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Mission of the Health Insurance Council:

-Act as the primary resource for all Affordable Care Act and other health insurance and benefit information for restaurant and food-service operators.

-Provide opportunities for education among members and prospective members.

-Translate the ever-changing Affordable Care Act legislation into easily understandable language.

 

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Mesirow Financial's Employer Compliance Alert: 6055/6056 Filing Completed - Next Steps

Posted By Eric Fine, Thursday, May 12, 2016

 6055/6056 Filing Completed - Next Steps

Applicable large employers and self-funded employers of all sizes have now completed the first round of required IRS reporting under the Patient Protection and Affordable Care Act (ACA). The ACA requires individuals to have health insurance, while applicable large employers (ALEs) are required to offer health benefits to their full-time employees. In order for the IRS to verify that (1) individuals have the required minimum essential coverage, (2) individuals who request premium tax credits are entitled to them, and (3) ALEs are meeting their shared responsibility (play or pay) obligations, employers with 50 or more full-time or full-time equivalent employees and insurers were required to report on the health coverage they offered. Similarly, insurers and employers with less than 50 full time employees but that have a self-funded plan also have reporting obligations. All of this reporting is done on IRS Forms 1094-B, 1095-B, 1094-C and 1095-C.

Now that the first set of forms has been completed, many employers are wondering what the next steps are. Employers that did not fulfill all of their obligations under the employer shared responsibility provision (play or pay) might owe a penalty to the IRS. A penalty will be owed in regard to the 2015 plan year if:

  • The employer does not offer health coverage or offers coverage to fewer than 70 percent of its full-time employees and the dependents of those employees, and at least one of the full-time employees receives a premium tax credit to help pay for coverage on a Marketplace; or
  • The employer offers health coverage to all or at least 70 percent of its full-time employees, but at least one full-time employee receives a premium tax credit to help pay for coverage on a Marketplace, which may occur because the employer did not offer coverage to that employee or because the coverage the employer offered that employee was either unaffordable to the employee or did not provide minimum value.

As of March 2016, the only information from the IRS on the payment of these penalties is as follows:

The IRS will adopt procedures that ensure employers receive certification that one or more employees have received a premium tax credit. The IRS will contact employers to inform them of their potential liability and provide them an opportunity to respond before any liability is assessed or notice and demand for payment is made. The contact for a given calendar year will not occur until after the due date for employees to file individual tax returns for that year claiming premium tax credits and after the due date for applicable large employers to file the information returns identifying their full-time employees and describing the coverage that was offered (if any).

If it is determined that an employer is liable for an Employer Shared Responsibility payment after the employer has responded to the initial IRS contact, the IRS will send a notice and demand for payment. That notice will instruct the employer on how to make the payment. Employers will not be required to include the Employer Shared Responsibility payment on any tax return that they file.

Exchange Notification "Employer Notice Program"
The penalty is only triggered if an employee, who either was not offered coverage, or who was not offered affordable, minimum value, or minimum essential coverage, goes to the Exchange and gets a subsidy or "advance premium tax credit."

Although the IRS has not completely determined its system for penalty assessment, it does have a system to notify employers when one of their employees enrolls in Exchange coverage and is eligible to receive advance payment of the premium tax credit. The Marketplace notice will identify the employee, that he or she is eligible for the tax credit, that this could trigger a penalty on the part of the employer, and that the employer may appeal the decision. Employers are strictly prohibited from retaliating against an employee for going to the Exchange or receiving a tax credit.

The IRS has a four-page Employer Appeal Request form, which must be submitted within 90 days of receipt of a Marketplace notice. The form asks for basic information about the employer, provides a place to identify a secondary contact, and asks for the employer to explain why it is appealing the determination that the employee is eligible for premium assistance.

Alternatively, the employer can send a letter requesting an appeal. An employer must submit an appeal with the following information:

  • Business name
  • Employer ID Number (EIN)
  • Employer's primary contact name, phone number and address
  • The reason for the appeal
  • Information from the Marketplace notice received, including date and employee information

Employers must then mail the appeal request form or letter and a copy of the Marketplace notice to:

Health Insurance Marketplace
Department of Health and Human Services
465 Industrial Blvd.
London, KY 40750-0061

This appeal will not determine if the employer owes a fee, but could help prevent employees from erroneously obtaining an advance premium tax credit, which in turn could provide the employer with information about whether or not it might owe a penalty. By preventing employees from incorrectly obtaining the advance premium tax credit, employers could lessen the chance of being asked to provide further information to the IRS to prove they met their obligations under the employer shared responsibility requirements.

Documentation
Employers should keep in mind that, in order to consider their offer of coverage affordable, they must meet the requirements of one of three affordability safe harbors. Affordability may be met under any of these criteria:
The W-2 test, which requires that the employee's cost not exceed 9.5 percent (indexed) of the employee's income as reported in Box 1 of the W-2.

  • The rate of pay method, which requires that the employee's cost not exceed 9.5 percent (indexed) of the lowest hourly rate paid to the employee, multiplied by 130 hours per month.
  • The federal poverty line test, which requires that the employee's cost not exceed 9.5 percent (indexed) of federal poverty rate (or about $93/month for 2015).

In some rare instances an employer might meet the requirements of an affordability safe harbor, but based on unique factors in an employee's household, the employee will be eligible for premium assistance (a tax subsidy or an advance premium tax credit) because the coverage is not affordable in relation to their household income. This situation would not trigger a penalty for the employer, so long as it met the requirements of one of the three affordability safe harbors. As a best practice, employers should have documentation that their offer of coverage fulfilled the requirements of their chosen affordability safe harbor.

 

Our access to PPACA Advisor resources can help you clear up PPACA questions and help you shape your company's benefit strategy.

This information is general and is provided for educational purposes only. It reflects UBA's understanding of the available guidance as of the date shown and is subject to change. It is not intended to provide legal advice. You should not act on this information without consulting legal counsel or other knowledgeable advisors.

Copyright © 2016 United Benefit Advisors, LLC. All Rights Reserved.

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10 Ways to Cut Your Health Care Costs

Posted By Eric Fine, Thursday, March 31, 2016

No matter how you get your insurance through your employer, from a state exchange, from an agent or directly from an insurance company you’re paying a bigger share of your healthcare costs than you used to. Higher premiums are only part of the picture. Deductibles are rising, provider networks are shrinking, and insurers have been switching from fixed dollar copayments to coinsurance, based on a percentage of the cost of care.  Your out of pocket costs could rise significantly unless you learn some key strategies to become a better health care shopper. The following moves can help you save hundreds or even thousands of dollars.

 

Stay in Your Network

Many insurers are shrinking their networks and including fewer doctors and hospitals. "The most expensive health care mistake you can make is to go out of your health plan’s network," says Jackie Aube, a senior vice president of Cigna.The cost difference can be huge. Preferred provider organizations (PPOs) usually let you use out of network doctors but charge higher copayments or coinsurance rates say, 50% for out of network care compared with 10% for in network services. If your plan is a health maintenance organization (HMO), you may not have coverage at all for out of network providers except in an emergency.

 

Find out about Super Preferred Providers

Your health plan may provide extra incentives for you to use certain in network providers or facilities. The United Health Premium designation program, for example, recognizes physicians that meet guidelines for providing high quality, cost efficient care, and you may pay lower copayments or coinsurance rates if you use those doctors.

 

Save at Standalone Radiology Centers

Different facilities charge vastly different prices for x-rays and tests. The average outpatient hospital cost for MRIs and CAT scans is $1,384 to $1,668, says Aube, but the average radiology center costs $445 to $725. And there can be a huge range between the highest and lowest cost in your area. For example, among all facilities within 25 miles of New York, the cost of a knee MRI ranges from $238 at a freestanding radiology facility to $2,191 at a local hospital.

 

Ask Your Doctor About Cheaper Facilities
Your doctor may work at several hospitals or outpatient surgery centers. While the surgeon’s charge will be the same, "the hospital’s fees can vary by thousands of dollars," says Aube. The cost may be even less at an outpatient surgery center, even though the same doctor is performing the procedure. For example, the average cost nationwide for a colonoscopy, GI endoscopy or arthroscopy in a hospital is $2,548, but the average cost at an outpatient surgery center is $959, she says. Make sure the facility you choose is in your insurer’s network

 

Avoid the Emergency Room If You Can
Sometimes you can’t avoid a trip to the emergency room. But you may be able to go to a much less expensive urgent care center or convenience care clinic for some types of care. Visit an urgent care center for conditions such as minor cuts, burns and sprains, fever and flu symptoms, joint or lower back pain, and urinary tract infections. You may pay even less at a convenience care clinic at a supermarket, pharmacy or other retail store, where a clinician can treat you for sinus infections, rashes, earaches, minor burns and other routine medical conditions, she says. Find out ahead of time which urgent care and convenience care clinics are included in your insurer’s network.

 

Take Advantage of Telemedicine
Many health plans now offer 24 hour help lines staffed by doctors or nurses who can treat you by phone or online video chat.You can use this service for non emergency conditions, such as cold and flu symptoms, nausea and vomiting, sore throat, earache, and sinus pain. A doctor will prescribe medications, if appropriate. The average telehealth consultation costs $40 to $50.

  

Switch to Generic Drugs
Generic drugs can cost as much as 80% less than their brand name alternatives, says Aube. The lower list price makes a huge difference when you’re in the plan’s deductible period and paying the full price out of your pocket. And the coinsurance rates are usually lower, too often 10% to 15% of the cost for generics, 25% for preferred brand name drugs, and 50% for non-preferred brand name drugs. Some plans no longer cover certain brand name drugs. You may also get a good deal on generics at certain stores, such as Walmart and Target which charge as little as $4 for a 30 day supply of certain drugs or $10 for a 90 day supply.

 

Keep an Eye Out for New Generics
The patents for several popular brand name drugs Celebrex, Copaxone, Nexium, Actonel and Exforge are scheduled to expire soon, which will open the door for drug companies to manufacture generic alternatives. You can look into generic alternatives now for Cymbalta, Maxalt, Maxalt MPT, Micardis, Micardis HCT, Twynsta and Xeloda, whose patents expired recently and for which generics are on the market, says Jim Yocum, executive vice president

of  DRX. Most insurers have Web tools or apps to help you look up generic alternatives to your drugs.

 

Use Preferred Pharmacies
More health plans are introducing preferred pharmacies, which cost even less than regular in network pharmacies. For example, the Humana Walmart Rx plan for Medicare Part D charges a $1 copayment for a 30 day supply of certain generic drugs purchased at Walmart or Sam’s Club (or a $0 copayment through Right Source mail order), but the plan charges a $10 copayment for the same drugs purchased at a nonpreferred network retail pharmacy.

Get Your Drugs Through the Mail
Mail order pharmacies may provide a three month supply of drugs for the same price as a one month supply at a local pharmacy. Some plans require you to use mail order for maintenance drugs.

 

This page printed from:http://www.kiplinger.com/

 

For more information please contact:

Dave Brennan

REGIT, Inc.

Email: dbrennan@regitinc.com

Phone: 630.495.1500

 

 

Tags:  health care savings  Health Insurance Council  Inc.  IRA HIC  REGIT 

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THE FUTURE OF DATA ANALYTICS IN THE EMPLOYEE BENEFITS ARENA

Posted By Eric Fine, Thursday, March 24, 2016

WE COUNT STEPS AND COUNT CALORIES. We monitor our heart rate and how much we exercise each day. Individuals and organizations are collecting untold amounts of data, but what do we do with it? 

The future is here today. Some organizations offer unique plan designs involving personal data transmitted to primary physicians. Devices like Fitbit and Jawbone monitor every movement and are being tested by transmitting data to physicians’ offices. This could be too invasive for many people, but the technology is here. 

Pay for performance models could offer another solution. This model, which integrates data from multiple sources, allows health organizations to offer their patients better service. Insurers will pay physicians for improved health outcomes, stabilizing chronic conditions and lowering other health risks. In this model, your health data will be integrated. Again, it’s happening now. 

One employee recently went to a CVS Minute Clinic for strep throat. A week later, she went to her family doctor, who said, “I see you went to the Minute Clinic for strep throat and are taking antibiotics.” Through full data transparency from the insurance carrier, the doctor had a full picture of the employee’s medical care—even for health services outside of her office. This affords her the opportunity to treat health needs holistically.

What you do with data matters

Yes, data is everywhere. It can overwhelm even the brightest of us. What it requires is succinct analysis. We can tell how many employees in a given area had strep throat in August 2015, but how relevant is this information? Employers need actionable, meaningful data. They need solutions that help employees improve their health and lower health plan costs.  

Or maybe those cases of strep throat in August are extremely relevant once you have context. Through a holistic view of data, you might find a higher rate of absenteeism in August. Is there a trend with the medical claims? Was there a pattern with medical claims and absenteeism? If so, why was there an outbreak? 

Working backwards, schools begin in August—every August. Let the illnesses begin. Start a communication campaign in July to educate employees how to prevent the sharing of germs, including those leading to strep throat. Next, take actionable steps. If, for example, your workplace doesn’t have hand sanitizers, install them. Although this is a minor example, it can have a profound impact on productivity and the health of employees and their families.

Now, you are taking steps that are impactful, specific and truly meet a specific health challenge. Now you are looking at employee health—and your plan costs—holistically. Now, you are establishing strategies and following through to control your health plan costs.

CONCLUSION: A BRAVE NEWWORLD

CHANGING BEHAVIOR IS DIFFICULT and people don’t always like change. But when clear data analysis can predict future health trends and lead to suggestions that improve employee health, Big Data is just the right amount of data. When interpreting that data identifies areas of improvement in your plan and reveals those employees who can realize better health outcomes, you better control your plan’s costs. When your employees reduce their health risks and take advantage of quality health services, everyone wins.

That’s what is possible with an integrated approach to the solutions that data analytics can provide. 

For many plan sponsors, too much data is as damaging as not having enough data. Actionable data is the key, identified and prioritized according to your plan’s objectives.When you can digest a full view of the impact your various benefits have on employees and your organization, you can understand your challenges more thoroughly. When you understand how plan design can encourage plan participants to adopt healthier habits, you appreciate the power of data when used wisely.

The key is working with a partner who helps you develop solutions that, in turn, guide you to meet your plan challenges. When you have the right information, you can attack nothing less than the root cause of your plan’s inefficiencies. 

In today’s competitive environment, providing healthcare benefits has become a financial hurdle many small and mid-sized businesses must clear. But clear it they must, because robust benefits help companies attract the best and the brightest. 

The trick is to identify the data important to your plan, and then develop solutions that align with your goals. Robust data analytics can help take you there.

For more information, contact David Kleifield for The Horton Group at david.kleifield@thehortongroup.com or 312-917-8636.

Tags:  Health Insurance Council  HIC  IRA  IRA HIC  The Horton Group 

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Health Care Reform: Employer Update

Posted By Eric Fine, Thursday, March 17, 2016

A Summary of Benefits and Coverage (SBC) is four-page (double-sided) communication required by the federal government. It must contain specific information, in a specific order and with a minimum size type, about a group health benefit's coverage and limitations. In February 2016, the Department of Labor (DOL) issued proposed revisions to the template and related materials. The agency expects final templates and materials to apply to plan or policy years beginning on or after January 1, 2017. The proposal includes both a blank template and a sample completed template along with instructions for completion. The agency has also invited public comments on the proposed template, to be submitted on or before March 28, 2016. All information about current and proposed SBCs, including a proposed uniform glossary and more can be found on the DOL's website.

 

For fully insured plans, the insurer is responsible for providing the SBC to the plan administrator (usually this is the employer). The plan administrator and the insurer are both responsible for providing the SBC to participants, although only one of them actually has to do this.

 

For self-funded plans, the plan administrator is responsible for providing the SBC to participants. Assistance may be available from the plan administrator's TPA, advisor, etc., but the plan administrator is ultimately responsible. (The plan administrator is generally the employer, not the claims administrator.)

 

Proposed Changes

The proposed template is shorter than the original four-page (double sided) communication. It includes a new "important question" that asks "Are there services covered before you meet your deductible?" and requires family plans to disclose whether or not the plan has embedded deductibles or out-of-pocket limits. This is reported in the "why this matters" column in relation to the question "what is the overall deductible?" and plans must list "If you have other family members on the policy, they have to meet their own individual deductible until the overall family deductible has been met" or alternatively, "If you have other family members on the policy, the overall family deductible must be met before the plan begins to pay."

 

Tiered networks must be disclosed and the question "Will you pay less if you use a network provider" is now included. The proposed SBC also includes language that warns participants that they could receive out-of-network providers while they are in an in-network facility. The SBC also indicates a consumer could receive a "balance bill" from an out-of-network provider.

 

The "explanatory coverage page" was dropped from the proposed template.

 

The provided coverage examples provide clarification to the "having a baby" example and the "managing type 2 diabetes" example, in addition to providing a third example of "dealing with a simple fracture." The coverage example must be calculated assuming that a participant does not earn wellness credits or participate in an employer's wellness program. If the employer has a wellness program that could reduce the employee's costs, they must include the following language: "These numbers assume the patient does not participate in the plan's wellness program. If you participate in the plan's wellness program, you may be able to reduce your costs. For more information about the wellness program, please contact: Greg Gallagher, Mesirow Financial at 312.595.8131."

 

The column for "Limitations, Exceptions, & Other Important Information" must contain core limitations, which include:

 

  • When a service category or a substantial portion of a service category is excluded from coverage (i.e., column should indicate "brand name drugs excluded" in health benefit plans that only cover generic drugs)
  • When cost sharing for covered in-network services does not count toward the out-of-pocket limit;
  • Limits on the number of visits or on specific dollar amounts payable under the health benefit plan; and.
  • When prior authorization is required for services.

 

The proposed template and instructions indicate that qualified health plans (those certified and sold on the Marketplace) that cover excepted abortions (such as those in cases of rape or incest, or when a mother's life is at stake) and plans that cover non-excepted abortion services must list "abortion" in the covered services box. Plans that exclude abortion must list it in the "excluded services" box, and plans that cover only excepted abortions must list in the "excluded services" box as "abortion (except in cases of rape, incest, or when the life of the mother is endangered)." Health plans that are not qualified health plans are not required to disclose abortion coverage, but they may do so if they wish.

 

Our access to PPACA Advisor resources can help you clear up PPACA questions and help you shape your company's benefit strategy.

 

This information is general and is provided for educational purposes only. It reflects UBA’s understanding of the available guidance as of the date shown and is subject to change. It is not intended to provide legal advice. You should not act on this information without consulting legal counsel or other knowledgeable advisors.

 

Copyright © 2016 United Benefit Advisors, LLC. All Rights Reserved.

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Alliant Healthcare Co-Sponsored Event

Posted By Eric Fine, Thursday, March 3, 2016

 

Robert Shine from Alliant Healthcare is co-sponsoring this IRA event:

 

 

 

IRA March 7th Winter Luncheon at Hamburger University

Please join us at Hamburger University on the Campus of McDonald's WorldHeadquarters for an event in conjunction with the Northern Illinois Franchise Association entitled: “Restaurant and Franchise Operations in 2016: Driving Sales, Managing Costs and Identifying Risks."  The event will feature a panel of industry experts who will discuss and answer questions surrounding restaurant franchising.

·         12:00   Sign in and Meet and Greet

·         12:15   Special Welcome

·         12:20   Lunch is Served

·         12:30   Panel Discussion

§  Sara Rush, Restaurant Business Magazine, moderator

§  Julia Howe, McDonald’s Franchisor, panelist

§  Derrick Taylor, McDonald’s Franchisee, panelist

§  Sam Stanovich, Firehouse Subs Franchisee & Area Developer, panelist

§  David Grossman, Freshii Franchisee & Area Developer, panelist

·         1:30   Networking and Dessert

·         2:00   Luncheon Concludes

CLICK HERE to register or call Eric Fine (312) 380-4115

Plus, for the first time, the IRA is hosting a gathering in conjunction with the Northern Illinois Franchise Association (NIFA). The two groups are combining efforts for the event to bring together Illinois’ largest contingency of franchise and restaurant business leaders. The Winter Luncheon is not to be missed!

 

Kind regards,

 

Illinois Restaurant Association & Robert Shine of Alliant Employee Benefits


Tags:  Health Insurance Council  IRA HIC 

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Benefits of Corporate Wellness

Posted By Eric Fine, Thursday, February 11, 2016

By Dave Brennan, EVP, REGIT, Inc.

Most people spend more hours at work than anywhere else, not to mention the time they spend commuting each day. In fact, the typical American works approximately 47 hours a week which is significantly more than the average 20 years ago.

Given these statistics, it is easy to see why maintaining a healthy work / life balance is becoming increasingly important.

According to a 2013 Department of Labor study, approximately 50% of US employers with at least 50 employees offer some type of wellness program as part of their employee benefit package.

They all share a common goal – to promote the well-being of their employees, which in turn benefits the employer organization.  One of the primary benefits of corporate wellness involves a reduction in the rates of illness and injuries among employees. Unhealthy employees experience a wide range of work-related injuries such as muscle strain, carpal tunnel syndrome, stress fractures or back pain.

These unhealthy individuals are more susceptible to developing complications such as diabetes, heart disease or stroke.  Consequently, they could find themselves on long-term disability for an extended period of time or be forced to discontinue working entirely.

Giving employees the opportunity to participate in corporate wellness programs may reduce the incidence of serious illnesses. In addition to preventing illnesses amongst employees, corporate wellness programs also lead to a reduction in employee absenteeism. Employees who are stressed, unhealthy or overworked tend to become sick much more often than healthy employees.  They tend to rely more on sick leave and disability insurance.

Another benefit of corporate wellness programs is a reduction in the cost of healthcare.  Companies who have implemented a corporate wellness program are realizing a significant decrease in healthcare costs. 70% of the healthcare dollar is being spent treating chronic diseases such as cancer, diabetes and heart disease. These illnesses have become known as lifestyle diseases. More than a third of working adults are dangerously obese, 80% do not exercise enough, 20% are overly stressed, 18% still smoke and roughly 10% are damaging their health with abuse of alcohol and narcotics.

Increased productivity is another benefit of corporate wellness. Employees who are happy and healthy tend to produce a greater volume of work at a higher quality than unhealthy employees. Employers need to realize that implementing programs that improve fitness and lower stress levels will increase the overall output of their employees.

Corporate wellness programs also contribute to the enhanced retention of key employees. Companies that implement wellness programs normally experience a much lower rate of employee turnover.

The bottom line is you should take advantage of the benefits of corporate wellness. Make it a goal to implement a program as soon as possible. You will experience a reduction in employee injuries, illness, absenteeism and healthcare costs, as well as an increase in employee retention and productivity. Assuming responsibility for establishing a healthy, harmonious working environment will allow everyone to enjoy the benefits of corporate wellness.

For more information please contact Dave Brennan, REGIT Inc., at dbrennan@regitinc.com or 630-495-1500.

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SO IT’S 2016 – NOW WHAT?!

Posted By Eric Fine, Thursday, January 28, 2016

 

By Kris Aufmann, Director of Benefits, Heil & Kay Insurance

 

What a wild and crazy year 2015 was…..unfortunately, 2016 may end up being ‘more of the same’ – we can say, however, that it is becoming easier as we learn more and more on how everything works and the reasons why certain procedures or processes are important!

Employers did receive a reprieve from the Cadillac Tax for another two years (until 2020) – and depending on the Presidential election outcome, could be delayed even further.

One item employers are still struggling with is the reporting requirements needed for those that have over 50 full-time equivalent employees.  Although the employer may not be subject to any penalty under the Employer Shared Responsibility provision in 2015, they are STILL required to report to the IRS on their employees and benefits.  Here are the different report forms and who is providing them:

n  Form 1095-A:  Marketplace issues to those insured in the Marketplace plans

n  Form 1095-B:  Generally provided by health insurers to individuals covered by their plans

n  Form 1095-C:  Provided by EMPLOYERS to employees with details on coverage availability/affordability

Many payroll companies are assisting employers in getting the information together, but the employer continues to have the bulk of the responsibility in not only providing the details, but verifying that the details are correct.  We have learned that the initial set-up with the payroll company is KEY in having the records correct so the end of year reporting doesn’t consume the employer’s time!  In addition, there are now 3rd party vendors that will handle all the aspects of the reporting for the employers – buyer beware, though, for those ‘small print’ extra fees!

We would be happy to discuss the various ways to reduce the stress of the reporting requirements along with a number of excellent, cost-effective vendors who can provide the service for you!

Contact Kris Aufmann at kaufmann@heilandkay.com or by phone at 847.258.5310, ext 207, for more information.

 A Notice Regarding Third Party Information

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IRS Provides Major Delay in 6055 and 6056 Reporting

Posted By Eric Fine, Thursday, January 28, 2016

 

Under the Patient Protection and Affordable Care Act (ACA), individuals are required to have health insurance, while applicable large employers (ALEs) are required to offer health benefits to their fulltime employees. In order for the Internal Revenue Service (IRS) to verify that (1) individuals have the required minimum essential coverage, (2) individuals who request premium tax credits are entitled to them, and (3) ALEs are meeting their shared responsibility (play or pay) obligations, employers with 50 or more fulltime or fulltime equivalent employees and insurers will be required to report on the health coverage they offer. Final instructions for both the 1094B and 1095B and the 1094C and 1095C were released in September 2015, as were the final forms for 1094B, 1095B, 1094C, and 1095C.

Reporting will first be due in 2016, based on coverage in 2015. All reporting will be for the calendar year, even for non-calendar year plans. On December 28, 2015, the IRS issued Notice 20164, delaying the reporting deadlines. 

The reporting requirements are in Sections 6055 and 6056 of the ACA. The 1094C, 1095C, 1094B, and 1095B were originally due to the IRS by February 28 if filing on paper (February 29, in 2016, because February 28 falls on the weekend), or March 31 if filing electronically. The 1095C form was due to employees by January 31 of the year following the year to which the Form 1095C relates (February 1, in 2016, because January 31 falls on a weekend). The 1095B was due to the individual identified as the “responsible individual” on the form by January 31 (February 1, in 2016, because January 31 falls on a weekend).

The transition relief provided by Notice 2016-4 extended the following due dates:

·         For issuing Form 1095B and 1095C to individuals, the deadline moved to March 31, 2016, previously February 1, 2016.

·         For filing all paper forms (1094C, 1095C, 1094B, and 1095B) to the IRS, the deadline moved to May 31, 2016, previously February 29, 2016

·         For filing all forms electronically (1094C, 1095C, 1094B, and 1095B) to the IRS, the deadline moved to June 30, 2016, previously March 31, 2016.

Employers that have difficulty meeting the extended reporting deadlines are encouraged to file late, as the IRS will take late filing into consideration when determining whether to reduce penalties for reasonable causes. The IRS will also take into account if an employer made reasonable efforts to prepare for reporting, such as gathering or transmitting necessary information to a reporting service.

 

Impact on Individuals

The IRS has determined that individual taxpayers may be affected by the extension, as employees are not eligible for the premium tax credit for any month, which an employee is eligible for an employer plan that provides minimum value, affordable coverage. However, the IRS has determined most individuals offered employer-provided coverage will not be affected by the extension.

Employees who enrolled in Marketplace coverage, but did not receive a determination from the Marketplace regarding whether their employer sponsored coverage was affordable, could be affected by the extension if they do not receive their 1095C form prior to filing their individual income tax returns. As a result, for 2015 only, individuals who rely on other information received from employers about their offers of coverage for purposes of determining eligibility for the premium tax credit when filing their income tax returns need not amend their returns once they receive their Forms 1095C or any corrected Forms 1095C.  Individuals do not need to send this information to the IRS when filing their returns, but should keep it with their tax records. 

Some individuals might also be affected by the extension because they will use the forms in determining whether they had minimum essential coverage. Individuals may not have received this information before they file their income tax returns, so for 2015 only, individuals who rely on other information received from their coverage providers about their coverage, for purposes of filing their returns, need not amend their returns once they receive the Form 1095B or Form 1095C or any corrections. Individuals need not send this information to the IRS when filing their returns, but should keep it with their tax records.

The extensions of due dates provided in the Notice apply only to section 6055 and section 6056 information returns and statements for calendar year 2015 filed and furnished in 2016 and do not require the submission of any request or other documentation to the IRS. 

Extension Process 

In September 2015, the IRS provided information on the Form instructions on applying for extensions.  Generally, an automatic 30-day extension will be given to entities filing Form 8809, and no signature or explanation is needed. Form 8809 must be filed by the due date of returns in order to be granted the 30 day extension. Waivers may be requested with Form 8508, and are due at least 45 days before the due date of the information returns. This extension relates to the deadline to provide the IRS with the forms, not providing individuals with the forms. 

However, because of the transition relief, for 2015, no extension requests will be granted. Employers must utilize the transition relief guidelines provided in Notice 2016-4. 

 

For more information, contact Greg Gallagher, Employee Benefits, Mesirow Financial at ggallagher@mesirowfinancial.com or 312.595.8131.

A Notice Regarding Third Party Information

Tags:  Health Insurance Council  HIC  IRA Mesirow 

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Rising cost of prescription drugs threatens health care gains

Posted By Eric Fine, Thursday, December 17, 2015

By Sreedhar Potarazu, founder and CEO of VitalSpring Technologies Inc.:         

 

(CNN)According to a recent report from the Centers for Disease Control and Prevention's National Center for Health Statistics, an unprecedented 90.8% of Americans now have health insurance.

 

We'll leave it to the politicians to debate whether Obamacare is a good program or a bad program -- whether it should be maintained, re-legislated or repealed outright. The fact is that only 9.2% of Americans -- the lowest percentage ever -- are uninsured. And while that number is far short of perfect, it's something the White House can rightly brag about.

But the bragging could be short-lived, because Obamacare is officially called the Patient Protection and Affordable Care Act -- and the soaring cost of prescription drugs is well on its way to making health care unaffordable again.

Prescription drug costs are rising dramatically in the United States. Based on a recent survey by Consumer Reports, 33% of Americans were paying an average of $39 more out of pocket for their regular prescription medications, and 10% were paying as much as an extra $100. Among the drugs that saw the highest increases were medications for asthma, high blood pressure and diabetes, which went up by more than 10% last year.

According to the survey, one out of four people whose prescription drug costs went up said they were unable to pay their medical or medication bills. Seven percent said they missed a mortgage payment. One out of four stopped getting their prescriptions filled, and one out of five skipped scheduled doses.

That is hardly a prescription for good health.

But the impact of these price increases goes far beyond the people who need prescription drugs. The cost increases affect employers and insurers, who are transferring some of these costs to consumers, requiring them to pay a larger share through their monthly premiums and rising copays.

They also affect state Medicaid programs for the poor and Medicare programs for people with fixed incomes.

It's a prescription for disaster for far too many consumers who, despite having health insurance and even government assistance to pay for it, are increasingly unable to pay for the care they need.

So what can be done to rein in the cost? A lot, and the sooner the better.

1. Consumers, employers and insurance companies require much more transparency on how much prescription drugs actually cost. The negotiated rates between drug manufacturers and distributors are a well kept secret, and if you don't know what a drug should cost, you can't tell if you're overpaying.

2. Employers need to strongly encourage their employees to use generic drugs and to get them through mail order, because even if your employer is providing you with health insurance, your copays and deductibles may be rising to the point where you can't afford to buy the brand-name drug at the corner drugstore.

3. There is a need for more competition. The unfortunate fact is that three major pharmacy benefits managers -- CVS Caremark, Express Scripts Inc. and Prime -- negotiate rates between the manufacturers and pharmacies. And now the major insurance companies are starting to merge, leaving even less choice for consumers. Competition always drives prices lower, but we're heading in the other direction.

4. Drug manufacturers attribute their rising drug costs to massive investments in research and development, but many critics say that's an excuse for price-gouging. Gilead Sciences' Harvoni, a new medication to treat Hepatitis C, costs $1,350 per pill -- $113,400 for a 12-week treatment. Its predecessor, Solvaldi, cost "only" $1,000 per pill -- $84,000 for a 12-week treatment. An estimated 3 million people in the United States have Hepatitis C. At retail, the cost of Harvoni could come to $340 billion. Even at a discounted price, a heavy price will get passed on to consumers. Manufacturers are certainly entitled to cover the costs of research and development, but releasing new drugs into the market at a faster pace, depending on how quickly the FDA can accelerate its approval processes, would increase competition and lower the cost of R&D.

5. Long-standing patents on medications often create barriers to developing new ones, and they also delay access to generics. Shortening the expiration of those patents would lower overall costs and might create an environment that encourages more options for consumers.

6. Restrictions on purchasing prescription drugs in other countries and bringing them to the United States -- both through travel and on the Internet -- must be relaxed. This would drive up competition and encourage the companies to lower their prices.

7. This is the big one: The largest purchaser of health care services in the country is Medicare, but the law forbids Medicare officials -- unlike Medicaid and Department of Veterans Affairs officials -- from negotiating prices with pharmaceutical companies. That makes no sense whatsoever. Changing this law has the potential to change everything.

In a country where all men and women are created equal, health care must be affordable for all of us, not only for some. The ever-rising cost of prescription drugs is hindering everything we've achieved in health care. We need to keep those costs in check, and we need to take steps to do it now.

 

 

For more information please contact Dave Brennan, EVP, REGIT, Inc. at dbrennan@regitinc.com or by phone at 630-495-1500.

Tags:  Health Insurance Council  HIC  Inc.  Obamacare  prescription drugs  VitalSpring Technologies 

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Comprehensive Health Coverage

Posted By Administration, Wednesday, December 9, 2015


 

 


Comprehensive Health Coverage—Essential Health Benefits Package

brought to you by The Horton Group Inc.

The Affordable Care Act (ACA) requires non-grandfathered health insurance plans in the individual and small group markets to offer comprehensive health coverage, known as the essential health benefits package. This requirement is effective for plan years beginning on or after Jan. 1, 2014.

Under the essential health benefits package, a health insurance plan is required to:

·         Cover a core set of items and services, known as essential health benefits;

·         Limit cost-sharing for essential health benefits; and

·         Provide either a bronze, silver, gold or platinum level of coverage (or a catastrophic plan in the individual market).

affected health plans

The essential health benefits package requirement applies to non-grandfathered insured health plans in the individual and small group markets, both inside and outside of the health insurance Exchanges. Thus, group health plans purchased by small employers outside of the Exchange’s Small Business Health Options Program (SHOP) must provide the essential health benefits package.

This comprehensive coverage requirement does NOT apply to grandfathered health plans, self-insured group health plans and health insurance plans offered in the large group market. However, as explained below, the out-of-pocket maximum for essential health benefits applies to all non-grandfathered plans, including self-insured group health plans and insured health plans of any size.

Small Group Market

To make health insurance coverage for small groups more affordable and to apply additional consumer protections, the ACA expands the small group market. The ACA called for the definition of a “small employer” to be expanded to include an employer that employed an average of at least one employee, but not more than 100 employees, on business days during the preceding calendar year, and also that employs at least one employee on the first day of the plan year.

However, on Oct. 7, 2015, President Obama signed the Protecting Affordable Coverage for Employees (PACE) Act into law, which repeals the ACA’s small group market expansion requirement and, instead, gives states the option of expanding their small group markets to include businesses with up to 100 employees. Most states have historically defined a small employer as one with 50 or fewer employees. However, some states have already amended their state laws to adopt the expanded small group market definition. These states will have to take action to undo those changes in order to return to a small group market including only employers with up to 50 employees.

An employer not in existence during the preceding calendar year must determine whether it is a small or large employer based on the average number of employees that it reasonably expects to employ on business days in the current calendar year. Also, the tax code’s aggregation rules for controlled groups, companies under common control and affiliated service groups apply when determining an employer’s size.

The Department of Health and Human Services (HHS) indicated that it intended to issue guidance in the future about how to count employees in order to determine the market size of a group health plan. Currently, states use a variety of different methods to calculate employer group size.

Optional Transition Policy

In November 2013, HHS created a transition policy that allows issuers in the individual and small group markets to renew health insurance policies that do not comply with certain ACA reforms that are effective for 2014, including the essential health benefits requirement. Originally, HHS announced that the transition policy would last one year; however, HHS later extended the transition policy for two additional years, to policy years beginning on or before Oct. 1, 2016.

Due to this transition policy, some insured group health plans for small employers may not include the essential health benefits package. If an issuer is using the transition relief, it is required to send a notice to the employer that explains which ACA reforms are not included in the health plan’s coverage.

The transition policy is not available in every state. Because the insurance market is primarily regulated at the state level, state governors or insurance commissioners must allow issuers in their states to use the transition policy. Also, even if the transition policy is available in a state, health insurance issuers are not required to follow the transition relief and renew plans that do not comply with ACA reforms.

In addition, transition relief was also available to large employers that currently purchase insurance in the large group market, but that as of Jan. 1, 2016, would have been redefined by the ACA as small employers purchasing insurance in the small group market. At the option of the states and health insurance issuers, these large employers had the option to renew their current policies through policy years beginning on or before Oct. 1, 2016, without their policies being considered as out of compliance with the specified ACA reforms that apply to the small group market but not to the large group market, such as the essential health benefits package requirement.

essential health benefits

Effective for plan years beginning on or after Jan. 1, 2014, insured health plans in the individual and small group markets must cover a core set of items and services, known as essential health benefits.

The ACA requires essential health benefits to reflect the scope of benefits covered by a typical employer and to cover at least the following 10 general categories of items and services:

· Ambulatory patient services (outpatient care)

· Emergency services

· Hospitalization

· Maternity and newborn care

· Mental health and substance use disorder benefits, including behavioral health treatment

· Prescription drugs

· Rehabilitative and habilitative services and devices

· Laboratory services

· Preventive and wellness services and chronic disease management

· Pediatric services, including oral and vision care

 

The ACA directed HHS to more specifically define the items and services that comprise essential health benefits. HHS developed a state-specific benchmark approach for defining essential health benefits. Under this approach, each state selected a benchmark insurance plan that reflects the scope of services offered by a typical employer plan in the state. If a state did not select a benchmark plan, HHS selected the small group plan with the largest enrollment in the state as the state’s default benchmark plan.

As a general rule, the items and services included in a state’s benchmark plan comprise the essential health benefits that insured health plans in the state’s individual and small group markets must cover.

More information on the benchmark plans, including the benchmark plan for each state, is available on the Center for Consumer Information & Insurance Oversight (CCIIO) website.

cost-sharing limits

Effective for plan years beginning on or after Jan. 1, 2014, the ACA requires non-grandfathered health plans to comply with cost-sharing limits with respect to their coverage of essential health benefits. Cost sharing includes any expenditure required by or on behalf of an enrollee with respect to essential health benefits, such as deductibles, copayments, coinsurance and similar charges.

As enacted, the ACA’s cost-sharing limits included an overall annual limit (or out-of-pocket maximum) and an annual deductible limit. However, on April 4, 2014, the ACA’s annual deductible limit was repealed, effective as of the date of the ACA’s enactment. The repeal did not affect the out-of-pocket maximum.

Out-of-pocket Maximum

The out-of-pocket maximum for essential health benefits applies to all non-grandfathered plans. This includes, for example, self-insured health plans and insured health plans of any size. Thus, even plans that are not required to cover essential health benefits (for example, insured plans for large employers) must comply with the ACA’s out-of-pocket maximum for any covered benefits that fall within the scope of essential health benefits.

The out-of-pocket maximum limits are as follows:

 

2014

2015

2016

Self-only Coverage

$6,350

$6,600

$6,850

Family Coverage

$12,700

$13,200

$13,700

 

Once the out-of-pocket maximum is reached for the year, the enrollee is not responsible for additional cost sharing for essential health benefits for the remainder of the year.

Other Limits

Effective for plan years beginning on or after Sept. 23, 2010, the ACA prohibits all health plans from placing lifetime dollar limits on essential health benefits.

In addition, effective for plan years beginning on or after Jan. 1, 2014, all health plans are prohibited from placing annual dollar limits on essential health benefits. Prior to 2014 plan years, restricted annual limits on essential health benefits were permitted. For example, unless a plan received a waiver of the restricted annual limits, its annual limit on essential health benefits for the 2013 plan year could not be less than $2 million.

In order to determine which benefits are essential health benefits for the purpose of removing annual and lifetime dollar limits, a self-insured group health plan, large group market health plan, or grandfathered group health plan may choose any benchmark plan from any state that was approved by HHS. (Frequently Asked Question ID 1364).

metal levels of coverage

To satisfy the requirement to offer the essential health benefits package, issuers in the individual and small group markets (both inside and outside of the Exchanges) must provide a level of coverage that meets certain actuarial values. The ACA’s required actuarial values are referred to as “metal levels”—bronze, silver, gold and platinum.

Alternatively, issuers in the individual market may offer a catastrophic plan for young adults and persons who are exempt from the individual mandate because affordable coverage is unavailable or they have a hardship exemption.

Actuarial value is calculated as the percentage of total average costs for essential health benefits that a plan will cover. A health plan’s actuarial value tells consumers how generous the plan’s coverage is based on its cost-sharing provisions (that is, deductibles, copayments and coinsurance). Plans with higher actuarial values provide coverage that is more generous. For example, if a plan has an actuarial value of 70 percent, on average, a consumer would be responsible for 30 percent of the costs of covered benefits. If a plan has an actuarial value of 80 percent, on average, a consumer would be responsible for 20 percent of the cost of covered benefits.

Each metal level is based on a specified share of the actuarial value of the plan’s essential health benefits. Bronze plans have the least generous coverage, while platinum plans have the most generous coverage. Coverage levels are as follows:

Bronze Level

Silver Level

Gold Level

Platinum Level

60 percent actuarial value

70 percent actuarial value

80 percent actuarial value

90 percent actuarial value

 

In the small group market, special standards for determining actuarial value apply to high deductible health plans (HDHPs) offered with health savings accounts (HSAs) and health plans integrated with health reimbursement arrangements (HRAs). 

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