Health Care Reform Resources for Employers

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Affordable Care Act Kept in Place with All Coverage and Reporting Obligations

Beginning in 2017, the Republican majority in Congress and the Trump administration made repeal and replacement of the Affordable Care Act (ACA) a top priority, and in March 2017 the House GOP leadership introduced the American Health Care Act (AHCA) as their designated bill to begin to "repeal and replace" the ACA. The House passed their legislation on May 4, 2017.

In July 2017, Senate GOP leaders released the Senate's repeal and replacement bill, named the Better Care Reconciliation Act (BCRA), but defections by both GOP Senate conservatives and moderates blocked passage. Senate Republicans' then tried to pass a "skinny repeal" bill dubbed the Health Care Freedom Act—which would have eliminated penalties under the ACA's individual mandate to enroll in ACA-compliant coverage and (through 2024) the employer mandate to provide coverage—but it, too, went down to defeat by a vote of 49 to 51.

A September 2017 effort to pass the Graham-Cassidy bill, a last-ditch attempt to repeal and replace the ACA that would have ended the individual and employer mandates and given the states greater authority over their health care systems, was not brought up for a Senate vote as Republicans lacked enough support to pass the measure.

These failures left in place the ACA's wide-ranging obligations for employers with 50 or more full-time employees or equivalents to provide ACA-compliant health coverage to employees who work at least 30 hours per week, and to track and report all employee hours to the IRS, along with other administrative requirements.

Going forward, the GOP is likely to seek, with possible bipartisan support, specific targeted reforms. Among these efforts, Sen. Lamar Alexander, R-Tenn., chairman of the Senate Health, Education, Labor and Pensions (HELP) committee, is working to forge health care compromise legislation with Democrats.

Until the ACA's employer coverage and reporting obligations are changed through legislative actions or regulatory adjustments, employers subject to the ACA must comply with all its coverage and administrative requirements.


Updates

What's Next for Health Care Legislation?
Republicans are no longer expected to make big changes in the Affordable Care Act (ACA), but bipartisan legislation streamlining ACA reporting and giving health savings accounts more flexibility are on the agenda. 

Bipartisan Legislative Proposals to Enhance Health Savings Accounts Introduced
The Bipartisan HSA Improvement Act, supported by the Society for Human Resource Management, could be attached to the fiscal 2018 omnibus federal spending bill. 

IRS Issues Transition Rule for HSA-Incompatible Vasectomies
Recently enacted state laws requiring health plans to pay for men's vasectomies regardless of any deductible were poised to render health plans in those states incompatible with IRS rules for health savings accounts (HSAs). The IRS has now provided two years of temporary relief. 

IRS Lowers 2018 Family HSA Contribution Limit by $50
The 2018 contribution limit for health savings accounts (HSAs) linked to family coverage will be $6,850—not $6,900, as the IRS had previously announced. Some employees who calculated their pretax payroll contributions at the beginning of the year will need to adjust their deferrals.

How Will Health Industry Mergers Affect Employer Drug Plans?
The announcement of a planned acquisition of Express Scripts, one of the largest pharmacy benefit managers in the U.S., by Cigna, one of the nation's largest health insurers, could alter the competitive landscape for employer-provided prescription drug plans. 

The Right Ingredients Brew Wellness Program Success
With the efficacy of workplace wellness programs being questioned, new research may help to explain why some efforts are successful and others aren't. That matters, because if employers can't show that their wellness programs are producing results, fewer will continue to offer them.

Does a New Study Underestimate Wellness Programs?
A major new study casts doubt on whether worksite wellness programs improve employees' health and lower health care costs. But does it tell the full story? 

Employees Are More Likely to Stay If They Like Their Health Plan
Employer-sponsored health coverage needs to be more flexible to innovate and meet workers' health care needs, experts say. 

High-Deductible Plans More Common, but So Are Choices
The share of big employers offering high-deductible health plans (HDHPs) has grown by more than 20 percent since 2016, new research shows. Employers are offering HDHPs alongside traditional plans to give employees more choices. Here's what employers and employees are paying. 

States Might Require Health Insurance
Some state lawmakers want to require residents to purchase health insurance to help mitigate the potential impact of the "repeal" of the Affordable Care Act's individual mandate.

DOL Proposes Rule to Expand Association Health Plans for Small Employers
A proposed rule by the Department of Labor (DOL) would allow small business to band together and purchase health insurance without some of the regulatory requirements that the Affordable Care Act (ACA) imposes on smaller employees.

Will Medical Marijuana Have a Place in Employee Health Plans?
With 29 states and the District of Columbia now allowing the use of medical marijuana, employee health plans may have to consider adding coverage for the drug. In an environment in which opiate addiction continues to escalate, there may be more openness to reimbursing medical marijuana as an alternative, less addictive pain medication.

IRS Extends Deadline to Supply ACA Forms to Employees
The IRS extended by 30 days—until March 2, 2018—the due date for distributing health coverage information forms 1095-C or 1095-B to employees. The due dates for filing these forms with the IRS, however, were not extended.

What the Individual Mandate Repeal Means for Employers
The Tax Cuts and Jobs Act effectively repeals the Affordable Care Act's (ACA's) requirement that most Americans obtain ACA-compliant health coverage, effective in 2019. Here's how it will affect employer-sponsored health plans now, and what it portends for the future of the employer health care mandate and related reporting obligations.

Prepare for ACA Information Reporting in Early 2018
The IRS has published final forms and instructions to help employers prepare for reporting on health coverage they offered to their employees in 2017. The forms are to be distributed to employees and filed with the IRS early in 2018 by employers subject to the Affordable Care Act's reporting requirements.

IRS Begins to Send ACA Penalty Letters
The IRS has started to send out penalty notices to employers subject to the Affordable Care Act (ACA) that failed to provide ACA-compliant coverage to full-time employees. Employer that receive a penalty letter will have just 30 days to respond before the IRS demands payment.

Not Every Aspect of Form 1095-C Can Be Outsourced
Outsourcing the processing of Form 1095-C, Employer-Provided Health Insurance Offer and Coverage, is common. But employers remain responsible for the accuracy of the form, which is cumbersome to complete, and should be knowledgeable about it when employees have questions.

For 2018, PCORI Fee Is Rising, IRS Says
The annual fee to fund the federal Patient-Centered Outcomes Research Institute (PCORI), paid by self-insured employers, will go up by about 10 cents per health plan enrollee next year. The annual fees must be paid by July 31 through 2019. 

Trump's Executive Orders Seek to Roll Back Health Plan Requirements
President Donald Trump's executive order directing federal agencies to issue new rules that will make it easier for businesses to buy health insurance across state lines through association health plans was praised by some for offering new flexibility in health coverage, especially for plans offered in the small group market. But others raised concerns about higher costs for those who remain in individual and small group health plans.

Consider Employees' Reactions Before Reducing Birth Control Coverage
Most employer health plans are expected to continue providing no-cost contraception coverage for women, despite the Trump administration's announcement that it will allow employers to claim a religious or moral objection to the Affordable Care Act's contraceptive coverage requirement. Employee relations repercussions and maternity costs are factors to consider.

Play or Pay: Rising Penalties' Role in Complying with the ACA
Every year the Affordable Care Act (ACA) is in effect, some employers must decide whether they will play according to the ACA's rules or pay ACA penalties. Even employers that are trying to comply may slip up and have to pay fees, which are adjusted up each year.

Crossing the Threshold—Small Business to ACA-Bound 'Applicable Large Employer'
If your small business has crossed the threshold to applicable large employer (ALE) status by reaching the threshold of 50 full-time equivalent employees, consider your vulnerability to the ACA's nondeductible employer penalties.

The ACA Remains but Targeted Reforms Will Be Sought
Advocates for easing the ACA's financial and administrative burdens on employers are hopeful that at least a few of the reforms on their wish list, as discussed in this article, will resurface in new legislation.

Out of Sight, Out of Mind? Don't Forget the Possibility of ACA Retaliation Claims
As the end of 2017 approaches, employers that failed to comply with the ACA's coverage obligations may soon be receiving employer mandate assessments. While we don't know the exact amount of employer dollars that will be at risk, the Congressional Budget Office estimates that between 2015 and 2024 it will be $139 billion.

HSA Provisions in Failed GOP Bills Could Return in Future Legislation. Should They?
The health savings account (HSA) reforms in the now-abandoned Senate and House health care bills may yet be voted on by Congress, if HSA stand-alone legislation is introduced or as part of efforts to stabilize the public health care exchanges.

Don't Overlook 2018 Change in 'Affordability' Safe Harbor Percentage
The IRS recently announced the maximum share of income that employees can be required to pay under the Affordable Care Act's affordability provision, as adjusted annually for inflation. Employers should consider this adjustment in determining how much of their plan premiums they can ask employees to pay next year.

IRS Sets 2018 HSA Contribution Limits
Next year, the amounts that employees can contribute to their health savings account (HSA) will Employers should consider these limits when planning for the 2018 benefit plan year and should review plan communications to ensure that the appropriate limits are reflected 

Dealing with Rejected Form 1095-C Returns
Sometimes rejected returns are due to faulty transmission, missing (or multiple) attachments, an error reading the file or duplicate files. Remember, an initial rejection after an IRS computer review is not the same as a notice of a penalty assessment.

Relief Extended for 'Grandmothered' Small Group Health Plans
The Trump administration is allowing small business an extra year to renew certain older plans that don't comply with the ACA and that don't fall under the open-ended exemption for grandfathered plans.


SHRM Resources

For additional information on implementing the Affordable Care Act, SHRM members can contact the SHRM Knowledge Center.

SHRM Government Affairs

Health Care Public Policy and Advocacy Updates

IRS

Types of Employer Payments Under ACA and How They Are Calculated

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