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Volume 12, Issue 1 |
March 5, 2014 |
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Proposed Amendments Expand Excepted Benefits |
Proposed amendments published by various federal agencies jointly in the December 24, 2013 Federal Register look to expand and clarify the categories of benefits that qualify as "excepted benefits." |
At a glance, under these changes: |
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Certain employee assistance programs (EAPs) will be considered excepted benefits. |
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Self-insured dental, vision, or long-term care benefits would be considered excepted benefits (without regard to a separate participant contribution). |
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An expanded category of "limited wraparound" group coverage for individuals will be considered excepted benefits if particular requirements are met. |
For details of the proposed amendments to excepted benefits, see the Federal Register. |
When a Health FSA is an Excepted Benefit |
It’s important for employers to review their health flexible spending account (FSA) plans to determine if the health FSA meets the definition of an excepted benefit. |
Generally, health FSAs qualify as excepted benefits if the FSA meets the following criteria: |
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The group health plan is classified as a "non-excepted benefit" and is made available to all employees who are eligible FSA participants; and |
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The arrangement is structured so the maximum benefit payable to any eligible participant cannot exceed two times the participant’s salary reduction election (or if greater, $500 plus the amount of the salary reduction election). |
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For example: A health FSA can include a dollar-for-dollar match of each participant’s election ($600 employee; $600 employer) or include an employer contribution of $500 or less to satisfy the maximum benefit requirement. |
If the health FSA does not meet the criteria of an excepted benefit, the plan is subject to certain Affordable Care Act (ACA) requirements (e.g., prohibition against lifetime limits). Normally, a health FSA will not meet these ACA requirements. Employers should consult with legal counsel in making the determination whether their health FSA qualifies as an excepted benefit or not. |
Treasury Delays Employer Mandate Again |
Seven months after announcing the first employer mandate delay, the Treasury Department delayed part of it again as well as changed some of its provisions. |
The employer-shared responsibility requirements known as the "employer mandate," or "pay or play," is a key provision of the ACA, which states businesses with 50 or more full-time employees must offer full-time employees health coverage that is affordable and provides minimum value or pay a penalty (businesses with fewer than 50 employees, about 96 percent of all employers, are exempt). |
The latest ruling provides additional transition relief as organizations seek to comply with the employer mandate. Recent highlights include: |
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Employers with 50 to 99 employees have an additional year to comply with the mandate — until 2016. However, employers will still need to report on their workers and coverage in 2015. |
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Employers with 100 or more employees must comply with the mandate in 2015 with coverage to 70 percent of their full-time employees. This increases to 95 percent in 2016. Employers that fail to meet the mandate requirements in 2015 will have to make an employer responsibility payment. |
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Other smaller changes in the final regulations concern counting how many hours employees work (e.g., educators and seasonal workers). |
For more information, view the final regulations in the February 12, 2014 Federal Register. The Treasury also issued a press release, a fact sheet, and a series of Questions and Answers on this mandate. |
Looming Individual Mandate Deadline |
With the ACA individual mandate deadline fast approaching, more than half of Americans (55 percent) surveyed still do not know the deadline is March 31, 2014. |
In fact, about one in four Americans (24 percent) incorrectly think the deadline already passed on January 1, 2014. And 11 percent mistakenly think they have until December 31, 2014 to sign up for health insurance. |
Bankrate's Health Insurance Pulse survey also revealed that the majority of respondents (62 percent) expect the individual mandate deadline to be pushed back, like other ACA deadlines. |
This is troubling since those who fail to sign up for health insurance by the March 31 deadline will pay a penalty when they pay their taxes. Additionally, those who miss the deadline will have to wait until next year's open enrollment period to sign up for health insurance, unless they experience a qualifying event such as marriage in the interim. |
Employers that do not provide group coverage may want to remind their employees of the upcoming March 31 deadline. Also, brokers who help individuals find insurance coverage may want to encourage them to sign up now. |
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Senate Introduces Restoring OTC Bill |
The Restoring Access to Medication Act is a new bill presented in the Senate which mirrors legislation previously introduced in the House of Representatives. The new bill calls for repeal of the prescription requirement for over-the-counter medicines (OTC) and drugs, which became effective on January 1, 2011 as part of health care reform. |
Current regulations mandate the need for a doctor’s prescription for OTC medicines to be eligible 213(d) expenses. This prescription requirement has been dubbed as burdensome and unnecessary by many advocacy groups. |
One such group is the Health Choices Coalition (HCC) representing physicians, consumers, employers, pharmacies, and other retailers and businesses associated with the pharmaceutical industry. In a letter of endorsement applauding the bill, HCC reiterated that OTC medicines and drugs provide consumers with a first-line of defense in effectively, affordably, conveniently, and accessibly addressing their families’ health care needs. And if unrestricted, these medicines can "save consumers billions of dollars annually through reducing unnecessary doctors' visits, less time lost from work, and the cost advantage of OTC medicines." |
CONEXIS will report additional details if this bill progresses. |
HSAs Celebrate a Decade of Growth |
As those in the benefits industry celebrate the 10-year anniversary of health savings accounts (HSAs), we applaud their steady growth, now with 15.5 million account holders. |
According to an annual Employer Health Benefits survey from the Kaiser Family Foundation, 11 percent of employees who are offered HSAs opt to enroll. That's up from 6 percent in 2010. HSAs have become popular employee benefits since account holders save money on taxes, funds add up from year to year, and HSA dollars are theirs to keep. |
Employers also benefit from offering HSAs along with qualifying high deductible health plans (HDHPs): |
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Pay lower premiums. The Kaiser survey found that total annual HDHP premiums are about $1,000 lower per individual and $2,500 per family than the premiums of a traditional health plan. This saves a company about $700 a year for each individual account holder and about $925 for account holders with qualifying family coverage. |
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Pay less in claims. Since HSA account holders are responsible for their medical bills until they reach their deductible, many learn how to incorporate healthier lifestyles as well as compare prices before spending their HSA funds. Employees being better health care consumers can reduce the claims experience, which can lower a company’s premiums in subsequent years. |
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Pay lower payroll taxes. Employee contributions to HSAs are on a pre-tax basis, which lowers companies’ payroll taxes. And employer contributions (if any) don't count against the payroll tax. This may be especially important to employers that currently offer "Cadillac plans" (those that cost more than $10,200 for an individual or $27,500 for a family). Beginning in 2018, employers will incur an excise tax of 40 percent on the amount that premiums exceed total costs. Offering an HDHP paired with an HSA is a great alternative to consider before the tax mandate becomes effective. |
Learn more about how an HSA can be an attractive option for your company and your employees by visiting our website, or simply contact us today. |
Telehealth Gaining Popularity |
If legislative activity is the indicator, then telehealth appears to be gaining popularity and making more inroads nationally. In just the last few months, there have been numerous laws passed or proposed concerning telehealth, or "telemedicine," at the state and federal levels. |
The American Telemedicine Association, which tracks policy updates in each state, reports that providers in Missouri and Montana became eligible to receive telehealth service fees at the same level as in-person services beginning January 1, 2014. Similar legislation went into effect last fall in the District of Columbia and last summer in Mississippi and New Mexico. |
Based on legislation enacted in California, the Telehealth Modernization Act of 2013 introduced in Congress seeks to establish a federal definition of telehealth that would clear up confusion from countless state policies. In addition, the Centers for Medicare & Medicaid Services announced changes to Medicare's 2014 physician fee schedule that would incrementally expand coverage for telehealth and slightly increase reimbursement for physicians. |
Reimbursement has been one of the main barriers to the wider telehealth adoption. Another has been licensure, which another bill introduced in the House last fall addresses. The TELEhealth for MEDicare (TELE-MED) Act of 2013 would allow Medicare providers to treat patients electronically across state lines without having to obtain multiple state medical licenses. |
The National Telehealth Policy Resource Center defines telehealth as the "use of electronic information and telecommunications technologies to support distance clinical health care, patient and professional health-related education, public health, and health administration." This includes a growing variety of applications and services using two-way video, email, smartphones, wireless tools, and other forms of telecommunications technology. |
The Center notes on its website that telehealth is an increasingly significant tool for expanding access to care, improving the quality of care that leads to better patient outcomes, and ultimately reducing the per capita cost of care. By removing all barriers — including time, distance, and provider scarcities — telehealth can deliver "important medical and other health and education services where they are needed the most, in remote, rural areas and medically underserved urban communities." |
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SOUE Award Honors Best of the Best |
Some acronyms are not very widely known; however, at CONEXIS, "SOUE" is an acronym that everyone knows. It’s short for "Service of Unequalled Excellence" — our company motto that drives our culture and commitment to customers. It’s also the name of a very prestigious company award. |
The SOUE Award publically recognizes and rewards our employees who consistently embody the spirit of CONEXIS as well as provide service of unequalled excellence to everyone around them. Twice each year, SOUE candidates are nominated by fellow coworkers and then six winners are selected through a rigorous peer committee review and voting process. |
According to Robert Andrews, senior director, human resources, the award is a pretty big deal to our company and the recipients. "The SOUE Award is important at CONEXIS because it honors those who live by the principles we value as a company. It also demonstrates that our commitment to exemplary service is genuine and applies to internal and external customers alike," he said. |
Award recipients receive public recognition and then have the opportunity to win "Employee of the Year" through a companywide vote at year’s end. "What’s priceless is the expression on the faces of our biannual and annual award winners," Robert shared. |
"They simply cannot believe that they stood out as going above and beyond in the eyes of fellow team members. It’s something they never forget personally or professionally. Plus, our SOUE winners then become an inspiration to all of us." |
All the World’s a Stage |
"All the world's a stage" is a phrase that begins a monologue in Act II, Scene VII of William Shakespeare's As You Like It. But for Shawn Gann, all the world truly is a stage on which he performs regularly. |
Shawn, a business process engineer in our IT department, spends his weekdays behind a computer analyzing and designing strategies for better optimization of our products and services. Nights and weekends, however, he spends in front of audiences; playing parts as vast as Mercutio in Romeo and Juliet to Snoopy in You’re a Good Man, Charlie Brown. |
And according to Shawn, he’s been doing this almost nonstop since the 4th grade. "My teacher encouraged me to be in our school’s musical. It was called Flying High about a caveman who wanted to fly. I played the caveman. After that, I was hooked," he said. |
Last year, Shawn performed in four productions in the Dallas-Fort Worth area, including Dante: Inferno, Chess: The Musical, Romeo and Juliet, and SPAMALOT. This year, he plans to perform in at least that many, if not more, including Much Ado About Nothing, Antony and Cleopatra, and Tartuffe during the Dallas Shakespeare Festival. |
"My passion’s for the stage. I go wherever there is an interesting part or production that I can participate in," said Shawn. |
"Plus, I’ve found it’s incredibly rewarding to share my love of the arts with others, or have them come to a performance, and then see them gain a new appreciation or love for the arts as well," he added. |
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Have questions, comments, or feedback regarding the CONEXIS Comment Newsletter? If so, we would love to hear from you. Please drop us a line at comment@conexis.com. |
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