Blog By: Beth Ede, SPHR
There’s been a lot of news lately about more uncertainty and delays related to the implementation of the health care reform law. Yes, there have been delays announced, but those delays do not impact the implementation of the rest of the health care reform mandates.
Let’s take a quick look at what’s going on with health care reform (HCR).
On July 2, 2013, the Treasury department announced that the employer mandate penalties and related reporting requirements will be delayed for one year, until 2015. Therefore, the “play or pay” penalty to employers will not apply for 2014. The Internal Revenue Service issued more formal guidance on the delay through Notice 2013-45. Additional guidance is expected on the reporting requirement.
There are still mandates that are moving forward for 2013 and employers and individuals need to be prepared. Here are just a few of the mandates we need to be focused on:
Limited Health Flexible Savings Account Contributions – effective for plan years beginning after December 31, 2012, HCR limits the amount of salary reduction contributions to health FSAs to $2,500 per year, indexed by CPI for subsequent years (revisions adopting amendments to plan document(s) must be made by December 31, 2014)
Employee Notice of Exchanges – employers must provide a notice to all employees regarding the availability of the health marketplaces (exchanges) regardless of whether a group health plan is offered. The notice of exchange must be provided to current employees by October 1, 2013 – in addition, the notice must be provided to new employees beginning on this date. Model language is available on the Department of Labor website.
Additional Medicare Tax on High Wage Earners – employers must withhold an increased Medicare hospital insurance tax rate of 0.9% on employee wages over $200,000 – once that threshold is met. Employers do not have to match this expanded tax rate increase.
Patient Centered Outcomes Research Fee (PCORI) – for plan years ending on and after October 1, 2012 and before October 1, 2019, applicable plans must pay a fee per covered life. The initial fee is $1 per covered life, increasing to $2 per covered life for plan years ending on or after October 1, 2013 (and adjusted annually for later plan years). The first possible payments were due July 31, 2013. These fees are paid by applicable carriers of fully-insured plans, but self-insured plan administrators are responsible for the payments.
Remember to keep health care reform compliance focused on your radar. If WA can be of further assistance to you, please feel free to contact us.