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Preston Rutledge to be Nominated as Next EBSA Head | Maryland Benefit Advisors

President Trump has announced his intent to nominate Preston Rutledge as Assistant Secretary of Labor, Employee Benefits Security Administration (EBSA). The position as head of the EBSA has been vacant since Phyllis Borzi stepped down in January 2017.

The White House announcement includes highlights of Mr. Rutledge’s career which clearly demonstrate his knowledge and experience in the employee benefits field:

“Mr. Rutledge currently serves as senior tax and benefits counsel on the Majority Tax Staff of the U.S. Senate Finance Committee where his responsibilities include employee benefits, retirement issues, tax-exempt organizations, health tax issues, and the tax provisions of the Affordable Care Act. Prior to joining the Finance Committee, Mr. Rutledge served as a senior tax law specialist on the Headquarters Staff of the Tax Exempt and Government Entities Division of the Internal Revenue Service, and as a senior technical reviewer in the Qualified Pension Plans Branch of the IRS Office of Chief Counsel. During his tenure there, he was the recipient of an Office of Chief Counsel National Award. Mr. Rutledge also served as a law clerk on the United States Court of Appeals for the Fifth Circuit, and worked in private law practice as an employee benefits counselor and ERISA litigator. Mr. Rutledge earned a B.S. in business, cum laude, from the University of Idaho; J.D., with high honors, from the George Washington University School of Law, and an L.L.M. – taxation, with distinction, including a certificate in employee benefits law, from the Georgetown University Law Center.”

Working under the direction of the Secretary of the Department of Labor, Alexander Acosta, the new EBSA head will play an important role in crafting regulatory guidance on the Employee Retirement Income Security Act (ERISA), the Affordable Care Act (ACA), and other employee benefit plan laws.

Originally posted by www.ThinkHR.com

President Directs Federal Agencies to Consider ACA Changes | Maryland Benefit Advisors

On October 12, 2017, President Trump issued an Executive Order directing the Departments of Labor (DOL), Health and Human Services (HHS), and Treasury to develop new rules to allow some exemptions from the Affordable Care Act (ACA).

The Order indicates the Administration’s priorities although it has no immediate effect since any rule changes must first go through a long proposal, review, and public comment process.

The Order’s key directives are:

1. Consider expanding the time period allowed for short-term limited duration insurance (STLDI).
By excluding pre-existing conditions and restricting the scope of covered services, STLDI policies typically offer lower premiums. STLDI policies are already exempt from many of the ACA’s requirements, but are generally limited to three-month coverage periods. Changing the federal rules may allow greater availability for longer coverage periods, although state insurance laws will also need to be considered.

2. Consider allowing employer-funded Health Reimbursement Arrangements (HRAs) to reimburse their employees’ premiums for individual medical insurance.
HRAs allow employers to make tax-free contributions to account plans that reimburse employees for eligible healthcare expenses, such as group medical deductibles and co-pays. The ACA currently prohibits employers (other than certain small employers) from paying or reimbursing an employee’s individual policy premiums either directly or through an HRA. This prohibition could be revised or eliminated by changing the current federal rule.

3. Consider loosening restrictions on association health plans and expand availability across state lines.
Association health plans are designed to cover members of professional and trade groups. Generally they are exempt from some of the ACA requirements and state insurance laws that apply to typical “small employer” group health plans. Expanding the availability of association health plans, which generally offer less coverage at lower costs, would likely require changing how group plans are defined under the Employee Retirement Income Security Act (ERISA). Also, state insurance laws, particularly in states that are wary of association health plans, may limit the impact of any federal rule changes.

ThinkHR will continue to monitor developments as the federal regulatory agencies consider rule changes. In the meantime, all current ACA requirements and state insurance laws continue to apply.

Originally posted by www.ThinkHR.com

IRS Releases Final 2017 ACA Reporting Forms and Instructions | Maryland Benefit Advisors

The IRS has finalized the forms and instructions that employers will use for 2017 reporting under the Affordable Care Act (ACA).

Applicable large employers (ALEs) will use the following:

Employers that self-fund a minimum essential coverage plan will use the following:

Background

Applicable large employers (ALEs), who generally are entities that employed 50 or more full-time and full-time-equivalent employees in the prior year, are required to report information about the health coverage they offer or do not offer to certain employees. To meet this reporting requirement, the ALE furnishes Form 1095-C to the employee or former employee and files copies, along with transmittal Form 1094-C, with the IRS.

Employers, regardless of size, that sponsor a self-funded (self-insured) health plan providing minimum essential coverage are required to report coverage information about enrollees. To meet this reporting requirement, the employer furnishes Form 1095-B to the primary enrollee and files copies, along with transmittal Form 1094-B, with the IRS. Self-funded employers who also are ALEs may use Forms 1095-C and 1094-C in lieu of Forms 1095-B and 1094-B.

Information is reported on a calendar-year basis regardless of the employer’s health plan year or fiscal year.

Changes for 2017

The 2017 forms and instructions are similar to the 2016 materials, although there are some changes for items that no longer apply or to simplify or clarify the information. Some of the changes include:

  • Removing references to transition relief options that are no longer available to ALEs.
  • Confirming the multiemployer interim relief rule remains in place for ALEs that contribute to a multiemployer plan (e.g., union trust).
  • Updating references for items that have been adjusted for inflation, such as the affordability percentage (9.69 percent for 2017).
  • Adding a note in the instructions for Form 1095-C, line 16, stating that “There is no specific code to enter on line 16 to indicate that a full-time employee offered coverage either did not enroll in the coverage or waived the coverage.”

In general, the forms and instructions are very similar to the versions used last year. Since the reporting requirements have been in place for several years now, employers and their advisors should have little trouble in working with the new materials for 2017.

Due Dates

The due date to furnish 2017 forms to individuals is January 31, 2018, while the due date to file copies with the IRS, including the appropriate transmittal form, will depend on whether the employer files electronically or by paper. Entities that provide 250 or more forms to individuals are required to file electronically with the IRS.

The due dates for 2017 reporting are:

  • January 31, 2018: Deadline to furnish 2017 Form 1095-C (or 1095-B, if applicable) to employees and individuals.
  • February 28, 2018: Deadline for paper filing of all 2017 Forms 1095-C and 1095-B, along with transmittal form 1094-C or 1094-B, with the IRS.
  • April 2, 2018: Deadline for electronic filing of all 2017 Forms 1095-C and 1095-B, along with transmittal form 1094-C or 1094-B, with the IRS. (April 2 is the first business day following the usual due date of March 31.)

Summary

Employers are encouraged to work with experienced vendors, tax advisors, and payroll administrators to review how the ACA reporting requirements apply to their situation. The required forms are important IRS documents and preparers should use the same level of care that would apply to employee W-2s.

Originally posted by www.ThinkHR.com

Senate Fails to Pass Any Changes to the ACA | Maryland Benefit Advisors

In the early morning hours of July 28, 2017, the Senate’s leadership failed in its latest attempt to pass a bill—any bill—to repeal the Affordable Care Act (ACA). Capping off weeks of divergent proposals, and various procedural moves to avoid the normal committee process, the last measure was defeated 49 – 51.

What happens now? Possibly nothing at all—at least not in Congress. On the other hand, several senators and representatives from both sides of the aisle have expressed their intent to work together to craft modifications to the existing law. While any significant legislation is highly unlikely, the parties may find some areas of agreement to revise specific items within the ACA. Typically, such work would begin in committees in the House and Senate.

Meanwhile, we may see some changes in how the ACA is enforced. The Departments of Labor (DOL), Treasury (including the IRS), and Health and Human Services (HHS), with joint responsibility for regulating and enforcing the ACA, may take steps to change rules that the current administration considers too burdensome on businesses or individuals.

Originally Posted By www.thinkhr.com

How the GOP and Democrats might begin to compromise on health care | Maryland Benefit Advisors

WASHINGTON — Senate Majority Leader Mitch McConnell warned last week that Republicans’ failure to pass comprehensive health care reform could have dire consequences. He even warned of one scenario rarely seen here lately: bipartisanship.

There’s no guarantee that a holistic, bipartisan health care bill could succeed should McConnell’s nearly single-handed effort to repeal much of the Affordable Care Act fail. But Democrats at least claim they are willing to compromise.

“We’re all there,” Sen. Sherrod Brown (D-Ohio) said of his party’s willingness to work on fixes to existing law. “I don’t know what it ultimately looks like, but clearly we stabilize the insurance pool, clearly we want to get more young, healthy people in. Clearly we need to go after the price of prescription drugs. … All kinds of things.”

It is entirely possible, of course, that McConnell could wrangle enough votes to enact a GOP plan, and that a compromise approach will prove unnecessary.

And even if the Republican effort fails, members of both parties could decide to do nothing at all, instead allowing uncertainty to reign and cause the insurance market to struggle, playing the blame game through the midterm elections in November 2018.

But there is at least a faint scent of bipartisanship in the air in Washington, and Democratic legislators in recent weeks have hinted at a number of long-ignored policy ideas that, under the right circumstances, could form the basis for a health bill that garners the requisite votes in the Senate and House.

What might that bill look like? Democrats don’t have a single answer. But STAT’s interviews with senators, lobbyists, Capitol Hill staffers, and outside analysts at least provide some outlines of the picture, however blurry it may be.

Insurance reform

Any compromise would likely start with insurance reform — and with helping to lower premiums or stabilize insurance markets.

At least 41,000 people in some 61 counties are at risk of having no insurance options on HealthCare.gov — and there’s no backup plan in federal law. Many others could see sizable jumps in their monthly health insurance premiums for next year.

Democrats seem more willing than ever to acknowledge the ACA’s flaws. There is increasing willingness on their part to allow states more flexibility in structuring their insurance exchanges; some hints at modifying the strictness of essential health benefit requirements; and perhaps even allowing insurers to widen age bands — ratios that dictate how much more they can charge older, sicker patients as compared to younger, healthier ones.

There are several health policy solutions that both parties agree on — at least in the abstract.

Republican repeal bills in the House and Senate include massive federal financing for so-called reinsurance programs that help offset the costs of some of the sickest Americans. Obamacare, too, included a temporary reinsurance program — and several Democratic senators offered new legislation this month that would focus on that solution.

“One of the biggest challenges insurance companies have faced is managing their risk,” said Sen. Chris Coons (D-Del.), pointing to the reinsurance bill he co-sponsored with two other Democrats.

One related idea from Sen. Lindsey Graham (R-S.C.) would place those diagnosed with any of the five or so most expensive health conditions in a federally managed risk pool so healthier Americans need not subsidize their insurance.

“How many of those people do we have on the risk pool?” said Sen. Heidi Heitkamp (D-N.D.), who has responded enthusiastically to Graham’s concept. “How do we get them off the risk pool so that insurance becomes affordable for a whole lot more people? … There’s a ton of stuff we could be talking about if we lay down some facts and lay down some priorities.”

Mandates, essential health benefits, and more

Beyond market stability, little is clear. But many Democrats — if Republicans back off proposals to reduce future Medicaid spending — appear ready to negotiate on more granular policy elements.

Among those is flexibility on the individual and employer mandates. Even the left-leaning Urban Institute in January recommended replacing the ACA’s unpopular individual mandate with a version of the premium penalties currently imposed for late enrollment by some Medicare programs. The version of the health care bill passed by the House would have allowed insurers to charge larger premium penalties — a 30-percent markup to those who failed to maintain continuous coverage — while the pending Senate version would impose a six-month waiting period for those looking to re-enter the market.

“I think the six-month waiting period is industry consensus — that’s what [the individual mandate] needs to be replaced with,” said Katie Allen, the president of the free-market Council for Affordable Health Coverage.

There is room to work, it seems, on the employer side as well.

Democrats may be open to increasing the number of employees at which some businesses would be compelled to offer health insurance, said Sen. Angus King (I-Maine), who caucuses with the Democrats. Current law forces most companies with 50 or more employees to offer health insurance, but some employers close to that threshold say the mandate makes it difficult to do business successfully.

Of course, all of these proposals cost money. How Congress would pay for them, even if a policy consensus is unexpectedly reached, remains a major question — at least, to some.

“What, you mean instead of a tax cut of $800 billion for rich people?” Brown said, referring to the pending Republican bill. “[Some proposals cost] some money, but it’s costing a lot more to have this volatility.”

Another Republican policy concept is a bill long pushed by pair of moderate Republicans — Susan Collins of Maine and Bill Cassidy of Louisiana — and long ignored by everyone else. One of its provisions would allow some states to opt out of essential health benefit requirements, which Democrats have no desire to permit. Allowing a select number of slight easements in those requirements, however, is not out of the question.

Still to be determined: whether Democrats can stomach the idea of widening existing age bands from 3:1 to 5:1, meaning older, sicker consumers would pay higher premiums than younger healthier ones at a wider disparity. Many senators, when asked, said the question was premature and that they preferred first to focus on market-stabilization measures.

Another carrot Democrats could offer the right wing is the expansion of both 1332 and 1115 waivers for ACA restrictions. Such exemptions would allow states to restructure their health exchanges so long as coverage levels remained roughly equivalent, and to spend Medicaid funds in ways otherwise unauthorized but that the federal government judges will yield at least equivalent outcomes. Besides boilerplate language about allowing states more flexibility, Democrats so far have had little to say.

Other provisions

There are also some parts of Obamacare that have long been unpopular with a subset of Democratic lawmakers. Efforts to repeal the so-called Cadillac tax on high-cost plans have earned the support of as many as 90 senators. The dreaded Independent Payment Advisory Board, which could institute Medicare cuts as early as this year, is also unpopular with both parties.

Drug pricing

Democrats were also largely silent or vague when asked for bipartisan solutions to bring down drug prices. That’s hardly a surprise — after all, other than a belief that Medicare should be able to negotiate drug prices, Democrats don’t uniformly agree on a solution to sky-high pharmaceutical costs.

But both Republican and Democratic members of Congress agree on the need for reform, even if they don’t know exactly how to get there.

There are various bills in play proposing more transparency requirements for pharmacy benefit managers’ price structures, a longstanding proposal to allow pharmaceutical reimportation from Canada to increase competition; and a proposal from Ron Wyden (D-Ore.) to force drug makers to justify substantial price hikes.

If there’s enough pressure for the Senate to act on a comprehensive health care bill, it could present an opportunity for any of those parties to shoehorn in a drug-pricing proposal that other members would feel compelled to vote for.

The issue has otherwise stagnated in Congress, with Sen. Lamar Alexander (R-Tenn.), who chairs the Senate committee overseeing most health policy, pledging not to hold further hearings on drug pricing as he “awaits a bipartisan attitude” on health care.

The day after those comments, Sen. Bernie Sanders (I-Vt.) wrote an open letter to Alexander asking him to “end backroom deals” on health care.

Opioid crisis

The current Senate bill initially included a $2 billion fund meant essentially as a peace offering to Republican senators worried about the impact of Medicaid spending reductions on access to addiction treatment. The current, pending draft reportedly increased that sum to $45 billion. If the GOP bill fails and leaves Medicaid untouched, calls for that level of spending may dissipate. Still, the opioid epidemic remains an issue of bipartisan concern and could present lawmakers with an opportunity.

The House’s Bipartisan Heroin Task Force last week unveiled a package of legislation that would provide hundreds of millions of dollars to bolster addiction treatment efforts. It is not what’s needed, many experts say, but Republicans have shown at least some willingness to bolster spending on the crisis.

Sen. Roy Blunt (R-Mo.), who chairs the Senate’s health appropriations subcommittee, told STAT last month that he doubted there was an efficient mechanism for spending money on the scale currently included in the bill. But if members can pass a bipartisan health bill, it seems that added funding for addiction treatment and prevention would be among the most politically popular elements.

The bottom line

In the end, the negotiations all boil down to a simple question: whether the two parties can compromise. True to the Senate’s partisan tone of late, members’ responses to that question were revealingly different.

“We don’t see much energy on the part of the other side to come to the table with us, unless it’s 100 percent their way,” said Sen. Orrin Hatch (R-Utah), who chairs the Senate Finance Committee tasked — at least in theory — with drafting the Senate legislation. “And I don’t even see that effort.”

Democrats say they’re willing to make that effort. But for now they’re also unwilling to budge on a central plank of the GOP’s plan: rolling back the expansion of Medicaid and reducing its spending increase rate.

Sen. Jon Tester (D-Mont.) said he was “absolutely” willing to compromise.

But, he added, “if the price of admission is throwing 22 million people off of insurance, I’m out.”

Originally published by www.statnews.com

Senate Releases Health Care Proposal | Maryland Benefit Advisors

This morning, Senate Republicans released their proposal to repeal and replace the Affordable Care Act (ACA). Called the Better Care Reconciliation Act of 2017 (BCRA), the Senate proposal adopts H.R. 1628, the bill narrowly passed last month by the House of Representatives, but replaces all the text. The Senate proposal was released without going through committee review or being scored by the Congressional Budget Office (CBO). Next week, after the CBO provides cost and impact estimates, the full Senate will begin debating and amending the proposed legislation.

As was the case with the House bill, the Senate’s BCRA primarily focuses on funding for Medicaid and other state programs, maintaining stability in the individual insurance markets, and giving individual states more flexibility in opting out of insurance reforms. Also included are a number of provisions offering relief to employers and reducing the scope of requirements on group health plans. Below are highlights of provisions of the most interest to employers.

Employer Highlights:

  • Employer Mandate: The BCRA would repeal the ACA’s employer shared responsibility provision, that is the so-called “employer mandate” or “play or pay,” as of 2016. The rules for 2015 would not change, which would still be an issue for certain large employers that did not qualify for transition relief that year.
  • Employer Reporting: The existing rules requiring completion of Forms 1094 and 1095 would continue to apply, although the IRS may have the ability to soften them in the future.
  • Taxes and Fees: The Cadillac tax on high-cost health plans would be delayed six years, then take effect in 2026. The PCORI fee would continue as previously scheduled for plan years through September 2019. The additional Medicare tax on high earners would be repealed starting in 2023.
  • Health Plan Requirements: Current ACA rules regarding eligibility for children to age 26, limits on waiting periods, prohibitions against annual or lifetime dollar limits, and most other provisions would continue unchanged. Coverage for pre-existing conditions generally would be protected, at least for persons that maintained continuous coverage.
  • Essential Health Benefits (EHBs): The ACA currently requires broad coverage of all EHBs in the small group insurance market (unless grandfathered or grandmothered). The BCRA would give the individual states broad flexibility to determine EHBs and to change or reduce any coverage standards.
  • Health Savings Accounts (HSAs): The annual HSA contribution limits would be increased significantly for years after 2017.
  • Health Flexible Spending Accounts (HFSAs): The annual contribution limit, currently $2,600 per 12-month period, would be repealed for years after 2017.
  • Over-the-counter (OTC) medications: The ACA prohibits HSAs, HFSAs, and other reimbursement accounts from covering OTC medications (unless prescribed or insulin). The BCRA would repeal this provision for years after 2017.

Summary

The Senate proposal is similar to the House bill in most areas that directly affect employers, such as relief from the employer mandate, repeal of various health plan fees and taxes, and fewer restrictions on group insurance and benefit plan designs. Those sections, however, are part of a large piece of legislation that may face obstacles in the Senate due to the proposal’s significant impact on Medicaid funding and the individual insurance markets. Without support from at least 50 of the 52 Senate Republicans, the legislation will fail. At this time, at least four of those Senators are withholding their support.

Originally published on June 22, 2017 by www.thinkhr.com

U.S. House Passes Health Care Bill. The Senate Now Holds the Cards. | Maryland Benefit Advisors

On May 4, 2017, the U.S. House of Representatives passed legislation to repeal and replace the Affordable Care Act (ACA). An earlier version of the House bill, called the American Health Care Act (AHCA), had been debated in March but was not voted on due to opposition from Democrats and insufficient support from Republicans. This time around, after revisions were made regarding Medicaid funding, coverage of pre-existing conditions, and insurance market reforms, the bill squeaked through on a 217-213 vote.

Yesterday’s House vote was held without waiting for the Congressional Budget Office (CBO) to score the cost and impact of the bill. The AHCA now moves to the Senate for consideration, which will require CBO scoring. The bill’s fate in the Senate is far from certain. Without support from at least 50 of the 52 Senate Republicans, the bill will fail. At this time, at least five of those Senators have given public statements expressing doubts on the House version of the bill.

The primary focus of the AHCA is on funding for Medicaid and other state programs, maintaining stability in the individual insurance markets, and giving individual states more flexibility in opting out of insurance reforms. Also included are a number of provisions offering relief to employers and reducing the scope of requirements on group health plans. Below are highlights of provisions of the most interest to employers.

Employer Highlights:

  • Employer Mandate: The proposed legislation would repeal the ACA’s employer shared responsibility provision, that is the so-called “employer mandate” or “play or pay,” as of 2016. The rules for 2015 would not change, which would still be an issue for certain large employers that did not qualify for transition relief that year.
  • Employer Reporting: The existing rules requiring completion of Forms 1094 and 1095 would continue to apply, although the IRS may have the ability to soften them in the future.
    Taxes and Fees: The Cadillac tax on high-cost health plans would be delayed six years, then take effect in 2026. The PCORI fee would continue as previously scheduled for plan years through September 2019. The additional Medicare tax on high earners would be repealed starting in 2023.
  • Health Plan Requirements: Current ACA rules regarding eligibility for children to age 26, limits on waiting periods, prohibitions against annual or lifetime dollar limits, and most other provisions would continue unchanged. Coverage for pre-existing conditions also would be protected, at least for persons that maintained continuous coverage.
  • Essential Health Benefits (EHBs): The ACA currently requires broad coverage of all EHBs in the small group insurance market (unless grandfathered or grandmothered). The AHCA would give individual states more flexibility in defining EHBs and determining coverage requirements.
  • Health Savings Accounts (HSAs): The annual HSA contribution limits would be increased significantly.
  • Health Flexible Spending Accounts (HFSAs): ACA restrictions regarding over-the-counter medications and the annual benefit cap would be repealed.

Summary
The bottom line for employers is this: The proposed AHCA includes many provisions that most employers would welcome as good news, such as relief from the employer mandate, repeal of various health plan fees and taxes, and fewer restrictions on group insurance and benefit plan designs. Those provisions, however, are part of a large piece of legislation that is not likely to pass the Senate without significant modification. Therefore, for now, nothing has changed and employers are advised to continue complying with current law.

Get a section-by-section summary of the bill passed by the House.

Originally published by www.thinkhr.com

Long-Awaited Repeal and Replacement Plan for ACA Unveiled | Maryland Benefit Advisors

On March 6, 2017, the U.S. House of Representatives Ways and Means Committee released a proposed budget reconciliation bill, entitled the American Health Care Act, to replace portions of the Affordable Care Act (ACA). If enacted, the American Health Care Act would provide some relief from provisions of the ACA for employers and make other significant changes to employee benefits. While the proposal is 53 pages long and covers a range of tax and benefit changes, below is a summary of key provisions impacting employers and employee benefits.

Employer and Individual Mandates

The proposal effectively eliminates the employer and individual mandate by zeroing out penalties for an employer’s failure to offer, and an individual’s failure to obtain, minimum essential coverage retroactive to January 1, 2016.

Health Care Related Taxes

The proposal extends the applicable date for the “Cadillac tax” from 2020 to 2025 and repeals the medical device tax, over the counter medication tax, indoor tanning sales tax, and Medicare hospital insurance surtax beginning in 2018.

Reporting Requirements

Because the proposal is through a budget reconciliation process, employer reporting requirements for reporting offers of coverage on employees’ W-2s cannot be repealed; however, the proposal creates a simplified process for employers to report this information that, according to the House Ways and Means Committee’s section-by-section summary, makes the current reporting redundant and allows the  Secretary of the Treasury to cease enforcing reporting that is not needed for taxable purposes.

Contribution Limits

Additionally, the proposal eliminates the cap on contributions to flexible spending accounts (FSAs) and almost doubles the maximum allowable contributions to health savings accounts (HSAs) by allowing contributions of $6,550 for individuals and $13,100 for families beginning in 2018. This aligns the HSA contribution amount with the sum of the annual deductible and out-of-pocket cost expenses permitted under a high deductible health plan. The proposal also allows both spouses to make catch-up contributions to one HSA beginning in 2018.

Patient Protection Provisions

Finally, the proposal retains some key patient protection provisions of the ACA by continuing to prohibit insurers from excluding individuals with pre-existing conditions from obtaining or paying more for coverage and continuing to allow children to stay on their parent’s plan to age 26.

What Employers Should Know Now

We are still in the first round of the new government’s strategy to repeal and replace the ACA. The Congressional Budget Office will next review and score the plan before it goes back to the House and the Senate for full votes before making it to President Trump’s desk for approval. This will take time.

In the interim, the provisions of the ACA still apply. While applicable large employers may not be assessed penalties for failing to offer minimum essential coverage to employees if the proposal is eventually enacted, please note that employers are still obligated to report offers of coverage and should finalize their ACA reporting for the 2016 tax year if they have not completed their e-filing with the IRS (due March 31, 2017).

By Nicole Quinn-Gato, JD
Originally published by www.thinkhr.com

 

President Trump Makes First Moves Towards ACA Repeal – What Employers and Plan Sponsors Should Know Now | Maryland Employee Benefits

One of President Donald Trump’s first actions in office was to make good on a campaign promise to move quickly to repeal the Affordable Care Act (ACA). He issued Executive Order 13765, Minimizing the Economic Burden of the Patient Protection and Affordable Care Act Pending Repeal. The one-page executive order (EO) is effective immediately and very light on details, with the goal to minimize the financial and regulatory burdens of the ACA while its repeal is pending. The EO directs the Executive Branch agency heads (those in the departments of Labor, Health and Human Services, and the Treasury) in charge of enforcing the ACA to “exercise all authority and discretion available to them to waive, defer, grant exemptions from, or delay the implementation of any provision or requirement of the Act that would impose a fiscal burden on any State or a cost, fee, tax, penalty, or regulatory burden on individuals, families, healthcare providers, health insurers, patients, recipients of healthcare services, purchasers of health insurance, or makers of medical devices, products, or medications.”

While Congress works on the ACA repeal through budget reconciliation, which allows for quick consideration of tax, spending, and debt limit legislation, President Trump is tackling the regulatory enforcement actions of the law. The practical impact of the EO is limited to agency enforcement discretion and requires agencies to implement the EO in a manner consistent with current law, including assuring that any required changes to applicable regulations will follow all administrative requirements for notice and comment periods.

The bottom line is that until the agency heads in Labor, Health and Human Services, and the Treasury are confirmed and take charge of their departments, there will probably be little change in agency enforcement action right away. The broader changes to amend or repeal the ACA will take even more time to implement.

What Employers and Plan Sponsors Should Know Now

While the EO does not specifically refer to the ACA compliance burdens on employers or plan sponsors, such as the employer or individual mandates, required health benefits coverage, reporting or employee notification requirements, the language addresses the actions that the federal agencies can take to soften enforcement until the repeal is accomplished. It does direct the government to address the taxes and penalties associated with the ACA. So what does that mean for employers and plan sponsors now?

IRS employer reporting delay? Not yet. The top concern of employers is whether or not those subject to the shared responsibility provisions of the law would need to submit their 1094/1095 reports of coverage to the IRS by February 28 (or March 31, if filing electronically) and provide their employees with individual 1095-C statements by March 2. These reports are essential for the IRS to assess penalties under the law, and this reporting has been a burden for employers. Unfortunately for employers, the order did not mention delaying or eliminating this reporting requirement.

What employers should do now:

  • Applicable large employers (ALEs) subject to the employer mandate should plan to comply with their 1094/1095 reporting obligations this year.
  • All employers should continue to comply with all current ACA requirements until there is further guidance from the lawmakers.

We’ve Got You Covered

We’ll be monitoring President Trump’s actions to reduce regulatory burdens on American businesses along with Congressional legislative actions that can impact your business operations. Look for ThinkHR’s practical updates where we’ll analyze these developments and break them down into actionable information you need to comply with the changing laws and regulations.

By Laura Kerekes, SPHR, SHRM-SCP
Originally published by www.thinkhr.com