ACA Here to Stay – What do Employers Do Next?

WHAT DO EMPLOYERS DO NEXT? They will be making decision as to whether to continue providing coverage to   employees. In Portland, the majority of our businesses are small and many of them are family owned. My employer groups have been saying they will continue to offer coverage for their employees for as long as they can. Our city is also made up of many new businesses and a benefit program is an attractive recruiting and retention tool.  They too will offer benefits. But for others, they will take a closer look at the “Pay or Play” penalties and decide if it’s more cost effective to pay the penalty.

The employer groups that sponsor a health plan  now must prepare for a few deadlines:

  1. Summary of Benefits and Coverage – These are provided by the carrier and are employers are required to make them available to participants for plan years beginning on or after September 23, 2012
  2. 60-Days notice of plan changes – A health plan or issuer must give 60 days notice of any modifications to the plan off renewal cycle-employers must pass on to employees.
  3. There is a $2,500 limit on health flexible spending account (FSA) contributions beginning January 1, 2013.
  4. W-2 reporting for groups over 250 employees beginning with the 2012 tax year.
  5. Employer Notice of Exchanges – Effective March 1, 2013 employers must notify employees of the health care reform exchange. Health and Human Services will provide model notices that employers can use as a starting point.
  6. Additional Medicare Tax for high wage earners making more than $200,000 (or $250,000 for married filing jointly). Employers will withhold additional amounts once the employees cross that threshold.

There are pending regulations and guidance from DOL, Treasury and HHS that is expected shortly now that the election is over. Here are the top 3:

  1. Employer pay or play Mandate – guidance to help employers determine how to comply with the shared responsibility of the law
  2. Automatic enrollment – DOL will issue regulations that require large employers that offer benefits to automatically enroll new employees.
  3. Nondiscriminiation Rules for Fully-insured plans – Employers will not be able to discriminate in favor of highly-compensated employees.

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