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With all the attention to the ACA requirements for 2013 and 2014 it’s easy to lose sight of other benefit and human resource requirements.

The Medicare Part D Creditable Coverage Law affects all employer-sponsored group health plans. Entities are required to notify Medicare eligible policyholders whether or not their prescription drug coverage is creditable.

Creditable Coverage means that the coverage is expected to pay, on average, as much as the standard Medicare prescription drug coverage. Notice is due by October 15th.

There are two required disclosure notices for qualifying entities:

• The first requirement is to provide a written discloser.
• The second requirement is for entities to complete the Online Disclosure to CMS Form to report the creditable coverage status of their prescription drug plan.

Employee Benefit Advisors is able provide links to model notices.

Employers must notify employees about health insurance available through state and federal exchanges by October 1, 2013.

Who gets notified

You must send a notice to all full- and part-time employees, whether or not they are on your group health plan. You do not have to notify employees’ dependents or others who are eligible for coverage but are not employees. New employees hired on or after October 1, 2013, must receive this notification within 14 days of their start dates.

Employers can use a template

The U.S. Department of Labor (DOL) created model notices.

Minimum value standard question

If your group health plan does not meet the minimum value standard, your employees may be able to get a tax credit by buying health insurance on a federal or state exchange. Therefore, you must show on the model notice whether your group health plan meets this minimum value standard. Please note: Your health plan meets the ACA’s minimum value standard if it pays for at least 60 percent of each covered employee’s health care costs.

Penalties

The penalty for not distributing the notice is $100 per worker per day.

DOL Release Sept 11 – If your company is covered by the Fair Labor Standards Act, it should provide a written notice to its employees about the Health Insurance Marketplace by October 1, 2013, but there is no fine or penalty under the law for failing to provide the notice.

Not All ACA 2013 Tasks Postponed

Don’t be fooled!

Not all aspects of healthcare reform are postponed. Employers face other compliance requirements during or by the end of 2013. Examples:

• Reducing waiting times for plan eligibility to no more than 90 days;
• Complying with the rules for the Patient-Centered Outcomes Research Institute (PCORI) fee; and
• Notifying employees about the availability of state exchanges.

Opportunity for Course Reversal

This delay creates an opportunity for employers to test their compliance strategy for the Shared Responsibility provisions of the Affordable Care Act and to ensure they have the systems and procedures in place to fully comply when required in 2015.

Checks will soon be going out to groups from the insurance carriers that represent a rebate of premiums on health insurance costs.

Under PPACA Health Care Reform insurance carriers are required to adhere to certain Medical Loss Ratio (MLR) guidelines.  If a group’s particular MLR is lower than specified thresholds, the carrier must issue a rebate.  Checks going out in August 2013 are for the 2012 calendar year. Employers will have 90 days from receipt of a check to make payments to participants. Groups can elect to use any rebate monies received in varying ways:

1.   To pay future premiums

2.  To allocate to wellness funds or other employee benefit programs

(Employee Benefit Advisors recommends either Options 1 or 2).

3.  To distribute the corresponding percentages to their employees.  This option can be quite cumbersome to calculate the allocation to each employee based upon their respective contributions, time covered on the plan, benefit selections, etc. (it is an administrative nightmare).

If the amount of a premium rebate is de minimis, an employer may determine that the cost of issuing checks will exceed the amount of the checks.

It is the Carrier’s responsibility to notify the groups and administer the process of issuing refunds.  It is then up to the group to decide what to do with the refund.  Remember, in Technical Release No. 2011-04 the DOL announced the rebate checks may be “plan assets” subject to the ERISA fiduciary rules. Therefore, whichever option a company chooses, we recommend that the group notify their accounting departments to keep accurate records.

(MLR variables include small or large group, fully-insured vs. self-funded, and pre or post tax.)

Notice Must Be Distributed to Current Employees No Later Than October 1, 2013

Following a delay in the original effective date, employers will need to comply with the new requirement to provide each employee a written notice with information about a Health Insurance Exchange (also known as a Marketplace) beginning this fall. Below are four important reminders about the notice.

1. The notice requirement applies to employers covered by the federal Fair Labor Standards Act (FLSA).
2. Employers must provide the notice to each employee, regardless of plan enrollment status (if applicable) or of part-time or full-time status.
3. The U.S. Department of Labor has provided two sample notices employers may use to comply with this requirement.
4. Notices must be provided to each current employee no later than October 1, 2013, and to each new employee at the time of hiring beginning October 1, 2013.

Technical Release 2013-02 includes additional details regarding this notice requirement.

Clients can log into HR Advisor and visit our section on Health Care Reform for information on this and other notices required to be provided and to download additional model notices available for employers and group health plans.