Agencies Issue Proposed Guidance on Excepted Benefits

In their proposed rule on "Amendments to Excepted Benefits", the Departments of Labor, Treasury, and Health and Human Services indicated:

"This document contains proposed rules that would amend the regulations regarding excepted benefits under the Employee Retirement Income Security Act of 1974, the Internal Revenue Code (the Code), and the Public Health Service Act related to limited wraparound coverage. Excepted benefits are generally exempt from the requirements that were added to those laws by the Health Insurance Portability and Accountability Act and the Patient Protection and Affordable Care Act."

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Mintz Levin Examines Look Back Period Communications

In "Explaining the Look-Back Measurement Method to Employees", Mintz Levin explains that:

"Many applicable large employers—i.e., employers that are subject to the Affordable Care Act’s (ACA) employer shared responsibility rules—have a pretty good sense of what these rules are, how they work, and what they plan to do to comply. A subset of these employers has gained a sophisticated understanding of the employer shared responsibility rules, while another (hopefully much smaller) subset has only a vague sense that they need to do something by or in 2015 in connection with extending coverage to full-time employees."

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Buck Consultants Analyzes 2016 Reinsurance Contribution Rate and OOP Maximims

In "HHS Proposes 2016 Reinsurance Contribution Rate and OOP Maximums", Buck Consultants, a Xerox company explains that:

"The Department of Health & Human Services has proposed a 2016 transitional reinsurance rate of $27 and provided additional guidance in several key areas of the reinsurance program. HHS has also proposed 2016 out-of-pocket maximums of $6,850 for self-only coverage and $13,700 for other than self-only coverage, and provided guidance on the marketplace open enrollment periods for 2016 and later years."

To read more, click here.

ERIC members and trial members can read more here.

Buck Consultants Highlights 2015 Compliance Issues for Health Plans

In "2015 Planning for Health and Welfare Benefit Plan Operations", Buck Consultants, a Xerox company indicates:

"As 2014 comes to a close, it’s time for employers and plan sponsors to look forward to compliance issues for 2015. To that end, the calendar below presents a schedule of activities that address important deadlines for 2015. Additionally, the recently updated Reporting and Disclosure Guide identifies and addresses other activities that are event-based and participant specific. In terms of planning, many of the projects put in place in 2014 will need to be maintained for 2015, but employers and sponsors will also need to address some new issues."

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Mintz Levin Analyzes Changes to the Minimum Value Rules

In "Health and Human Services (HHS) Wastes No Time Issuing Proposed Rules Modifying Minimum Value Rules", Mintz Levin indicates that:

"Over the last couple of months, we have followed and reported on a particular ACA compliance strategy under which an employer subject to the Affordable Care Act’s employer shared responsibility (or “pay-or-play”) rules satisfies the requirement to make an offer of coverage under a group health plan that has the look-and-feel of major medical coverage with one significant modification: the plan offers no inpatient hospital coverage or physician services... Following the convention established by promoters of these arrangements, we refer to these arrangements as “minimum value plans” or “MVP arrangements.” Because the monthly premium cost of MVP plans is far less expensive than the cost of traditional major medical coverage that includes inpatient hospital services or physician services, the cost to the employer to make such coverage affordable—and thereby avoiding exposure for assessable payments—is also lowered significantly."

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Buck Consultants Analyzes New FAQs on Premium Reimbursement Arrangements

In "New FAQs Address Premium Reimbursement Arrangements", Buck Consultants, a Xerox company explains that:

"Building on previous guidance, the departments have issued three new FAQs that address ACA market reform and other compliance issues for premium reimbursement arrangements. The departments warn that employers could be subject to significant excise taxes if they reimburse employees’ individual health insurance premiums either on a pre- or post-tax basis or if they offer employees with high claims risk a choice between the employer’s health plan and cash."

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Buck Consultants Analyzes FAQ on Reference-Based Pricing and Out-of-Pocket Maximums

In "FAQ Offers Additional Guidance on Reference-Based Pricing and Out-of-Pocket Maximums", Buck Consultants, a Xerox Company explains that:

"The Departments of Labor, Health & Human Services, and Treasury recently issued an FAQ that provides clarification on how sponsors of non-grandfathered plans that use reference-based pricing may comply with ACA’s limits on out-of-pocket maximums. Group health plans that use reference-based pricing, or similar network designs, should review those plans for compliance with this guidance."

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IRS Issues FAQs on Transitional Reinsurance Program

In "ACA Section 1341 Transitional Reinsurance Program FAQs", the Internal Revenue Service (IRS) indicates that:

"Section 1341 of the Affordable Care Act establishes a transitional Reinsurance Program to help stabilize premiums for coverage in the individual market during the years 2014 through 2016. The statute requires all health insurance issuers and third-party administrators on behalf of self-insured group health plans to make contributions under this program to support payments to individual market issuers that cover high-cost individuals (payment-eligible issuers)...The following questions and answers provide information on the treatment of contributions made under the Reinsurance Program."

To read more, click here.

DOL Issues Guidance on Stop-Loss Insurance

In Technical Release No. 2014-01: Guidance on State Regulation of Stop-Loss Insurance, the U.S. Department of Labor indicates that:

"Under current law, employers and other sponsors of group health plans may either provide coverage through an insurance contract or instead, pay benefits directly, as claims occur. In general, private sector employment-based group health plans that self-insure are not subject to State health insurance laws, including coverage laws, rating policies, and certain other State consumer protections applicable to health insurance...Employers and other sponsors of self-insured group health plans, especially small employers, may face large fluctuations in claims, and they frequently seek to reduce this risk by purchasing stop-loss insurance."

To read more, click here.

IRS Issues Guidance on Plans Without In-Patient Hospitalization Services

In Notice 2014-69: Group Health Plans that Fail to Cover In-Patient Hospitalization Services, the Internal Revenue Service indicates that:

"The Department of Health and Human Services (HHS) and the Department of the Treasury (including the Internal Revenue Service) (collectively, the Departments) have become aware that certain group health plan benefit designs that do not provide coverage for in-patient hospitalization services are being promoted to employers. A plan that fails to provide substantial coverage for these services would fail to offer fundamental benefits that are nearly universally covered, and historically have been considered integral to coverage, under typical employer-sponsored group health plans. Promoters of these plans contend that the plans satisfy minimum value within the meaning of the Affordable Care Act (including section 36B(c)(2)(C)(ii)of the Internal Revenue Code (Code) and final HHS regulations under section1302(d)(2)(C) of the Affordable Care Act (referred to in this notice as minimum value or MV)), as determined through use of the on-line MV Calculator referred to in final HHS regulations and proposed Treasury regulations."

The Notice is available here.
ERIC members and trial members can read more here.

Agencies Issue More ACA FAQs

In "FAQs about Affordable Care Act Implementation (Part XXII)", the the Departments of Labor (DOL), Health and Human Services (HHS), and the Treasury indicate that:

"[T]hese FAQs answer questions from stakeholders to help people understand the new law and benefit from it, as intended...On September 13, 2013, DOL and the Treasury published guidance on the application of the market reforms and other provisions of the Affordable Care Act to health reimbursement arrangements (HRAs), certain health flexible spending arrangements (health FSAs) and certain other employer health care arrangements.(1)HHS issued contemporaneous guidance to reflect that HHS concurs in the application of the laws under its jurisdiction as set forth in the DOL and Treasury Department guidance.(2) Subsequently, on May 13, 2014, two FAQs were made available on the IRS website addressing employer health care arrangements.(3)"

To read more, click here.

Supreme Court to Hear ACA Subsidies Case

Scotusblog reports in "Court to rule on health care subsidies" that:

"The Supreme Court, moving back into the abiding controversy over the new health care law, agreed early Friday afternoon to decide how far the federal government can extend its program of subsidies to buyers of health insurance. At issue is whether the program of tax credits applies only in the consumer marketplaces set up by 16 states, and not at federally-run sites in 34 states."

To read more, click here.

ERIC members and trial members can read more here and here.

Mintz Levin Examines the ACA Employer Shared Responsibility Rules

In "Misunderstanding 'Offer[s] of Coverage on Behalf of Another Entity;”, Mintz Levin explains that:

"Applicable large employers faced with the prospect of complying with the Affordable Care Act’s employer shared responsibility rules must grapple with and understand what it means to make an offer of minimum essential coverage under an eligible employer-sponsored [group health] plan to their full-time employees. Final regulations implementing these rules determine an individual’s status as an “employee” by applying the “common law” standard, the contours of which were examined in a previous post. Identifying an employer’s common law employees in a two-party arrangement is a simple matter. But this is not always the case in three-party arrangements (i.e., those in which workers are hired from or through commercial staffing firms or professional employer organizations). Three-party arrangements invite the question—whose employee is it? Where the Act’s employer shared responsibility rules are concerned, the answer to that question tells us which entity must make the requisite offer of coverage when assessing exposure for assessable payments."

To read more, click here.

Mintz Levin Discusses Employer Responding to Marketplace Notices

In "What’s an Employer to Do (with Marketplace Notices)?", Mintz Levin explains that:

"Under the Affordable Care Act’s employer shared responsibility rules, applicable large employers (those with 50 or more full-time and full-time equivalent employees on business days during the preceding calendar year) incur exposure for assessable payments under Internal Revenue Code § 4980H when an applicable premium tax credit or cost-sharing reduction is allowed or paid for one or more low- or moderate-income full-time employees who have been certified to the employer as qualifying for an advance premium tax credit under Code § 36B. The final Code § 4980H regulations refer to this certification as a “Section 1411 Certification,” which is a reference to Act § 1411(a). This provision gives the Department of Health and Human Services (“HHS”) the authority to determine whether individuals are eligible to enroll in qualified health plans through a public exchange and whether they are eligible for a premium tax credit."

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New Timeline for Employer Health Compliance

In "Updated Timeline of Highlights for Employer Group Health Plan Compliance with the Affordable Care Act", Epstein Becker Green explains that:

"Since enactment of the Affordable Care Act (“ACA”), the regulators have promulgated a myriad of regulations implementing the ACA’s requirements for group health plans. Over the past several years, the Obama administration has delayed many different elements of the ACA’s requirements, in large part, to give the regulators sufficient time to promulgate guidance. As the employer shared responsibility penalties become a reality for employers with plan years beginning on and after January 1, 2015, we have updated our timeline for employer group health plans to assist employers in staying current with the ACA’s requirements and deadlines."

To read more, click here.

ERIC Files Comment Letter on Draft Forms and Instructions for ACA Reporting

The ERISA Industry Committee (ERIC) recently filed comments with the Treasury Department and Internal Revenue Service on the draft forms and instructions for the Affordable Care Act (ACA) reporting requirements applicable to health plan coverage offered under employer-sponsored plans.

In its letter, ERIC urges the government to provide additional time to comply with the reporting requirements, to simplify the requirements, and to provide a number of clarifications regarding the forms and instructions. Among others, ERIC asked the government to specify the circumstances under which an employer may apply some of the alternative reporting methods as well as for additional guidance on when employers may use substitute forms.

ERIC's comment letter is available here.

Epstein Becker Green Identifies 5 Key ACA Issues

In "Five ACA Issues That Employers Should Be Following," Epstein Becker Green indicates that:

"Employers have about three months to finalize their employer mandate compliance plans under the Affordable Care Act (“ACA”). While most employers are in the final stages of planning, this month’s Take 5 will address five ACA issues that employers should be aware of as they move forward into 2015 and beyond, including: ACA-related litigation[,] Employer mandate reporting[,] Section 510 liability[,] Alternatives to traditional plan offerings[, and] The looming Cadillac tax."

To read more, click here.

Agencies Post New FAQs on Cost-Sharing Limits

In "FAQs About Affordable Care Act Implementation, Part XXI", the U.S. Departments of Labor, Health and Human Services (HHS), and the Treasury state that:

"Based on comments received, set forth below is an additional FAQ regarding the [maximum out-of-pocket] requirements. This FAQ addresses only group health plans’ and group health insurance issuers’ obligations under section 2707(b) of the PHS Act. For non-grandfathered health plans in the individual and small group markets that must provide coverage of the essential health benefit package under section 1302(a) of the Affordable Care Act, additional requirements apply."

To read more, click here.

Miller & Chevalier Analyzes Transitional Reinsurance Fee

In "Looming Deadline for Another ACA Fee", Miller & Chevalier explain that:

"By November 15, 2014, contributing entities, which generally include all health insurance issuers and self-funded group health plans,1 must register and report enrollment data on Pay.gov and ultimately pay the transitional reinsurance fee (TRF) by January 15, 2015 (if the contributing entity elects to pay the TRF in one installment) or January 15, 2015 and November 15, 2015 (if the contributing entity elects to pay the TRF in two installments). The TRF is part of the Transitional Reinsurance Fee Program, which is one of three programs, in addition to the Risk Adjustment and Risk Corridors Programs, designed to stabilize premiums and mitigate the potential side effects of adverse selection in the individual and small group markets. While the definition of a contributing entity encompasses the individual, small group and large group markets, HHS will distribute the collected TRF contributions only to certain non-grandfathered plans in the individual market."

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Another Court Decides ACA Subsidies Case

In "Federal judge limits health care subsidies", SCOTUSblog reports that:

"Deepening the controversy over tax subsidies to help lower-income workers obtain health insurance, a federal trial judge in Oklahoma on Tuesday barred those credits for individuals who shop for coverage on marketplaces run by the federal government, not by a state.

That issue is already awaiting the Supreme Court’s attention, with the federal government due to file there on Friday a defense of the subsidies scheme that has so far helped nearly five million individuals to afford health coverage under the Affordable Care Act."

To read more, click here.