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New Tax Law Effectively Repeals the Individual Mandate

Repeal Effective in 2019 President Trump has signed into law the Tax Cuts and Jobs Act, which, among other things, effectively repeals the Affordable Care Act's (ACA) individual mandate beginning in 2019. Individual Mandate Repeal Effective in 2019 Under the ACA, individuals are currently required to have minimum essential health coverage, qualify for an exemption from the requirement, or pay a penalty tax. This ACA provision is known as the "individual mandate." Effective in 2019, the individual mandate is effectively repealed, as the penalty tax for noncompliance with the mandate will be reduced to $0. ...

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IRS Increases Limits for HSA, FSA, HDHP

The IRS recently announced cost-of-living adjustments to the annual dollar limits for various welfare and retirement plan limits for 2018. Although some of the limits will remain the same, many of the limits will increase for 2018. The annual limits for the following commonly offered employee benefits will increase for 2018: High deductible health plans (HDHPs) and health savings accounts (HSAs); Health flexible spending accounts (FSAs); Transportation fringe benefit plans; and 401(k) plans Employers should update their benefit plan designs for the new limits and also make sure that their plan administration will be consistent with the new limits in 2018. Employers may also want to...

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IRS Releases New Guidance on QSEHRAs

Notice & Other Requirements Clarified The Internal Revenue Service (IRS) has released guidance further clarifying the rules regulating qualified small employer health reimbursement arrangements (QSEHRAs). QSEHRAs—which are health reimbursement arrangements exempt from the Affordable Care Act's market reforms—may be offered by employers with fewer than 50 full-time equivalent employees that do not offer a group health plan to any of its employees to reimburse employees for medical expenses, including individual health insurance policy premiums. Highlights of the guidance are described below. Guidance Highlights Written Notice Deadline: An employer that provides a QSEHRA during 2017 or 2018 must generally furnish its initial written notice...

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Top 5 Open Enrollment Notices

Certain Notices Must Be Distributed Around Open Enrollment A company's open enrollment period can be a hectic time for management, HR, and employees alike. However, during the enrollment process, employers should remember their disclosure obligations. Below are five key notices that must be distributed to employees around the open enrollment period: Summary Plan Description (SPD): An SPD must generally be distributed to group health plan participants within 90 days after the employee becomes a plan participant. Click here for more on the SPD requirement. Summary of Benefits and Coverage (SBC): An SBC must generally be provided to group health plan participants and beneficiaries...

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Final 2017 Instructions for Forms 1094 and 1095 Now Available

Used for Reporting in Early 2018 The IRS has released the final 2017 Instructions for Forms 1094-B, 1095-B, 1094-C, and 1095-C to help employers prepare for calendar year 2017 Affordable Care Act (ACA) information reporting. Employers will use the final versions of the forms and instructions in early 2018 to report on health coverage offered (or not offered) in the 2017 calendar year. Key Changes for 2017 Reporting The 2017 instructions differ from the 2016 instructions as follows: Instructions to Forms 1094-C and 1095-C: The final instructions have been revised to remove discussion of section 4980H transition relief, as none is available for 2017. Instructions...

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Court Orders EEOC to Reconsider Wellness Rules

The U.S. District Court for the District of Columbia has directed the Equal Employment Opportunity Commission (EEOC) to reconsider its final wellness rules under the Americans with Disabilities Act (ADA) and the Genetic Information Nondiscrimination Act (GINA). The final rules allow employers to offer wellness incentives of up to 30 percent of the cost of health plan coverage. The court held that the EEOC failed to provide a reasonable explanation for adopting the incentive limit. Rather than vacating the final rules, the court sent them back to the EEOC for reconsideration. It is unclear how the EEOC will respond to the court’s...

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New SBC Template Required for 2018 Open Enrollment

The updated template and related materials for the summary of benefits and coverage (SBC) are required for annual open enrollment periods beginning on or after April 1, 2017. For calendar year plans, this means that the updated template must be used for the 2018 open enrollment period. Employers should do the following to prepare for the new SBC template and related materials for the 2018 open enrollment period. Self-funded plan sponsors should ensure that they are using the new template. Employers with insured plans should make sure the carrier is providing the correct version of the template. Contact SIMA Benefits Consulting Group with any...

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What is the ‘Age 26’ Requirement Under the ACA?

Law Requires Certain Employers to Offer Dependent Coverage Until Age 26 Under the Affordable Care Act, when a plan covers dependents, it must continue to make the coverage available until a child reaches the age of 26, even if the young adult has been offered coverage through his or her own employer, is married, no longer lives with his or her parents, is not a dependent on a parent's tax return, or is no longer a student. There is no federal requirement compelling a plan or issuer to offer dependent coverage. However, applicable large employers may be liable for a "pay or...

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IRS Issues Maximum Individual Mandate Payment for 2017

Guidance Provides 2017 Monthly National Average Premium for Bronze Plans The IRS has released the 2017 monthly national average premium for a bronze level health plan offered through the Health Insurance Marketplace, which is used to determine the maximum individual mandate penalty. New Guidance According to the new IRS guidance, the monthly national average premium for qualified health plans that have a bronze level of coverage and are offered through the Health Insurance Marketplace in 2017 is: $272 per individual (up from $223); and $1,360 for a family with five or more members (up from $1,115). The guidance is effective for taxable years ending after December...

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DOL Releases Updated Model CHIP Notice

Model Notice Informs Employees of Eligibility for Premium Assistance Under Medicaid or CHIP An updated model notice for employers to provide information on eligibility for premium assistance under Medicaid or the Children's Health Insurance Program (CHIP) is now available for download from the U.S. Department of Labor (DOL). Click here to download the latest employer CHIP notice in PDF format. A Microsoft Word version is also available. Annual Notice Requirement Employers that provide health insurance coverage in states with premium assistance through Medicaid or CHIP must provide employees with the employer CHIP notice annually before the start of each plan year. An employer can...

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