Timely updates on Recent State and National Legal Issues affecting Employers

1. Industrial Insurance Associates
November 2012 “Benefits and Business Insurance Alert” TM
FREE: What is a Contractor's Obligation to Provide Reasonable
Accommodation to An Employee's Disability?
Event Name: Workplace Accommodations under the Rehabilitation Act of 1973
Description: This Chicago District Office Technical Assistance Event will discuss a
contractor's obligations to provide reasonable accommodation to employees'
disabilities.
Date: Dec 5, 2012
Time: 10:00 to 12:00
Location: 230 South Dearborn
Room 706
Chicago, IL
Information: 312-596-7045
2013 Retirement Planning - New Contribution Limits Announced
The IRS has announced cost-of-living adjustments affecting dollar limits for defined contribution
and defined benefit retirement plans and other retirement-related items for 2013. Many plan limits
on contributions and benefits will rise as a result. Below are the key changes effective Jan. 1, 2013.
Defined Contribution Plans
• The contribution limit for employees who participate in 401(k), 403(b) and most 457 plans
increases to $17,500 from $17,000.
• The catch-up contribution limit for those age 50 and older remains unchanged at $5,500.
• The overall limit for defined contribution plan deferrals from all sources (employer and employee
combined) increases to $51,000 per participant from $50,000.
• The amount of employee compensation limit that can be considered in calculating contributions to
defined contribution plans increases to $255,000 from $250,000.
• The limit used in the definition of a key employee in a top-heavy plan remains unchanged at
$165,000.
• The limit used in the definition of a highly compensated employee for 401(k) nondiscrimination
testing purposes remains at $115,000.
Healthcare Reform - New Provisions - Highlights: 2013 and 2014
2013
1. FSA limit of $2,500 (Effective 1/1/2013 or at the start of the plan’s 2013 plan year)

2. 2. Health Coverage - Restricted annual limit on essential benefits at $2 million
3. Availability of Public Exchange notices to all employees due by March 1, 2013, but there is
no guidance as of yet, so this deadline may be postponed
4. Elimination of Medicare Part D subsidy tax advantage
5. Patient-centered outcome research fee on health insurers and sponsors of self-funded plans
6. 0.9 percent increase in Medicare tax for employees earning at least $200,000
2014
7. Individual mandated purchase of health insurance
8. Public Exchange health insurance coverage available
9. Employer Health Benefits “pay-or-play” mandate
10. Health insurance coverage of essential health benefits (individual & small-group only)
11. Health insurer rating limits (individual and small groups only)
12. Health insurer guaranteed issue requirement and renewability
13. New Hire Benefit Waiting periods limited to 90 days
14. No annual dollar limit on essential health benefits
15. Coverage for clinical trials, which can be pretty expensive
16. Increased wellness plan incentive to 30 percent
17. No pre-existing condition exclusions, regardless of age
18. Cost-sharing limits of $5,950 for individual coverage/$11,900 for family (adjusted in 2014)
19. Deductible limit of $2,000 for individual coverage/$4,000 for family coverage
20. Insurer provider fee—Insurer must pay a new “tax” based on net written premiums
21. Reinsurance fee on insurer & third party administrator of self-funded plan, payable
2014-16, collected quarterly starting Jan. 15, 2014, the fee is supposed to raise $10 billion used
towards the Healthcare Law’s expenses
22. Section 6055 IRS reporting for plans that provide minimum essential coverage
Section 6056 IRS reporting for large employers (at least 50 full-time employees),
presumably to verify individual mandate and pay-or-play information
Repeal?
At this juncture, there is a tremendous amount of uncertainty surrounding the PPACA .
If Mitt Romney becomes president and Republicans hold sway in Congress, much of PPACA could
be “unwound” in a big budget bill. But a budget bill might not repeal the entire law. Romney may
also delay new rules, repropose existing rules and institute nonenforcement policies to buy time
before repeal.
If President Barack Obama is re-elected, parts of PPACA will get scrutinized again, most likely.
Employers should expect an avalanche of guidance after the election.
Affordable Care Act: Quiz Corner
Healthcare reform has a provision requiring insurers to pay new fees in addition to current taxes ?
Answer: See items 20 and 21 above
Industrial Insurance Associates
1632 Colonial Parkway
Inverness, IL 60067
847-705-6600