Employee Benefits Blog : Employee Benefits & Executive Compensation Lawyers & Attorneys: McDermott Will & Emery Law Firm

by Amy M. Gordon, Jacob Mattinson and Susan M. Nash

As part of the Patient Protection and Affordable Care Act (ACA), the U.S. Department of Health and Human Services (HHS) recently released proposed regulations regarding the estimated amount of annual contributions that are required to be paid to HHS from employer-sponsored group health plans to finance state transitional reinsurance programs.  The reinsurance programs are intended to help stabilize premiums for coverage in the individual market during the first three years the state health insurance exchanges are operational (2014 through 2016).  HHS is estimating the annual contribution rate for 2014 will be $63 per covered life (employees and their dependents).  This will undoubtedly impact the overall cost of providing coverage under an employer-sponsored group health plan and should be taken into account by employers for purposes of estimating cost trends.

Read the full article here.

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by Amy M. Gordon and Susan M. Nash

New proposed employer wellness program regulations have been released under the Patient Protection and Affordable Care Act.

To read the full article, click here.

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by Amy M. Gordon, Susan M. Nash and Jacob Mattinson

As part of the regulations under the Patient Protection and Affordable Act (PPACA), the U.S. Office of Personnel Management (OPM) proposed a requirement that OPM contract with private health insurance companies to ensure that at least two multi-state plans are offered in each state’s Affordable Insurance Exchange.   Under the law, a multi-state plan issuer may phase in the states in which it offers coverage over four years, but must offer a multi-state plan in exchanges in all States and the District of Columbia by the fourth year.  The proposed regulations generally address OPM’s approach to the offering of multi-state plans and the attributes of the multi-state plans to be offered.  Comments are being solicited, and are due within 30 days after the rules are published in the Federal Register, which is expected to take place this week. 

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by Amy M. Gordon and Susan M. Nash

With the end of 2012 quickly approaching, and for 2013 planning purposes, this newsletter provides a high-level list of the important changes to be aware of under the Patient Protection and Affordable Care Act and the effective date of those required changes.

To read the full article, click here.

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by Andrew C. Liazos

An IRS compensation rule aimed at health insurers could actually apply to a wide range of companies.

It is well known that the Patient Protection and Affordable Care Act (PPACA, or the federal health care reform law) significantly limits the ability of health insurance companies to deduct payment of compensation beginning in 2013.  What is not so well known is that the Internal Revenue Service might apply this limitation to health care services providers that are not typically considered to be insurance companies, to captive insurance companies, and even to companies outside the health insurance industry. 

To read the full article, click here.
 

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by Christopher M. Jedrey, Joel L. Michaels, Susan M. Nash, Paul W. Radensky and Eric Zimmerman

While the Supreme Court of the United States has in large part resolved questions regarding the constitutionality of the Patient Protection and Affordable Care Act, participants in the health care industry should prepare for ongoing uncertainty in the manner and degree to which states will participate in the expansion of Medicaid.

To read the full article, click here. 

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by Amy M. Gordon, Susan M. Nash and Maureen O'Brien

On June 28, 2012, the Supreme Court upheld the most significant provisions of the Patient Protection and Affordable Care Act (the Act), including the controversial individual mandate.  The vote was 5-4 and the majority opinion was written by Chief Justice John Roberts.  Ironically, the justices concluded that the mandate was not a valid exercise of Congress' commerce clause power but was a proper use of Congress' tax authority.  One of the most complicated issues that everyone struggled with, the severability issue, is now moot because the individual mandate was upheld.

Click here to view the Supreme Court opinion.

Please join us for a webcast discussing the opinion on Friday June 29, 2012, from 12:00-2:00 p.m. EDT.  To register, click here.

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by Amy M. Gordon, Joanna C. Kerpen and Susan M. Nash

Recently issued final regulations and related guidance clarify the requirement under the Patient Protection and Affordable Care Act that group health plans and health insurance issuers provide a summary of benefits and coverage and a uniform glossary.  The guidance includes final regulations and sample summaries and instructions.

To read the full article, click here.

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by Amy Gordon, Susan Nash and Ashley McCarthy

The Internal Revenue Service (IRS) has issued revised guidance, Notice 2011-28, regarding the requirement under the Patient Protection and Affordable Care Act (PPACA) that employers report to employees the cost of their employer-sponsored group health plan coverage on Forms W-2.  This requirement applies to calendar year 2012 W-2s, which employees will receive from their employer in 2013.

The guidance provided assistance on calculating aggregate reportable cost.  Aggregate cost may be calculated in accordance with one of several methods including the “COBRA applicable premium” method, the “premium charged” method (for fully-insured coverage), or a “modified COBRA premium” method.

In addition to medical coverage, employers must include in the cost of employer-sponsored group health plan coverage, coverage under an Employee Assistance Program, wellness program coverage, on-site medical clinic coverage (but only aggregate reportable cost to the extent that the coverage is provided under a group health plan and the employer charges a premium for such coverage to beneficiaries of federal continuation coverage [e.g., COBRA]), Health Flexible Spending Account coverage (FSA), but only where the employer itself contributes to the FSA or otherwise provides flex credits through a Internal Revenue Code Section 125 cafeteria plan, and coverage under a dental plan or vision plan if such plans are not excepted from the Health Insurance Portability and Accountability Act (HIPAA).  Employers do not need to include in the cost of employer-sponsored group coverage the cost of coverage under a dental plan or vision plan if such plans are excepted from HIPAA, amounts contributed to an Archer medical savings account (MSA) or a Health Savings Account, amounts of any salary reduction election to an FSA, the cost of coverage under a multiemployer plan, cost of coverage under a Health Reimbursement Arrangement not included in aggregate reportable income, and the cost of coverage provided under a self-insured group health plan that is not subject to federal continuation coverage requirements (i.e., a church plan).

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by Amy M. Gordon, Todd A. Solomon and Brian J. Tiemann

The U.S. Department of Health and Human Services (HHS) issued a bulletin on December 16, 2011, outlining and requesting comments on its proposed regulatory approach to allow states to define what is an “essential health benefit.”

To read the full article, please click here. 

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by Susan M. Nash and Elizabeth A. Savard

Group health plans that offer prescription drug coverage are required to issue a notice of creditable or non-creditable coverage to Medicare-eligible participants and beneficiaries each year prior to the annual Medicare Part D open enrollment period.  In the past, the Medicare Part D open enrollment period ran from November 15 through December 31, so the notice had to be provided by November 15.  The Patient Protection and Affordable Care Act moved the Medicare Part D open enrollment period earlier, beginning in 2011, to October 15 through December 7.  Therefore, this year's notice of creditable or non-creditable coverage must be provided by October 15, 2011.

A plan's notice of creditable or non-creditable coverage describes whether prescription drug coverage under the plan is "creditable" -- i.e., expected to pay out at least as much as standard Medicare prescription drug coverage, on average for all participants.  This information is designed to help Medicare-eligible individuals avoid late enrollment penalties, which can apply when an individual who does not have creditable coverage fails to enroll in Medicare Part D when first eligible.

Plan sponsors will need to update their notices of creditable or non-creditable coverage to reflect the new dates for the Medicare Part D open enrollment period.  The Centers for Medicare and Medicaid Services have updated their model notices of creditable and non-creditable coverage to reflect the new dates.  No other substantive changes were made to the model notices.  The updated notices are available here.

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Live Knowledge Congress Webcast
Strategies to Deal with the Patient Protection & Affordable Care Act
September 13, 2011, Noon to 2 pm (EST)

Panel includes Susan Nash, Co-Chair of McDermott Will & Emery’s Health and Welfare Benefits Group.

The Patient Protection & Affordable Care Act (PPACA or “Health Reform Bill”) has been the subject of significant legal and policy debate since it was enacted in April 2010. The legislation has been both hailed as an important victory in the battle to improve the quality and accessibility of healthcare in the United States, and challenged as unconstitutional and ineffective in reducing medical costs and otherwise incenting choice and value in medical care and services.

Amidst this debate, legal and business strategies for dealing with the aspects of Health Reform that have been, or soon will be, implemented are often left in the background. These strategies are critical for ensuring compliance and optimizing business performance as PPACA rolls out. No matter how the broader policy or legal debate resolves, entities affected by PPACA must consider the Act’s impact on reimbursement, cost protection, and other day-to-day operational issues.

Strategies to Deal with the Patient Protection & Afford Care Act LIVE Webcast is a must-attend for healthcare professionals, health policy directors, health executives, pharmaceutical and medical device manufacturers and others who are interested in developing practical strategies to deal with healthcare reform. The Knowledge Group has assembled a panel of key thought leaders and regulators to discuss the fundamentals and updates regarding this topic.

Click here to register for the event.

To receive a discount courtesy of McDermott Will & Emery, please enter this code: will8992.

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by Susan M. Nash and Maureen O'Brien

On June 17, 2011, the U.S. Department of Health and Human Services (HHS) issued additional guidance with respect to the annual waiver limit program.  The annual waiver limit program allows issuers or other group health plan sponsors to apply for a waiver from the annual limit requirements if they present evidence that meeting the annual limits would result in diminished access to benefits or a significant increase in premiums.  Typically, issuers or group health plan sponsors that offer extremely basic coverage would be interested in applying for the annual limit waiver program.

Importantly, recipients of these waivers must take action between June 24, 2011 and September 22, 2011 in order to preserve those waivers through the end of 2013. In addition, new applicants must submit applications under the annual limit waiver program between June 24, 2011 and September 22, 2011 in order to receive a new waiver.  Extensions or new applications not received on or before September 22, 2011 will not be eligible for an annual limit waiver and will need to comply with the requirements of the Patient Protection and Affordable Care Act (PPACA).

Additional Modifications to the Annual Limit Waiver Program

The following additional modifications were made to the annual limit program:

• Health plans and issuers will no longer need to apply for a waiver each year. 
• Plans and issuers that have secured waivers must distribute a notice each year to all eligible participants informing them of the waiver.
• As a condition of the extension, updates must be filed by December 31, 2012 and December 31, 2013 providing the same materials as are required for the extension.

Click here for the new HHS Guidance. 

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by Amy Gordon, Susan Nash and Maureen O'Brien

The 2011 budget agreement just passed by U.S. Congress on April 14, 2011, contains provisions that repeal and de-fund certain provisions of the Patient Protection and Affordable Care Act  (as amended by the Health Care and Education Reconciliation Act of 2010)   (PPACA).

Specifically, the “free choice voucher” program mandated under Section 10108 of  PPACA has been repealed.  The free choice voucher provision of PPACA required employers to provide vouchers for workers whose employer-provided health insurance premiums cost between 8 percent and 9.8 percent of the worker’s family income.  The vouchers could then have been used by the worker to purchase insurance in the private market or in the exchanges.

In addition, the 2011 budget agreement rescinds $2.2 billion of the $6 billion in start-up funding provided for the Consumer Operated and Oriented Plan program created under Section 1322 of PPACA and also rescinds $3.5 billion in performance bonus payments authorized in the 2009 State Children’s Health Insurance Program reauthorization.

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