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The Patient Protection and Affordable Care Act (PPACA) was signed into law on March 23, 2010, bringing many changes for employers and health plans. The law continues to evolve as regulations are released. This monthly alert brings you information on the major provisions and regulations coming from Washington, connects you to valuable tools in understanding and complying with the law, and keeps you informed of Michigan legislation enacted in response to PPACA.
On Friday, January 20, 2017, President Trump signed his first Executive Order, titled "Minimizing the Economic Burden of the Patient Protection and Affordable Care Act Pending Repeal."
The Executive Order instructs the Secretary of the Department of Health and Human Services (HHS) and the heads of all other executive departments and agencies with authority, or responsibility, under the Patient Protection and Affordable Care Act (ACA) to exercise all authority and discretion to waive, defer, grant exemptions from, or delay the implementation of any provision or requirement of the ACA that would impose a fiscal burden on any state, or cost a fee, tax, penalty, or regulatory burden on individuals, families, health care providers, health insurers, patients, recipients of health care services, purchasers of health insurance, or makers of medical devices, products, or medications.
44North recommends that employers wait for confirmation from various federal agencies that regulations they are in the process of complying with (notably, ACA-related reporting) are on hold for the time being. Without confirmed Cabinet members for the Secretary of HHS, the Secretary of the Treasury, and the Secretary of Labor, there will likely be a lag in information directly from any one agency. President Trump's Chief of Staff also sent out a memo that essentially put a regulatory freeze on all agencies until presidential appointments are confirmed. We are, unfortunately, in a "wait and see" period.
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 COVERAGE REPORTING |
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DEADLINE APPROACHING
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Under the Patient Protection and Affordable Care Act (PPACA), individuals are required to have health insurance, while applicable large employers (ALEs) are required to offer health benefits to their full-time employees. In order for the Internal Revenue Service (IRS) to verify that (1) individuals have the required minimum essential coverage, (2) individuals who request premium tax credits are entitled to them, and (3) ALEs are meeting their shared responsibility (play or pay) obligations, employers with 50 or more full-time and full-time equivalent employees and insurers will be required to report on the health coverage they offer. Final instructions for the B forms and the C forms were released in September 2016, as were the final forms themselves: 1094-B, 1095-B, 1094-C, and 1095-C.
On November 18, 2016, the IRS issued Notice 2016-70, delaying the reporting deadlines in 2017 for the 1095-B and 1095-C forms to individuals. The 1095 forms are due to individuals now by
Thursday,
March 2, 2017.
There is no delay for the 1094-B and 1094-C forms, or for forms due to the IRS
. They are still due by today for paper returns and by Friday, March 31, 2017, for electronic returns.
44North presented an instructional webinar on completing the forms. It may be found on our website.
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| MARKETPLACE NOTICE |
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Marketplace Notice and OMB Expiration Date
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At the top right of each model notice, there is a Form Approved area that indicates the form's OMB approval number and expiration date. Often, as the expiration date approaches, employers will ask whether they can continue to use the model notice after the OMB approval number expires and whether the DOL has indicated when it will update its form.
Employers can continue to use the model notice if the OMB approval number has expired. The DOL doesn't usually give advanced notice when it will update its forms.
As clarification, the OMB expiration date applies to the OMB approval, not the form. This means that the expiration date does not apply to the form itself, just the Office of Management and Budget (OMB) approval of the form for data collection purposes. A form can still be used if the OMB approval number has expired; however, under the Privacy Act, the expiration of the OMB approval number can limit the information the government can require an individual to provide if the form is intended to collect information.
Also, sometimes an agency has secured an updated OMB approval, but simply hasn't revised a form to reflect the updated OMB approval.
Even if an OMB approval number has expired, the failure of a form to display a currently valid OMB number does not invalidate the underlying regulation or law.
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| MARKET STABILIZATION |
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CMS' Proposed Rule on Market Stabilization
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On February 17, 2017, the Department of Health and Human Services' Centers for Medicare & Medicaid Services (CMS) issued a proposed rule to stabilize the health insurance market and address risks to the individual and small group markets. CMS proposes changes to guaranteed availability of coverage, network adequacy, essential community providers, open enrollment periods, special enrollment periods, continuous coverage, and standards for the Exchanges.
The proposed changes primarily affect the individual market. However, to the extent that employers have fully-insured plans, some of the proposed changes will affect those employers' plans because the changes affect standards that apply to issuers.
Guaranteed Availability of Coverage
Under the proposed rule, CMS modifies its interpretation of the guaranteed availability provisions so that an issuer may refuse to activate new coverage because of premium payment failure. This means that an issuer can require a policyholder whose coverage was terminated for premium non-payment in the individual or group market to pay all past due premiums owed to the issuer for coverage enrolled in the prior 12 months for that policyholder to resume coverage from that issuer.
Network Adequacy
The Department of Health and Human Services (HHS) proposes to rely on state reviews for network adequacy in states where a federally-facilitated exchange is operating. For states that do not have the authority and means to conduct sufficient network adequacy reviews, HHS would rely on an issuer's accreditation (commercial or Medicaid) from an HHS-recognized accrediting entity.
Annual Open Enrollment Periods
CMS proposes to shorten the open enrollment period to begin on November 1, 2017, and end on December 15, 2017.
Special Enrollment Periods
Starting in June 2017, CMS proposes to require pre-enrollment eligibility verification for all special enrollment periods of new consumers who seek QHP coverage through the federally-facilitated exchanges and state-based exchanges on the federal platform (Exchanges).
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| CONTRACEPTIVE SERVICES |
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DOL Releases FAQ Regarding Contraceptive Services Objection Accommodation
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As part of implementing the Patient Protection and Affordable Care Act (ACA), the Departments of Labor (DOL), Health and Human Services (HHS), and the Treasury (collectively, the Departments) issued regulations to require coverage or women's preventive services, which essentially includes all FDA-approved contraceptives, sterilization procedures, and patient education and counseling for women with reproductive capacity, as prescribed by the health care provider (collectively, contraceptive services).
The regulations exempt group health plans of "religious employers" (specifically defined in the law) from the requirement to provide contraceptive coverage. Later, amended regulations provide an accommodation for eligible organizations -- which are not eligible for the religious employer exemption -- that object on religious grounds to providing coverage for contraceptive services. Because of litigation, the Departments extended the accommodation to closely held for-profit entities.
Under the accommodation, an eligible organization that objects to providing contraceptive coverage for religious reasons may either:
- self-certify its objection to its health insurance issuer (to the extent it has an insured plan) or third party administrator (to the extent it has a self-insured plan) using a form provided by the Department of Labor (EBSA Form 700); or
- self-certify its objection and provide certain information to HHS without using any particular form.
Most recently, in 2016, the U.S. Supreme Court considered claims by several employers that, even with the accommodation provided in the regulations, the contraceptive coverage requirement violates the Religious Freedom Restoration Act (RFRA). The Court heard oral arguments and ultimately remanded the case (and parallel RFRA cases) to the lower courts to give the parties "an opportunity to arrive at an approach going forward that accommodates [the objecting employers'] religious exercise while at the same time ensuring that women covered by [the employers'] health plans 'receive full and equal health coverage, including contraceptive coverage.'"
To address the Court's statement, the Departments published their request for information (RFI) regarding the Court's statement and received more than 54,000 public comments. Based on the comments submitted, the Departments released FAQs About Affordable Care Act Implementation Part 36 to indicate that they are not making changes to the accommodation for the following reasons:
- No feasible approach has been identified that would resolve the religious objectors' concerns, while still ensuring that the affected women receive full and equal health coverage, including contraceptive coverage.
- The process described in the Court's supplemental briefing order would not be acceptable to those with religious objections to the contraceptive coverage requirements.
- There are administrative and operational changes to a process like the one described in the Court's order that are more significant than the Departments had previously understood and that would potentially undermine women's access to full and equal coverage.
Table of Contents
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| COMPLIANCE RECAP |
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January 2017
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January was a significant month in the employee benefits world because the new U.S. administration issued an Executive Order announcing its intent to repeal the Patient Protection and Affordable Care Act (ACA). However, January was a relatively inactive month for new laws and administrative rulemaking because the new administration placed a freeze on rulemaking until presidential nominations of agency heads are confirmed.
HHS Releases 2017 Federal Poverty Guidelines
The 2017 poverty guidelines (also referred to as the FPL) were released by the Department of Health and Human Services (HHS). For a family/household of 1 in the contiguous United States, the FPL is $12,060. In Alaska, the FPL is $15,060 and in Hawaii the FPL is $13,860. Applicable large employers that wish to use the FPL affordability safe harbor under the employer shared responsibility/play or pay rules should ensure that their lowest employee-only premium is equal to or less than $97.38 a month, which is 9.69 percent of the FPL.
DOL Releases Inflation-Adjusted Federal Civil Penalty Amounts
- Form 5500: For failure to file, the maximum penalty increases to $2,097 for every day the form is late.
- Summary of Benefits and Coverage: For failure to file, the maximum penalty increases to $1,105 per failure.
- Genetic Information Nondiscirmination Act: For violations, the maximum penalty increases to $112 per participant per day.
The adjustments are effective for penalties assessed after January 13, 2017, for violations occurring after November 2, 2015
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| HR CORNER |
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MIOSHA Recordkeeping Form 300A
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All establishments covered by Public Law of 1970 (P.O. 91-596) and Michigan Occupational Safety and Health Act 154, P.A. 1974, Part 11, Michigan Administrative Rule for Recording and Reporting of Injuries and Illnesses, must complete the MIOSHA Summary of Work-Related Injuries and Illnesses (Form-300A), even if no injuries or illnesses occurred during the year. The Summary must be posted in the workplace from February 1 to April 30 of the year following the year covered by the form. More information about the reporting requirements can be found on MIOSHA's website.
Who is covered by the recordkeeping rule? Employers with 11 or more employees are covered by MIOSHA's recordkeeping requirements. Covered employers must prepare and maintain records of work-related injuries and illnesses.
If you had 10 or fewer employees during all of the last calendar year or your business is classified in a partially exempt industry, you do not have to keep injury and illness records unless MIOSHA, Bureau of Labor Statistics (BLS), or the United States Department of Labor's Occupational Safety and Health Administration (OSHA), informs you, in writing, that you must keep records. In 2014, OSHA updated the list of employers partially exempt from the recordkeeping requirements. The recordkeeping rule was expanded and now 25 new industries will be required to keep illness and injury records. MIOSHA adopted these new requirements.
These exemptions apply to recordkeeping only and do not excuse any employer from other MIOSHA requirements or from compliance with all applicable MIOSHA safety and health standards.
Additional Information and Forms:
More information is available on MIOSHA's website, including a
Recordkeeping FAQ
. The required forms are also available on the website and can be accessed by following this
link
. The federal OSHA website offers several resources for those new to illness and injury recordkeeping, including a
tutorial
on how to complete the 300 logs.
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The information in this newsletter is based on 44North's review of the national healthcare reform legislation and is not intended to impart legal advice. Interpretations of the reform legislation vary, and efforts will be made to present and update accurate information. This overview is intended as an educational tool only and does not replace a more rigorous review of the law's applicability to individual circumstances and attendant legal counsel and should not be relied upon as legal or compliance advice. Analysis is ongoing and additional guidance is also anticipated from the Department of Health and Human Services.
Questions or comments? Please email us at
[email protected] .
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Does Your Plan Renew This Month?
DON'T FORGET!
- Due 7 months after the plan year ends.
- SAR, if applicable, is due 2 months later.
Health Plan Related Notices and Disclosures
:
- SPD
- SMM
- SBC
- For full list click here.
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