More Related Content Similar to Cut through the Clutter: 2014 Compliance Update Similar to Cut through the Clutter: 2014 Compliance Update (20) Cut through the Clutter: 2014 Compliance Update1. Cut through the Clutter:
Understanding the latest compliance updates
April 2014
1
Cut through the Clutter:
Understanding the latest compliance updates
Sally Wineman, JD
Area Senior Vice President, Compliance Counsel
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
Timeline
© 2014 GALLAGHER BENEFIT SERVICES, INC.
6/23/10 9/23/10 1/1/12 6/28/12 2014 2015 2016 2018
• Cadillac Tax
• W-2 Reporting
• SBC
• ERRP
• High Risk Pool
• Patient Protections
• Supreme
Court Ruling
• Large Employer Mandate
• Reporting
• Revenue
• Marketplace Opens
• Individual Mandate
• Small Employer
Mandate
2. Cut through the Clutter:
Understanding the latest compliance updates
April 2014
2
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
2014 Plans
• New! Health FSA Carryover- $500
• W-2 Reporting on value of health coverage continues
• Automatic Enrollment (delayed beyond 2014)
• Nondiscrimination (delayed pending guidance)
• Wellness program incentive increase
• Women’s contraceptive coverage
• 2014 Patient Protections
– No waiting periods longer than 90 days unless variable employee
• New! Orientation period
– Elimination of Pre-existing Condition Exclusions for all adults
– No Annual Limits for Essential Benefits
– Grandfathered plans: No exception for coverage up to age 26 on other
employer plan
– Non-grandfathered plans: Limits to out of pocket maximums
($6,350/$12,700)
– Non-grandfathered plans: Cannot deny participation in a clinical trial
– Small employer plans: Limits on deductibles
© 2014 GALLAGHER BENEFIT SERVICES, INC.
Repealed
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
PPACA Notices
• Marketplace notice
• Updated Summary of Benefits
& Coverage (SBC)
• Wellness program reasonable
alternative
• Grandfathered status notice
• Contraceptive coverage self-
certification
• HIPAA Certificate of Creditable
Coverage – through 2014
• New COBRA General Election Notice
© 2014 GALLAGHER BENEFIT SERVICES, INC.
3. Cut through the Clutter:
Understanding the latest compliance updates
April 2014
3
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
• Minimum Essential Coverage (MEC) Reporting
(Section 6055)
– Lets individuals and the IRS know if an employer is
providing minimum essential coverage and if an
individual satisfied the individual mandate for the
preceding calendar year
• Employer Mandate Reporting (Section 6056)
– Lets individuals and the IRS know if an employer is
complying with the employer mandate, minimum
value and affordability
Employer Reporting
© 2014 GALLAGHER BENEFIT SERVICES, INC.
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
MEC Reporting (Section 6055)
© 2014 GALLAGHER BENEFIT SERVICES, INC.
2015
Calendar
Year
Reporting
2016
Report
Are you required to
report?
• Self-funded only
• All size employers
• Not TPA
What year do you
report on?
When do you report?
• Each member of controlled group
reports separately
• To Employees – Jan 31
• To IRS – Feb 28 (March 31 if e-file)
To Enrolled Employees:
Individualized statements
• ≥50 FTEs: Form 1095-C
• <50 FTEs: Form 1095-B
To IRS:
Each employee
statement
• ≥50 FTEs: Form 1095-C
• <50 FTEs: Form 1095-B
To IRS:
Transmittal report
• ≥50 FTEs: Form 1094-C
• <50 FTEs: Form 1094-B
2014
MEC
Reporting
4. Cut through the Clutter:
Understanding the latest compliance updates
April 2014
4
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
Employer Mandate Reporting
(Section 6056)
© 2014 GALLAGHER BENEFIT SERVICES, INC.
2015
Calendar
Year
Reporting
2016
Report
Are you required to
report?
• FTE – include equivalents
• Controlled group – add all FTEs
• ≥50 FTEs only
• Fully-insured and self funded
What year do you
report on?
• Any year ≥50 FTEs
• No delay for employers
50-99 FTEs
When do you report?
• Each member of controlled group
reports separately
• To Employees – Jan 31
• To IRS – Feb 28 (March 31 if e-file)
To Full-Time Employees:
Individualized statements
Form 1095-C
To IRS:
Each employee
statement
Form 1095-C
To IRS:
Transmittal report
Form 1094-C
2014
Employer
Mandate
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
Taxes & Fees
© 2014 GALLAGHER BENEFIT SERVICES, INC.
Purpose Cost Timeframe Responsible Party
Patient-Centered
Outcomes Research
InstituteFee
(“PCORI” or
“CER” fee)
Supports research of effective
and efficient medical prevention,
treatment and care options
$2 annually per covered life ($1 per member
for the policies/plans ending before 10/1/13);
adjusted annually for inflation
• 2013 through 2019; does not
apply to plan/policy years ending
after 9/30/19
• Fee due once per year by 7/31
(for plan year ending in
proceeding calendar year)
• Insurers of fully insured plans, included
in premium cost
• Sponsors of self-insured plans
Transitional
Reinsurance
Assessment Fee
Helps stabilize premiums in
individual market as new high-
cost individuals begin to access
health insurance
$63 annually ($5.25/month) per covered life
for the first year, $44 in 2015 (confirmed)
and estimated to be $26 in 2016
• 2014 through 2016 paid on an
annual basis
• Must report covered lives to
HHS by 11/15 of each year
• Insurers of fully insured plans, included
in premium cost
• Sponsors of self-insured plans; may be
collected and remitted by TPA
• Does not apply to self-insured, self
administered plans for 2015 and 2016
Health Insurer Fee Supports cost of healthcare
reform
Amount will vary for each insurer based on
its relative market share of U.S. health
insurance business; estimates range from 1-
3% of premium
Begins in 2014 and will be ongoing • Insurers of fully insured plans, included
in premium cost
• Does not apply to self-insured plans
Marketplace
(Exchange) Fees
States will either set up State
Marketplaces to help individuals
and small businesses buy health
insurance, or use the Federal
Marketplace; fees used to
support Marketplace
administration
State Marketplaces to be determined and
will vary by state; Federal Marketplace is
3.5% user fee on premiums sold
State Marketplace to be
determined and will vary by state;
Federal Marketplace to be paid
monthly by insurer beginning in
2014
• Some states will assess fees across
only those participating in the
Marketplace while others will assess
across all policies written in and out of
the Marketplace
• Insurers of policies sold by Federal
Marketplace
High-cost Health
Insurance Tax
(Cadillac Tax)
Supports cost of healthcare
reform and encourages reduction
of medical costs
Excise tax of 40% on plan costs that exceed
defined thresholds
Begins in 2018 and will be ongoing • Insurers of fully insured plans, included
in premium cost
• Sponsors/Administrators of self-
insured plans
Additional
Medicare Tax &
Unearned Income
Tax
Supports cost of Medicare
program
0.9% additional Medicare tax on
compensation in excess of $200,000
single/$250,000 married filing jointly
3.8% tax on unearned income for taxpayers
with modified adjusted gross incomes over
$200,000 single/$250,000 married
Begins in 2013 and will be ongoing
Begins in 2013 and will be ongoing
• Individual tax-payers; employer must
withhold if employee’s wages or
compensation exceeds $200,000; no
employer match
• Individual tax-payers
5. Cut through the Clutter:
Understanding the latest compliance updates
April 2014
5
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
PCORI Fee – Due July 31
© 2014 GALLAGHER BENEFIT SERVICES, INC.
Plan Year^
IRS Form 5500
Due Date#
Amount Due
IRS Form 720
Due Date with Payment
2/1/2012 - 1/31/2013 8/31/2013
$1 per number
of covered lives+ per year
July 31, 2014
3/1/2012 - 2/28/2013 9/30/2013
4/1/2012 - 3/31/2013 10/31/2013
5/1/2012 - 4/30/2013 11/30/2013
6/1/2012 - 5/31/2013 12/31/2013
7/1/2012 - 6/30/2013 1/31/2014
8/1/2012 - 7/31/2013 2/28/2014
9/1/2012 - 8/31/2013 3/31/2014
10/1/2012 - 9/30/2013 4/30/2014
11/1/2012 - 10/31/2013 5/31/2014
$2 per number
of covered lives+ per year
12/1/2012 - 11/30/2013 6/30/2014
1/1/2013 - 12/31/2013 7/31/2014
^ The fee is imposed for each plan year ending on or after October 1, 2012, and before October 1, 2019.
# The 5500 method for determining average number of lives may not be used if Form 5500 is filed later than the Form 720 due date.
+ Includes each covered individual; eg. employee, spouse, domestic partner, children, COBRA participants, retirees, etc.
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
Transitional Reinsurance Fee
• 2014 through 2016, paid on annual basis
• $63 annually per covered life for the first year
– $44 in 2015
– Estimated $26 in 2016
• Must report covered lives to HHS by 11/15 each year
– Insurers of fully insured plans: Included in premium cost
– Sponsors of self-insured plans: May be collected and remitted by
TPA
– Does not apply to self-insured, self administered plans for 2015
and 2016
• Paid in 2 installments
– Early January 2015 ($52.50)
– Late 2015 ($10.50)
© 2014 GALLAGHER BENEFIT SERVICES, INC.
6. Cut through the Clutter:
Understanding the latest compliance updates
April 2014
6
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
“Cadillac” Tax - 2018
© 2014 GALLAGHER BENEFIT SERVICES, INC.
COBRA Rate ≥ $10,200 for individual or
$27,500 for family
Special Provisions
• High risk
professions
• Early retirees
• Age & gender
= 40% of plan value that
exceeds threshold
Excise Tax
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
Penalty
Individual Mandate
Exception
Minimum
Essential
Coverage
Premium
Assistance
400% FPL
$45,960 (single)
$94,200 (family of 4)
7. Cut through the Clutter:
Understanding the latest compliance updates
April 2014
7
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
Premium Assistance
• Premium assistance available to lower cost of
coverage for those <400% FPL
© 2014 GALLAGHER BENEFIT SERVICES, INC.
Expanded
Medicaid
Cost
Sharing
Federal Poverty
Level
Annual Income:
Individual
Annual Income:
Family of Four
100% $11,490 $23,550
138% $15,856 $32,499
250% $28,725 $58,875
300% $34,470 $70,650
400% $45,960 $94,200
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
The Marketplace
© 2014 GALLAGHER BENEFIT SERVICES, INC.
Gold Plan
Bronze Plan
Silver Plan
Platinum Plan
Catastrophic Plan
Large Group
Individuals
Small Group
?
Government
Subsidy
Providers
8. Cut through the Clutter:
Understanding the latest compliance updates
April 2014
8
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
Connect for Health Colorado
© 2014 GALLAGHER BENEFIT SERVICES, INC.
• 277,149 enrolled as of 4/1
– 158,521 in Medicaid
• 59% of enrollees received premium assistance
• Next open enrollment:
– Nov 15, 2014 – Feb 15, 2015
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
Premium Assistance
• Most individuals who are eligible for employer-
sponsored coverage will not be eligible to receive
premium assistance
• Unless:
– Low value plan (less than 60% minimum value)
– Unaffordable (employee-only contribution is greater
than 9.5% of income*)
© 2014 GALLAGHER BENEFIT SERVICES, INC.
*Proposed regulations
9. Cut through the Clutter:
Understanding the latest compliance updates
April 2014
9
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
Employer Mandate for 2015
© 2014 GALLAGHER BENEFIT SERVICES, INC.
No penalty applies!
Lesser of:
•$3,000 per FTE receiving tax
credit*
Or
•$2,000 per FTE (minus first 80)
$2,000 penalty per FTE (minus
first 80) if at least one FTE
receives the tax credit
No penalty applies!
Is coverage affordable?
Plan provides minimum
required value?
Offer MEC to 70% of
FTEs (and dependents)?
^ May be eligible for delay to 2016 if 50-99 FTEs and meet requirements.
* Only applies to FTEs with household incomes of 400% of FPL or less
Have at least 50 FTEs?^
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
When do penalties apply?
• ^Must meet requirements for delay- not automatic
• *Must meet eligibility requirements for transition rule – not automatic
• Use monthly average count of employees to determine large
employer status
– May use any 6 month period in calendar 2014 for 2015
© 2014 GALLAGHER BENEFIT SERVICES, INC.
Employer Size Calendar Year Plan Non-Calendar Year Plan
0-49 FTEs N/A N/A
50-99 FTEs January 1, 2016^ 1st day of 2016 plan year*
100+ FTEs January 1, 2015 1st day of 2015 plan year*
10. Cut through the Clutter:
Understanding the latest compliance updates
April 2014
10
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
Transition Rules
• Transition rule available for non-calendar year plans
• Transition rule available for employers with 50-99 FTE employees
– Not automatic
– Flowcharts available at www.ajghealthcarereform.com
– Newsletters  Healthcare Reform Update, March 3, 2014
© 2014 GALLAGHER BENEFIT SERVICES, INC.
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
Employer Mandate for 2015
© 2014 GALLAGHER BENEFIT SERVICES, INC.
No penalty applies!
Lesser of:
•$3,000 per FTE receiving tax
credit*
Or
•$2,000 per FTE (minus first 80)
$2,000 penalty per FTE (minus
first 80) if at least one FTE
receives the tax credit
No penalty applies!
Is coverage affordable?
Plan provides minimum
required value?
Offer MEC to 70% of
FTEs (and dependents)?
^ May be eligible for delay to 2016 if 50-99 FTEs and meet requirements.
* Only applies to FTEs with household incomes of 400% of FPL or less
Have at least 50 FTEs?^
11. Cut through the Clutter:
Understanding the latest compliance updates
April 2014
11
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
Full-Time Employees
• Effective January 1, 2015
– May be eligible for delay until 2016 if 50-99 FTEs – not automatic
• Count FTE working 30 hpw or more
• Also calculate full-time equivalent employees
– Any employee hours worked under 30 hpw (but no more than 120 hours per
month)
– (PT hours worked) / 120 = Full time equivalents
• Add together full-time plus full-time equivalent employees
• Count all employees in a controlled group during preceding calendar year
• Excludes:
– Sole proprietor
– Leased employees
– Partners
– 2% S corp shareholder
– Foreign employees (maybe)
No penalty applies!Have at least 50 FTEs?^
© 2014 GALLAGHER BENEFIT SERVICES, INC.
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
Additional Relief in 2015
• Offer employee + dependent coverage
– Does not include spouse
– New! Does not include foster children or step-children
• Offer coverage to “substantially all” full-time employees
– 95% of FTEs (70% for 2015)
• Provide effective opportunity to accept or decline coverage
• Member by member company assessment
– Not on a controlled group basis
– Controlled group must share the 30 FTE (80 for 2015) exclusion pro-
rata
• Minimum essential coverage
© 2014 GALLAGHER BENEFIT SERVICES, INC.
$2,000 penalty per FTE (minus
first 80^) if at least one FTE
receives the tax credit
Offer MEC to 70%* of
FTEs (and dependents)?
* 95% in 2016 and beyond
^ 30 in 2016 and beyond
12. Cut through the Clutter:
Understanding the latest compliance updates
April 2014
12
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
Full Time for Penalty Calculation
• Who is an employee? Common law definition
• Who is full-time?
– Worked an average of at least 30 hours/week (130/month)
• Calculate hours worked:
– Hourly Employees - actual hours worked plus PTO
– Non-Hourly Employees – three options:
• Actual hours worked plus PTO
• Days worked equivalent (8 hours per day)
• Weeks worked equivalent (40 hours per week)
• Look-Back Method
– New variable hour or seasonal employees
– Ongoing variable hour employees
– Part-time employees
• Monthly Measurement Method
– No penalty if offer coverage by 1st day of 4th month
© 2014 GALLAGHER BENEFIT SERVICES, INC.
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
Employee Categories
© 2014 GALLAGHER BENEFIT SERVICES, INC.
• Offer affordable, minimum value employee + dependent child coverage
• Offer coverage within 90 days or pay penalty
Full-Time Employee
(30+ hpw)
• Use measurement/lookback period to monitor eligibility
• No penalty applies if remain part-time
Part-Time Employee
(<30 hpw)
• Six months or less which begins in same part of year each year
• May use measurement/lookback period to determine eligibility
• Offer coverage no later than 13 (+fraction) months from hire date or pay penalty
Seasonal Employee
(30+ hpw)
• Can’t be determined that the employee is reasonably expected to work 30 hpw
• May use measurement/lookback period to determine eligibility
• Offer coverage no later than 13 (+fraction) months from hire date or pay penalty
New Variable Employee
(30+ hpw)
• May use measurement/lookback period to determine eligibility (no longer than
12 months)
• Offer coverage at end of admin period or pay penalty
Ongoing Variable Employee
(30+ hpw)
13. Cut through the Clutter:
Understanding the latest compliance updates
April 2014
13
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
Variable Hour and Seasonal Employees
• New! Who is variable?
– Is employee replacing FT employee or non-FT employee?
– Have ongoing employees in same/comparable position varied
above/below average of 30 hours of service per week?
– Was job advertised, communicated, or documented as requiring
hours of service that would average 30 or more/less?
© 2014 GALLAGHER BENEFIT SERVICES, INC.
• New! Who is seasonal?
– Employee in position for which customary annual
employment is 6 months or less
– Begins in the same time of year each year (e.g.,
summer or winter)
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
FTE Special Status Clarifications
• New! Short-term and high-turnover employees
– Must offer coverage to short-term hires reasonably expected to
work a full-time schedule by the first day of the fourth full month
after hire (or risk paying a penalty)
• New! Unique hours of service (e.g. adjunct faculty, layover or
on-call hours)
– Must use reasonable method of crediting hours
• New! Volunteers
– Hours of service as bona fide volunteer do not count
• New! Student interns
– If full-time interns are unpaid, hours not counted as hour of service
• New! International employees
– May treat as terminated if position anticipated to continue
indefinitely or at least 12 months, and substantially all compensation
treated as foreign-sourced income
© 2014 GALLAGHER BENEFIT SERVICES, INC.
14. Cut through the Clutter:
Understanding the latest compliance updates
April 2014
14
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
Measurement/Stability Safe Harbor
© 2014 GALLAGHER BENEFIT SERVICES, INC.
Standard Measurement Period
Standard
Administrative
Period
Standard Stability Period
Ongoing employees
• Look-back at hours worked by
variable hour employee to determine
eligibility for coverage
• Employer choose length from 3 to 12
months
• Coverage remains available
regardless of hours worked during
stability period
• Full time employees
• Cannot be shorter than the
standard measurement period
• Must be at least 6 months
• Non full time employees
• Stability period cannot be longer
than the standard measurement
period
• Count hours, offer &
enroll in coverage
• Maximum length of
90 days
• Cannot reduce or
lengthen the
measurement or
stability period
• Overlaps with prior
stability period
• New! Short transitional 6-month measurement period for 2015
• Monthly measurement period – “weekly rule” to accommodate payroll periods
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
Ongoing Full-Time Employee
© 2014 GALLAGHER BENEFIT SERVICES, INC.
2013
Plan Year
2014
Plan Year
1st Stability Period
Jan 1, 2015-Dec 31, 2015
2nd Stability Period
Jan 1, 2016-Dec 31, 2016
1st Standard
Measurement Period
(6-Month Transition Relief)
Apr 15, 2014-Oct 14, 2014
1st Administrative Period
(≤90 days)
Oct 15, 2014-Dec 31, 2014
2nd Standard Measurement Period
(≤12 months)
Oct 15, 2014-Oct 14, 2015
2nd Administrative Period
(≤90 days)
Oct 15, 2015-Dec 31, 2015
• Meets hpw
requirements during 1st
Standard Measurement
Period
• Employee offered
coverage Jan 1, 2015
15. Cut through the Clutter:
Understanding the latest compliance updates
April 2014
15
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
Measurement/Stability Safe Harbor
© 2014 GALLAGHER BENEFIT SERVICES, INC.
Initial Measurement Period
Initial
Administrative
Period
Initial Stability Period
New employees
*Combined length of initial measurement period and the administrative period cannot be longer
than 13 and a fraction months from employee’s hire date
• Look-back at hours worked by
variable hour employee to determine
eligibility for coverage
• A period of 3 to 12 months*
• Coverage remains available
regardless of hours worked during
stability period
• Full time employees
• Must be at least 6 months
• Cannot be shorter than the initial
measurement period
• Cannot be shorter than the
standard stability period for
ongoing employees
• Non full time employees
• Stability period cannot be more
than 1 month longer than the
initial measurement period
• Count hours, offer
& enroll in coverage
• Maximum length of
90 days*
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
Break in Service/Leaves of Absence
• New! Breaks longer than 13 weeks (26 weeks for schools)
– Treat as a new employee
• Breaks shorter than 13 weeks
– Treat as continuing employee with same status for the
remainder of the stability period
– Treat measurement period as if did not have a break in
service (counting zero hours during break)
• Optional – Rule of Parity
– Use for breaks between 4-13 weeks
– Can treat as new employee if the break period is longer than
immediately preceding employment period
© 2014 GALLAGHER BENEFIT SERVICES, INC.
Initial Employment = 9 weeks
Employee terminates
Break in Service = 12 weeks
Employee rehired. Break in service longer than
initial employment.
Employer can:
1) Treat as continuing employee, or
2) Treat as new employee
16. Cut through the Clutter:
Understanding the latest compliance updates
April 2014
16
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
Special Unpaid Leave
• Special unpaid leave
– FMLA
– USERRA/military leave
– Jury duty
• Credit hours as:
1. Hours worked Ă· # of weeks
worked (disregarding LOA weeks);
or
2. Average weekly hours used for
LOA weeks
© 2014 GALLAGHER BENEFIT SERVICES, INC.
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
What’s to come?
• Employer Reporting
• Automatic Enrollment rules
• Nondiscrimination rules
• Health Plan Identification number
• HIPAA standard transaction certification
• 2018 Cadillac Tax
2015 Open Enrollment for Marketplaces:
Nov. 15, 2014 – Feb. 15, 2015
© 2014 GALLAGHER BENEFIT SERVICES, INC.
17. Cut through the Clutter:
Understanding the latest compliance updates
April 2014
17
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
Other Compliance Topics
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
• Dental or vision excepted if:
– Limited in scope; and either:
1) Separate policy, certificate or contract of insurance
or
2) Not an integral part of GHP
– Right to waive dental or vision benefit; AND
– Additional contribution required (eliminated) New!
• Employee Assistance Program (EAP) excepted if:
• Does not provide significant medical benefits
• Not coordinated with other group health benefits
• No employee contribution allowed
• No cost sharing under EAP
Excepted Benefits
© 2014 GALLAGHER BENEFIT SERVICES, INC.
18. Cut through the Clutter:
Understanding the latest compliance updates
April 2014
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ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
Excepted Benefits
• Health FSAs excepted if:
– Major medical group coverage available to employee
– Maximum annual benefit (employee and employer FSA contribution)
cannot exceed 2x the employee’s election (or, if greater, the
employee’s election, plus $500)
• HRA – no general exception
– If only reimburse limited-scope dental or vision
– Exception from annual limit and preventive services mandate if
“integrated” HRA
• Must offer other non-excepted group health plan
• Employee must be enrolled in another non-excepted group health
plan
• HRA only available to employee enrolled in other group health plan
• Must be able to permanently opt out and waive future HRA
reimbursements
© 2014 GALLAGHER BENEFIT SERVICES, INC.
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
• Defense of Marriage Act (DOMA) –
– Section 3 declared unconstitutional by Supreme Court in
Windsor decision on June 26, 2013
– “Spouse”, “marriage”, “husband” and “wife” will include
spouses of the same-sex, if legally married under state or
federal law
– Place of celebration controls the definition of spouse, not
place of residence
– “Marriage” does not include domestic partnership or civil
union under state law
• Colorado:
– Recognize same-sex civil unions since May 1, 2013
– Allow joint filing for state income tax as of 2014 tax years
DOMA
© 2014 GALLAGHER BENEFIT SERVICES, INC.
19. Cut through the Clutter:
Understanding the latest compliance updates
April 2014
19
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
DOMA Issues
• Fully-insured plans
• Self funded plans
• Proof of relationship?
• Federal tax issues
– Legally married same-sex spouse recognized as “spouse”
for tax purposes, regardless of state of residence
– Effective September 16, 2013
• FMLA
• COBRA
• HIPAA Special Enrollment
• HSA
• Section 125 Cafeteria Plan
© 2014 GALLAGHER BENEFIT SERVICES, INC.
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
Questions?
ajghealthcarereform.com
© 2014 GALLAGHER BENEFIT SERVICES, INC.
20. Cut through the Clutter:
Understanding the latest compliance updates
April 2014
20
ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™
Thank you!