Author: Byrne

On February 20, 2014, the Department of Health and Human Services (HHS), the Department of Labor (DOL) and the Internal Revenue Service (IRS) released final regulations on the eligibility waiting period requirements. The Patient Protection and Affordable Care Act (PPACA) provides that plans may not require an employee who is eligible for coverage to complete a waiting period of more than 90 days before coverage is available. This requirement is effective on the first day of the 2014 plan year. This requirement applies to all plans, including grandfathered plans, fully insured and self-funded plans, and plans offered by small employers. It applies to both full-time and part-time employees if the employer has chosen to cover part-time employees. These final regulations are effective as of the beginning of the 2015 plan year, but they largely mirror the rules that are already in place for 2014. They do not in any way delay the requirement that plans meet the eligibility waiting period requirement by the start of the 2014 plan year.

The regulations state that an eligibility waiting period cannot be more than 90 days. This, literally, is 90 calendar days – a plan that begins coverage as of the first of the month after 90 days of employment, or after three months of employment, will be out of compliance. If the 91st day falls on a weekend or holiday, the plan may not wait to begin coverage until the following work day. In that situation, the plan will need to begin coverage as of the Friday before the end of the allowed waiting period.

The waiting period may be delayed until the employee meets the plan’s eligibility requirements. For example, if the plan does not cover employees who work fewer than 30 hours per week, or employees in certain job categories, and an employee moves from ineligible to eligible status, the waiting period may begin as of the date the employee first moves into the eligible class. Other acceptable eligibility requirements include earnings requirements for salespeople, cumulative service requirements of up to 1,200 hours for part-time employees, or employees covered under a multiemployer plan, and similar arrangements that are not designed to circumvent the waiting period.

Example: Fay begins working 25 hours per week for Acme Co. on January 6, 2014. Acme’s group health plan does not cover part-time employees until the employee has completed a cumulative 1,200 hours of service. Fay satisfies the plan’s cumulative hours of service condition on December 15, 2014. Acme must offer Fay coverage by March 15, 2015 (the 91st day after Fay meets the service requirement.).

The regulations recognize that multiemployer plans often have complicated eligibility rules, and that is permitted as long as the eligibility requirements are not designed to avoid the waiting period rules.

Example: A multiemployer plan has an eligibility provision that allows employees to become eligible for coverage by working a specified number of hours of covered employment for multiple contributing employers. The plan aggregates hours in a calendar quarter and then, if enough hours are earned, coverage begins the first day of the next calendar quarter. The plan also permits coverage to extend for the next full calendar quarter, regardless of whether an employee’s employment has terminated. This arrangement satisfies the regulation.

An employer may require that an orientation or probationary period be successfully completed before an employee is considered an eligible employee. However, in a proposed regulation issued with the new final regulation, the agencies state that because of concerns that orientation or probationary periods will be used to improperly delay coverage, they are considering limiting permissible orientation and probationary periods to one month.

The regulation allows a waiting period that is longer than 90 days for new variable hours employees. A variable hours employee is someone whose hours cannot be predicted when the person is hired. An employer may average the time worked by a variable hours employee over his or her initial measurement period to determine if the employee is eligible for coverage. The waiting period may be imposed after the initial measurement period is completed as long as both periods are completed by the first day of the month following completion of 13 months of employment.

Example: Ann is a variable hours employee because she is an on-call nurse. Ann’s employer uses a 12-month initial measurement period for variable hours employees and a 60-day waiting period. Ann is hired May 10, 2014. If Ann averages 30 or more hours per week during the initial measurement period, she must be offered coverage with an effective date of July 1, 2015, or sooner.

Individuals who are part way through a waiting period as of the start of the 2014 plan year must be credited with time prior to 2014, so that their total waiting period as of the start of the 2014 plan year is no more than 90 days.

Example: Ed is hired October 22, 2013. Ed’s employer has a calendar year plan and during 2013 it used a six-month waiting period. Ed must be offered coverage with an effective date on or before January 20, 2014, because that is Ed’s 91st day of employment.

Although not related to eligibility waiting periods, this regulation also confirms that certificates of creditable coverage need to be provided through December 31, 2014, (regardless of plan year). The certificates will not be required after that date because pre-existing condition limitations will not be permitted after the start of the 2014 plan year.

There is a lot of talk about the many cost-control and health care reform tactics available to employers, but what are companies actually implementing? The latest UBA Benefit Opinions Survey aims to define just that. While clients and prospects of UBA’s Partner Firms have contributed thousands of responses to the survey, any employer can participate and get a complimentary findings report. This landmark benchmarking resource compiles information from employers representing all major industry classifications, employee size categories and regions of the country, and delineates employers’ opinions in five key areas:

• Health Plan Strategies
• Benefits Philosophy and Opinion
• Health Plan Management
• Personal Health Management
• Employee Communications

Health plan strategies, philosophy, management, and communications have become a critical focus for employers evaluating their options to comply with health care reform and remain competitive. Nearly 80% of all employers continue to be firmly committed to the value of providing health benefits to active employees and their dependents and more than 95% believe good benefits help attract and retain employees according to the previous survey results.

If your company is interested in comparing attitudes and strategies with your peers regarding employer-provided health care, we invite you to participate. The survey is open from February 14 through March 10, 2014. Some of the results will undoubtedly be surprising and will help employers see how they stack up when it comes to:

• How savvy employees are about health care costs
• Prevailing employee attitudes during open enrollment
• What programs are helping employees become better health care consumers
• Wellness and prevention programs that are actually in use
• Prescription cost-control strategies that are working
• What most employers think when it comes to dependent coverage, consequences for unmanaged chronic care, and more
• Health care reform strategies in place —from early renewals, Small Business Health Options Program (SHOP) enrollment, ensuring health care is “affordable” and/or moving to Administrative Services Only (ASO) or self-funded models—to skinny plans, paying penalties, and/or sending employees to public exchanges for subsidies

Participate in the UBA Benefit Opinions Survey today to make more informed decisions regarding compliance, employee retention and cost management strategies.

The Federal Poverty Level (FPL) is used to determine eligibility for many government programs, including Medicaid and the premium tax credit/subsidy available through the health marketplace/exchange. The Department of Health and Human Services (HHS) ha…

  Don’t forget open enrollment for individual health insurance ends on March 31st.  It can be confusing to sift through all the overwhelming options, especially with the complicated new changes the Affordable Care Act brings to the table. Our account executive Elena Cowan will be glad to assist you with finding the best individual coverage … Continued

The 90-day maximum for eligibility waiting periods is effective as of the start of the 2014 plan year.  As employers are beginning to implement this new requirement, many have questions. For instance, what should employers do if they hired an employee under the prior rules?  

The 90-day limit applies as of the start of the 2014 plan year, even for those hired under the prior plan rules. This means that an employee who had worked 90 days by the start of the 2014 plan year must be covered as of the start of the year. Those who had worked fewer than 90 days must be credited with all time worked.

Here are some examples to help explain this scenario:

Ellen was hired October 2, 2013. Ellen’s employer has a calendar year plan and during 2013 it used a “first of the month after 90 days of employment” waiting period. Ellen must be offered coverage on January 1, 2014, because she will have completed at least 90 days of employment by that date.

Fred was hired October 22, 2013, to work part-time. Fred’s employer has a calendar year plan and during 2013 it used a six month waiting period. Fred must be offered coverage with an effective date on or before January 20, 2014, because that is Fred’s 91st day of employment. (It does not matter that Fred works part-time because the waiting period limit applies to both part-time and full-time employees.)

Jane was hired December 10, 2013, and Jim was hired January 29, 2014. Jane and Jim’s employer has a May 1 plan year and has been using a “first of the month after 90 days” waiting period. The employer is switching to a “first of the month after 45 days” waiting period as of May 1, 2014. Jane must be offered coverage with an effective date of April 1, 2014 (because the first of the month after 90 days is allowable for Jane’s employer until May 1). Jim must be offered coverage with an effective date of May 1, 2014, because Jim will have completed 90 days of employment by then.

United Benefit Advisors (UBA) has created a Patient Protection and Affordable Care Act (PPACA) Advisor that addresses a number of other recurring questions about this new provision that include, but are not limited to:

• Does PPACA affect eligibility waiting periods?
• May a plan use a 3-month waiting period?
• May a plan impose a probationary period or cumulative service requirement before applying a waiting period?
• May a plan allow employees to buy or bank hours toward an “hours of service for eligibility” requirement?

Click here to access the Frequently Asked Questions (FAQ) about waiting periods resource.

As we inch closer to full implementation of the Patient Protection and Affordable Care Act (PPACA), the nation’s employers are facing a deadline about whether or not they will “play or pay,” with regard to offering employee benefits. Unfortunately, many still do not fully understand the options and various implications of their PPACA-related decisions.

United Benefit Advisor’s 2013 Health Plan Survey shows that a majority of employers (76.58%) continue to be firmly committed to the value of providing group health insurance to active employees and their dependents, but how those benefits are structured can vary greatly and have a significant impact on the bottom line.

No two employers face the same set of circumstances under PPACA and each should base its insurance solutions on its own size, industry, region, workforce characteristics, financial considerations, and strategic goals for employee health.

In UBA’s white paper, The Employer’s Guide to “Play or Pay,” employers are educated about how to move beyond “compliance with health care reform” and what they should do to take a more strategic look at cost control.

Topics to consider (and covered in the white paper) include: 

• The facts about penalties and the pros and cons of “playing” or “paying”
• Compensation issues and how seemingly small decisions can have significant ramifications for all employers and employees (regardless of whether or not they offer benefits)
• Seven issues to consider beyond penalties; for example, lost tax advantages, reporting burdens, recruitment and retention challenges, and more
• How location, compensation, subsidies, Medicaid, family size, and income affect decisions 

Download a complimentary copy of The Employer’s Guide to “Play or Pay” at http://bit.ly/1chiLEQ or contact a local UBA Partner Firm for the detailed guidance and support of a benefit consultant.

In the face of the Patient Protection and Affordable Care Act (PPACA), the most substantial change in decades to the U.S. health care system, many employers are struggling to stay on top of health plan compliance while focusing on attracting and retaining employees, especially as the economy improves. Employee benefits packages that include vision insurance can help employers reach strategic goals, attract and retain employees, control health care costs, and increase productivity.

In fact, vision benefits are the most requested benefit after dental insurance, with more than 80% of American adults requiring some form of vision correction, according to VisionWatch—a study conducted by the Vision Council in June 2013. Additionally, United Benefit Advisors (UBA) believes that voluntary benefits, including vision, will be an even greater differentiator in 2014 than ever before, according to its survey from nearly 12,000 employers.

VSP® Vision Care, the nation’s largest vision benefits provider, and UBA are hosting a webinar for HR professionals and employers titled, “What You May Not Know About Vision” on Thursday, January 23, 2014 at 2:00 p.m. ET. This webinar will show how a vision plan (even if offered as a voluntary benefit) can help employers by:

1. Enhancing the capability to detect chronic conditions early by focusing on employee wellness.
2. Saving your employees’ already constrained post-tax dollars on a health service and product.
3. Developing higher productivity in the workplace.

To register, visit UBA WisdomWorkplace webinars and enter code “UBAVSP ” to receive the $149 discount. This webinar has been submitted to the Human Resource Certification Institute to qualify for 1.25 recertification credit hours.

To alleviate PPACA compliance anxiety, employers need resources that clearly explain which provisions affect them so they can make the best decisions. The following four guides will help you get started: 

1. Confused About What PPACA Changes To Make When? This compliance timeline helps employers prepare for key milestones related to: 

• Plan design requirements
• Other plan provisions
• Employer reporting requirements
• Employee notice requirements
• Individual mandates
• Exchanges
• Insurer provisions
• Medicaid expansion
• Nondiscrimination requirements
• Automatic enrollment
• Fees and “Cadillac” taxes 

2. Counting Employees Under PPACA: This guide helps employers determine how many employees they have for several purposes under PPACA. Make sure you are counting your employees correctly so you are not surprised with stiff fees. Learn the basics about: 

• The definitions of full time employees
• How to count part-time employees on a pro-rata basis
• How to treat seasonal employees
• Who the law considers an “employee”
• Counting hours correctly
• Determining average hours worked
• Penalties that result if a “large employer” doesn’t offer coverage 

3. What Is Your State Doing with Exchanges and Medicaid? This comprehensive chart that shows where each state stands on its: 

• Exchange Election: whether the state will run the health exchange themselves, or if the federal government will run the exchange for the state
• Medicaid Election: whether the state will expand Medicaid to cover most individuals whose income is below 133 percent of the federal poverty level 

4. PPACA Executive Summary: This PPACA overview document provides a list of changes that employers should already be making and obligations employers must fulfill between now and 2014. 

You can stay apprised of other PPACA employer obligations by visiting the UBA Compliance Resource Center at www.UBAbenefits.com.

Peter Freska, CEBS
Benefits Advisor
The LBL Group, A UBA Partner Firm

By all accounts, California is leading the country when it comes to On-Exchange sales (Covered California). With a total 2013-2014 marketing budget of $286,519,301, Covered California is definitely working to get the word out about their options. Also interesting to note is that reports show Covered California costs 56 times more than Facebook (more than $910 million spent on Covered California). So for all this hype and cost, Covered California has 71,188 applications completed.

The question that I still get asked almost daily is, “should I buy on the exchange?” Here is something to think about: There will be four basic levels of coverage: Platinum, Gold, Silver and Bronze. As the coverage increases, so does the monthly premium payment, but the cost when a person receives medical care is usually lower. Californians can choose to pay a higher monthly cost so that when they need medical care, they pay less. Or they can choose to pay a lower monthly cost, which means that when they need medical care, they pay more. Each person has the choice. Families can also seek insurance through Medi-Cal (California’s version of Medicaid). (Covered California Fact Sheet – Changes Coming to Health Care in 2014). In case you are wondering, this has been the case.

The answer may be as simple as answering with another question, “Do you think you might qualify for a subsidy?”

This is an important answer, because the only way to receive a premium subsidy is with the purchase of an On-Exchange plan (e.g. Covered California Insurance Marketplace).

If the answer is yes, “I may qualify for a premium subsidy,” then let’s look at the four basic tiers (Bronze, Silver, Gold, Platinum) – yes, now there are basically four metal tiers from which to choose (see key benefits below). Gone are the days of 30-40 plans from a single carrier, and gone are all the carriers in almost all the markets in the state. For example, in Southern California, Anthem Blue Cross changed their plans from Preferred Provider Organization (PPO) to Exclusive Provider Organization (EPO) On- and Off-Exchange (so check your provider network before enrolling on any plan). Their decision process is made easier by fewer plan options, but a consumer still needs to be savvy and make the choice that best meets their needs.

If the answer is no, “ I don’t qualify for a premium sudsidy,” then we can look On- and Off-Exchange. In doing so, a consumer should keep in mind that ALL the plans offered On-Exchange ARE offered Off-exchange. And yes, they are the same price! There are some more options from which the consumer may choose.

The reality is that if you qualify for a premium subsidy, then a certified insurance agent will direct you and assist you with enrollment On-Exchange. If you don’t qualify for a subsidy, then contact your trusted agent (hopefully the same as your certified agent) and they can provide you with enrollment assistance.

Bottom line: If you do not qualify for a premium subsidy, there is no reason to enroll On-Exchange. The same plans, at the same prices – with more options – are avaialble Off-Exchange. Also, the applications (at least in California) that are tried and true from the carriers work just fine! (Note: Still allow time for carrier processing.)

Deadline to submit a completed application was December 23, 2013, for a January 1, 2014, effective date. Payments must be received by Jan. 15, not just postmarked before that date. Consumers have until March 31, 2014 to get health care coverage and avoid a federal tax penalty in 2014.

To view the 2014 Standard Benefits for Individuals on the Covered California website, visit: https://www.coveredca.com/coverage-basics/PDFs/standard-benfits-for-individuals.pdf

“The Only Thing That Is Constant Is Change.”  ― Heraclitus.

When it comes to health plan compliance, this statement couldn’t be truer. The IRS and the Department of Health and Human Services (HHS) are constantly developing, revising and amending regulations related to the Patient Protection and Affordable Care Act (PPACA). While overwhelming, it’s still crucial for employers to keep pace with the plethora of changes since the regulations affect many facets of employee benefit planning, compensation, and taxes. It seems these days that benefit management needs to keep up with the law in addition to attracting and retaining employees. 

To help you sort through the revolving door of regulations, notices, and proposed rules, United Benefit Advisors (UBA) recently updated its PPACA Resource Center—a free, online archive focused on compliance with health care reform. The UBA PPACA Resource Center now includes the following documents:

• Highlights of Wellness Program Requirements: Summary of new requirements for the 2014 plan year.
• Additional Medicare Tax on High Earners: Summary of the published IRS final regulations on the Additional Medicare Tax (AMT)
• Marketplace Notices and Proposed Rule Summaries: Summary of IRS and HHS final and proposed rules on Transitional Reinsurance Fee (TRF), maximum Out-of-Pocket for 2015 (OOP), open enrollment for the marketplaces, maximum deductible for 2015, Small Business Health Options Program (SHOP) marketplace, and other changes affecting small insured plans as well as information about the general health marketplace.
• HHS Announces Extensions to Enrollment and Premium Deadlines for Marketplace Coverage and Eligibility for Catastrophic Coverage: Summary of the Interim Final Rule that formally extends some of the marketplace (also known as the exchange) deadlines and encourages insurers to provide additional extensions if possible.