Health Care Reform Updates & Human Resource News Alerts

Health Care Reform News

HR360::Health Care Reform
  • New Guidance on Applicability of ACA's Market Reforms to Family HRAs

    Posted on January 17, 2017
    Print

    Non-Compliant HRAs May Be Subject to Significant Penalties

    The U.S. Departments of Labor, Health and Human Services, and Treasury have published new FAQs clarifying how family HRAs (HRAs available to reimburse the medical expenses of an employee's spouse and/or dependents) can be integrated with other group health plan coverage to satisfy the market reforms of the Affordable Care Act (ACA).

    Background
    With the exception of qualified small employer HRAs, retiree-only HRAs, and HRAs consisting solely of excepted benefits, HRAs are considered group health plans that do not comply with the group market reform provisions of the ACA. Thus, stand-alone HRAs and HRAs used to purchase individual market coverage may be subject to a $100 per day excise tax per applicable employee, unless they are properly "integrated" with an underlying group health plan in accordance with agency guidance, as modified by IRS Notice 2015-87.

    Q&A #4 of Notice 2015-87 clarifies that an HRA available to reimburse the medical expenses of an employee’s spouse and/or dependents (a family HRA) may not be integrated with self-only coverage under the employer's non-HRA group health plan. As a result, questions have arisen regarding the integration of a family HRA in cases in which the employee is enrolled in self-only coverage and the employee’s spouse and dependents are enrolled in a non-HRA group health plan sponsored by the spouse’s employer.

    New Guidance
    The new FAQs make clear that a family HRA may be integrated with:

    • A non-HRA group health plan sponsored by the employer of the employee's spouse that covers all of the individuals covered by the family HRA, so long as that non-HRA group health plan otherwise meets the applicable integration requirements (referred to as a "qualifying non-HRA group health plan"). For this purpose, an employer may rely on the reasonable representation of an employee that the employee and other individuals covered by the family HRA are also covered by another qualifying non-HRA group health plan.
    • A combination of coverage under other qualifying non-HRA group health plans, provided that all of the individuals who are covered under the family HRA are also covered under other qualifying non-HRA group health plan coverage. For example, a family HRA covering an employee, spouse, and one dependent child may be integrated with the combination of (1) the employee's self-only coverage under the non-HRA group health plan of the employee's employer, and (2) the spouse and dependent child’s coverage under the non-HRA group health plan of the spouse's employer, provided that both non-HRA group health plans are qualifying non-HRA group health plans.

    Click here to read the FAQs in their entirety.

    © 2012 - 2013 HR 360, Inc.
  • New FAQs on ACA Information Reporting and Preventive Services Requirements Released

    Posted on January 12, 2017
    Print

    Updated Guidance Now Available

    Two sets of FAQs related to the Affordable Care Act (ACA) have been updated, as described below.

    • Questions and Answers on Information Reporting by Health Coverage Providers (Section 6055). These FAQs provide additional information about completing Forms 1094-B and 1095-B for calendar year 2016 (which are to be filed and furnished in 2017). The FAQs may be used in conjunction with the Instructions for Forms 1094-B and 1095-B, which provide detailed information about completing the forms. Click here to read the FAQs.
    • FAQs About Affordable Care Act Implementation, Part 36. These FAQs address the current accommodation for employers with religious objections to the ACA's contraceptive coverage requirements. The FAQs make clear that no changes to the accommodation are being made at this time. Click here to read the FAQs.   
    © 2012 - 2013 HR 360, Inc.
  • Hawaii Granted Waiver to Discontinue Operation of SHOP Marketplace

    Posted on January 10, 2017
    Print

    Waiver Impacts Employers' Small Business Health Care Tax Credit Eligibility

    The U.S Departments of Health and Human Services and Treasury have approved the State of Hawaii’s application for a waiver from the Affordable Care Act (ACA) requirement that it operate a Small Business Health Options Program (SHOP) Marketplace. The waiver is effective from January 1, 2017 through December 31, 2021.

    Background
    Section 1332 of the ACA permits a state to apply for a "State Innovation Waiver" to pursue innovative strategies for providing its residents with access to quality health care, as long as the plan meets certain requirements to retain the basic protections of the ACA. State Innovation Waivers are available beginning January 1, 2017—Hawaii is the first state to have such a waiver approved. The waivers are approved for five-year periods and can be renewed.

    Small Business Health Care Tax Credit Eligibility Implications
    Because providing SHOP-based coverage is one of the requirements for receiving the Small Business Health Care Tax Credit, the approved waiver will prevent small employers in Hawaii from being eligible for the credit. Credit amounts that would otherwise be paid to small employers in the state will be provided as a pass-through payment to the state, which will be used primarily to support a state fund that helps small businesses cover their health care costs.

    © 2012 - 2013 HR 360, Inc.
  • Key Facts About Information Reporting for Employers and Health Coverage Providers

    Posted on January 05, 2017
    Print

    Overview of the Purpose of Forms 1094 & 1095 and Reporting Deadlines

    The information reporting provisions under the Affordable Care Act require insurers, self-insuring employers, and large employers to submit information returns to the IRS and individuals reporting on health coverage. The IRS is reminding employers and health coverage providers about the types of forms, the purpose of each, and noteworthy dates.

    Form 1095-C, Employer-Provided Health Insurance Offer and Coverage

    • This form is filed by applicable large employers (ALEs), which generally are employers with 50 or more full-time employees, including full-time equivalents.
    • ALEs with fully insured health coverage send this form to full-time employees, with information about the coverage offered. (ALEs that do not offer coverage must still send this form to full-time employees.)
    • ALEs with self-insured health coverage send this form to individuals they cover, with information about who was covered and when.
    • This form is submitted to the IRS with Form 1094-C, Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Returns.
    • The deadline for filing this form with the IRS is February 28, 2017 (or March 31, 2017 if filing electronically).
    • The deadline for furnishing this form to the full-time employee is March 2, 2017, which is a 30-day extension from the original due date of January 31.

    Form 1095-B, Health Coverage

    • This form is filed by providers of minimum essential coverage, including employers that are not ALEs but who offer employer-sponsored self-insured health coverage.
    • This form is used to report information to covered individuals about each person enrolled in coverage, and is sent to the person identified as the "responsible individual" on the form.
    • This form is submitted to the IRS with Form 1094-B, Transmittal of Health Coverage Information Returns.
    • The deadline for filing this form with the IRS is February 28, 2017 (or March 31, 2017 if filing electronically).
    • The deadline for furnishing this form to the responsible individual is March 2, 2017, which is a 30-day extension from the original due date of January 31.

    Additional Resources
    The IRS provides a set of Q&As on information reporting for self-insuring employers and other providers of minimum essential coverage, as well as a set of Q&As for ALEs.

    © 2012 - 2013 HR 360, Inc.
  • CMS to Launch Pilot Program on Marketplace Special Enrollment Eligibility Verification

    Posted on December 29, 2016
    Print

    Pilot to Begin in June 2017

    As part of its continuing effort to ensure that Health Insurance Marketplace special enrollment periods are only available to those who are eligible for them, the Centers for Medicare & Medicaid Services (CMS) has announced a pilot program starting in 2017 that will test the impact of pre-enrollment verification on compliance, enrollment, continuity of coverage, and other outcomes.

    Pilot Program Details
    CMS will pilot the pre-enrollment verification in both the federally-facilitated and state-based Marketplaces that rely on the Healthcare.gov platform. All special enrollment period types will be subject to enhanced verification in some form, whether through the pilot or through other enhanced procedures. In particular, applications based on loss of minimum essential coverage will be included in the pilot.

    Applications will be randomly selected for the pilot, with 50% of new applications with relevant special enrollment periods taking part. Consumers included in the pilot will still be able to submit their application and select a plan, with a coverage effective date determined by the date of plan selection. However, the Marketplace will "pend" the consumer's enrollment until the consumer submits documents that establish his or her eligibility for a special enrollment period.  

    Pilot Program Start Date
    The pilot will begin in June 2017 and CMS anticipates basing future decisions about special enrollment period verification procedures on the results of the pilot. Before the pilot begins, CMS will offer extensive training so that agents, brokers, and others are able to help consumers find and submit the necessary documents.

    Click here for more information on the pilot program.

    © 2012 - 2013 HR 360, Inc.
  • Federal Agencies Finalize Changes to SHOP Exchanges

    Posted on December 27, 2016
    Print

    Most Changes Apply Only to Federally-Facilitated SHOPs, SHOPs Using Federal Platform

    A new final rule from the U.S. Department of Health and Human Services revises the enrollment processes in the Small Business Health Options Program (SHOP) Exchange for plan years beginning in 2018. Among other things, the final rule provides that SHOP Exchanges must:

    • Provide required notices electronically, or, if an employer or employee elects, through standard mail (unless otherwise required by federal or state law);
    • Limit waiting periods to 60 days, beginning on the date the employee becomes eligible—regardless of when the employer notifies the SHOP about the newly qualified employee;
    • Provide an employee who becomes a qualified employee outside of the initial or annual open enrollment period with a 30-day enrollment period that begins on the date the employer notifies the SHOP about the newly qualified employee—employers are required to notify the SHOP on or before the 30th day after the day that the employee becomes a newly qualified employee; and
    • Ensure that the coverage effective date for a newly qualified employee is the first day of the month following plan selection, unless the employee is subject to a waiting period.

    In addition, for employers with variable hour employees that regularly make having a specified number of hours of service per period (or working full-time) a condition of eligibility, any measurement period that the employer uses to determine eligibility for SHOP coverage must not exceed 10 months (rather than the 12-month measurement period otherwise allowed).

    Note: Most of the enrollment processes above are applicable only in federally-facilitated SHOPs (FF-SHOPs) or states using the federal platform for SHOP functions (SBE-FPs). The only finalized modification that applies to all SHOPs (both State-based SHOPs and FF-SHOPs) is the specification with regard to when SHOP waiting periods begin.

    Click here to read the final rule in its entirety.

    © 2012 - 2013 HR 360, Inc.

    HR News and Alerts

    HR360::Health Care Reform
    • New Guidance on Applicability of ACA's Market Reforms to Family HRAs

      Posted on January 17, 2017
      Print

      Non-Compliant HRAs May Be Subject to Significant Penalties

      The U.S. Departments of Labor, Health and Human Services, and Treasury have published new FAQs clarifying how family HRAs (HRAs available to reimburse the medical expenses of an employee's spouse and/or dependents) can be integrated with other group health plan coverage to satisfy the market reforms of the Affordable Care Act (ACA).

      Background
      With the exception of qualified small employer HRAs, retiree-only HRAs, and HRAs consisting solely of excepted benefits, HRAs are considered group health plans that do not comply with the group market reform provisions of the ACA. Thus, stand-alone HRAs and HRAs used to purchase individual market coverage may be subject to a $100 per day excise tax per applicable employee, unless they are properly "integrated" with an underlying group health plan in accordance with agency guidance, as modified by IRS Notice 2015-87.

      Q&A #4 of Notice 2015-87 clarifies that an HRA available to reimburse the medical expenses of an employee’s spouse and/or dependents (a family HRA) may not be integrated with self-only coverage under the employer's non-HRA group health plan. As a result, questions have arisen regarding the integration of a family HRA in cases in which the employee is enrolled in self-only coverage and the employee’s spouse and dependents are enrolled in a non-HRA group health plan sponsored by the spouse’s employer.

      New Guidance
      The new FAQs make clear that a family HRA may be integrated with:

      • A non-HRA group health plan sponsored by the employer of the employee's spouse that covers all of the individuals covered by the family HRA, so long as that non-HRA group health plan otherwise meets the applicable integration requirements (referred to as a "qualifying non-HRA group health plan"). For this purpose, an employer may rely on the reasonable representation of an employee that the employee and other individuals covered by the family HRA are also covered by another qualifying non-HRA group health plan.
      • A combination of coverage under other qualifying non-HRA group health plans, provided that all of the individuals who are covered under the family HRA are also covered under other qualifying non-HRA group health plan coverage. For example, a family HRA covering an employee, spouse, and one dependent child may be integrated with the combination of (1) the employee's self-only coverage under the non-HRA group health plan of the employee's employer, and (2) the spouse and dependent child’s coverage under the non-HRA group health plan of the spouse's employer, provided that both non-HRA group health plans are qualifying non-HRA group health plans.

      Click here to read the FAQs in their entirety.

      © 2012 - 2013 HR 360, Inc.
    • New FAQs on ACA Information Reporting and Preventive Services Requirements Released

      Posted on January 12, 2017
      Print

      Updated Guidance Now Available

      Two sets of FAQs related to the Affordable Care Act (ACA) have been updated, as described below.

      • Questions and Answers on Information Reporting by Health Coverage Providers (Section 6055). These FAQs provide additional information about completing Forms 1094-B and 1095-B for calendar year 2016 (which are to be filed and furnished in 2017). The FAQs may be used in conjunction with the Instructions for Forms 1094-B and 1095-B, which provide detailed information about completing the forms. Click here to read the FAQs.
      • FAQs About Affordable Care Act Implementation, Part 36. These FAQs address the current accommodation for employers with religious objections to the ACA's contraceptive coverage requirements. The FAQs make clear that no changes to the accommodation are being made at this time. Click here to read the FAQs.   
      © 2012 - 2013 HR 360, Inc.
    • Hawaii Granted Waiver to Discontinue Operation of SHOP Marketplace

      Posted on January 10, 2017
      Print

      Waiver Impacts Employers' Small Business Health Care Tax Credit Eligibility

      The U.S Departments of Health and Human Services and Treasury have approved the State of Hawaii’s application for a waiver from the Affordable Care Act (ACA) requirement that it operate a Small Business Health Options Program (SHOP) Marketplace. The waiver is effective from January 1, 2017 through December 31, 2021.

      Background
      Section 1332 of the ACA permits a state to apply for a "State Innovation Waiver" to pursue innovative strategies for providing its residents with access to quality health care, as long as the plan meets certain requirements to retain the basic protections of the ACA. State Innovation Waivers are available beginning January 1, 2017—Hawaii is the first state to have such a waiver approved. The waivers are approved for five-year periods and can be renewed.

      Small Business Health Care Tax Credit Eligibility Implications
      Because providing SHOP-based coverage is one of the requirements for receiving the Small Business Health Care Tax Credit, the approved waiver will prevent small employers in Hawaii from being eligible for the credit. Credit amounts that would otherwise be paid to small employers in the state will be provided as a pass-through payment to the state, which will be used primarily to support a state fund that helps small businesses cover their health care costs.

      © 2012 - 2013 HR 360, Inc.
    • Key Facts About Information Reporting for Employers and Health Coverage Providers

      Posted on January 05, 2017
      Print

      Overview of the Purpose of Forms 1094 & 1095 and Reporting Deadlines

      The information reporting provisions under the Affordable Care Act require insurers, self-insuring employers, and large employers to submit information returns to the IRS and individuals reporting on health coverage. The IRS is reminding employers and health coverage providers about the types of forms, the purpose of each, and noteworthy dates.

      Form 1095-C, Employer-Provided Health Insurance Offer and Coverage

      • This form is filed by applicable large employers (ALEs), which generally are employers with 50 or more full-time employees, including full-time equivalents.
      • ALEs with fully insured health coverage send this form to full-time employees, with information about the coverage offered. (ALEs that do not offer coverage must still send this form to full-time employees.)
      • ALEs with self-insured health coverage send this form to individuals they cover, with information about who was covered and when.
      • This form is submitted to the IRS with Form 1094-C, Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Returns.
      • The deadline for filing this form with the IRS is February 28, 2017 (or March 31, 2017 if filing electronically).
      • The deadline for furnishing this form to the full-time employee is March 2, 2017, which is a 30-day extension from the original due date of January 31.

      Form 1095-B, Health Coverage

      • This form is filed by providers of minimum essential coverage, including employers that are not ALEs but who offer employer-sponsored self-insured health coverage.
      • This form is used to report information to covered individuals about each person enrolled in coverage, and is sent to the person identified as the "responsible individual" on the form.
      • This form is submitted to the IRS with Form 1094-B, Transmittal of Health Coverage Information Returns.
      • The deadline for filing this form with the IRS is February 28, 2017 (or March 31, 2017 if filing electronically).
      • The deadline for furnishing this form to the responsible individual is March 2, 2017, which is a 30-day extension from the original due date of January 31.

      Additional Resources
      The IRS provides a set of Q&As on information reporting for self-insuring employers and other providers of minimum essential coverage, as well as a set of Q&As for ALEs.

      © 2012 - 2013 HR 360, Inc.
    • CMS to Launch Pilot Program on Marketplace Special Enrollment Eligibility Verification

      Posted on December 29, 2016
      Print

      Pilot to Begin in June 2017

      As part of its continuing effort to ensure that Health Insurance Marketplace special enrollment periods are only available to those who are eligible for them, the Centers for Medicare & Medicaid Services (CMS) has announced a pilot program starting in 2017 that will test the impact of pre-enrollment verification on compliance, enrollment, continuity of coverage, and other outcomes.

      Pilot Program Details
      CMS will pilot the pre-enrollment verification in both the federally-facilitated and state-based Marketplaces that rely on the Healthcare.gov platform. All special enrollment period types will be subject to enhanced verification in some form, whether through the pilot or through other enhanced procedures. In particular, applications based on loss of minimum essential coverage will be included in the pilot.

      Applications will be randomly selected for the pilot, with 50% of new applications with relevant special enrollment periods taking part. Consumers included in the pilot will still be able to submit their application and select a plan, with a coverage effective date determined by the date of plan selection. However, the Marketplace will "pend" the consumer's enrollment until the consumer submits documents that establish his or her eligibility for a special enrollment period.  

      Pilot Program Start Date
      The pilot will begin in June 2017 and CMS anticipates basing future decisions about special enrollment period verification procedures on the results of the pilot. Before the pilot begins, CMS will offer extensive training so that agents, brokers, and others are able to help consumers find and submit the necessary documents.

      Click here for more information on the pilot program.

      © 2012 - 2013 HR 360, Inc.
    • Federal Agencies Finalize Changes to SHOP Exchanges

      Posted on December 27, 2016
      Print

      Most Changes Apply Only to Federally-Facilitated SHOPs, SHOPs Using Federal Platform

      A new final rule from the U.S. Department of Health and Human Services revises the enrollment processes in the Small Business Health Options Program (SHOP) Exchange for plan years beginning in 2018. Among other things, the final rule provides that SHOP Exchanges must:

      • Provide required notices electronically, or, if an employer or employee elects, through standard mail (unless otherwise required by federal or state law);
      • Limit waiting periods to 60 days, beginning on the date the employee becomes eligible—regardless of when the employer notifies the SHOP about the newly qualified employee;
      • Provide an employee who becomes a qualified employee outside of the initial or annual open enrollment period with a 30-day enrollment period that begins on the date the employer notifies the SHOP about the newly qualified employee—employers are required to notify the SHOP on or before the 30th day after the day that the employee becomes a newly qualified employee; and
      • Ensure that the coverage effective date for a newly qualified employee is the first day of the month following plan selection, unless the employee is subject to a waiting period.

      In addition, for employers with variable hour employees that regularly make having a specified number of hours of service per period (or working full-time) a condition of eligibility, any measurement period that the employer uses to determine eligibility for SHOP coverage must not exceed 10 months (rather than the 12-month measurement period otherwise allowed).

      Note: Most of the enrollment processes above are applicable only in federally-facilitated SHOPs (FF-SHOPs) or states using the federal platform for SHOP functions (SBE-FPs). The only finalized modification that applies to all SHOPs (both State-based SHOPs and FF-SHOPs) is the specification with regard to when SHOP waiting periods begin.

      Click here to read the final rule in its entirety.

      © 2012 - 2013 HR 360, Inc.