| COMPLIANCE CORNER
|
PCOR Fees Now in Effect
|
| Late last year, the Internal Revenue Service (IRS) released final regulations that hit issuers and plan sponsors squarely in their pocketbooks and will continue over the next seven years.
|
| The regulations implemented fees established by the Patient Protection and Affordable Care Act of 2010 (ACA) for the Patient-Centered Outcomes Research (PCOR) Trust Fund. Fees include $1 per covered life for the first plan/policy year that ends on or after October 1, 2012, and $2 (indexed for inflation) per covered life for the remaining years.
|
| Payments and reports are due July 31 of the year following the fee assessment. This means many plans will need to pay their PCOR fees by July 31, 2013.
|
| Learn more about PCOR and its fees in our Compliance Flash, December 21, 2012 issue. |
New Law Affects Flex and Fringe Benefits
|
| In early January when President Obama signed the American Taxpayer Relief Act of 2012 (ATRA) into law, a number of tax provisions affecting several tax and fringe benefit plans were modified, made permanent, or extended. Among these are dependent care tax credit, adoption tax credit and the adoption assistance programs exclusion, and employer-provided commuter parking benefits.
|
| Soon after that, the IRS issued inflation adjustments for the 2013 tax year affecting adoption assistance programs and the monthly pre-tax limit for employer-provided commuter benefits. The IRS also issued guidance making the transit benefit increase retroactive.
|
| Here’s a brief overview of this flurry of activity:
|
- Dependent Care Tax Credit: ATRA permanently extends the child and dependent care credit. The current 35 percent credit rate is now permanent along with the $3,000 cap on expenses for one qualifying individual and the $6,000 cap on expenses for two or more qualifying individuals.
- Adoption Credit/Assistance: ATRA permanently extends the adoption credit and the income exclusion for employer paid or reimbursed adoption expenses up to $12,970 (adjusted 2013 limit).
- Employer-provided Commuter Benefits: ATRA extends parity in transit benefits through December 31, 2013. The adjusted 2013 limit is now $245 per month for eligible parking expenses, and for eligible transit expenses, the new monthly limit is also $245.
- Retroactive Pre-tax Limit for Transit Benefits in 2012: ATRA makes a retroactive change to the monthly pre-tax limit for eligible transit expenses incurred in 2012. The recharacterization of such after-tax benefits to pre-tax benefits will require refunds of FICA and requests for overpayments as set forth in Notice 2013-8.
|
| For detailed information, see our Compliance Flash, January 8, and Compliance Update, January 18. |
HIPAA Rule Changes Breach Notification
|
| The Department of Health and Human Services (HHS) announced a final rule that implements a number of provisions of the Health Information Technology for Economic and Clinical Health (HITECH) Act.
|
| While much of the final rule adopts the interim final rules, one major exception to this is the breach notification rule. Prior to the final rule, a HIPAA/HITECH breach was defined as a use or disclosure that caused a "significant risk of financial, reputational, or other harm."
|
| The final rule changed the definition of a breach. Regulations state that an impermissible use or disclosure of PHI is "presumed to be a breach unless the covered entity demonstrates that there is a low probability that the protected health information has been compromised."
|
| This means covered entities must now determine whether there is a low probability that the PHI was compromised. As a result, covered entities must comply with several new breach notification requirements:
|
- Update their policies and procedures for reporting, analyzing, and documenting a possible breach of PHI.
- Train workforce members regarding the revised policies and procedures.
- Modify their notice of privacy practices to include the individual’s right to receive the breach notice.
- Watch for future guidance on these requirements from HHS.
|
| Deadline for compliance is September 23, 2013. See the final rule in the Federal Register for details. |
| NEWS AND TRENDS
|
DOL Delays Exchange Notice Deadline
|
| March 1, 2013 was the original deadline for employers to notify their employees of health care cost-sharing plans and health insurance exchanges available under the Patient Protection and Affordable Care Act (ACA). However, as the deadline neared, the Department of Labor (DOL) postponed it.
|
| The new deadline is still undecided, but the DOL expects it to be late summer or fall of 2013, which coordinates with the open enrollment period for exchanges. Open enrollment for state exchanges begins on October 1, 2013.
|
| The delay also allows for a smoother transition to the government-run exchanges, and gives the U.S. Department of Health and Human Services and the Internal Revenue Service more time to provide employers further education and guidance. In addition, the DOL may decide to provide generic language that would satisfy this requirement.
|
| Even though there’s no action for employers to take in regards to the exchange notice at this time, employers should be on the lookout for future guidance. For more information, please visit the DOL website. |
HSAs on the Rise ... Again
|
| With consistent increases in health care costs, even more Americans are turning to health savings accounts (HSAs) to ease some of their financial burdens. Recent research shows HSAs rose to more than $15.5 billion in assets (27 percent annual growth), represented by 8.2 million accounts (22 percent annual growth) by the end of 2012. Increased HSA contributions and withdrawals show that account holders are using their HSA funds for current medical expenses, but more importantly, dollars are accumulating for future health care needs.
|
| These findings are from a survey conducted by Devenir, an investment firm that specializes in providing investment options for HSAs. For further details, see the complete report on the Devenir website. |
| Interested in adding an HSA to your employee benefits package? Let us show you why a CONEXIS HSA is the perfect product for you and your employees. Contact us today!
|
An Ongoing Communication Struggle
|
| According to insights gained by Benz Communications, communicating benefits continues to be a struggle for most employers — even with today’s seemingly endless opportunities presented by social media.
|
| Why? The reasons are varied.
|
| Of the 298 benefits professionals polled for the 2012 Inside Benefits Communication survey, all expressed their desire to get employees actively engaged in decisions about their health and financial needs. But few companies reported that they brand and target materials, two proven methods for improving employee engagement.
|
| Additionally, few said they promote their benefits routinely throughout the year. And adoption of the tools that ease year-round communication, including benefits websites and social media, remains low.
|
| In contrast, organizations that have embraced social media use it as a tool for simple, low-cost, and ongoing communication. Rather than another channel to maintain, and a drain on resources, social tools become a way to improve the effectiveness and efficiency of communication. They allow real-time updates, an ongoing dialog with employees and families, and a simple and inexpensive way to keep online resources fresh.
|
| View the full report on the Benz Communications website. |
| BEHIND THE SCENES
|
ONE Degree Makes a Difference
|
| At 211°, water is hot. At 212°, it boils. With boiling water, comes steam. And steam can power a locomotive. That’s the difference of one degree.
|
| Knowing this, CONEXIS created the "Power of CONEXIS" program, which has been in place for more than five years. This program inspires employees to give an extra degree in the workplace — and receive recognition for it. |
According to Linda Asseff, senior executive assistant, CONEXIS encourages employees to bestow instant recognition on each other with specially designed certificates whenever they witness an act of ONE Degree. Givers state on certificates precisely how the extra degree of commitment, teamwork, leadership, and positive attitude helped make a difference. Recipients get to display their certificates and have their names put into a
bi-weekly drawing for prizes. |
| One walk through CONEXIS offices reveals the program’s popularity. Certificates adorn employees’ workspaces. Employees are proud of showing them off.
|
| "Since we value our clients by consistently providing service of unequalled excellence, we wanted to recognize and reward our employees’ contributions toward it," said Linda. "Not only is this a great way to do that, but it also involves all of our employees in the process. So it’s successful on many levels."
|
CONEXIS Exec Coaches On and Off the Court
|
| Step into Allen Gehrki’s office at CONEXIS and you can almost hear the Arkansas fight song. That’s because our senior vice president of client experience is a proud University of Arkansas alum and avid Razorback fan.
|
| His love of the Hogs is matched only by his love of coaching. Allen’s coached both on and off the court for more than 25 years now.
|
| At CONEXIS, Allen "coaches" the teams that work closest with our various partners and clients, helping to ensure our commitment to quality and service. These teams include marketing and sales operations, product development and management, implementation, and the client service center. "I’m proud to say, our commitment to excellence is the same as when CONEXIS first began. It’s what continues to drive our organization," he said.
|
| He also coaches student sports teams, helping to foster sportsmanship, leadership, and teamwork in 5th-8th graders. Allen’s a recent recipient of the Dallas Parochial League’s Max Wernick Award given for excellence in positive coaching and contributions through the years. It is the league’s highest honor. "I’ve coached basketball, football, and baseball, but mostly basketball," said Allen.
|
| "I’ve coached all four of my kids through their 5th-8th grades. I’ve even coached when I didn’t have kids of my own. All because my wife, Jenifer, asked me to coach her 5th grade class shortly after we were married," exclaimed Allen.
|
| "I’ve been coaching most years ever since — and it’s been a joy to do so," he added.
|
