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Companies with Employer-Sponsored Health Plans Must Still Notify Employees of Exchanges

Many U.S. employers offer health insurance coverage to their employees and have been doing so long before the Affordable Care Act (ACA) was signed into law in March of 2010. However, these employers may still be impacted by ACA regulations including the requirement to notify employees of health insurance exchanges regardless of the quality of their own employer-sponsored health plans.

New guidance on exchange notifications required by the ACA has recently been issued by the Department of Labor (DOL) in Technical Release 2013-02.

Beginning October 1, 2013, employers subject to the Fair Labor Standards Act (FLSA) will be required to provide each employee a written notice informing them of their health coverage alternatives offered through the Health Insurance Marketplace, also known as the exchange. Employees must be notified within 14 days of the time of hiring, and current employees must be notified no later than October 1, 2013.

The DOL has provided model language for the notification on their website at http://www.dol.gov/ebsa/healthreform/. There is a model notice for employers who offer health insurance and a different model notice for those who do not offer health insurance coverage.

The Marketplace is designed to help employees find health insurance that meets their needs and fits their budget with one-stop shopping for finding and comparing private health insurance options. If their employer-sponsored coverage does not meet minimum requirements as set forth by the ACA, they may be eligible for a tax credit that would help them save money on their health insurance premiums through the Marketplace.

Employers who have employees who qualify for a tax credit to buy coverage through the Marketplace could be subject to penalties. Watch for our upcoming ACA blog post on “ACA Penalties: Insurance Inadequacies Can Cost You”  and signup for our webinar – Think Your Business is ACA Compliant? – to learn more.



Author Bio: Newman Wells is a writer, designer and entrepreneur with over 20 years of corporate marketing experience. Passionate about B2B marketing, Newman Wells specializes in helping businesses define their value propositions by simplifying technical jargon for easier-to-digest messages that drive sales. She has spent the last two decades building successful marketing departments from the ground up and has been Paycom's director of marketing since 2005.

signing forms

Ready or Not, IRS Finalizes ACA Forms

The time has arrived for employers impacted by the eligibility reporting requirements of the Affordable Care Act (ACA), as the IRS officially released the 2014 versions of the final forms and instructions on Feb. 8. Posted were the following forms, which fulfill the reporting requirements under ACA sections 6055 and 6056:

  • Form 1094-B, Transmittal of Health Coverage Information Returns;
  • Form 1095-B, Health Coverage;
  • Form 1094-C, Transmittal of Employer-Provided Health Insurance Offer Coverage Information Returns; and
  • Form 1095-C, Employer-Provided Health Insurance Offer and Coverage.

Applicable large employers (ALEs) – those with 50 or more full-time or full-time-equivalent (FTE) employees – will be held to the mandatory filing; however, some organizations may receive transitional relief based on:

Regardless, all ALEs are required to file these forms with the IRS and provide statements to full-time employees about health coverage, even if the employers are not required to offer affordable coverage that meets minimum essential coverage or value in 2015.

Information reporting is voluntary for 2014, but all ALEs must submit the forms in early 2016 for calendar year 2015. It is anticipated that the IRS will release the 2015 version of the forms by the end of this year.

If you are a Paycom client, the submission and distribution of these mandatory forms can be done easily through the ACA Dashboard. Paycom’s ACA Dashboard streamlines reporting requirements as users can analyze their information to ensure they are in compliance with the new federal guidelines. In addition, the ACA Dashboard can be autopopulated with an employer’s existing data, and this data also can be autopopulated into the required IRS forms. The ACA Dashboard is provided free of charge to all clients; filing of the forms for 2015 can be done on your behalf for a small fee.

ACA-ToolKit



Author Bio: A writer, speaker and young business leader, Jason has been the communications pulse for a number of organizations, including Paycom. A featured writer on human capital management technology, leadership and the Affordable Care Act, Jason launched Paycom’s blog and social media channels, helping empower organizations around the nation. Jason is attune to the needs of businesses and recently helped develop a tool to aid organizations in their pursuit to comply with the ACA; one of the largest changes in healthcare the country has seen. While working in athletics for ESPN and FoxSports, Jason learned the importance of hard work and branding. In his free time he enjoys adventuring with his family, reading and exploring new areas to strengthen his business acumen.

Green highway sign with exit for year 2015

New Year, but Not for ACA’s Non-Calendar-Year Plans

Here we are, kicking off 2015 – the official beginning of the Affordable Care Act’s employer mandate. However, some employers have plan years that don’t begin on Jan. 1 and will not take part in the fun just yet.

Transitional relief provides employers whose plans don’t start on Jan. 1 an opportunity for respite, so long as they meet the requisites below. Employers who fall into this category do not have to comply with ACA requirements until the beginning of their 2015 plan year, as long as their employees are offered affordable, minimum-value coverage from day one of the 2015 plan year.

The following are required in order to qualify for transitional relief.

  1. All plans must have been adopted and legally in effect on or before Dec. 27, 2012. Appropriate documentation, including for the Employee Retirement Income Security Act (ERISA), must have been established by this date.
  2. After Dec. 27, 2012, employers could not have modified the plan-year start dateof non-calendar plans.
  3. The employer must offer coverage to an acceptable percentage of employees, in one of two scenarios:
    1. As of any date in the 12 months ending Feb. 9, 2014, at least 25 percent of employees are covered under the non-calendar-year plan, or
    2. During the non-calendar-year plan during the most recent open-enrollment period ending before Feb. 9, 2014, at least one-third of its employees or 50 percent of its full-time employees were offered coverage.

Provided that each applicable large employer has followed these three requirements, transitional relief is granted. However, all other employers must adhere to the rules and regulations of ACA’s employer mandate, which went into effect Jan 1.

Disclaimer: You should speak to an attorney regarding your specific situation and to determine whether you qualify for this relief.



Author Bio: A writer, speaker and young business leader, Jason has been the communications pulse for a number of organizations, including Paycom. A featured writer on human capital management technology, leadership and the Affordable Care Act, Jason launched Paycom’s blog and social media channels, helping empower organizations around the nation. Jason is attune to the needs of businesses and recently helped develop a tool to aid organizations in their pursuit to comply with the ACA; one of the largest changes in healthcare the country has seen. While working in athletics for ESPN and FoxSports, Jason learned the importance of hard work and branding. In his free time he enjoys adventuring with his family, reading and exploring new areas to strengthen his business acumen.

Funny retro nerd flexing his muscle isolated on white background

ACA Loopholes Closing by a ‘Skinny’ Margin

Employers already are well aware that the health care landscape is changing – and changing drastically. But now employers who thought they were complying with the Affordable Care Act (ACA) are being told otherwise, as the Obama administration works to close loopholes – and fast.

Two major loopholes exist that employers must account for now.

  1. Plans that pass the minimum-value test – but do not offer hospital coverage – no longer will be accepted after 2015.
  2. So-called “skinny plans” were determined to meet the minimum-essential coverage rules of the IRS, but those offering them could still face penalties.

Hospital Coverage Now a Must
According to the U.S. Department of the Treasury, employers offering medical plans that lack hospital coverage and/or physician services will not qualify as meeting the ACA’s minimum-value threshold. This is reflected in IRS Notice 2014-69.

This represents a blow to a large number of employers who were preparing to offer similar plans for 2015 – the first year they will be held to the ACA’s employer mandate, lest face costly penalties.

Despite this news, the administration will allow employers one year to find an alternative, provided they had committed – in writing and before Nov. 4 – to offer one of these plans to their employees. These employers have been granted limited grandfather protection, but will have to add coverage for inpatient services in order to qualify for minimum-value status for the preceding calendar year. Additionally, this protection applies only for those plan years beginning on or before March 1, 2015.

The Treasury also noted that individuals offered these plans still will be able to qualify for subsidies, despite the employer-offered insurance meeting the minimum-value coverage mark under the grandfathered protection.

Employers offering grandfathered plans either must revise their summary of benefits and coverage, or send another form of notice to employees that they still will qualify for subsidies through a health-insurance exchange because of the plan’s limitations.

Large employers failing to offer minimum-value coverage next year could be fined upward of $3,000 per worker in 2015. These penalties will be assessed when employees qualify for subsides through exchanges based on their income.

‘Skinny Plans’
“Skinny plans” are employer-sponsored benefits that offer little more than preventive care. These plans were adopted by employers because they pass the ACA requirement of providing minimum-essential coverage, which is not to be confused with “minimum-value.” These plans are not designed to meet the minimum-value requirement of 60 percent, but allow employers to bypass the first tier of fines under the ACA’s pay-or-play penalty assessment ($2,000 multiplied by each employee for failure to offer coverage).

For employers to be spared the affordability/minimum-value portion of the ACA penalties, they also must offer a comprehensive health plan to all employees and prove that an affordable offer was made to each one. Those choosing the lower-cost alternative (Skinny plans) then would not qualify for subsidies because they were offered a plan that met the ACA’s minimum-value standard.

Penalties for employers offering solely “skinny plans” would be assessed only for employees who opted for the exchange and qualified for subsidies.

As an employer, it is important that you know all of the facts when deciding which plan to choose for your employees … and note that sometimes, being “skinny” isn’t all it’s cracked up to be.



Author Bio: A writer, speaker and young business leader, Jason has been the communications pulse for a number of organizations, including Paycom. A featured writer on human capital management technology, leadership and the Affordable Care Act, Jason launched Paycom’s blog and social media channels, helping empower organizations around the nation. Jason is attune to the needs of businesses and recently helped develop a tool to aid organizations in their pursuit to comply with the ACA; one of the largest changes in healthcare the country has seen. While working in athletics for ESPN and FoxSports, Jason learned the importance of hard work and branding. In his free time he enjoys adventuring with his family, reading and exploring new areas to strengthen his business acumen.

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