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Holiday Gift Giving Ideas

Each year I suggest the perfect gift for that special someone on your Holiday list and I am pleased to announce that the current version of my book, the 2015/2016 Welfare Benefits Guide, is now available.

This two-volume set makes the perfect gift and, for those on a budget, you can buy the books on the monthly payment plan.

EEOC & GINA and Wellness Programs

Sometimes (OK – oftentimes) it is frustrating dealing with all the rules and this is especially the case when the government issues inconsistent guidelines. This is happening with the rules governing wellness programs. Health care reform increased the maximum penalty or reward under a wellness program to up to 50% of the premiums if tobacco is involved. Then the EEOC issued rules in April of this year explaining how wellness programs have to comply with the Americans with Disabilities Act or ADA. Now the EEOC has just issued rules saying how wellness programs have to comply with Genetic Information Nondiscrimination Act or GINA.

The latest set of rules are in proposed format and the government has asked for comments until the end of this year. Again, what is frustrating is the fact the EEOC rules issued earlier this year are different from the rules the EEOC issued last month.

Is Telemedicine the Wave of the Future?

Everyone continues to look for ways to reduce health care costs and provide better access to health care providers.

Telemedicine may be part of the answer. This is where people simply call and talk or videoconference with a physician for routine non-emergency conditions. It is convenient, less expensive and saves a trip to the doctor’s office.

Auto Enrollment Canned

One of the requirements under health care reform was that larger employers (i.e. those with at least 200 employees) were to auto enroll employees into the employer’s group health plan. Those rules were postponed until the government issued regulations.

President Barack Obama signed H.R. 1314, the Bipartisan Budget Act of 2015, on November 2, 2015, which eliminated this provision from the law. That is, the auto enrollment provision of health care reform has been permanently eliminated.

Tax Treatment of Identity Thief Protection

Unfortunately data breaches are happening more often and one of the common remedies is to provide those impacted with identity thief protection for a period of time. This protection commonly includes credit monitoring, etc.

The IRS has indicated that in most cases the value of the identity thief protection is not taxable income but any proceeds the employee may receive under the program will be treated under the rules governing insurance recoveries.

IRS Forms 1094 and 1095 are Coming Due

We have included numerous articles on the new reporting requirements (i.e. IRS Forms 1094 and 1095) under health care reform. These are just a few more articles.

One of the things I like about the first one is that it talks about the “reasonable cause” standard when it comes to the IRS assessing penalties. However, employers should focus on preparing, filing and distributing the forms rather than ways to reduce or eliminate the noncompliance penalty.

Cadillac Tax Continues to Take Heat

One of the most controversial provisions of health care reform is the 40% non-deductible excise tax on high value health plans commonly referred to as the Cadillac tax. The Cadillac tax is scheduled to kick in January 1, 2018.

The tax is being criticized almost uniformly but health care reform is expensive and the Cadillac tax is one way to finance the law. So it remains to be seen if this provision of the law is repealed and, if so, what provision will be enacted to help pay for health care reform.

SHOP – No Go!!!

Part of Obamacare was the establishment of the Small Business Health Options Program, or SHOP, where small businesses could go and buy health coverage for their employees. As it turns out, very few are taking advantage of the SHOP.

In fact, less than 1% of the small businesses are using the SHOP to buy health coverage for their employees.

Transitional Reinsurance Fee Submission Date

The transitional reinsurance fee is a temporary program developed to help compensate the insurance companies for the adverse selection anticipated for offering coverage through the exchanges or marketplaces. Employers sponsoring fully insured health plans are not required to do anything because the carriers will calculate and pay the fee, although the carriers will pass this cost on to the employers through higher premiums.

Employers sponsoring self-funded health plans are required to report and pay the fee. The reporting deadline for this year is November 15th. We have included articles about the reinsurance fee in previous newsletters.

Spousal Carve Outs

A spousal carve out is when the employer institutes a program where employees’ spouses are not eligible to participate in the employer’s group health plan. Initially, it is imperative the employer realize that the group health plan has to specifically provide for a spousal carve out. In other words, the employer cannot simply adopt an internal policy that says the employees’ spouse are not eligible for the employer’s group health plan. This means the group health plan has to be amended to specifically exclude spouses. In the context of a fully insured plan the carrier has to agree to the provision. The Ohio Department of Insurance relatively recently said that it would allow carriers to insert this type of provision into a fully insured group health plan. Of course, it is up to each carrier whether or not it wants to offer products having a spousal carve out. This article discusses some of the things to consider when implementing a spousal carve out.

The most critical thing once the decision is made to implement a spousal carve out is to ensure all the documents have been modified to reflect the carve out. Again, the employer cannot simply adopt a policy; the group health plan has to be formally amended to reflect the change.

ACA and Birth Control

Health care reform requires most group health plans provide birth control free of charge. This is one of the most controversial provisions of the law and, in fact, there have been three U.S. Supreme Court cases on the topic.

This will not go away. The U.S. Supreme Court has just agreed to hear the fourth case. The upcoming case will combine parts of seven other pending cases.

Litigation Roundup

I am hesitant to reference court cases in this newsletter because each case is decided on its own facts and circumstances.

Nevertheless, I am including this link because it is by a really good law firm and it provides a short summary of a number of interesting cases.

ACA Penalty Notices

The employer mandate penalty under health care reform is predicated on a full-time employee going to the marketplace or exchange and getting a subsidy. Initially the system was set up so that the exchanges or marketplaces would provide employers advance notice an employee is receiving a subsidy so that the employer would have an opportunity to contest the potential penalty.

Unfortunately (but not surprisingly) the system is not yet fully operational. Therefore, employers may not receive advance notice an employee is receiving a subsidy. Of course the employers still have a chance to contest any proposed penalties after the close of the year before any penalties actually are assessed but employers may not receive advanced notices throughout the year.