COBRA Alternatives

With the recent Health Care Reform changes and the addition of the Health Insurance Marketplace, former employees now have more choices than just electing COBRA to continue their health insurance benefits with their prior employer.  Former employees can elect to continue their benefits under COBRA and are responsible to pay for the full monthly premium cost of the benefit.  As some may know, COBRA premiums can be quite expensive and costly for an individual who may be in between positions.  With the addition of the Health Insurance Marketplace, individuals now have another option versus electing to continue their benefits through COBRA.

The Health Insurance Marketplace allows the individual to choose a health insurance plan that best suits his or her budget versus only having the employer option from which to choose.  The Marketplace offers a wide variety of health insurance plans from multiple carriers.  By having the freedom of choice, the individual can select a plan that best suits his or her coverage needs and is within his or her budget.  In addition, the employee may be eligible for a subsidy from the government to cover some of the costs of the plan. 

Employees may check out the options for the Health Insurance Marketplace here.  For employers with employees in different states, please check with the state the employee is located in to see if a state Health Insurance Marketplace has been established.  If not, please click here to be directed to the Federal Health Insurance Marketplace.

For more information on the Health Insurance Marketplace, please feel free to contact me at my office.  Thank you.

Non-Conforming ACA Plans

With Health Care Reform in full swing beginning January 1, 2014, there will be many changes for employers who offer health insurance plans.  One of the requirements is that health insurance plans themselves have to meet certain ACA plan standards in order to be offered to the public.  If the health insurance plans are not able to meet the minimum requirements to be ACA compliant, these plans will no longer be offered by the health insurance carriers.  However, the Federal government has allowed the health insurance carriers to offer these non-conforming plans in 2014, but the Federal government has left it up to each State to decide if they would allow these plans to be offered in 2014.

Massachusetts has decided not to allow non-conforming health insurance plans to be offered beginning in 2014.  Therefore, Massachusetts will conform to make sure all of its health insurance plans meet the minimum ACA requirements set forth by the Federal government.  Health insurance carriers will no longer be offering health plans that do not meet these requirements.  Members can be assured beginning in 2014, their health plans will be ACA compliant. 

The health insurance companies have begun to make these ACA changes at the plan's renewal for companies with non-conforming health plans.  If you have questions regarding your health insurance plan, please feel free to contact our office.  Thank you and have a wonderful day!

Provision Changes to Flexible Spending Accounts

Last week, the Department of Treasury changed the provisions within the Flexible Spending Account regulations to allow participants to roll over a certain amount of unused funds at the end of the FSA's plan year.  The new regulation will affect current employers who offer Flexible Spending Accounts plans and for new Flexible Spending Account plans that are established in 2014.

Currently, participants who do not spend the full amount elected will lose any remaining dollars at the end of the plan year.  With the new provision, participants will be able to have up to $500 carried over into the following year's Flexible Spending Account plan year.  This provision is only permitted as long as the employer's plan does not incorporate an Extension Grace Period of more than two and a half month's.  For employer's who will begin to offer a Flexible Spending Account as a new benefit in 2014, this new regulation will allow them to carry over unused funds at the end of the FSA's plan year.

Adopting this plan provision requires a change to the current Plan Document and specific communications to employees.  If you have any questions regarding implementing this provision or the documentation requirements, please contact our office.

Thank you.

Employer Notice Regarding Health Insurance Exchanges

Under the Patient Protection and Affordable Care Act (PPACA), health benefit exchanges will be operational on Jan. 1, 2014. PPACA requires employers to provide a notice to all benefits eligible employees prior to the beginning date of the exchange.

The notice informs employees about the existence of the health benefits exchange and gives a description of the services provided by the exchange. The notice also explains how the employee may be eligible for a premium tax credit or a cost-sharing reduction if the employer's plan does not meet certain requirements. The notice informs employees that if they purchase a qualified health plan through the exchange, they may lose any employer contribution toward the cost of employer-provided coverage, and that all or a portion of the employer contribution to employer-provided coverage may be excludable for federal income tax purposes. Lastly, the notice includes contact information for customer service resources within the exchange, and an explanation of appeal rights.  The notification requirement will take effect on October 1, 2013.  Employers who do not provide this notice to eligible employees by October 1^st will not be assessed a penalty but compliance is strongly encouraged.

Employers will need to provide new employees the notice within 14 days of their start date.  For current employees, employers will need to provide the notice to their employees no later than October 1, 2013.  For employees who may be electing COBRA, employers must also provide the notice with their COBRA letter as well.

Earlier this year, the Department of Labor provided employers with sample “Notices” to use if their company offered health insurance or if they did not offer health insurance.  Employers will be able to use this sample “Notice” until the Department of Labor creates a final version “Notice” for all employers to use.  Please click here to view the sample “Notice”.  Employers can click here to review the guidelines regarding the exchange notice.  If your company does not offer health insurance, please click here to view the “Notice” you have to provide to your employee population.

The notice must be provided in writing to all benefits eligible employees.  Alternatively, it may be provided electronically if the requirements of the DOL's electronic disclosure safe harbor at 29 CFR 2520.104b-1(c) are met.

If your company has any questions regarding these “Notices” or has general questions regarding the new Health Care Reform laws, please feel free to contact Ipswich Bay Advisors at our offices at 978.777.6554.

Thank you.

Medicare Part D Credible Coverage

All employers who provide health insurance coverage to their employees must provide a notice of Credible Coverage to all Medicare eligible employees.  The notice is to inform these employees the prescription drug benefit that is provided through the company’s health insurance plan is equivalent to or superior to the Standard Medicare Part D plan.  If a company’s prescription drug plan does not meet the credible coverage requirements, employers must still provide a notice to the eligible employees stating their plan does not meet this minimum requirement.  Employers must provide each Medicare eligible employee with this notice once a year.  The notice must also be provided to the dependents of the eligible Medicare employee.  The Centers for Medicare & Medicaid Services has provided employers with a template notice to use as guidance when generating these notices.  Please click here to view the sample notice provided by the Centers of Medicare & Medicaid Services for credible coverage.  If your company’s prescription drug benefit does not meet the minimum credible coverage, please click here for the Non-Credible Coverage Model Notice.

The last requirement employers are responsible for is to complete an online questionnaire provided by the Centers for Medicare & Medicaid Services.  This questionnaire will inform CMS if your company’s prescription drug benefit is credible or non-credible.  Employers should complete the online questionnaire roughly 60 days before their health insurance plan renews or is effective.  The questionnaire should also be completed if the plan is terminated or if there is any status change.  For these situations, the questionnaire should be completed in 30 days after the termination or status change.  Please click here to view the questionnaire employers are required to complete.

For more information regarding the distribution & completion of the Medicare Part D Credible Coverage Notice, please contact our office.

Thank you.

Health Care Reform Simplified: Educating Employees

Beginning January 1, 2014, the rules and regulations of health care reform will be in full force.  Many employers are still trying to figure out how these new regulations will impact their company and their employees.  The rules and regulations associated with health care reform are confusing and are constantly being revised and implemented.  And not all employers have the time to focus all of their efforts on health care reform and its impact.  Thankfully, the Kaiser Family Foundation has made learning about health care reform simple.

The Kaiser Family Foundation identified the main components of health care reform and has explained them in a fun, animated presentation video.  By doing this, it will help employers and employees understand exactly what health care reform is, who is funding this reform, & how it will affect employees and employers.  The information provided is interactive and comical and will surely keep the viewer engaged in the presentation.  To view the animated presentation provided by the Kaiser Family Foundation, please click here.   This video is a great tool to provide employees information about health care reform. 

If your company has any questions regarding the upcoming regulations proposed by health care reform, please contact our office at (978)-777-6554.

Thank you.

Medical Loss Ratio (MLR) Rebates

Your company may have recently received information from your health insurance carrier regarding a Medical Loss Ratio Rebate.  As part of the Health Care Reform legislation it requires a certain percentage of the employers premiums go towards medical claims versus administration expenses.  In addition, Massachusetts has its own regulations and for small groups in Massachusetts it is 90%.  Your company may be entitled to a rebate check if your health insurance carrier contributed less than 90% of your group’s premium toward medical claims.   

There are two different ways the employer may use the refund.  The employer may keep the amount given to them and use it toward future premium costs.  Or the employer may give the refund back to the employees.  The health insurance carriers have begun to mail out the rebate checks to Massachusetts employers.  If you are unsure of how to distribute the refund, please visit the link below to the Department of Labor’s website for additional information.  Please visit “The Best Bottom Line” to remain up to date on health care reform as well as other HR related topics.  Please feel free to contact our office at (978)-777-6554 with any questions you may have.

http://www.dol.gov/ebsa/newsroom/tr11-04.html.

Thank You.