How to Fix Mistakes with IRS Forms 1094 and IRS Forms 1095
New SBCs Next Year
Health Care Reform Issues on the Horizon
Government Stepping Up HIPAA Audits
ACA and Small Employers
ERISA Preemption Alive and Well – Mostly
Plan Imposed Statute of Limitations
Provider Directories in the Spotlight
EEOC Continues to Battle and Lose with Respect to Certain Wellness Programs
Finalized Rules
FMLA and Medical Certificates
Indexed Amounts
Health Costs Continue to Rise
What is MEC?
Chasing Dollars Got Harder
Health Care Reform and Hours of Service
Litigation Roundup
HR Director Personally Liable for FMLA Violation
Don’t Forget the Snake
Paid Sick Leave for Federal Contractors
DOL Issues New Fiduciary Rules
How to Fix Mistakes with IRS Forms 1094 and IRS Forms 1095
The deadline for sending out the IRS Form 1095 to the employees was the end of last month. Few things are certain but chances are some employers fumbled the ball when it comes to the forms and some of the forms contain errors. This article talks about how to correct those errors.
Correcting Mistakes on ACA Reporting Forms
The government has indicated it will not assess penalties if the employer made a good-faith attempt to comply. This means the employer at least distributed the forms and will submit them to the government by the due date. We anticipate the process will get easier as time goes on. However, for the time being employers should make every attempt to comply with the rules.
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New SBCs Next Year
Health care reform imposed a new disclosure requirement on health plans. All plans are required to use a four-page summary of benefits and coverage or SBC. The goal is to standardize an easy-to-read summary so that people can do an “apples to apples” comparison for health plans.
SBC Template and Instructions Available
The government is updating the template. The new template must be used for plan years with open enrollment periods beginning after April 1, 2017. This means the new template is not required for the enrollment periods with a January 1, 2017, effective date.
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Health Care Reform Issues on the Horizon
Almost everyone agrees that health care reform expanded access to health coverage but did little to control costs. This survey shows that those enrolling in the health care exchanges or marketplaces are incurring claims at a higher rate than the general population.
Exchange Enrollees Sicker, More Expensive
This does not bode well for the carriers participating in the exchanges or marketplaces. If claims continue to increase the carriers will be forced to raise premiums and the plans will become either unattractive or the government subsidies will have to increase.
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Government Stepping Up HIPAA Audits
HIPAA was enacted to require certain entities to secure individuals’ protected health information or PHI. As a practical matter, if you are a smaller employer with a fully insured health plan, chances are you do not receive PHI. Therefore, HIPAA really does not have a major impact on you. On the other hand, if you are sponsoring a self-funded health plan, you need to ensure that you and all your vendors are complying with the rules.
HIPAA Begins Phase 2 Audits
HIPAA Phase 2 Audit Protocol
HIPAA has been around for a while and the government continues to check to ensure that entities are complying with the law. Therefore, it makes sense to (1) determine if you are receiving PHI and (2) if you are receiving PHI, that you and your vendors are complying with the rules.
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ACA and Small Employers
Health care reform impacts every employer and individual in the United States. However, in the case of employers, the law’s impact depends on the number of employees. The IRS continues to provide guidance to employers.
How ACA Impacts Employers with Fewer than 50 Employees
This is the latest release by the government and it talks about the law’s impact on employers with fewer than 50 employees.
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ERISA Preemption Alive and Well – Mostly
All employers except churches and government entities are subject to ERISA. ERISA preempts state laws that impact employee benefit plans, but that preemption is not absolute. The rules are very complicated and convoluted. Although ERISA preempts state laws, the states do have the right to regulate insurance companies.
ERISA Preemption is Alive and Well
High Court Decision and the Future of ERISA
So what this means is if you are sponsoring a fully insured health plan, the insurance company will be subject to state law which, in turn, means that you will have to comply with those rules. If you sponsor a self-funded health plan, then, as a general proposition, you will have more flexibility. This is especially true after a recent US Supreme Court case discussed in this article.
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ACA Anti-Retaliation Provisions
Common sense dictates that employers not punish employees who participate in or take advantage of the employer’s benefit plans. However, the statute has specific provisions that preclude employers from retaliating against employees.
New Concerns for Employer Plan Sponsors
Large employers may be subject to the employer mandate or play or pay penalty if a full-time employee goes to the exchange or marketplace and receives a premium subsidy. The government was concerned employers may take adverse actions against an employee who tries to take advantage of the premium subsidies, so the law has a set of procedures for filing a complaint against the employer or insurance company if the person feels the employer or insurance company has violated the statute.
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Plan Imposed Statute of Limitations
A plan may impose its own statute of limitation as long as the time period is reasonable. What this means is that the plan may require the person to file suit within a certain period of time. Obviously the plan must spell out that timeframe.
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Contractual Limitations Provisions in Denial Letters
A recent court case held that the timeframe also has to be listed on the denial letter. That is, the notice telling the person his or her claim has been denied in whole or in part must also spell out the time frame for filing suit if the person wants to litigate the matter.
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Provider Directories in the Spotlight
The government may start assessing fines against carriers with outdated provider directories. Individuals could end up paying large out-of-pocket amounts because they used an out-of-network provider. So it is important the provider directory be accurate and up to date.
CMS Threatens Fines for Outdated Directories
The rules currently only apply to Medicare Advantage products and policies sold through the marketplace or health care exchanges.
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EEOC Continues to Battle and Lose with Respect to Certain Wellness Programs
An employer adopted a program where employees had to complete a health risk assessment as a precondition for participating in the employer’s group health plan. The EEOC filed suit saying this violated the Americans with Disabilities Act, as amended by the ADA Amendments Act of 2008 (ADA).
Voluntary Plans, Safe Harbors and the Future of Wellness Programs
The District Court ruled in favor of the employer and the EEOC has appealed that decision to the Appellate Court. This article outlines the issues.
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Finalized Rules
Health care reform was enacted over six years ago and the government has issued a substantial amount of guidance in a variety of formats. For example, the government has issued proposed regulations, bulletins and Q&As. The government has consolidated some of that guidance and issued final regulations.
Departments Finalize Market Mandate Guidance
There is really nothing new here but it is nice to have the final rules in one place. The final regulations are effective for plan years beginning next year. Again, no major surprises; it is more a matter of clarifications and consolidation.
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FMLA and Medical Certificates
The FMLA allows the employer to gather information if someone wants to take advantage of the FMLA. The government has developed a template medical providers can use to supply information. This article talks about what happens if the provider wants to use its own form.
When Doctors Refuse to use Employer’s FMLA Form
Another trend is that providers are starting to charge for supplying information. You cannot blame the provider for wanting to get paid for their time. This article says the employee is responsible for any provider fees and the employer need not pay or reimburse the employee those fees.
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Indexed Amounts
Many parts of the Internal Revenue Code allow the government to increase various amounts for inflation. Health care reform under the employer mandate or play or pay rules imposes a penalty on large employers that fail to provide quality/affordable health coverage to full-time employees.
Final 2017 Out-of-Pocket Maximums
The penalties are indexed and the Department of Health and Human Services released the 2017 numbers. See Page 4 of this article for a chart listing the amounts.
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Health Costs Continue to Rise
The Consumer Price Index for all items increased by 1 percent over the last 12 months but the CPI for health insurance increased by 6 percent over that same period.
Health Insurance Premiums Jump Amid General Deflation
I don’t think that comes as a surprise to those who are involved with employer-sponsored health plans.
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What is MEC?
Health care reform requires most Americans have health coverage or pay a penalty (i.e. the individual mandate). The statute says the person must have minimum essential coverage or MEC, which is defined under the law.
Health Care Law: Do You Have Minimum Essential Coverage?
The IRS has released this information explaining what MEC is, who is exempt from the penalty (i.e. the individual mandate) and how to calculate the penalty if the person (1) does not have MEC and (2) is not exempt from the penalty.
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Chasing Dollars Got Harder
Oftentimes when an employee or family member is injured in a car accident and incurs substantial medical claims, the employer’s group health plan pays those claims. The person then sues the individual that caused the accident and gets a pot of money.
Dissipation of Settlement Precludes ERISA Reimbursement Rights
Supreme Court Limits Plan’s Ability to Recoup Medical Expense Payments
When this happens the health plan may try to recover some or all the claims it paid. This comes up most often when the employer is sponsoring a self-funded health plan. The US Supreme Court addressed this situation and the ruling makes it harder for the health plan to recover money from the plan participant.
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Health Care Reform and Hours of Service
By now everyone knows that large employers have to offer quality/affordable health coverage to full-time employees. A full-time employee is one that works at least 30 hours per week. You would think that counting hours would be easy but little, if anything, about health care reform is simple.
How Disability Leave Impacts Hours of Service Under ACA
This article does a nice job discussing the rules when an employee is disabled and not actively at work and how to treat the individual under health care reform.
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Litigation Roundup
As a general proposition, I do not like to reference court cases unless they involve the US Supreme Court, because each case is decided on its own facts. However this article, prepared by a large law firm, talks about several recent lawsuits involving employee benefit issues.
Benefits Litigation Update, Spring 2016
Again, this article does a really nice job explaining a few major cases that involve different employee benefit matters.
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HR Director Personally Liable for FMLA Violation
In case you do not have enough on your mind, here are two articles about a Court that held the HR Director personally liable for an FMLA violation.
Second Circuit Court Holds HR Director is Individually the “Employer”
Circuit Court Holds That HR Director May be Individually Liable Under FMLA
The HR Director had substantial control over the employee as well as the ability to fire the employee. The Court held the HR Director exercised sufficient control over the employee’s employment to be subject to liability under the FMLA.
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Don’t Forget the Snake
With so much attention on health care reform and the establishment of the health care exchanges or marketplaces it is easy to forget about COBRA. However, a recent court case reminds us the snake has not gone away.
Bad COBRA Notices Can Cost You
The COBRA notice was deficient and there was a class-action lawsuit where the defendant agreed to pay almost $300,000. Again, it is doubtful many people will elect COBRA coverage nowadays but the statute has not gone away and employers need to continue to comply with COBRA, especially the notice requirements.
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Paid Sick Leave for Federal Contractors
Those who work with the Federal government should be aware that beginning next year, you will be required to provide sick leave for certain employees.
Paid Sick Leave for Federal Contractors
The proposed rule requires employees are entitled to accrue no less than one hour of paid sick leave for every 30 hours worked. There is a cap of the maximum number of hours that can be accrued.
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DOL Issues New Fiduciary Rules
It has been a long time coming but the Department of Labor has issued new rules redefining who is a fiduciary when it comes to investment advice to plans and participants.
Department of Labor Issues Final Fiduciary Rule
The rules should have little impact on welfare benefit plans because most of these plans are not designed to accumulate assets. However, the new rules will impact retirement plans.
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