No. The new health care reform legislation, The Patient Protection and Affordable Care Act (PPACA) as amended by the Health Care and Education Reconciliation Act, did not eliminate COBRA or change the COBRA rules.
See An Employee’s Guide to Health Benefits Under COBRA, The Consolidated Omnibus Budget Reconciliation Act for more information about COBRA
Source: http://www.dol.gov/ebsa/pdf/faq-healthcarereform.pdf
IRS Health Care Tax Tip 2014-13, Apr. 17, 2014
Find out if You Qualify for a Health Insurance Coverage Exemption
The Affordable Care Act calls for individuals to have qualifying health insurance coverage for each month of the year, have an exemption, or make a shared responsibility payment when filing his or her federal income tax return.
You may be exempt from the requirement to maintain qualifying health insurance coverage, called minimum essential coverage, and may not have to make a shared responsibility payment when you file your next federal income tax return. .
You may be exempt if you:
•Have no affordable coverage options because the minimum amount you must pay for the annual premiums is more than eight percent of your household income,
•Have a gap in coverage for less than three consecutive months, or
•Qualify for an exemption for one of several other reasons, including having a hardship that prevents you from obtaining coverage or belonging to a group explicitly exempt from the requirement.
The IRS website, IRS.gov/aca, has a comprehensive list of the coverage exemptions.
How you get an exemption depends upon the type of exemption. You can obtain some exemptions only from the Marketplace in the area where you live, others only from the IRS, and yet others from either the Marketplace or the IRS.
Additional information about exemptions is available on the Individual Shared Responsibility Provision web page on IRS.gov. The page includes a link to a chart that shows the types of exemptions available and whether they must be granted by the Marketplace, claimed on an income tax return filed with the IRS, or by either the Marketplace or the IRS. For additional information about how to get exemptions that may be granted by the Marketplace, visit HealthCare.gov/exemptions.
More Information
Find out more about the tax-related provisions of the health care law at IRS.gov/aca.
Find out more about the health care law at HealthCare.gov.
Subscribe to IRS Tax Tips to get easy-to-read tips via e-mail from the IRS.
Source: http://www.irs.gov/uac/Newsroom/Find-out-if-You-Qualify-for-a-Health-Insurance-Coverage-Exemption
Some of the provisions of the Affordable Care Act, or health care law, apply only to small employers, generally those with fewer than 50 full-time employees or equivalents.
If you have fewer than 50 employees, but are a member of an ownership group with 50 or more full-time equivalent employees, you are subject to the rules for large employers.
Coverage
•If you have 50 or fewer employees, you can purchase affordable insurance through the Small Business Health Options Program (SHOP).
•To learn more about how the Affordable Care Act may affect your business, visit HealthCare.gov.
Reporting
•You must withhold and report an additional 0.9 percent on employee wages or compensation that exceed $200,000. Learn more.
•You may be required to report the value of the health insurance coverage you provided to each employee on his or her Form W-2.
•Effective for calendar year 2015, if you provide self-insured health coverage to your employees, you must file an annual return reporting certain information for each employee you cover. This rule is optional for 2014. Learn more.
Payments & Credits
•You may be eligible for the Small Business Health Care Tax Credit if you cover at least 50 percent of your full-time employee’s premium costs and you have fewer than 25 full-time equivalent employees with average annual wages of less than $50,000.
•If you self-insure, you may be required to pay a fee to help fund the Patient- Centered Outcomes Research Trust Fund.
Source: http://www.irs.gov/uac/Affordable-Care-Act-Tax-Provisions-for-Small-Employers
Q: Do you know if dental and vision and our STD/life policies are governed by PPACA? I’m trying to figure out if I need to change our eligibility on those to become 60 days, like our health. Do we need to make those changes with our plans or will they be an automatic change?
A: These stand-alone programs are excepted benefits under HIPAA so you shouldn’t have to revise the waiting period. Here is a reference source: www.hortongroupblog.com/ proposed-guidance-issued-on-90-day-waitingperiod- limit/.
Source hiu-digital.com; http://d27vj430nutdmd.cloudfront.net/23967/197281/98f13de6b67298a5688b7f8a5185a00aded4be02.5.pdf
5.1 Southern California earthquake reminds Californians to be prepared for the Big One
Earthquake insurance can help residents repair, rebuild, or replace
LOS ANGELES, Calif. – The 5.1 La Habra earthquake was significantly more powerful than the 4.4 magnitude trembler on St. Patrick’s Day in Los Angeles. These events serve as a reminder of the importance of purchasing earthquake insurance, having an emergency plan with adequate supplies for your family, and to retrofit older homes that may not be tied down to the foundation.
“The 5.1 earthquake in La Habra is a reminder to Californians of the need for preparation before catastrophic events strike,” said Commissioner Dave Jones. “I extend my sincere concern and sympathy for those who incurred a personal injury or are dealing with damage to their homes and personal property as a result of this earthquake. The topography of California is dramatic and beautiful, but this should be a constant reminder that earthquakes can strike at any time, along any fault line, and typically when we least expect it. This reality underscores the importance for Californians to take some very simple, but very effective precautionary steps before it is too late.”
To find important information about preparing for a disaster, please visit the web site of the California Department of Insurance or call our toll-free consumer hotline at 1-800-927-HELP.
Earthquake preparedness includes, but is not limited to, the following:
″Review your insurance policies at least once each year with your agent or broker to ensure that they provide adequate coverage.
″Consider purchasing an earthquake policy if your home is in an earthquake-prone area, and is more susceptible to earthquake damage such as older or multi-story homes, or homes on soft soil or a slope.
″Take measures to retrofit your home to increase your safety during an earthquake.
″Bolting your home’s wood frame to the foundation can prevent damage resulting from the structure sliding off its foundation. And for houses on raised foundations, the bracing of “cripple walls” can also reduce damage from earthquakes.
″Brace your water heater to minimize the risks of fire and water damage caused by water heaters that topple during earthquakes.
″Mobile home owners should use earthquake-bracing systems to reduce the chance of damage from homes slipping off support jacks.
″Fasten cupboard doors with child-proof latches to prevent them from opening and spilling their contents.
″Fasten bookcases, mirrors, televisions and other tall or heavy objects to wall studs.
″Gas appliances should have flexible attachments, and family members should be familiar with gas shut-off techniques.
For more earthquake preparedness tips, go to www.redcross.org and http://earthquake.usgs.gov/.
Most homeowners’ and renters’ policies do not cover damage from earthquakes. Under California law all insurers selling residential property insurance are required to also offer earthquake coverage subject to minimum dwelling, personal property and additional living expense limits. Dwellings must be covered but other structures such as outbuildings, swimming pools, and masonry fences may be excluded.
Source: California Department of Insurance, http://www.insurance.ca.gov/0400-news/0100-press-releases/release013-14.cfm
How will the credit make a difference for you?
For tax years 2010 through 2013, the maximum credit is 35 percent of premiums paid for small business employers and 25 percent of premiums paid for small tax-exempt employers such as charities.
For tax years beginning in 2014 or later, there will be changes to the credit:
•The maximum credit will increase to 50 percent of premiums paid for small business employers and 35 percent of premiums paid for small tax-exempt employers.
•To be eligible for the credit, a small employer must pay premiums on behalf of employees enrolled in a qualified health plan offered through a Small Business Health Options Program (SHOP) Marketplace.
•The credit will be available to eligible employers for two consecutive taxable years.
Here’s what this means for you. If you pay $50,000 a year toward workers’ health care premiums — and if you qualify for a 15 percent credit, you save… $7,500. If you save $7,500 a year from tax year 2010 through 2013, that’s total savings of $30,000. If, in 2014, you qualify for a slightly larger credit, say 20 percent, your savings go from $7,500 a year to $10,000 a year.
Even if you are a small business employer who did not owe tax during the year, you can carry the credit back or forward to other tax years. Also, since the amount of the health insurance premium payments is more than the total credit, eligible small businesses can still claim a business expense deduction for the premiums in excess of the credit. That’s both a credit and a deduction for employee premium payments.
There is good news for small tax-exempt employers too. The credit is refundable, so even if you have no taxable income, you may be eligible to receive the credit as a refund so long as it does not exceed your income tax withholding and Medicare tax liability.
And finally, if you can benefit from the credit this year but forgot to claim it on your tax return, there’s still time to file an amended return.
Can you claim the credit?
Now that you know how the credit can make a difference for your business, let’s determine if you can claim it.
To be eligible, you must cover at least 50 percent of the cost of single (not family) health care coverage for each of your employees. You must also have fewer than 25 full-time equivalent employees (FTEs). Those employees must have average wages of less than $50,000 (as adjusted for inflation beginning in 2014) per year. Remember, you will have to purchase insurance through the SHOP Marketplace to be eligible for the credit for tax years 2014 and beyond.
Let us break it down for you even more.
You are probably wondering: what IS an FTE. Basically, two half-time workers count as one FTE. That means 20 half-time employees are equivalent to 10 FTEs, which makes the number of FTEs 10, not 20.
Now let’s talk about average annual wages. Say you pay total wages of $200,000 and have 10 FTEs. To figure average annual wages you divide $200,000 by 10 — the number of FTEs — and the result is your average annual wage. The average annual wage would be $20,000.
Also, the amount of the credit you receive works on a sliding scale. The smaller the business or charity, the bigger the credit. So if you have more than 10 FTEs or if the average wage is more than $25,000 (as adjusted for inflation beginning in 2014), the amount of the credit you receive will be less.
How do you claim the credit?
You must use Form 8941, Credit for Small Employer Health Insurance Premiums, to calculate the credit. For detailed information on filling out this form, see the Instructions for Form 8941.
If you are a small business, include the amount as part of the general business credit on your income tax return.
If you are a tax-exempt organization, include the amount on line 44f of the Form 990-T, Exempt Organization Business Income Tax Return. You must file the Form 990-T in order to claim the credit, even if you don’t ordinarily do so.
Don’t forget… if you are a small business employer, you may be able to carry the credit back or forward. And if you are a tax-exempt employer, you may be eligible for a refundable credit.
http://www.irs.gov/uac/Small-Business-Health-Care-Tax-Credit-for-Small-Employers
Your health is important.
How you take care of it plays a big role in what your future will be like.
Preventive care is the first step in knowing how healthy you are.
Why should you get preventive care?
Each year you should have an exam by your doctor and certain screenings recommended for your age and gender.
Most medical plans cover preventive care at 100% when you see an in-network doctor.
First things first!
When you make your appointment, and when you check in, be sure to let the scheduler know that your visit should be coded as preventive care.
If you are getting any other services because of an ongoing condition, or any diagnostic care, they will not qualify as preventive care services.
During your visit your doctor may check the following:
Women’s health services, including:
Are covered at 100% as preventive care.
Are part of your preventive care coverage.
There are other services or screenings that may be scheduled at another time with the help of your primary care doctor that are also covered at 100% as part of your preventive care benefit,
Such as:
The goal of preventive care is to “prevent” a serious health condition by finding problems early.
Heart Disease is the number one killer for both men and women.
High blood pressure and high cholesterol are two main risk factors for heart disease, which kills 910,000* Americans every year.
8% of Americans have diabetes, 57 million have pre-diabetes**. High blood pressure, high cholesterol, obesity and an elevated blood glucose level are all factors that put you at risk for developing diabetes.
Getting regular screenings to check for cancer are important.
Don’t wait until it’s too late.
For better or worse, if you get a diagnosis early you may be able to treat it and make lifestyle changes that can possibly change your health outlook.
Remember, all of these screenings are covered at 100% when you see an in-network provider.
Take a step in the right direction and start by scheduling a preventive care examination with your doctor.
To see the preventive care guidelines, visit uhcpreventivecare.com
*American Heart Association
** American Diabetes Association
***American Cancer Society
Source: http://www.uhcpreventivecare.com/site/theme/assets/videos/PreventiveCare-Why-Transcript.html
Many employers are just exhausted from changing health plans every time there is another rate increase – someone always gets upset by the change and what started out as an employee benefit ends up being a challenge. Rates have escalated way too much in the past decade, some employees are reluctant to change providers and the administrative/regulatory hassles are overbearing on many employers, especially small ones. An exchange does two things to make the employer’s life simpler: First, they provide a broad choice of plans and carriers – allowing employees to choose the plan that is best for them as opposed to the traditional “one shoe fits all” approach that employers have traditionally taken when selecting a plan; Second, all of this is done on a single administrative platform that consolidates the administrative functions into a single arrangement that the employer (or the broker) can handle.
Source Blue Shield of California
https://www.blueshieldca.com/employer/administrator-resources/reference/tax-resources.sp
03/20/14
Many employers and health care advisors do not fully understand ERISA (Employee Retirement Income Security Act) guidelines and how ERISA impacts Group Health Plans. ERISA is a set of Department of Labor guidelines that regulate employer sponsored benefit plans. Employer sponsored ‘health & welfare’ benefits offered by most employers fall under ERISA guidelines and the failure to comply with ERISA’s requirements can mean costly governmental penalties. Health & Welfare Plan sponsors are required to provide employees with specific Plan features and provisions, funding information, and reporting to the government. Plan Sponsors face strict deadlines for disclosing Plan information to eligible employees and Plan Sponsors who provide ERISA Health & Welfare Plan benefits must follow a strict fiduciary code of conduct.
Penalties are $110 per employee per day for not providing the required employee notices.
Source: ERISA Compliance Services, Inc., www.erisacs.com
1. How are the ACA taxes factored into the medical rate?
Blue Shield calculated the cost of ACA taxes and included the amount in the medical rate. The medical rate that customers will see on bills starting with January 2014 invoices includes the portion for the ACA taxes at the subscriber and dependent level.
2. I purchased plans in 2013. Are the ACA taxes now included in my rate?
Yes. The new ACA taxes will be included in the medical rate for small business customers starting with January 2014 invoices.
3. With the ACA taxes included in medical rates, how do I calculate payroll deductions?
The taxes taking effect on January 1, 2014, represent a 3.6% change of the medical rate. Blue Shield does not offer tax advice, and we encourage you to speak with your tax or financial advisor for guidance.
| Type of tax ————— |
Takes effect —————- |
Approximate cost ———————— |
| Health insurer tax | 01/01/14 | 2.3% of dues and/or premiums |
| Transitional reinsurance tax | 01/01/14 | 1.3 % of dues and/or premiums |
| Exchange tax | upon renewal, 2014 | 0.2% of dues and/or premiums |
| Risk adjustment tax | upon renewal, 2014 | 0.02% of dues and/or premiums |
Reference: Blue Shield of California
http://www.blueshieldca.com/employer-aca