Mid-Term Elections Loom, Increasing Focus on Key Decisions Under ACA
As the battle lines are drawn and both Republicans and Democrats gear up for the Mid-Term elections, employers await key decisions on some of the more difficult and complicated items of the Affordable Care Act (ACA). The final regulations on non-discrimination with respects to Healthcare as well as employer reporting rules are expected at some point this summer. Both the Department of Health and Human Services (HHS) as well as the Department of Labor (DOL) have been working to create a standardized report that will allow the Federal Government to regulate the employer market. These reports are vital to ensure compliance under the ACA and to protect the integrity of the subsidies on Healthcare.gov.
In the meantime, employers should take some steps now as a call to action to ensure their organizations have a jump start on the compliance aspects of the law. The government cannot regulate what is not reported so naturally this new environment will lead to more work for the Human Resource professionals.
Here are some areas of focus this summer as you prepare for the fall:
- Lookout for guidance on Form 6056: Employers with over (50) FTE’s will be required to provide the Federal Government with details on which employees were offered coverage, those that elected and those that declined. All employees that were provided a “qualifying offer” of healthcare will be reported on an IRS form 6056. This form is in the process of development and is expected to be released this summer or fall. Keep on the lookout for this new form since many organizations may need to evaluate how they track and manage the employees that eligible for coverage during the plan year. In today’s world, this data in not reported by the employer to the Federal Government but will quickly become an annual requirement under the ACA.
- For Self-Funded groups, prepare for form 6055: For fully insured employer groups, the medical carrier will provide the Federal Government with form 6055. This form is expected to detail the employer Tax ID# as well as all the enrollees on the medical plan. All self-funded groups will need to file their own form 6055. Also a new requirement under the ACA, we are expecting actual release of the document and reporting details this summer.
- Transitional Relief: The transitional relief rules for groups that are expected to expand due to the ACA in order to meet compliance have been recently amended for 2015. If your organization is expected to grow to remain in compliance with the ACA, you should be reviewing the latest updates on transitional relief in preparation for January 1, 2015.
- Smokers vs. Non-Smokers & Wellness: All Small (2-50) employers were sent smoking attestation forms during 2013 and 2014. For employees that disclosed they were smoking, a direct surcharge at the member level with an increase in the rate of (10-25%) is being charges for smokers. Since the insurance company and not the employer enacted the surcharge, many employers escaped the wrath of their angry employees and were able to point to the ACA or the insurance company as a result of the surcharge. However, for groups over (50) a decision has to be made on how to manage smokers and not alienate smokers. What should they be charged? Should they pay more? How do you manage employees that do not smoke but are otherwise unhealthy? Can you incorporate wellness as a strategy to the greater benefit of the entire group? Are you self-funding medical claims, but not managing wellness? This all sets the stage for a meaningful discussion on Wellness and it’s effective use under the ACA.
Article provided by MEA’s Employee Benefits Partner, Trinity Benefit Advisors.