State and federal laws require that all plans cover preventive health services and preexisting conditions.

Upon request, the Affordable Care Act (ACA) requires every health insurance company to give you a Summary of Benefits and Coverage. This document explains your benefits and coverage limits in easy-to-understand language.

Benefits health plans must cover under the federal ACA

Under the ACA, the following 10 essential health benefits apply to individual/family and small employer health plans:

1. Ambulatory patient services: Covers outpatient care without being admitted to a hospital.
2. Emergency medical services in an emergency department: Covers services provided in an emergency department if a medical provider believes the patient is having an emergency.
3. Hospitalization: Surgery and overnight stays.
4. Maternity and newborn care: Coverage for maternity and newborn health care.
5. Mental health substance abuse disorder services: Behavioral treatment, mental and behavioral health inpatient services and substance abuse disorder treatment.
6. Lab services: Such as blood draws or urinalysis, a medical provider orders.
7. Pediatric services: Health care for children from birth to age 19, including dental and vision care.
8. Prescription drugs: Medications a medical provider prescribes that patients buy through a pharmacy.
9. Preventive and wellness services and chronic disease management: Preventive services, such as shots and screening tests, at no cost to the patient when a medical provider from the plan's network delivers the service.
10. Rehabilitative and habilitative services and devices: Services and devices to gain or recover mental and physical skills for people with injuries, disabilities or chronic conditions.

Benefits health plans must cover under Washington state law

In addition to the health benefits covered under the ACA, certain individual/family and group health plans must also offer specific health benefits according to Washington state law.

Source:  What health insurance plans must cover | Office of the Insurance Commissioner.

On April 23, 2024, and Dec. 13, 2024, the Centers for Medicare and Medicaid Services (CMS) provided status updates on the progress it is making toward implementation of the advanced explanation of benefits (AEOB) transparency provision of the Consolidated Appropriations Act (CAA). While the AEOB requirement was originally effective in 2022, federal agencies delayed the requirement for plans and issuers to provide AEOBs until implementation rules could be issued. 

Background 

To help avoid surprise medical bills, the CAA requires health plans and issuers, upon receiving a “good faith estimate” (GFE) from a provider or facility, to send participants, beneficiaries or enrollees an AEOB notification. As the first stage of implementation, regulations were issued in 2021 on GFEs for uninsured (or self-pay) individuals, and those provisions are currently in effect. However, federal agencies recognized (in FAQ guidance) the complexities of developing the technical infrastructure to transmit these estimates from providers and facilities to plans and issuers. Accordingly, the enforcement of this requirement was delayed pending future rulemaking. 

CMS Progress 

As stated in its April 2024 status update, CMS is working with agencies across multiple federal agencies to implement the good faith estimate and AEOB requirements in stages. According to CMS, using this approach will allow the Departments and the OPM to better ensure each stage is informed by thorough research and collaboration and is supported by appropriate technical standards for data sharing between providers and payers. Neither the April nor the December 2024 status updates provide a specific timeline for implementation. 

CMS Research 

In addition to soliciting feedback through requests for information, CMS conducted a study into the health care industry’s business and technology needs as well as the capabilities of providers and payers. Based on this study, researchers recommended a single data exchange standard for the receipt of GFEs by payers and the transmission of AEOBs from payers to providers. 

In its December 2024 status update, CMS outlined three options that have potential for providers to transmit GFE information. CMS also stated it is considering whether there are hybrid approaches to use or allow for different standards that would maximize innovation pathways. 

Action Steps 

At this time, plans and issuers do not need to provide AEOBs and should continue to monitor for regulatory guidance, including timelines for implementation and any new standards for transmission of AEOBs that may apply. CMS provides a regulations and guidance webpage that summarizes all of the latest developments.

The IRS recently released�Revenue Procedure 2023-29, which declared that the Affordable Care Act (ACA) benchmark for determining the affordability of employer-sponsored health coverage will significantly decrease to 8.39% of an employee�s household income for the 2024 plan year. �This almost three-quarters of a percentage point is a significant decrease for several reasons.

Under the ACA, employer-sponsored minimum essential coverage (MEC) is affordable if an employee�s required contribution for the lowest-cost, self-only option with minimum value does not exceed an annually indexed percentage of the employee�s household income. �Employees and their family members eligible for minimum value, employer-sponsored MEC that meets the affordability standard cannot receive premium tax credits or cost-sharing reductions for public exchange coverage.

For Applicable Large Employers (ALEs), this decrease will mean they must contribute a larger share of their employees� premiums to meet the affordability requirement. �The significance of yet another decrease in the percentage cannot be overlooked.

Employers should start planning very soon as to what their 2024 benefits package will look like and how the percentage decrease and corresponding increase in contribution will affect their overall 2024 strategy.� The potential quandary for some of these employers exists because they may have had ideas of including additional benefits to their package, they may have been considering wage increases for some employees, and others may have opted to decrease their contributions. �To provide the best possible benefits at an affordable cost, employers may now have to revisit their prior intentions.

Setting new health plan premium contributions for the 2024 plan year will take some thoughtful consideration from employers who hope to maintain a complete benefits package without creating a financial burden.

An ALE wants to comply with the new affordability requirements to avoid the significant monetary penalties attached to non-compliance. �And just as a helpful reminder, non-calendar year plans will continue to use 9.12% to determine affordability in 2024 until their new plan year starts.

Source:��ACA Affordability Percentage Drops to a New Low for 2024 � Compliance NOW! (nabipcompliancenow.org)

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Over three years have passed since the start of the COVID-19 public health emergency in January of 2020. We have come a long way from the time of businesses being closed and mandatory quarantine periods. While we faced one of the most challenging times for our country, we also were able to show our resilience by working together to respond to � and overcome � these trying times. We�ve opened our businesses back up and brought employees back to the office. We�ve worked together to control the spread of COVID-19 by making testing and vaccines widely available. It is clear that this hard work has paid off as we look towards the end of the public health emergency. While we�ve accomplished a lot, there is still more to do. It is imperative that we continue to work together to ensure a safe and informed transition out of the public health emergency. And while we are unwinding some of the policies that were in place during the public health emergency, it is important to make sure that this unwinding is done in a manner that protects the individuals in your health plan.

So, what should employers and other plan sponsors do as we approach the end of the COVID-19 public health emergency and national emergency?

To start, we all understand that the end of the COVID-19 public health emergency means that many employers and other plan sponsors are evaluating what changes to make to their health benefits. For example, plans will no longer�be required to�cover some services related to COVID-19 (such as diagnostic testing, including over-the-counter tests) at no cost to the participant, but can still�choose�to do so. Additionally, some of the flexibility that was provided to extend the timeframes for participants for certain health plan-related deadlines, such as special enrollment, COBRA election and payment, and claims and appeals deadlines, may soon lapse.

In thinking about changes to benefits after the end of the COVID-19 public health emergency and national emergency and the reinstatement of normal timeframes to make key decisions related to health coverage, I urge employers and other plan sponsors to keep in mind the best interests of their workers and their families, who rely on their health benefits for their physical and mental wellbeing. It is critical to communicate with your participants as we enter the next chapter of the COVID-19 experience. What health benefits are changing? When? Can they still receive free COVID-19 tests? If not, what will the new benefits be? What are the new deadlines by which participants and their families need to make key health decisions? These are all important questions for workers and their families. We need to work together to ensure that individuals in your health plan are informed about changes to their benefits and continue to have access to COVID-19 testing, vaccines, and treatment, when at all possible.

In addition, as further explained below, some of your employees and their family members may not have enrolled in your health plan because they were eligible for Medicaid or Children�s Health Insurance Program (CHIP) coverage and may be losing that eligibility.� Because of this, they may have special enrollment opportunities to participate in their employment-based health coverage.� We need your partnership to help make sure individuals are informed during that transitional period.

Together with our colleagues at the Departments of Health and Human Services and the Treasury, we have issued�a new set of FAQs�that address the health plan-related changes to requirements that relate to the end of the COVID-19 public health emergency.�

Here are a few things that employers and other plan sponsors should keep in mind:

• After the end of the COVID-19 public health emergency, group health plans will no longer be required to cover COVID-19 diagnostic testing (including over-the-counter tests) at no cost to individuals.� Plans are encouraged to continue to cover these tests without out-of-pocket costs, as testing is still a critical component to reducing the spread of COVID-19. If plans are making changes to coverage for COVID-19 tests (or other benefits), be sure to communicate those changes, including any key limitations, to individuals in advance of those changes taking effect.
• While many plans must continue to cover COVID-19 vaccines at no cost to employees from an in-network provider, the requirement to cover COVID-19 vaccines out-of-network will generally lapse after the end of the COVID-19 public health emergency. Plans should make sure that participants and beneficiaries are aware of which providers are available to provide qualifying coronavirus preventive services at no cost. If plans are making changes to coverage for COVID-19-related preventive services, be sure to communicate those changes, including any key limitations, to individuals in advance of those changes taking effect.
• The end of the COVID-19 national emergency also means that the extensions of certain time frames for employee benefit plans are expected to end on July 10, 2023 (60 days after the end of the national emergency). Several timeframes were extended for many plans to give individuals more time to take action such as requesting special enrollment to join their employment-based health plan, electing COBRA continuation coverage and paying COBRA premiums, and submitting health plan claims and appeals. Employers should consider making reasonable accommodations to existing timeframes by amending the deadlines in their plans to minimize the possibility of individuals losing their benefits because of a failure to comply with one of these deadlines. Plans need to communicate key deadlines to impacted individuals in advance.
• Many employees and dependents who are currently enrolled in Medicaid or CHIP coverage may lose eligibility for that coverage after March 31, 2023. With some limited exceptions, state Medicaid agencies have not terminated coverage for any beneficiary who was covered at any time on or after March 18, 2020. Many states are beginning to unwind this �continuous enrollment� and resume eligibility determinations for Medicaid coverage. These determinations may result in some of your employees or their dependents losing coverage. Employers and plans are encouraged to make sure that employees who may be impacted are aware of their special enrollment right to enroll into the group health plan. Employers are also encouraged to amend their plans to provide additional time for individuals to exercise their special enrollment rights, to help ensure that these individuals can maintain health coverage. We�ve also developed�a flyer�that you can use to provide employees with information about these options.

Our agency is committed to working with employers, plan sponsors, participants, and other stakeholders to ensure a safe transition from the COVID-19 public health emergency. More specific information about the changing requirements is available in�DOL's Employee Benefits Security Administration�s Frequently Asked Questions. Any individual, employer, or other plan sponsor with questions about the end of the COVID-19 public health emergency can contact EBSA for assistance at�askebsa.dol.gov�or 1-866-444-3272.

Source:��https://blog.dol.gov/2023/03/29/what-does-the-end-of-the-covid-19-public-health-emergency-mean-for-health-benefits.

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Each year, employers whose health plans include prescription drug coverage must disclose to the Centers for Medicare & Medicaid Services (CMS) whether that coverage is creditable. Employers must complete an online disclosure with CMS within 60 days after the beginning of the plan year, or March 1, 2023, for calendar year plans. This video explains further.

Whether an employer is considered an�applicable large employer�(ALE) that is subject to the pay or play rules is determined each calendar year,�and generally depends on the average size of an employer's workforce during the prior year. For example, an employer will use information about the size of its workforce during 2022 to determine if it is an ALE for 2023.

All employers that are ALEs are subject to the pay or play rules, including for-profit, nonprofit (whether or not a tax-exempt organization)�and government entity employers.

General Rules

If an employer has, on average,�at least 50�full-time employees, including full-time equivalent employees (FTEs),�during the prior year, the employer is an ALE for the current calendar year.

If an employer has, on average,�fewer than 50�full-time employees, including FTEs, during the prior year, the employer is�not�an ALE for the current calendar year and is therefore not subject to the pay or play rules for the current year.

ALE Calculation

To determine its workforce size for a year, an employer must:

1. Calculate the number of full-time employees (including seasonal workers) for each calendar month in the prior calendar year.�
   • A full-time employee for any month is an employee who is employed, on average, at least 30 hours of service per week (or 130 hours of service per month).
   • Hours of service include hours for which an employee is paid or entitled to payment even when no work is performed (for example, vacation or sick leave).
2. Calculate the number of full-time equivalent employees or FTEs (including seasonal workers) for each calendar month in the prior calendar year.�
   • To determine the number of FTEs for a calendar month, calculate the total hours of service (but not more than 120 hours of service for any employee) for all employees who were not full-time for that month, and divide the total hours of service by 120, including fractions (which may be rounded to the nearest hundredth). The total is the number of FTEs for that calendar month.
3. Combine the totals from steps 1 and 2.
4. Divide the total sum from step 3 by 12 (disregarding fractions).

Exceptions

For purposes of determining if an employer is an ALE, all employees are counted, regardless of whether the employees are eligible for coverage from other sources, subject to the following limited exceptions:

• TRICARE/Veterans Administration Coverage.�An employee will not be counted toward the 50-employee threshold for a month in which the employee has medical care through the military, including Tricare or Veterans' coverage.
• Seasonal Workers.�An employer that exceeds 50 full-time employees, including FTEs, for�120 days or fewer�(or four�calendar months) during the preceding calendar year is not subject to the requirements for the current year if the employees in excess of 50 during that period were�seasonal workers. A�seasonal worker�performs labor or services on a seasonal basis as defined by the Secretary of Labor, including workers covered by�29 C.F.R. � 500.20(s)(1)�and retail workers employed exclusively during holiday seasons. Employers may apply a reasonable, good faith interpretation of the term "seasonal worker" and the regulation, including as applied by analogy to positions not otherwise covered.
• Employees Working Outside the U.S.�Employees (U.S. citizens or non-citizens) working only abroad generally are not taken into account for purposes of determining whether an employer is an ALE.

Basic ALE Determination Examples

Example 1 � Employer is Not an ALE

• Company X has 40 full-time employees for each calendar month during 2022.
• Company X also has 15 part-time employees for each calendar month during 2022, each of whom have 60 hours of service per month. When combined, the hours of service of the part-time employees for a month totals 900 [15 x 60 = 900]. Dividing the combined hours of service of the part-time employees by 120 equals 7.5 [900 / 120 = 7.5].�This number, 7.5, represents the number of Company X's FTEs for each month during 2022.
• Company X adds up the total number of full-time employees for each calendar month of 2022, which is 480 [40 x 12 = 480].
• Company X adds up the total number of FTEs for each calendar month of 2022, which is 90 [7.5 x 12 = 90].
• Company X adds those two numbers together and divides the total by 12, which equals 47.5 [(480 + 90 = 570)/12 = 47.5].�Because the result is not a whole number, it is rounded to the next lowest whole number, so 47 is the result.
• So, although Company X has 55 employees in total [40 full-time and 15 part-time] for each month of 2022, it has 47 full-time employees (including FTEs) for purposes of ALE determination. Because 47 is less than 50, Company X is not an ALE for 2023.

Example 2 � Employer is an ALE

• Company Y has 40 full-time employees for each calendar month during 2022.
• Company Y also has 20 part-time employees for each calendar month during 2022, each of whom has 60 hours of service per month. When combined, the hours of service of the part-time employees for a month totals 1,200 [20 x 60 = 1,200]. Dividing the combined hours of service of the part-time employees by 120 equals 10 [1,200 / 120 = 10].�This number, 10, represents the number of Company Y's FTEs for each month during 2022.
• Company Y adds up the total number of full-time employees for each calendar month of 2022, which is 480 [40 x 12 = 480].
• Company Y adds up the total number of FTEs for each calendar month of 2022, which is 120 [10 x 12 = 120].
• Company Y adds those two numbers together and divides the total by 12, which equals 50 [(480 + 120 = 600)/12 = 50].
• So, although Company Y only has 40 full-time employees, it is an ALE for 2023 due to the hours of service of its FTEs.

Additional examples can be found in��54.4980H-2�of the federal regulations.

Employer Aggregation Rules

Companies with a common owner or that are otherwise related under�Section 414�of the Internal Revenue Code are generally�combined and treated as a single employer for determining ALE status.

If the combined number of full-time employees and FTEs for the group is large enough to meet the definition of an ALE,�then each employer in the group (called an ALE member) is part of an aggregated ALE group and is subject to the pay or play rules, even if, separately, the employer would not be an ALE.

Important Note:�The rules for combining related employers�do not apply�for purposes of determining whether a particular company owes a pay or play penalty or the amount of any penalty. That is�determined�separately�for each related company, taking into account that company's offer of coverage (or lack thereof) and based on that company's number of full-time employees. Thus, one ALE member may fail to offer coverage and may owe a pay or play penalty, while another ALE member may offer coverage and not owe a penalty.

Employer Aggregation Example

• Corporation X owns 100% of all classes of stock of Corporation Y and Corporation Z. Corporation X has no employees at any time in 2022.
• For every calendar month in 2022, Corporation Y has 40 full-time employees and Corporation Z has 60 full-time employees. Neither Corporation Y nor Corporation Z has any FTEs.�
• Corporations X, Y, and Z are considered a controlled group of corporations.�Because Corporations X, Y and Z have a combined total of 100 full-time employees for each month during 2022, Corporations X, Y, and Z, together, are an ALE for 2023.

Application to New Employers

A new employer (that is, an employer that was not in existence on any business day in the prior calendar year) is an ALE for the current calendar year if it�reasonably expects�to employ, and�actually does�employ, an average of at least 50 full-time employees (including FTEs) on business days during the current calendar year. By contrast, for the next calendar year (the year after the first year the employer was in existence), the employer determines its ALE status�under the general rules discussed above.

Special Transition Rule for an Employer's First Year as an ALE:�If the ALE offers coverage to an employee on or before�April 1�of the first calendar year for which the ALE is subject to the pay or play rules, the employer will generally not owe a penalty for not offering coverage to the employee for January through March of that year, provided that the coverage offered by April 1 provides minimum value. (However, the ALE may still be subject to a penalty for not offering coverage to at least 95% of its full-time employees).

Source:� www.zywave.com

The American Rescue Plan Act (ARPA), which is the latest bill to address the ongoing economic impacts of COVID-19, has been signed into law. Most aspects of the law do not directly affect the HR function, but those that do—optional extension of sick and family leave and establishment of COBRA subsidies—are outlined below.

OPTIONAL EXTENSION OF SICK AND FAMILY LEAVES
Part of ARPA is an extension of the current tax credit scheme for Emergency Paid Sick Leave (EPSL) and Emergency Family and Medical Leave (EFMLA) under the Families First Coronavirus Response Act (FFCRA). The FFCRA required many employers to provide EPSL and EFMLA in 2020, but became optional when it was previously extended to cover January 1 through March 31, 2021. 

The new extension under ARPA takes effect April 1, 2021, and lasts through September 30, 2021. Like the current version, it remains optional. In addition, tax credits are available but only to employers with fewer than 500 employees and up to certain caps. To receive the tax credit, employers are required to follow the original provisions of the FFCRA. For example, they can’t deny EPSL or EFMLA to an employee if they’re otherwise eligible, can’t terminate them for taking EPSL or EFMLA, and have to continue their health insurance during these leaves.

Emergency Paid Sick Leave (EPSL) Changes
Here are the key changes to EPSL, in effect from April 1 through September 30, 2021:

• Employees can take EPSL to get the COVID vaccine and to recover from any related side effects.
• Employees can take EPSL when seeking or waiting for a COVID-19 diagnosis or test result if they’ve been exposed to COVID-19 or if the employer has asked them to get a diagnosis or test. (Previously, time spent waiting on test results was not necessarily covered, which seemed like an oversight.)
• Employees will be eligible for a new bank of leave on April 1. Full-time employees are entitled to 80 hours while part-time employees are entitled to a prorated amount.
• Employers can’t provide EPSL in a manner that favors highly compensated employees or full-time employees or that discriminates based on how long employees have worked for the employer. (Be aware that any inconsistencies in the granting of leave could potentially lead to a discrimination claim.)

Emergency Family and Medical Leave (EFMLA) Changes
Here are the key changes to EFMLA, in effect from April 1 through September 30, 2021:

• EFMLA can now be used for any EPSL reason, in addition to the original childcare reasons. This includes the two new EPSL reasons noted above.
• The 10-day unpaid waiting period has been eliminated.
• The cap on the reimbursable tax credit for EFMLA has been increased to $12,000 (from $10,000). This applies to all EFMLA taken by an employee, beginning April 1, 2020. This change accounts for the additional 10 days of paid time off—the daily cap of $200 remains the same.
• The law isn’t clear as to whether employees are entitled to a new 12-week bank of EFMLA. We anticipate that the IRS, DOL, or both will provide guidance on this question soon. It is possible that an employee will be entitled to additional unpaid protected time off, even if they already received the maximum reimbursable amount during previous EFMLA leave(s). We will update our materials if and when new information is available.
• Employers can’t provide EFMLA in a manner that favors highly compensated employees or full-time employees or that is based on how long employees have worked for the employer. (Again, be aware that any inconsistencies in the granting of leave could potentially lead to a discrimination claim.

Reasons for Using EPSL and EFMLA
Starting on April 1, employees can take EPSL or EFMLA for the same set of reasons, which is a useful simplification. The following are acceptable reasons for taking these leaves:

1. When quarantined or isolated subject to federal, state, or local quarantine or isolation order
2. When advised by a health care provider to self-quarantine because of COVID-19
3. When the employee is:
   a.  Experiencing symptoms of COVID-19 and seeking a medical diagnosis
   b.  Seeking or awaiting the results of a diagnostic test for, or a medical diagnosis of, COVID-19 because they have been exposed or because their employer has requested the test or diagnosis
   c.  Obtaining a COVID-19 vaccination or recovering from any injury, disability, illness, or condition related to the vaccination
4. When caring for another person who is isolating or quarantining on government or doctor’s orders
5. When caring for a child whose school or place of care is closed due to COVID-19

Employees and employers will—in most cases—want to exhaust EPSL first, since it has a higher tax credit, except when used to care for others. 

Tax Credit Review
The tax credits available between April 1 and September 30 are the same as under the original FFCRA, except for the increased aggregate cap for EFMLA. Tax credits are available as described below, regardless of how much EPSL or EFMLA an employee used prior to April 1.

• The credit available for EPSL when used for reasons 1, 2, or 3 (self-care) is up to 100% of an employee’s regular pay, with a limit of $511 per day.
• The credit available for EPSL when used for reasons 4 or 5 (care for another) is up to 2/3 of an employee’s regular rate of pay, with a limit of $200 per day.
• The credit available for EFMLA for any reason is up to 2/3 of an employee’s regular pay, with a limit of $200 per day and a cap of $12,000 per employee.

Employers can also claim a credit for their share of Medicare tax on the employee’s wages and the cost of maintaining the employee’s health insurance (qualified health plan expenses) during their absence.

COBRA SUBSIDIES
Another important aspect of the law employers should understand is the creation of COBRA subsidies.

Employees and families enrolled in the employer’s group health plans may lose coverage if the employee’s work hours are reduced or employment is terminated. They can elect to continue coverage under COBRA, but the high premium cost can make it difficult to afford this coverage.

ARPA provides a 100% COBRA subsidy if the employee’s work reduction or termination was involuntary. The subsidy applies for up to six months of coverage from April 2021 through September 2021 (unless the individual’s maximum COBRA period expires earlier).

For group plans subject to the federal COBRA rules, the employer will be required to pay the COBRA premium but then will be reimbursed through a refundable payroll tax credit.

Employers with fewer than 20 workers usually are exempt from the federal COBRA rules, but their group medical insurance plans may be subject to a state’s mini-COBRA law. In that case, it appears the subsidy will be administered by the carrier. The carrier will pay the premium and then be reimbursed by the government.

Employers will need to work with their group health plan carriers and vendors on how to administer the new subsidy provision. Although it takes effect April 1, 2021, employees who were terminated earlier but are still in their COBRA election window also are included. Federal guidance is expected to be released by April 10, including model notices that plans can tailor for their use.

Note that the COBRA subsidy doesn’t apply during FFCRA leaves because employees are entitled to maintain their health insurance during those leaves on the same terms as though they had continued to work.

We are continuing to monitor developments and will post any updates. Also watch this blog for a deeper dive on the COBRA subsidy.

Source:  

https://www.thinkhr.com/blog/american-rescue-plan-act-signed-into-law/

ThinkHR's Senior Legal Analyst, Kara Gorvo, answers employer questions about the COVID-19 vaccines.  You can see the answers by clicking the links below:

• If employees are vaccinated, do employers still need to mandate mask wearing and social distancing in the office?
• With vaccines rolling out among select populations, can employers start to bring back vaccinated employees into the office? Is that wise? What should the considerations be?
• Is it ethical/legal to incentivize getting the vaccine? Do you think this response varies based on industry, e.g., healthcare vs financial planning?
• What are the legal implications if there are vaccination incentives, but an employee can’t get the vaccine for a reason they can’t control, e.g., medical condition, lack of supply, etc.?
• Can employees offer incentives to employees to take the vaccine? What would that look like and what are the pros and cons of that?
• Can employers mandate their employees get the COVID vaccine before coming back to the office?

Source:  https://www.thinkhr.com/blog/our-senior-legal-analyst-answers-questions-about-the-covid-19-vaccines

Are you an employer that offers or provides group health coverage to your workers? Does your health plan cover outpatient prescription drugs — either as a medical claim or through a card system? If so, be sure to distribute your plan’s Medicare Part D notice before October 15.

Purpose

Medicare began offering “Part D” plans — optional prescription drug benefit plans sold by private insurance companies and HMOs — to Medicare beneficiaries many years ago. People may enroll in a Part D plan when they first become eligible for Medicare.

If they wait too long, a late enrollment penalty amount is permanently added to the Part D plan premium cost when they do enroll. There is an exception, though, for individuals who are covered under an employer’s group health plan that provides creditable coverage. (“Creditable” means that the group plan’s drug benefits are actuarially equivalent or better than the benefits required in a Part D plan.) In that case, the individual can delay enrolling for a Part D plan while he or she remains covered under the employer’s creditable plan. Medicare will waive the late enrollment premium penalty for individuals who enroll in a Part D plan after their initial eligibility date if they were covered by an employer’s creditable plan. To avoid the late enrollment penalty, there cannot be a gap longer than 62 days between the creditable group plan and the Part D plan.

To help Medicare-eligible plan participants make informed decisions about whether and when to enroll in a Part D drug plan, they need to know if their employer’s group health plan provides creditable or noncreditable prescription drug coverage. That is the purpose of the federal requirement for employers to provide an annual notice (Employer’s Medicare Part D Notice) to all Medicare-eligible employees and spouses.

Employer Requirements

Federal law requires all employers that offer group health coverage including any outpatient prescription drug benefits to provide an annual notice to plan participants.
The notice requirement applies regardless of the employer’s size or whether the group plan is insured or self-funded:

• Determine whether your group health plan’s prescription drug coverage is creditable or noncreditable for the upcoming year (2021). If your plan is insured, the carrier/HMO will confirm creditable or noncreditable status. Keep a copy of the written confirmation for your records. For self-funded plans, the plan actuary will determine the plan’s status using guidance provided by the Centers for Medicare and Medicaid Services (CMS).
• Distribute a Notice of Creditable Coverage or a Notice of Noncreditable Coverage, as applicable, to all group health plan participants who are or may become eligible for Medicare in the next year. “Participants” include covered employees and retirees (and spouses) and COBRA enrollees. Employers often do not know whether a particular participant may be eligible for Medicare due to age or disability. For convenience, many employers decide to distribute their notice to all participants regardless of Medicare status.
• Notices must be distributed at least annually before October 15. Medicare holds its Part D enrollment period each year from October 15 to December 7, which is why it is important for group health plan participants to receive their employer’s notice before October 15.
• Notices also may be required after October 15 for new enrollees and/or if the plan’s creditable versus noncreditable status changes.

Preparing the Notice(s)

Model notices are available on the CMS website. Start with the model notice and then fill in the blanks and variable items as needed for each group health plan. There are two versions: Notice of Creditable Coverage or Notice of Noncreditable Coverage and each is available in English and Spanish:

• Model Notice for Group Plan that is Creditable Coverage (English)
• Model Notice for Group Plan that is Noncreditable Coverage (English)

Employers who offer multiple group health plan options, such as PPOs, HDHPs, and HMOs, may use one notice if all options are creditable (or all are noncreditable). In this case, it is advisable to list the names of the various plan options so it is clear for the reader. Conversely, employers that offer a creditable plan and a noncreditable plan, such as a creditable HMO and a noncreditable HDHP, will need to prepare separate notices for the different plan participants.

Distributing the Notice(s)

You may distribute the notice by first-class mail to the employee’s home or work address. A separate notice for the employee’s spouse or family members is not required unless the employer has information that they live at different addresses.

The notice is intended to be a stand-alone document. It may be distributed at the same time as other plan materials, but it should be a separate document. If the notice is incorporated with other material (such as stapled items or in a booklet format), the notice must appear in 14-point font, be bolded, offset, or boxed, and placed on the first page. Alternatively, in this case, you can put a reference (in 14-point font, either bolded, offset, or boxed) on the first page telling the reader where to find the notice within the material. Here is suggested text from the CMS for the first page:

“If you (and/or your dependents) have Medicare or will become eligible for Medicare in the next 12 months, a federal law gives you more choices about your prescription drug coverage. Please see page XX for more details.”

Email distribution is allowed but only for employees who have regular access to email as an integral part of their job duties. Employees also must have access to a printer, be notified that a hard copy of the notice is available at no cost upon request, and be informed that they are responsible for sharing the notice with any Medicare-eligible family members who are enrolled in the employer’s group plan.

CMS Disclosure Requirement

Separate from the participant notice requirement, employers also must disclose to the CMS whether their group health plan provides creditable or noncreditable coverage. To submit your plan’s disclosure, use the CMS online tool and follow the prompts. The process usually takes only 5 or 10 minutes to complete. It is due with 60 days after the start of the plan year; for instance, for calendar year plans that will be March 1, 2021. If the plan’s prescription drug coverage ends or its status as creditable or noncreditable changes, submit a new disclosure within 30 days of the change.

On May 20, 2020, the Internal Revenue Service (IRS) released Revenue Procedure 2020-32 announcing the annual inflation-adjusted limits for health savings accounts (HSAs) for calendar year 2021. An HSA is a tax-exempt savings account that employees can use to pay for qualified health expenses.

To be eligible for an HSA, an employee:

• Must be covered by a qualified high deductible health plan (HDHP);
• Must not have any disqualifying health coverage (called “impermissible non-HDHP coverage”);
• Must not be enrolled in Medicare; and
• May not be claimed as a dependent on someone else’s tax return.

The limits vary based on whether an individual has self-only or family coverage under an HDHP. The limits are as follows:

• 2021 HSA contribution limit:
• Single: $3,600 (an increase of $50 from 2020)
• Family: $7,200 (an increase of $100 from 2020)
• Catch-up contributions for those age 55 and older remains at $1,000
• 2021 HDHP minimum deductible*
• Single: $1,400 (no change from 2020)
• Family: $2,800 (no change from 2020)
• 2021 HDHP maximum out-of-pocket limit:
• Single: $7,000 (an increase of $100 from 2020)
• Family: $14,000** (an increase of $200 from 2020)

*   The deductible does not apply to preventive care services nor to services related to testing for COVID-19. An HDHP also may choose to waive the deductible for coverage of COVID-19 treatment, and/or telehealth and other remote care services.

**   If the HDHP is a nongrandfathered plan, a per-person limit of $8,550 also will apply due to the Affordable Care Act’s cost-sharing provision for essential health benefits.

Source:  https://www.thinkhr.com/blog/irs-announces-hsa-limits-for-2021/.

Families First Coronavirus Response Act
Since the enactment of the Families First Coronavirus Response Act on March 18, new information and guidance has been released every few days, though still much slower than employers would like. We have summarized what we believe to be the most relevant new information below. We will continue to update the HR Support Center multiple times per day to keep you informed, and we encourage you to visit the site regularly for updates.

Required FFCRA Poster
The Department of Labor (DOL) has released a mandatory employee rights poster for the FFCRA. It should be posted or distributed to employees electronically (via email or online portal) by April 1. More information on the requirements can be found here.

Enforcement of FFCRA
The DOL will not bring enforcement actions against employers for violations of the FFCRA prior to April 17, 2020, provided that the employer has made reasonable, good faith efforts to comply with the Act. You can read more about the brief non-enforcement period here.

New Guidance from the DOL on Administering FFCRA Leaves
We strongly suggest that employers read through the entire Question and Answers document prior to Wednesday, so they have an understanding of how the leaves work. The following are some highlights from the updated guidance:

• These leaves are not available to employees with reduced hours, furloughed employees, or employees whose workplaces are closed. See questions 23-28.
• These leaves are not available to employees whose workplaces are closed due to a federal, state, or local shelter-in-place or stay-at-home orders, or due to business slowdowns. See question 23.
• These leaves (and payroll tax credit) are not retroactive. Employees are not entitled to pay under these leaves if they were absent or out of work (for any reasons) prior to April 1. See question 13.
• Both emergency paid sick leave (EPSL) and emergency Family and Medical Leave (EFMLA) can be taken on an intermittent basis in certain situations. See Questions 20-22 for explanations about when intermittent leave is allowed.
• Employees may not be required to use other forms of paid leave prior to or concurrently with EPSL or EFMLA. See questions 32 and 33.
• Employers should keep documentation to show that employees who received leave were actually in need of leave. The documentation requirements will be outlined in soon-to-be-released IRS guidance. See Questions 15 and 16.

Coronavirus Aid, Relief, and Economic Security Act (CARES Act)
On Friday, March 27, the President signed the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). The new law is a $2 trillion economic stimulus package designed to repair the economic damage caused by COVID-19 and provide additional protection to individuals and businesses who may lose income due to the pandemic. While most of the act pertains to direct payments and loans, there are some sections that affect employers.

Providing Alternatives to Closure and Layoffs
The CARES Act gives employers the following options and benefits, which may allow them stay open and keep more people employed:

• Small businesses may be eligible for emergency grants of up to $10,000 to cover immediate operating costs.
• The Small Business Administration (SBA) may provide loans of up to $10 million per business; any portion of that spent to pay employees, keep workers on payroll, or pay for rent, mortgages, or existing debt could be forgiven, provided workers remain employed through the end of June.
• Small businesses with existing SBA loans may have up to six months of payments waived.
• Businesses who have experienced a decline in gross receipts of 50% as compared to the same quarter of 2019 or who have been fully or partially shutdown by order may be eligible to receive a refundable tax credit for 50% of qualified employee wages up to $10,000 per employee. This is unrelated to the dollar-for-dollar payroll tax credit that can be taken for FFCRA leaves.
• Businesses may defer payment of employer payroll taxes imposed between the enactment of this law and December 31, 2020 with half of the deferred taxes due by December 31, 2021 and the rest due by December 31, 2022. This is unrelated to the dollar-for-dollar payroll tax credit that can be taken for FFCRA leaves.

We are unable to advise on these topics as they are outside the scope of our expertise. We encourage you to follow the IRS Coronavirus Tax Relief page and theSBA Coronavirus Loan Resources page, as well as consult with your tax professional or financial advisor. Detailed guidance on how to access these financial resources should be coming soon from those sources.

Impact on Unemployment Insurance
The act increases the length of time someone can be on unemployment benefits to a maximum of 39 weeks. In many states, this will be an increase of 13 weeks of benefits. The act also adds $600 to the weekly amount an individual would usually receive. While these unemployment benefits are generous, employers should still consider their options and incentives under the CARES Act mentioned above before making decisions about reduced hours, furloughs, or layoffs.

Employees who experience reduced hours, furloughs, or layoffs should be encouraged to file for unemployment insurance as soon as possible. We recommend that both employers and employees visit their state’s unemployment insurance department website and track local and state news, as departments across the country are updating their rules to facilitate displaced workers during this time.

Source:  https://www.thinkhr.com/blog/ffcra-updates-cares-act-provisions/

Question:

Can we extend a new employee’s probationary period? They aren’t meeting expectations yet.

Answer:

You can extend an introductory period, but I would recommend a different approach. I’d also advise against using the word “probationary.” I’ll explain both points.

Extending the Introductory Period

First things first, be aware that having an introductory period for new employees has no legal impact on the employment relationship. Terminations during that time still come with risk (so problems should be discussed and documented) and terminated employees can still file for unemployment insurance. Extending the introductory period doesn’t mitigate risk or affect your rights and responsibilities as an employer.

If a new employee has reached the end of their introductory period and they aren’t performing up to your expectations — but you still think they have potential — I’d recommend implementing a Performance Improvement Plan (PIP). This kind of plan allows you to detail the company’s expectations with respect to their performance and will provide for follow-up meetings to discuss the employee’s progress. Upon the conclusion of the PIP, you make a decision as to the employee’s continued employment.

Probationary v. Introductory

We strongly recommend using the word ‘introductory’ instead of ‘probationary’ for a few reasons. First, probationary has a punitive ring to it, and sounds a bit like the employee is already in trouble even though they’ve just started working for you. Second, and perhaps more importantly, at least one court has ruled that the term ‘probationary period’ implies greater employment rights upon the completion of the period. Essentially, its use could interfere with the at-will relationship between the company and employees. For these reasons, we suggest using the term ‘introductory period’ instead.

To get all your clients’ questions answered by HR experts, get access to the ThinkHR Live Advisors. Request a consultation and find out how you can add their expertise to your offering.

Source:  https://www.thinkhr.com/blog/can-we-extend-new-employees-introductory-period/.

Reporting Requirements

Applicable large employers (ALEs), which generally are entities that employed 50 or more full-time and full-time-equivalent employees in the year before the reporting year, must report information about the health coverage they offered or did not offer to full-time employees. To meet this reporting requirement, the ALE furnishes Form 1095-C to the employee or former employee and files copies, along with transmittal Form 1094-C, with the IRS.

If the ALE sponsored a self-funded (self-insured) health plan providing MEC, the ALE also must report coverage information about the plan’s enrollees. If the primary enrollee was a full-time employee, the ALE will report the coverage information on Form 1095-C (and file copies with transmittal Form 1094-C to the IRS). If the primary enrollee was not a full-time employee, the ALE has the option of using the “B” forms (1095-B and 1094-B) instead of the “C” forms to report the coverage information.

Small employers who are not ALEs are exempt from the reporting requirements – unless they self-funded a MEC plan. A non-ALE employer must report coverage information about its self-funded plan’s enrollees using Form 1095-B (and file copies with transmittal Form 1094-B to the IRS).

Lastly, when Form 1095-C is required, it must be delivered to the individual who is named in Part I (along with filing copies with the IRS). If Form 1095-B applies, however, the employer may be able to avoid having to print and mail forms to individuals (although copies still must be filed with the IRS). The IRS will not penalize the employer for failing to deliver Form 1095-B to individuals provided it meets two conditions:

1. Posts a notice prominently on its website stating that individuals may receive a copy of their 2019 Form 1095-B upon request. The notice must include contact information for requests and questions (i.e., email and physical addresses and telephone number); and
2. Furnishes Form 1095-B to the individual within 30 days of receiving the individual’s request.

Due Dates

The due date to furnish 2019 forms to individuals is March 2, 2020, while the due date to file copies with the IRS, including the appropriate transmittal form, depends on whether the employer files electronically or by paper. Entities that provide 250 or more forms to individuals are required to file electronically with the IRS.

• March 2, 2020: Deadline to furnish 2019 Form 1095-C or Form 1095-B, if applicable, to employees and individuals.
• February 28, 2020: Deadline for paper filing of all 2019 Forms 1095-C and 1095-B, along with transmittal form 1094-C or 1094-B, with the IRS.
• March 31, 2020: Deadline for electronic filing of all 2019 Forms 1095-C and 1095-B, along with transmittal form 1094-C or 1094-B, with the IRS.

Employers are encouraged to work with experienced vendors, tax advisors, and payroll administrators to review how the ACA reporting requirements apply to their situation. The required forms are important IRS documents and preparers should use the same level of care that would apply to employee W-2s.

For source and more informaiton go here.

The U.S. Department of Labor (DOL) has updated the model notice for employers to use to inform employees about the Children’s Health Insurance Program (CHIP). All employers with group health plans are required to distribute a CHIP notice at least once a year to employees living in certain states. There is no need to send another notice to workers who received the prior version in the past year, but employers should use the updated notice going forward. This also is a good time for employers to review their procedures for distributing CHIP notices.

The following are the most frequently asked questions we receive from employers about CHIP notices.

Frequently Asked Questions

What is the purpose of the CHIP notice?

The CHIP notice informs benefits-eligible employees that their state’s CHIP or Medicaid program may offer premium assistance to help them pay for group health coverage at work. Many states offer some form of premium assistance to residents based on their family income. The updated notice includes contact information for each participating state and explains that persons approved for premium assistance have a special 60-day enrollment period to join their employer’s group plan without having to wait for the employer’s next annual enrollment period. Currently, there are 36 participating states. Colorado, which participated previously, is no longer listed in the CHIP notice.

Does the CHIP notice requirement affect all employers?

All employers that offer a group health plan providing medical benefits, whether insured or self-funded, must consider the CHIP notice requirement. Each employer then will determine if it must distribute the notice depending on whether any of its employees live in one of the states listed in the notice.

Further, all group health (medical) plans must offer a special 60-day enrollment period when an employee becomes eligible for premium assistance (for the employee or a family member) from a state’s CHIP or Medicaid program.

Is the notice required for all employees or just for those enrolled in our group health plan?

The notice must be given to all employees living in any one of the listed states and eligible for the employer’s group health plan, whether or not currently enrolled. That is the minimum requirement. Many employers, however, choose to distribute the notice to all employees, regardless of benefits eligibility or location, to avoid the need for separate distributions when an employee’s status or location changes.

How do we prepare and distribute the notice? How often?

The DOL provides a model notice that employers can copy and distribute. Although employers have the option of creating their own notice to list only the states where their employees are located, most employers simply use the DOL model notice as it is. The model notice also is available in Spanish.

The notice must be distributed when employees initially become eligible for the employer’s health plan and then at least once a year thereafter. For convenience, most employers provide the notice at the same time as they distribute new hire materials and annual enrollment materials.

When combined with other materials, the CHIP notice must appear “separately and in a manner which ensures that an employee who may be eligible for premium assistance could reasonably be expected to appreciate its significance.” For instance, the notice may be a loose item in the same envelope with other material. If the notice is stapled inside other material, however, there should be a note on the top page or cover alerting the reader to the placement of the CHIP notice and its importance.

Do we have to mail out paper copies or can we distribute the notice electronically?

The notice may be sent by first-class mail. Alternatively, it can be distributed electronically if the employer follows the DOL’s guidelines for electronic delivery of group health plan materials. That means that the employer first must determine whether the intended recipient has regular access to the electronic media system (e.g., email) as an integral part of his or her job. If so, the notice can be sent electronically provided the employer takes steps to ensure actual receipt, along with notifying the employee of the material’s significance and that a paper copy is available at no cost.

For persons who do not have regular access to the electronic media system, the notice cannot be sent electronically unless the intended recipient provides affirmative consent in advance. The guidelines for obtaining advance consent are fairly cumbersome, so employers are advised to distribute paper copies in these cases.

Summary

Employers offering group health plans are encouraged to review their procedures for distributing CHIP notices. At a minimum, the notice must be given annually to all employees eligible for the employer’s health plan who live in any of the states listed in the notice. Many employers choose to distribute the notice to all workers in an abundance of caution. The DOL provides model notices in English and Spanish that do not need any customization, so employers can simply copy and distribute one or both versions as needed.

Source:  https://www.thinkhr.com/blog/dol-updates-employer-chip-notice

On November 29, 2018, the IRS released Notice 2018-94 to extend the due date for employers to furnish 2018 Form 1095-C or 1095-B under the Affordable Care Act’s employer reporting requirement. Employers will have an extra month to prepare and distribute the 2018 form to individuals. The due dates for filing forms with the IRS are not extended.

Background

Applicable large employers (ALEs), who generally are entities that employed 50 or more full-time and full-time-equivalent employees in 2017, are required to report information about the health coverage they offered or did not offer to certain employees in 2018. To meet this reporting requirement, the ALE will furnish Form 1095-C to the employee or former employee and file copies, along with transmittal Form 1094-C, with the IRS.

Employers, regardless of size, that sponsored a self-funded (self-insured) health plan providing minimum essential coverage in 2018 are required to report coverage information about enrollees. To meet this reporting requirement, the employer will furnish Form 1095-B to the primary enrollee and file copies, along with transmittal Form 1094-B, with the IRS. Self-funded employers who also are ALEs may use Forms 1095-C and 1094-C in lieu of Forms 1095-B and 1094-B.

Extended Due Dates

Specifically, Notice 2018-94 extends the following due dates:

• The deadline for furnishing 2018 Form 1095-C, or Form 1095-B, if applicable, to employees and individuals is March 4, 2019 (extended from January 31, 2019).
• The deadline for filing copies of the 2018 Forms 1095-C, along with transmittal Form 1094-C (or copies of Forms 1095-B with transmittal Form 1094-B), if applicable, remains unchanged:
  • If filing by paper, February 28, 2019.
  • If filing electronically, April 1, 2019.

The extended due date applies automatically so employers do not need to make individual requests for the extension.

More Information

Notice 2018-94 also extends transitional good-faith relief from certain penalties to the 2018 employer reporting requirements.

Lastly, the IRS encourages employers, insurers, and other reporting entities to furnish forms to individuals and file reports with the IRS as soon as they are ready.

Source:  https://www.thinkhr.com/blog/irs-extends-deadline-employers-furnish-forms-1095-c-1095-b/.