April 19, 2018 - Health Care Reform Update

Policies Renewed Under Extended Transitional Policy Must End by December 31, 2019

A previously extended transitional policy which allows health insurance issuers, at their option, to continue group coverage that would otherwise be terminated or cancelled has been further extended to policy years beginning on or before October 1, 2019, provided that all policies end by December 31, 2019. Health insurance issuers that renew coverage under the extended policy are required to provide standard notices to affected small businesses for each policy year.

Policies subject to the transitional relief will not be considered to be out of compliance with key Affordable Care Act provisions, including:

• The requirement to cover a core package of items and services known as essential health benefits;
• The requirement that any variations in premiums be limited with regard to a particular plan or coverage to age, tobacco use, family size, and geography;
• The requirements regarding guaranteed availability and renewability of coverage; and
• The requirements relating to coverage for individuals participating in approved clinical trials.

Click here to review the extended transitional policy.

© 2018 HR 360, Inc.

April 10, 2018 - Health Care Reform Update

HHS Issues Key Rule for 2019

A new rule from the U.S. Department of Health and Human Services (HHS) addresses, among other things, the requirement under the Affordable Care Act that non-grandfathered group health plans limit annual out-of-pocket cost-sharing for coverage of essential health benefits under the plan. Under the rule, these out-of-pocket expenses may not exceed $7,900 for self-only coverage or $15,800 for family coverage in 2019.

© 2018 HR 360, Inc.

April 10, 2018 - Health Care Reform Update

Rule Effective for Plan Year 2018

The U.S. Department of Health and Human Services (HHS) has issued a new rule that allows employers to directly enroll in SHOP (Small Business Health Options Program) coverage through a SHOP-registered agent or broker. This enrollment approach is now generally available in federally-facilitated SHOPs (FF-SHOPs), including state-based Exchanges using the federal platform for SHOP, for plan years beginning on or after January 1, 2018. State-based Exchanges operating their own SHOPs can also adopt this new approach.

For more information, please contact the SHOP that applies in your state.

© 2018 HR 360, Inc.

April 06, 2018 - Health Care Reform Update

Affordability, Tax Filing Threshold, and Other Exemptions Available

Under the Affordable Care Act's (ACA) ''individual mandate'' (also called individual shared responsibility) provision, every individual must have minimum essential health coverage for each month, qualify for an exemption, or make a payment when filing his or her federal income tax return for tax year 2017.

Among other exemptions, individuals may claim the following exemptions from the individual mandate by filing Form 8965, Health Coverage Exemptions, along with his or her 2017 tax return:

• Affordability Exemption: The lowest-priced coverage available to the individual, through either a Health Insurance Marketplace or employer-based group health plan, would have cost the individual more than 8.16% of his or her household income for plan years beginning in 2017, as computed on the tax return.
• Tax Filing Threshold Exemption: The individual’s gross income or household income was less than the applicable minimum threshold for filing a tax return (see ''2017 Federal Tax Filing Requirement Thresholds'').
• Short Coverage Gap Exemption: The individual went without coverage for less than three consecutive months during the year.
• Medicaid Expansion Exemption: The individual's household income is below 138% of the federal poverty line for his or her family size, and at any time during the year, the individual resided in a state that did not participate in the Medicaid expansion under the ACA. States that did not expand Medicaid for all of 2017 include: Alabama, Florida, Georgia, Idaho, Kansas, Maine, Mississippi, Missouri, Nebraska, North Carolina, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, Wisconsin, and Wyoming.

Click here to learn more about individual mandate exemptions.

© 2018 HR 360, Inc.

March 27, 2018 - Health Care Reform Update

IRS Electronic Filing Deadline is April 2

With the April 2 deadline to electronically file Forms 1094 & 1095 with the Internal Revenue Service (IRS) approaching, employers are reminded that failing to comply with these information reporting requirements may result in significant penalties. These penalties are as follows:

• Employers that fail to file correct information returns with the IRS and furnish correct payee statements are generally subject to a $260 penalty for each return for which such failure occurs, with a maximum annual penalty of over $3 million.
• Employers that file correct returns and furnish correct statements on or before 30 days after the required filing date are generally subject to a $50 penalty for each return for which such failure occurs, with a maximum annual penalty of over $500,000.
• Employers that file correct returns and furnish correct statements beyond 30 days after the required filing date but on or before August 1, 2018 are generally subject to a $100 penalty for each return for which such failure occurs, with a maximum annual penalty of over $1 million.

© 2018 HR 360, Inc.

March 22, 2018 - Health Care Reform Update

Deadline to File Paper Returns With IRS was February 28

Employers subject to the Affordable Care Act’s (ACA) information reporting requirements are reminded that the deadline to electronically file ACA information returns with the IRS is April 2.  

The reporting deadlines in 2018 are for the 2017 calendar year, and are as follows: 

• Applicable large employers (ALEs)—generally those with 50 or more full-time employees, including full-time equivalents—must electronically file Forms 1094-C and 1095-C with the IRS no later than April 2. The deadline to file paper returns was February 28.
• Self-insuring employers that are not considered ALEs, and other parties that provide minimum essential health coverage, must electronically file Forms 1094-B and 1095-B with the IRS no later than April 2. The deadline to file paper returns was February 28.

Note: Employers filing 250 or more Forms 1095-B or 1095-C are required to electronically file them with the IRS.

Additional information on electronic filing can be found on the IRS's ACA Information Returns (AIR) Program webpage. 

© 2018 HR 360, Inc.

March 16, 2018 - Health Care Reform Update

Company Size Impacts Application of "Pay or Play"

Employers are reminded that it is important to know how many full-time employees they have in order to ensure compliance with the employer shared responsibility provisions ("pay or play") of the Affordable Care Act, which apply only to applicable large employers (ALEs).

Determining ALE Status
Whether an employer is considered an ALE for a particular calendar year depends on the size of its workforce during the preceding calendar year. For example, employers will use information about the size of their workforce during 2017 to determine if their company is an ALE for 2018. Employers with an average of at least 50 full-time employees in the preceding calendar year—including full-time equivalent employees (FTEs)—are generally deemed ALEs for the current calendar year.

Identifying Full-Time Employees
In general, for purposes of pay or play: 

• A full-time employee is, for a calendar month, an employee who is employed on average at least 30 hours of service per week (130 hours of service in a calendar month is treated as the monthly equivalent of at least 30 hours of service per week).
• A full-time equivalent employee is a combination of employees, each of whom individually is not a full-time employee, but who, in combination, are equivalent to a full-time employee.

For additional rules on determining who is a full-time employee, including what counts as an hour of service, click here.

© 2018 HR 360, Inc.

March 09, 2018 - Health Care Reform Update

Changes May Impact Amount of Premium Tax Credit

Individuals with coverage through the Health Insurance Marketplace who are receiving advance payments of the premium tax credit—which are paid directly to insurance companies to lower monthly premiums—that certain changes in their income or family size may affect the credit. As a result, if circumstances have changed for such individuals, it would be prudent to perform a "mid-year checkup" via the IRS's Premium Tax Credit Change Estimator to determine if they need to adjust the premium tax credit they are currently receiving. Performing a checkup now will help individuals avoid large differences between the advance credit payments made on their behalf and the amount of the credit they are allowed when they file their tax returns next year.

Reporting Changes in Circumstances
The estimator tool does not report changes in circumstances to the Marketplace. To report changes and adjust the amount of advance payments of the credit, individuals must contact their Marketplace. Changes that should be reported to the Marketplace include:

• An increase or decrease in an individual's income;
• Marriage or divorce;
• The birth or adoption of a child;
• Starting a job that provides health insurance;
• Gaining or losing eligibility for other health care coverage; or
• Changing residences.

© 2018 HR 360, Inc.

March 02, 2018 - Health Care Reform Update

Overview of Eligibility Requirements for Small Employers

New and existing small employers should look into whether the Small Business Health Care Tax Credit can help them provide insurance to their employees. The credit can be worth up to 50% of the amount a small business contributes toward employees' premiums.

The credit benefits employers that:

• Have fewer than 25 full-time equivalent employees;
• Pay at least half of their employees' premiums for single health care coverage;
• Pay average wages of less than $53,000 a year per full-time equivalent (for tax year 2017, and adjusted for inflation in future years); and
• Offer a qualified health plan through a Small Business Health Options Program (SHOP) Marketplace (or qualify for a limited exception to this requirement).

A Small Business Health Care Tax Credit Estimator is available from Healthcare.gov, and an IRS Small Business Health Care Tax Credit information page provides additional details on claiming the credit.

© 2018 HR 360, Inc.

February 21, 2018 - Health Care Reform Update

Current Requirements Continue to Apply Until Proposal is Finalized

Federal agencies recently proposed to amend the definition of short-term, limited-duration insurance so that it may offer a maximum coverage period of less than 12 months after the original effective date of the contract, rather than the current maximum period of less than 3 months. The proposal would also revise the required issuer notice that must be displayed in the contract and any application materials.

Proposal Applicability Date
While the current definition applies to policy years beginning on or after January 1, 2017, a non-enforcement policy applies to policies sold before April 1, 2017, and that end on or before December 31, 2017. The current definition and non-enforcement policy would continue to apply unless and until the proposal is finalized. If finalized, the proposal would apply to insurance policies sold on or after the 60th day following publication of the final rule. Policies sold on or after this date would have to meet the definition of short-term, limited-duration insurance in the final rule in order to be considered such insurance.

Background
Under the Affordable Care Act, short-term, limited-duration insurance is exempt from certain market reforms. The allowable duration of such insurance is currently limited to less than 3 months after the original effective date of the contract. In addition, this insurance is not considered minimum essential coverage, which is necessary for an individual to satisfy the individual mandate unless an exemption applies.

Click here to read the proposal in its entirety. A fact sheet is also available.

© 2018 HR 360, Inc.

February 15, 2018 - Health Care Reform Update

Certain Employers Required to Electronically File Returns

Employers subject to the Affordable Care Act's (ACA) information reporting requirements are reminded that the deadlines to file and furnish Forms 1094 and 1095 are quickly approaching. The reporting deadlines in 2018 are for reporting information on the 2017 calendar year, and are as follows:

• Applicable large employers (ALEs)—generally those with 50 or more full-time employees, including full-time equivalents—must file Forms 1094-C and 1095-C with the IRS no later than February 28, 2018 (or April 2, 2018 if filing electronically). ALEs must also furnish a Form 1095-C to all full-time employees by March 2, 2018.
• Self-insuring employers that are not considered ALEs, and other parties that provide minimum essential coverage, must file Forms 1094-B and 1095-B with the IRS no later than February 28, 2018 (or April 2, 2018, if filing electronically). These entities are also required to furnish a Form 1095-B to "responsible individuals" (may be the primary insured, employee, former employee, or other related person named on the application) by March 2, 2018.

Electronic Filing Requirements
Reporting entities filing 250 or more Forms 1095-B or Forms 1095-C must electronically file them with the IRS. Additional information on electronic filing can be found on the IRS ACA Information Returns (AIR) Program webpage.

© 2018 HR 360, Inc.

February 06, 2018 - Health Care Reform Update

Form 1094-C & 1095-C Requirements Addressed

The Internal Revenue Service has updated its Q&As regarding Form 1094-C and 1095-C information reporting by applicable large employers (ALEs)—generally those with at least 50 full-time employees, including full-time equivalent employees, in the preceding calendar year. The Q&As answer the following questions and more:

• For which employees must an ALE file Form 1095-C?
• What information must be an ALE furnish to its employees?
• How should information about an offer of coverage for the month in which an employee is hired be reported on Form 1095-C?
• How should an ALE complete Form 1095-C for a full-time employee who terminates employment during a calendar year and receives an offer of COBRA continuation coverage?
• Should an ALE report coverage under a health reimbursement arrangement (HRA) for an individual who is enrolled in both the HRA and the employer’s other self-insured major medical group health plan?

Click here to read the updated Q&As.

© 2018 HR 360, Inc.

February 02, 2018 - Health Care Reform Update

Definitions Essential to Understanding 'Pay or Play' Compliance

In general, under the employer shared responsibility ("pay or play") provisions of the Affordable Care Act (ACA), applicable large employers—generally those with 50 or more full-time employees, including full-time equivalent employees—may be subject to a penalty if they do not offer minimum essential coverage that is affordable and provides minimum value to their full-time employees (and their dependents). 

Here are definitions to help employers understand these key terms:

Minimum Essential Coverage: Minimum essential coverage includes, among other things, coverage under an employer-based plan (including self-insured plans, retiree plans, and COBRA coverage). It does not include fixed indemnity, life insurance, dental, or vision coverage. Click here for more on what qualifies as minimum essential coverage.

Affordable Coverage: For plan years beginning in 2018, coverage is generally considered affordable if the employee’s required contribution for the lowest cost self-only health plan is 9.56% or less of his or her household income for the taxable year. Given that employers are unlikely to know an employee’s household income, for purposes of pay or play, they may use a number of safe harbors to determine affordability, including reliance on Form W-2 wages.  

Minimum Value: An employer-sponsored plan provides minimum value if it covers at least 60% of the total allowed cost of benefits that are expected to be incurred under the plan. Employers generally must use a minimum value calculator developed by the U.S. Department of Health and Human Services (HHS) to determine if a plan with standard features provides minimum value. Plans with nonstandard features are required to obtain an actuarial certification for any nonstandard features. HHS has also proposed regulations for certain safe harbor plan designs that will satisfy minimum value.

For more information on which ACA provisions apply to your company, visit the IRS webpage on ACA Tax Provisions for Employers.

© 2018 HR 360, Inc.

January 23, 2018 - Health Care Reform Update

Tax Previously Set to Become Effective in 2020

President Trump has signed the Extension of Continuing Appropriations Act, which (among other things) delays implementation of the "Cadillac Tax," the Affordable Care Act's excise tax on high-cost employer-sponsored health coverage, until 2022. Previously, this tax—which would impose a 40% tax on plans that cost more than $10,200 (for self-only coverage) and $27,500 (for family coverage)—was set to become effective in 2020.

© 2018 HR 360, Inc.

January 19, 2018 - Health Care Reform Update

Percentage Down from 2017

Under the employer shared responsibility ("pay or play") provisions of the Affordable Care Act, applicable large employers—generally those who had 50 or more full-time employees (including full-time equivalent employees) in 2017—may be subject to a penalty if they do not offer affordable coverage that provides minimum value to their full-time employees (and their dependents) in 2018. As a reminder, for plan years beginning in 2018, coverage will generally be considered affordable if the employee's required contribution for the lowest cost self-only health plan is 9.56% or less of his or her household income for the taxable year. For plan years beginning in 2017, the applicable percentage was 9.69%.

Given that employers are unlikely to know an employee's household income, they may use a number of safe harbors to determine affordability, including reliance on Form W-2 wages. Click here for more information on these safe harbors.

© 2018 HR 360, Inc.

January 12, 2018 - Health Care Reform Update

Requirement is Effectively Repealed Beginning in 2019

Individuals are reminded that the section of the Tax Cuts and Jobs Act which effectively repealed the individual shared responsibility provision ("individual mandate") of the Affordable Care Act does not become effective until 2019. As a result, individuals are required to have minimum essential health coverage, qualify for an exemption from the requirement, or pay a penalty tax for 2018.

© 2018 HR 360, Inc.

January 05, 2018 - Health Care Reform Update

Rule Would Permit Associations Based on Industry or Geography

The U.S. Department of Labor (DOL) has issued a proposed rule which would allow employers to join together as a single group to offer group health insurance coverage to current employees, former employees, working owners, and their family members as part of an "association health plan." If finalized, the rule would allow association health plans to be formed on the basis of industry or geography, such as by state, city, county, or metropolitan area.

Notably, the proposed rule would subject association health plans to the nondiscrimination rules currently applicable to large group coverage under the Health Insurance Portability and Accountability Act (HIPAA), as amended by the Affordable Care Act (ACA). These rules prohibit discrimination based on a health factor or within groups of similarly situated individuals, but do generally permit plans to impose different eligibility provisions and costs based on bona-fide employment-based classifications, such as full-time versus part-time status.

Click here to read the proposed rule in its entirety.

© 2018 HR 360, Inc.

December 29, 2017 - Health Care Reform Update

Forms 1095-C Due to Full-Time Employees by March 2, 2018

Under the Affordable Care Act, applicable large employers (ALEs)—generally those with at least 50 full-time employees, including full-time equivalent employees, in the preceding calendar year—must report certain information to their full-time employees and the Internal Revenue Service (IRS) about the health care coverage they have offered (if any). 

With deadlines for 2017 reporting just a few months away, ALEs should begin thinking about these five information reporting facts:

1. ALEs are required to furnish Form 1095-C to each of its full-time employees by March 2, 2018 (new extended deadline). 
2. ALEs must file Forms 1095-C, accompanied by the transmittal Form 1094-C, with the IRS no later than February 28, 2018 (or April 2, 2018, if filing electronically). 
3. Self-insured ALEs must also report via Forms 1094-C and 1095-C. 
4. ALEs that file 250 or more Forms 1095-C must file them electronically.
5. ALEs can find a complete list of resources and the latest news at the IRS's Applicable Large Employer Information Center.

For further details on filing and furnishing Forms 1094-C and 1095-C, please see the latest form instructions.

© 2018 HR 360, Inc.

December 22, 2017 - Health Care Reform Update

Good Faith Penalty Relief Also Extended

The IRS has extended the due dates for furnishing 2017 Forms 1095-B and 1095-C to covered individuals and full-time employees, respectively, from January 31, 2018, to March 2, 2018. The IRS has also extended good faith penalty relief to reporting entities who make certain calendar year 2017 information reporting errors. However, the deadline to file 2017 Forms 1095-B and 1095-C with the IRS remains February 28, 2018 (or April 2, 2018, if filing electronically).

Penalty Relief Extension
The IRS has extended penalty relief to reporting entities that can show that they made good faith efforts to comply with the calendar year 2017 information reporting requirements (both for furnishing to individuals and for filing with the IRS). This relief applies to missing and inaccurate taxpayer identification numbers and dates of birth, as well as other information required on the return or statement.

Background
Applicable large employers must use Form 1095-C to report information to their full-time employees about the health care coverage they have offered in a calendar year. Alternatively, Form 1095-B is used by insurers, self-insuring employers, and other parties that provide minimum essential health coverage to report information on this coverage to covered individuals. Employers subject to both reporting provisions (generally self-insured employers with 50 or more full-time employees, including FTEs) will satisfy their reporting obligations using Form 1095-C.

Click here for more information from the IRS.

© 2018 HR 360, Inc.

December 19, 2017 - Health Care Reform Update

Repeal Effective in 2019

President Trump has signed into law the Tax Cuts and Jobs Act, which, among other things, effectively repeals the Affordable Care Act's (ACA) individual mandate beginning in 2019. 

Individual Mandate Repeal Effective in 2019
Under the ACA, individuals are currently required to have minimum essential health coverage, qualify for an exemption from the requirement, or pay a penalty tax. This ACA provision is known as the "individual mandate." Effective in 2019, the individual mandate is effectively repealed, as the penalty tax for noncompliance with the mandate will be reduced to $0.

© 2018 HR 360, Inc.