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Benefits

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Fine-tuning your company’s compensation strategy

As a business evolves, so must its compensation strategy. Hopefully, your company is growing — perhaps adding employees or promoting staff members who are key to your success. But other things can spur the need to fine-tune your compensation strategy as well, such as economic changes or the rise of an intense competitor. A goal for many businesses is to provide equitable compensation. Do your research One aspect of equitable compensation is external equity; in other words, making sure compensation is in alignment with industry or regional norms. The U.S. Department of Labor and Bureau of Labor Statistics have a wealth of...

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Reminder: Issuer MLR Rebates Due to Plan Sponsors by Sept. 30

Overview of Employer Responsibilities for Handling Rebates   The Medical Loss Ratio (MLR) rules under Health Care Reform require an issuer to provide rebates if its medical loss ratio (the amount of health insurance premiums spent on health care and activities to improve health care quality) falls short of the applicable standard during a reporting year. Each year's rebates must be provided by issuers to policyholders (typically the employer that sponsors the plan) by September 30 of the following year. Employer Distribution The MLR rules provide that issuers must pay any rebates owed to persons covered under a group health plan to the...

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New Expiration Date for Health Insurance Exchange Notices is May 31, 2020

Model Notices Previously Set to Expire on May 31, 2017 The U.S. Department of Labor's Employee Benefits Security Administration (EBSA) has extended the effective date of its model Health Insurance Exchange Notices through May 31, 2020. Previously, these model notices were set to expire on May 31, 2017. No other changes have been made to these notices. Click here to access the model notices with the new expiration date. Please note that there are two separate notices--one for employers that offer a health plan to some or all employees, and another for employers that do not offer a health plan. These model notices...

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IRS ‘Pay or Play’ Estimator Available

As a reminder, the Taxpayer Advocate Service (an independent organization within the Internal Revenue Service) has developed a tool to assist employers in understanding how the Affordable Care Act's employer shared responsibility ("pay or play") provisions work and how the provisions may apply to them. Employer Shared Responsibility Provision Estimator Employers can use the Taxpayer Advocate Service's Employer Shared Responsibility Provision Estimator tool to determine their: Number of full-time employees, including full-time equivalent employees (FTEs);Applicable large employer (ALE) status; and Applicable large employer (ALE) status; and Estimated maximum amount of potential liability for the employer shared responsibility payment. The homepage for the tool provides additional information...

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Enhance benefits’ perceived value with strong communication

Providing a strong package of benefits is a competitive imperative in today’s business world. Like many employers, you’ve probably worked hard to put together a solid menu of offerings to your staff. Unfortunately, many employees don’t perceive the full value of the benefits they receive. Why is this important? An underwhelming perception of value could cause good employees to move on to “greener” pastures. It could also inhibit better job candidates from seeking employment at your company. Perhaps worst of all, if employees don’t fully value their benefits, they might not fully use them — which means you’re wasting dollars and...

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How to Appeal a Marketplace Notice

Appeals Due Within 90 Days Health Insurance Marketplaces are now sending letters to notify certain employers that one or more of their employees has been determined eligible for advance premium tax credits and cost-sharing reductions and has enrolled in a Marketplace plan. Because these events may trigger penalties under the Affordable Care Act's "pay or play" provisions for applicable large employers (generally those with 50 or more full-time employees, including full-time equivalents), such employers may seek to appeal an employee's eligibility determination. Employer Appeals Process Employers have 90 days from the date stated on the Marketplace notice to file an appeal. In the...

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How to Determine ALE Status

ALEs Must Comply with ACA's 'Pay or Play' Provisions An employer which has at least 50 full-time employees, including full-time equivalent employees (FTEs), on average during the prior year is generally considered an "applicable large employer" (ALE) under the Affordable Care Act (ACA) for the current calendar year. These employers are subject to the ACA's employer shared responsibility ("pay or play") provisions and information reporting requirements (Forms 1094-C and 1095-C). Here are the steps to determine whether an employer is an ALE: Determine how many full-time employees the employer had in each month of the prior year. For this...

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Reminder: Certain Small Employer HRAs Now Exempt From ACA’s Market Reforms

QSEHRAs Must Satisfy Certain Requirements As a reminder, a recent law allows certain small employers to offer new "qualified small employer health reimbursement arrangements" (QSEHRAs) to reimburse employees for qualified medical expenses, including individual health insurance premiums. Background Under prior agency guidance, stand-alone HRAs (except for retiree-only HRAs and HRAs consisting solely of excepted benefits) and HRAs used to purchase coverage on the individual market were considered group health plans that did not comply with certain market reforms of the Affordable Care Act (ACA). As a result, these HRAs were subject to a $100 per day excise tax per applicable employee under the...

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How to Correct Form 1094 & 1095 Errors

To avoid potential noncompliance penalties, employers should confirm the accuracy of all Affordable Care Act (ACA) information returns and correct any errors as soon as possible with both the IRS and their employees. Errors on Forms 1094-C and 1095-C Forms 1094-C and 1095-C are used by applicable large employers to satisfy their reporting obligations. To correct information on the paper version of the original Authoritative Transmittal Form 1094-C, employers should take the following steps: Prepare a new authoritative Form 1094-C including the correct information Enter an "X" in the CORRECTED checkbox at the top of the form File the standalone corrected authoritative Form 1094-C with the...

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Consider key person insurance as a succession plan safeguard

In business, and in life, among the most important ways to manage risk is through insurance. For certain types of companies — particularly start-ups and small businesses — one major threat is the sudden loss of an owner or hard-to-replace employee. To safeguard against this risk, insurers offer key person insurance. Under a key person policy, a business buys life insurance covering the owner or employee, pays the premiums and names itself beneficiary. Should the key person die while the policy is in effect, the business receives the payout. As you formulate and adjust your succession plan, one of these policies...

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