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February 2018  Volume 16, Number 2        
 

health benefits

Affordable Care Act Compliance Issues to Watch in 2018

Regardless of whether the Republican-controlled House and Senate repeals, replaces or alters the Affordable Care Act (ACA), there are a number of rules and regulations employers must comply with in 2018 and 2019 if they offer group health benefits to employees. To make sure you’re not caught unaware, review and implement this checklist of obligations and deadlines:

FORM 1095-C

Submit to the IRS by Feb. 28 (paper) or April 2 (electronically)

Hopefully you have already completed and provided copies of Form 1095-C to each of your employees, which was due on Jan. 31. Employees need the form so they can fill out Line 61 of their individual tax returns to demonstrate that they and family members had the required minimum essential health care coverage. The IRS issued Notice 2018-06 on Dec. 22, 2017, which extended by 30 days the 2018 due date for distributing 2017 health coverage information forms 1095-C or 1095-B to employees, regarding the health care coverage offered to them.

The new deadline for supplying these forms to employees is March 2, 2018. This 30-day extension is automatic. Employers and providers don’t have to request it. [See: https://tinyurl.com/y7nd23ad]

As the employer, you also must file either a paper copy of Form 1095-C with the Internal Revenue Service (IRS) or submit an electronic form. You must report whether the group health benefit plan you offered met the ACA’s Minimum Essential Coverage (MEC) requirements. Plus, you should include the employee’s ID number and Social Security numbers of the employee and dependents (but not the employee’s spouse).

FORM 1094-C

Submit to the IRS by Feb. 28 (paper) or April 2 (electronically)

The Employer Shared Responsibility mandate requires Applicable Large Employers – those who have 50 or more full-time equivalent employees — to provide health benefit coverage that is affordable and meets minimum value standards. Employers who do not do this may owe a penalty for noncompliance.

The definition of minimum value remains the same as 2017 and describes a plan that pays at least 60 percent of the costs and includes substantial coverage of physician and inpatient hospital services. The affordability requirement, however, has changed. An employer cannot charge a full-time employee more than 9.56 percent of household income, down slightly from 9.69 percent in 2017.

Not only must you meet these standards, but you also must document the plans you offer and keep track of employees who waived coverage. Submitting Form 1094-C demonstrates that you met the requirements. Small employers (less than 50 FTEs) do not need to fill out these forms.

Cadillac Tax

Due in 2020

The Cadillac tax is a 40 percent excise tax on high-cost health care benefit plans. Proponents of the tax thought it would stop employers from offering plans that were “too rich,” which would prevent employees from having “skin in the game” and truly understanding the cost of health care. Unfortunately, many of the ACA fees and requirements have made many plans that were once considered “average” qualify for the Cadillac Tax.

Although the tax does not go into effect until 2020, employers should review their health benefit plans as soon as possible to ensure their plans do not qualify for the tax.

Employee Notice of Exchange

Due when new employees are hired

Even if you offer group health benefits, you must provide all new employees with a written notice about the ACA health insurance exchanges. A Department of Labor document is available that you can use and customize. The notice informs employees about the Marketplace Exchanges and lets them know that they may be eligible for a premium tax credit or a cost-sharing reduction if the company’s plan does not meet certain requirements.

Cost-sharing

New limits for 2018

All health plans, except grandfathered health plans, have an annual limit on the maximum amount an employee must pay out of pocket. Review your plan’s out-of-pocket maximum to ensure it complies with the ACA’s limits for the 2018 plan year, which is $7,350 for self-only coverage and $14,700 for family coverage.

If you have a Health Savings Account-compatible high deductible health plan (HDHP), the 2018 out-of-pocket maximum limit for HDHPs is $6,650 for self-only coverage and $13,300 for family coverage.

The limits may change again for 2019. The IRS usually announces whether the limit will be adjusted for the next year at the end of the year.

Summary of Benefits and Coverage

New 2018 template
Due 90 days from enrollment


A Summary of Benefits and Coverage (SBC) is a short, easy-to-understand overview of what type of coverage you’re providing your employees. It also includes a glossary of health coverage and medical terms. You must make sure that every employee who is receiving health benefits from your company gets a copy of the SBC within 90 days of enrolling in the plan. If an individual requests a copy, you must provide it within seven business days.

Make sure you use the SBC template for the 2018 plan year. Your insurer will provide the SBC to you, unless you are self-funding your group health benefits. In that case, you will need to get the SBC from your plan administrator.

Preventive Services

New Definition for 2018/2019

It’s important employers and employees are aware of what kinds of preventive services all compliant health plans must offer. Beginning this year, preventive services include screening for depression in adults; low-dose aspirin for certain at-risk adults aged 50 to 59; syphilis screening for asymptomatic non-pregnant adults; and other benefits.

For more information or a review of your employee health plan, please contact us.

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In this issue:

Macy’s Tobacco Cessation Program Questioned

Affordable Care Act Compliance Issues to Watch in 2018

Questions to Ask Potential Retirement Plan Providers

Communicating the Value of Your Health Benefit Plan

The Advantages of Bundling Group Dental and Vision Insurance

 

 


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