094-B and 1095-B and the 1094-C and 1095-C were released in September 2015, as were the final forms for 1094-B, 1095-B, 1094-C, and 1095-C.

Form 1094-C is used in combination with Form 1095-C to determine employer shared responsibility penalties. It is often referred to as the “transmittal form” or “cover sheet.” IRS Form 1095-C will primarily be used to meet the Section 6056 reporting requirement, which relates to the employer shared responsibility/play or pay requirement. Information from Form 1095-C will also be used in determining whether an individual is eligible for a premium tax credit.

Form 1094-C contains information about the ALE, and is how an employer identifies as being part of a controlled group. It also has a section labeled “Certifications of Eligibility” and instructs employers to “select all that apply” with four boxes that can be checked. The section is often referred to as the “Line 22” question or boxes. Many employers find this section confusing and are unsure what, if any, boxes they should select. The boxes are labeled:

  1. Qualifying Offer Method
  2. Reserved
  3. Section 4980H Transition Relief
  4. 98% Offer Method

Different real world situations will lead an employer to select any combination of boxes on Line 22, including leaving all four boxes blank. Practically speaking, only employers who met the requirements of using code 1A on the 1095-C, offered coverage to virtually all employees, or qualified for transition relief in 2015 and had a non-calendar year plan will check any of the boxes on Line 22. Notably, employers who do not use the federal poverty level safe harbor for affordability will never select Box A, and corresponding with that, will never use codes 1A or 1I on Line 14 of a 1095-C form.

To fully understand each box, including plain language explanations of the form instructions, request UBA’s ACA Advisor, “IRS Reporting Tip: Form 1094-C, Line 22”.

By Danielle Capilla
Originally published by www.ubabenefits.com

Our Firm is making a big push to provide compliance assessments for our clients and using them as a marketing tool with prospects. Since the U.S. Department of Labor (DOL) began its Health Benefits Security Project in October 2012, there has been increased scrutiny. While none of our clients have been audited yet, we expect it is only a matter of time and we want to make sure they are prepared.

We knew most fully-insured groups did not have a Summary Plan Description (SPD) for their health and welfare plans, but we have been surprised by some of the other things that were missing. Here are the top five compliance surprises we found.

  1. COBRA Initial Notice. The initial notice is a core piece of compliance with the Consolidated Omnibus Budget and Reconciliation Act (COBRA) and we have been very surprised by how many clients are not distributing this notice. Our clients using a third-party administrator (TPA), or self-administering COBRA, are doing a good job of sending out the required letters after qualifying events. However, we have found that many clients are not distributing the required COBRA initial notice to new enrollees. The DOL has recently updated the COBRA model notices with expiration dates of December 31, 2019. We are trying to get our clients to update their notices and, if they haven’t consistently distributed the initial notice to all participants, to send it out to everyone now and document how it was sent and to whom.
  2. Prescription Drug Plan Reporting to CMS. To comply with the Medicare Prescription Drug Improvement and Modernization Act, passed in 2003, employer groups offering prescription benefits to Medicare-eligible individuals need to take two actions each year. The first is an annual report on the Centers for Medicare & Medicaid Services (CMS) website regarding whether the prescription drug plan offered by the group is creditable or non-creditable. The second is distributing a notice annually to Medicare-eligible plan members prior to the October 15 beginning of Medicare open enrollment, disclosing whether the prescription coverage is creditable or non-creditable. We have found that the vast majority (but not 100 percent) of our clients are complying with the second requirement by annually distributing notices to employees. Many clients are not complying with the first requirement and do not go to the CMS website annually to update their information. The annual notice on the CMS website must be made within:
  • 60 days after the beginning of the plan year,
  • 30 days after the termination of the prescription drug plan, or
  • 30 days after any change in the creditability status of the prescription drug plan.
  1. ACA Notice of Exchange Rights. The Patient Protection and Affordable Care Act (ACA) required that, starting in September 2013, all employers subject to the Fair Labor Standards Act (FLSA) distribute written notices to all employees regarding the state exchanges, eligibility for coverage through the employer, and whether the coverage was qualifying coverage. This notice was to be given to all employees at that time and to all new hires within 14 days of their date of hire. We have found many groups have not included this notice in the information they routinely give to new hires. The DOL has acknowledged that there are no penalties for not distributing the notice, but since it is so easy to comply, why take the chance in case of an audit?
  2. USERRA Notices. The Uniformed Services Employment and Reemployment Rights Act (USERRA) protects the job rights of individuals who voluntarily or involuntarily leave employment for military service or service in the National Disaster Medical System. USERRA also prohibits employers from discriminating against past and present members of the uniformed services. Employers are required to provide a notice of the rights, benefits and obligations under USERRA. Many employers meet the obligation by posting the DOL’s “Your Rights Under USERRA” poster, or including text in their employee handbook. However, even though USERRA has been around since 1994, we are finding many employers are not providing this information.
  3. Section 79. Internal Revenue Code Section 79 provides regulations for the taxation of employer-provided life insurance. This code has been around since 1964, and while there have been some changes, the basics have been in place for many years. Despite the length of time it has been in place, we have found a number of groups that are not calculating the imputed income. In essence, if an employer provides more than $50,000 in life insurance, then the employee should be paying tax on the excess coverage based on the IRS’s age rated table 2-2. With many employers outsourcing their payroll or using software programs for payroll, calculating the imputed income usually only takes a couple of mouse clicks. However, we have been surprised by how many employers are not complying with this part of the Internal Revenue Code, and are therefore putting their employees’ beneficiaries at risk.

There have been other surprises through this process, but these are a few of the more striking examples. The feedback we received from our compliance assessments has been overwhelmingly positive. Groups don’t always like to change their processes, but they do appreciate knowing what needs to be done.

Audit-proof your company with UBA’s latest white paper: Don’t Roll the Dice on Department of Labor Audits. This free resource offers valuable information about how to prepare for an audit, the best way to acclimate staff to the audit process, and the most important elements of complying with requests.

By Bob Bentley, Manager
Originally published by www.ubabenefits.com

Last fall, President Barack Obama signed the Protecting Affordable Coverage for Employees Act (PACE), which preserved the historical definition of small employer to mean an employer that employs 1 to 50 employees. Prior to this newly signed legislation, the Patient Protection and Affordable Care Act (ACA) was set to expand the definition of a small employer to include companies with 51 to 100 employees (mid-size segment) beginning January 1, 2016.

If not for PACE, the mid-size segment would have become subject to the ACA provisions that impact small employers. Included in these provisions is a mandate that requires coverage for essential health benefits (not to be confused with minimum essential coverage, which the ACA requires of applicable large employers) and a requirement that small group plans provide coverage levels that equate to specific actuarial values. The original intent of expanding the definition of small group plans was to lower premium costs and to increase mandated benefits to a larger portion of the population.

The lower cost theory was based on the premise that broadening the risk pool of covered individuals within the small group market would spread the costs over a larger population, thereby reducing premiums to all. However, after further scrutiny and comments, there was concern that the expanded definition would actually increase premium costs to the mid-size segment because they would now be subject to community rating insurance standards. This shift to small group plans might also encourage mid-size groups to leave the fully-insured market by self-insuring – a move that could actually negate the intended benefits of the expanded definition.

Another issue with the ACA’s expanded definition of small group plans was that it would have resulted in a double standard for the mid-size segment. Not only would they be subject to the small group coverage requirements, but they would also be subject to the large employer mandate because they would meet the ACA’s definition of an applicable large employer.

Note: Although this bill preserves the traditional definition of a small employer, it does allow states to expand the definition to include organizations with 51 to 100 employees, if so desired.

By Vicki Randall
Originally published by www.ubabenefits.com