Mid-Year ACA Review: For Your Best Pay or Play Solution
We’ve got more updates for you on the Affordable Care Act! A lot of information has come through piecemeal, but we’ve taken the time to compile some of the most recent updates all employers need to be aware of so you can determine the best pay or play solution for your business. To round out the first half of the year, here are some changes you may have missed.
May
The Department of Labor (DOL) released updates to the COBRA and CHIPRA model notices on May 2 to reflect the availability of coverage within the Exchanges.
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On May 13, the IRS issued guidance on Employer Health Arrangements. Employers who offer standalone HRAs pre-tax as a way to reimburse employees for coverage purchased on the Exchanges will be penalized $100 per day per person. These arrangements are known as “employer payment plans.” The FAQs indicate that these arrangements do not comply with the ACA’s market reforms.
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Also on May 13, the IRS released FAQs addressing consequences under the employer shared responsibility rules for large employers that offer health insurance coverage to all full-time employees, but do not offer dependent coverage. Under the employer shared responsibility provisions, a large employer may owe a penalty if:
- The employer does not offer health coverage to the dependents of its full-time employees (as well as to those full-time employees themselves); and
- At least one full-time employee receives a subsidy for purchasing individual coverage through an Exchange.
June
On June 20, the DOL issued a proposed rule that would revise the definition of “spouse” under the FMLA. The revised definition would look to the law of the jurisdiction in which the marriage was entered into, as opposed to the law of the state in which the employee resides.
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On June 23, the Departments of the Treasury, Labor and Health and Human Services released final regulations clarifying the maximum allowed length of any “reasonable and bona fide employment-based orientation period” as it relates to the waiting period limit. The final regulations confirm that an orientation period is permitted only if it does not exceed one month.
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On June 26, the Department of Treasury and the IRS issued final regulations on the Small Business Health Care Tax Credit, which helps small businesses afford the cost of health care for their employees. The regulations include information on the requirement to purchase health insurance coverage through the Small Business Health Options Program (SHOP) Marketplace. The final regulations are applicable for taxable years beginning in or after 2014.
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On June 30, the U.S. Supreme Court ruled that closely held for-profit corporations with sincere religious objections to certain types of contraceptives cannot be required to comply with the ACA’s contraceptive mandate (Burwell v. Hobby Lobby). Under the ACA, employers with non-grandfathered health plans are required to provide cost-free coverage for certain preventive care for women, including all FDA-approved contraceptive methods. Three family-owned corporations objected to providing health coverage for certain types of contraceptives, based on their owners’ religious beliefs.
A lot of things to keep track of, but keep breathing and we’ll keep the information coming to help with your discernment of your company’s best pay or play solution! Find more helpful hints on our Benetech Blog!
