Entries for the ‘Affordable Care Act’ Category

Start Your Planning for ACA Compliance in 2016

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Start Planning your ACA Compliance for 2016:  Employers of  50 – 99 Employees               Are Now Included in the Law

On Tuesday, March 23, 2010, President Obama signed the Patient Care Protection and Affordable Care Act into law.  Over the past year or so we have been providing information of value to employers, both large and small.  Employers between 50-99 employees will now have to make the decision in 2016 whether to pay or play.

The company resources needed to manage the offer of insurance, the on-boarding, the government reports, and the documentation can be extensive and confusing to companies of 50-99 employees.  Know the law to avoid penalties to your company.

Simply speaking, without going into extensive detail, there are two penalties that can affect your company.

Penalty “A” is the more significant of the two penalties. This requires you to offer employees health insurance that is affordable (no more than 9.5% of their annual income). If you do not offer insurance and/or it is not affordable, your fine is $2500 times 90% your total employees. So, if you have 99 employees, the penalty is 90 times $2500 or $235,000.

Penalty “B” is for any employee that is not offered the essential coverage. At the first signing of the Affordable Care Act into law, hospital coverage was omitted as essential. It was later added as essential. So, if an employee goes into the hospital and your policy does not cover inpatient coverage, you will be fined $3,000 for that employee under penalty “B”.

2016 – The New Affordable Care Act Challenge – Government Reporting

Who, When and Where

Forms 1094-C and 1095-C are required to be completed by all employers with 50 or more full-time equivalent employees. This must be filed by any employer subject to the employer mandate. Form 1094-C is the Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Returns. Form 1095-C is the Employer-Provided Health Insurance Offer and Coverage for Employees. Importantly, reporting for 2015 is required even if the employer is not subject to the mandate until 2016 (generally, employers that average between 50 and 99 full-time equivalents in 2014). There is a code provided to indicate that the employer qualified for the additional transitional relief.

A form must be filed for each employee who was a full-time employee of the employer for any month of the calendar year. If a full-time employee works for more than one employer that is a member of the same aggregate applicable large employer, that employee must receive a separate Form 1095-C from each employer. Employer sponsored, self-insured health plans must also complete Form 1095-C, Part III, for any individual, including employee family members, who enrolled in the self-insured plan. In addition, self-insured plans must complete Form 1095-C Part I and II for any employee enrolled in the health plan to include whether or not the employee is a full-time employee. The draft instructions include an explanation that an employee in a Limited Non-Assessment Period is not considered a full-time employee during that period. They include instructions on how to go about issuing a corrected Form 1094-C and 1095-C, along with the method to which an employer may request a 30-day extension to provide Form 1095-Cs to their employees.

The return and transmittal must be filed with the IRS on or before February 28 (March 31 if filed electronically) of the year following the calendar year. For instance, the first reports will be due the beginning of 2016 for the 2015 calendar year. If the due date is on a Saturday, Sunday or legal holiday, it must be filed by the next business day. The instructions clarify that Form 1095-C must be furnished to employees on or before January 31. Statements must be furnished on paper by mail, unless the recipient has consented to receive it electronically.

The 2015 draft instructions also outline the penalties, generally up to $250 per statement with an annual cap of $3,000,000 unless the failure to provide a statement or correct statement is intentional, at which point the penalty can increase substantially.

For more information, contact Roy Fazio at 856.667.5129

ACA Penalties for Employers That Don’t Offer Coverage

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The Affordable Care Act does not require businesses to provide health benefits to their workers, but larger employers face penalties if they don’t make affordable coverage available. The Obama Administration announced “transition relief” under which the penalties went into effect in 2015 for employers with 100 or more employees and will go into effect in 2016 for employers with 50 or more workers. This simple flowchart illustrates how those employer responsibilities work.

(Updated December 17, 2014 courtesy of The Henry J. Kaiser Family Foundation.)

ACA Penalty Chart 2015-2016

 

 

ACA Readiness Checklist – Is Your Company in Compliance?

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Countdown to ACA Compliance

Is your company still preparing for compliance with the many components of the Affordable Care Act? The deadline for businesses with more than 100 employees is January 1, 2015. Businesses with more than 50 employees need to be ready by January 1, 2016.

ACA Readiness Checklist

 

 

Healthcare Reform – Be Careful of “Minimum Value Plans”

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The Affordable Care Act: Strategic Decision- Compliant or Pay to Play

Can A Health Insurance Plan That Fails to Provide Inpatient Hospitalizaton, Provide Minimum Value?

In a recent Washington Post Article, (“Glitch in health care law allows employers to offer substandard insurance,” September 12, 2014) highlights an Affordable Care Act compliance strategy being marketed heavily (and adopted widely) in industries that traditionally did not previously offer coverage to large cohorts of variable hour and contingent workers like the staffing industry. The strategy—which is referred to commercially as a “minimum value plan” or “MVP”— involves an offer of group health plan coverage that, while similar in most respects to traditional major medical coverage, carves out inpatient hospital services.

The Washington Post article (and other commentary) engages in some hand-wringing about why these plans are inconsistent with the goals of the Act. One commentator fumed that an employer that offers these arrangements should “examine its conscience.” (Readers might recall a similar bout of hand-wringing that accompanied “skinny” plans.).

It’s time to take a breath.

Whether these plans were “intended” or whether they are consistent with Health Care Reform, is irrelevant. Under currently applicable laws and regulations, these plans appear to work as advertised. Moreover, no employer is required to do anything more than the law requires; and any employer that does, risks putting itself at a competitive disadvantage relative to those that do not. The regulators are aware of this glitch in the law, and this strategy might be short lived as the law might change.

MVP arrangements are generally offered in a suite of products and accompanying administrative services that include:

  • A “Minimum Essential Coverage” or “MEC” plan (previously known as a “skinny plan”)

These plans qualify as an offer-of-coverage for purposes of the more severe of the two levels of penalties, i.e., the penalty for failing to make an offer of coverage to substantially all full-time employees. But, if the employee should go to the hospital and later receive a subsidy, you may be subject to a $3,000 fine.

  • A “hospital or fixed indemnity plan”

A hospital or fixed indemnity plan is a type of plan that pays fixed amounts for specific medical services and care. These plans are structured as “excepted benefits” that are not subject to the Affordable Care Act’s insurance market reforms and other requirements when offered on a non-coordinated basis. That is, employees must be free to elect or reject this coverage independent of any other coverage they might elect or reject.

  • An MVP arrangement

An MVP arrangement is a major medical plan that carves out inpatient hospital services. The goal is to reduce the aggregate premium cost of minimum value coverage so that the cost of providing coverage that is “affordable” is similarly lowered. For example, the premium cost of a traditional major medial plan offered on a fully-insured basis by a top-tier, national carrier might be, say, $500 or more. But for an MVP arrangement the cost might be $200. (MVP arrangements are generally if not universally self-funded.)

Using Staffing Service Companies – “Make sure you know if the staffing service is offering insurance to the temporary staffing employees if they are classified as a Large Employer, says Protocall Group owner Roy Fazio. “Also make sure you ask them if they are offering a MEC Plan or Full Coverage to their eligible temporary staffing employees. If they are offering a MEC Plan (Skinny Plan), this does not provide hospitalization and puts you, the employer, at a potential risk of a $3,000 penalty if the employee goes to the exchange and receives a subsidy.  According to the provisions of the Affordable Care Act, the staffing industry may be considered the common law employer as in PEO’s.”

As Chairman for the national staffing trade group, ASGroup (www.asgroup.com), The Protocall Group and ASGroup became self-insured to help minimize client costs and enable us to provide full coverage insurance to our staffing employees. During the next couple of months we will offer clients educational materials about the ACA.     Roy Fazio, Protocall Group.

For the latest updates on the law, which occur regularly, email kimd@protocallgroup.com or call 856.667.7500 ext. 1234 to be included on our mailing list for Affordable Care Act updates as they become available.  A series of whitepapers can also be downloaded on our website www.protocallgroup.com via our blog category Corporate and then Affordable Care Act.

 

Historical Background on the Affordable Care Act

The Patient Protection and Affordable Care Act (PPACA), commonly called The Affordable Care Act (ACA), is a United States federal statute signed into law by President Barack Obama on March 23, 2010. Together with the Health Care and Education Reconciliation Act, it represents the most significant government expansion and regulatory overhaul of the U.S. healthcare system since the passage of Medicare and Medicaid in 1965.

Healthcare Reform – Who Is a Full-Time Employee?

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  • Post Date: 09/03/2014

The Affordable Care Act: Strategic Decision- Compliant or Pay to PlayHealthcare Reform is complicated, but this brief presentation offers up factual answers to the question Who is a Full-Time Employee? in an easier to digest format for employers.

Employers must carefully determine who are full-time vs. full-time equivalent employees vs. seasonal employees. There are special rules that pertain to each of these. Measurement methods to aid in determining the classification of your employees for ACA purposes are broken down by monthly and look-back periods.

Full-Time vs. Full-Time Equivalent

  • Full-time employees are counted for large employer determination and must be offered coverage (along with dependents) to avoid penalties.
  • Full-time equivalent employees are counted as a fraction for large employer determination and do not have to be offered coverage.
  • Seasonal employees have special rules that apply for large employer determination and for offering coverage (along with variable hour employees).

Click on the link below for more information in this helpful document.

ACA- Full-Time Equivalent Determination- August 2014

 

Employer Responsibility Under the Affordable Care Act

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The Affordable Care Act…Countdown to Compliance

The Affordable Care Act does not require businesses to provide health benefits to their employees, but larger employers face penalties if they don’t make affordable coverage available. Enforcement of those penalties will begin in 2016, a year later than originally scheduled. This simple penalty flowchart illustrates how the employer responsibilities work and when penalties may be applied to those employers not offering affordable health benefits under the Affordable Care Act (ACA). Note that in 2015 a large employer is defined as more than 100 employees. In 2016, a large employer will be 50 or more.

Penalty Chart – an easier way to understand the law as a large employer

ACA employer penalty flowchart

Information is courtesy of The Henry J. Kaiser Family Foundation.  http://kff.org/health-reform/

Copies of the article are available from The Protocall Group. For the latest updates on the law, which occur regularly, email kimd@protocallgroup.com or call 856.667.7500 ext. 1234 to be included on our mailing list for Affordable Care Act updates as they become available.  A series of whitepapers can also be downloaded on our website www.protocallgroup.com  via our blog category Corporate and then Affordable Care Act.

The staffing industry is affected the most by the Affordable Care Act. Protocall will increase coverage from 60 employees to over 300 who will qualify under the ACA guidelines.  As a cost-saving strategy, The Protocall Group is becoming self-insured through a health insurance “off-shore” captive model in 2015. This will in fact lower our premiums an estimated 10%. For more information, contact Roy Fazio via phone 856.667.5129 or email him rfazio@protocallgroup.com

Historical Background on the Affordable Care Act

The Patient Protection and Affordable Care Act (PPACA), commonly called The Affordable Care Act (ACA), is a United States federal statute signed into law by President Barack Obama on March 23, 2010. Together with the Health Care and Education Reconciliation Act, it represents the most significant government expansion and regulatory overhaul of the U.S. healthcare system since the passage of Medicare and Medicaid in 1965.

The Affordable Care Act: Skinny Insurance Plans Keep You Compliant but…

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skinny plans affordable care actIf you decide to save money and offer a “skinny plan”, while it meets the minimum essential coverage requirement, you are still subject to penalties by IRS. Essentially, “skinny plans” are wellness programs. That means if an employee goes to the hospital they are not covered. Furthermore, if they go to the “insurance market” to obtain coverage and receive a government subsidy, you will be fined $3,000!

Using staffing companies that offer insurance to their employees can protect your company from these fines.

Download the ACA white paper entitled, “Skinny Plans” to educate you on the latest additions to the ACA law in regard to meeting the minimum essential coverage requirement.

  • Some employers may opt to offer skinny plans to employees to save on the cost of insurance
  • Skinny Plans keep you compliant but do not protect you from penalties of $3,000
  • Using staffing companies offering insurance to their employees, eliminates the risk of the client being the employer

Don’t get punished for what you don’t understand.

Download the white paper today and sign up to receive the first Affordable Care Act series of white papers!

The Affordable Care Act: Strategic Decision- Compliant or Pay to Play

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The Affordable Care Act: Strategic Decision- Compliant or Pay to Play

Thanks to Uncle Sam for delaying the Affordable Care Act penalty phase for employers with over 50 employees till 2015, staffing companies have another year to better understand how the law will affect them and whether to be compliant with the law or Pay to Play. It will also give our industrytime to educate our customers before passing through the cost of the insurance if we decide to be compliant.

The staffing industry is the single most affected industry by healthcare reform. The most compelling decision to be made by staffing companies is whether to comply with the law and offer insurance to temporary employees eligible for insurance or should pay the penalty. For many larger staffing companies, they may find that being compliant with the law not only costs less, but may also give them a marketing edge over their competition. The marketing plan and message will require a well thought out plan and investing time to educate the sales team and internal service staff on what the message is. For staffing companies considering paying the penalty of $2,000 per employee, make sure you are aware that the true cost of paying the penalty is closer to $3,000, considering the tax implications.

Now that 2014 is here, it would appear that there is plenty of time till 2015 when the penalty would be incurred. Getting your ducks in order early will be important. Understanding the monetary implication is the foremost concern for a staffing company. Determining how many employees are eligible is the first step. Then determining what your worst case scenario would be if all employees accepted your insurance.

If you plan to be compliant, this may bring outstanding marketing opportunities. You now will have many decisions to make including the pass-through cost to your customers. We have determined that the cost we will need to pass through to clients in 2015 range from a low of 15 cents per hour to about 36 cents per hour.

I chair a national staffing organization of non-competing companies known as Affiliated Staffing Group (ASGroup). Our mission and goal is to “share best practices” and resources. At ASGroup we have had the advice of the top insurance organizations that understand our staffing industry the best. Through one of our board members we found an insurance organization, specializing in self-insurance. Our largest staffing companies met with the top executives and their underwriter. At the outset of our meetings, the insurance organization was a little skeptical in underwriting a self-insurance captive model to the staffing industry. Our owners were also skeptical of the risk of self-insurance since the only experience they had was with workers’ compensation captives and were concerned that the risk was similar. In the end, after a thorough understanding of staffing and insurance, both parties saw a business relationship to be a win-win. An exclusive insurance program was developed for ASGroup members to participate in.

Now with another year allotted by the government to plan for the implementation of healthcare reform, and our “ducks in order” for insurance, we have time to plan strategically for the roll-out to our temporary employees and clients. Our strategy will need to thoroughly plan for educating our sales and service team, as well as our customers. Salespeople are rarely comfortable talking about price increases. They will have to be well-educated on how to promote the health insurance cost pass-through to their clients. Your company should begin to engage in developing a consistent message and presentation that will be communicated to customers. It is essential to have good marketing materials and regular printed materials to be distributed to customers.

ASGroup meets three times per year and our mission of sharing best practices will enable us to share a good staffing industry message and share any printed materials we jointly develop. Our key managers attend meetings and in a “roundtable” format of information, receive a lot of take home value.

Many of our larger members are industrial staffing companies employing 5,000 to 15,000 temporary employees annually. Our ASGroup member owners and key managers can now can work together to share ideas at our upcoming meetings for the delivery of education and a message to our clients. Start planning now … there is much to do to assure compliance with the Affordable Care Act and a smooth transition with clients and temporary employees to health care reform.

Protocall Group Owner Roy Fazio speaks out on the ACA Mandate Delay for Employers

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In an article just published by Staffing Industry Analysts, Protocall Group owner Roy Fazio was interviewed and quoted in an article focusing on the one-year delay in the Affordable Care Act (ACA’s) employer mandate.  Roy Fazio is very well-educated on this subject matter and how it will affect staffing companies.

Fazio also serves as chairperson for Affiliated Staffing Group (ASGroup), an organization of non-competing staffing firms formed for the purpose of sharing best practices. Preparation is key. The members of ASGroup have already been analyzing their workforce to gauge the impact of the ACA and are working on measures they need to take to provide insurance to employees, says Roy Fazio.

ASGroup has also been working with attorney Alden Bianchi for about a year to get prepared, Fazio says. Bianchi represented the Romney administration in connection with the 2006 Massachusetts healthcare reform act, upon which the ACA was based.

Also starting Oct. 1 of this year, employers will have to notify current and new employees about their employers’ health insurance offerings, if any.

Read the full article by clicking this link.

http://www.staffingindustry.com/row/Research-Publications/Publications/Staffing-Industry-Review/September-2013/Don-t-Lose-Sight