Affordable Care Act Archives | Page 10 of 23

Full D.C. Circuit to Rehear ACA Premium Tax Credit Case

by McDermott Will & Schulte | Sep 11, 2014 | Health and Welfare Plans

The full U.S. Court of Appeals for the D.C. Circuit has vacated the 2-1 panel decision issued July 22, 2014, in Halbig v. Burwell, which struck down the Internal Revenue Service (IRS) Rule providing for Affordable Care Act (ACA) premium tax credits to be available to lower income exchange customers, regardless of their state of residence. The plaintiffs’ brief is due October 3, 2014, and the government’s opposing brief is due a month later on November 3, 2014, to precede oral arguments on December 17, 2014. It is likely that the full D.C. Circuit would not render its opinion before mid- to late Spring 2015. This has the effect of preserving the status quo with respect to the availability of premium tax credits, at least until the full D.C. Circuit renders its decision.

Meanwhile, the plaintiffs have sought review by the Supreme Court of the United States in King v. Burwell, Halbig’s sister case in which the U.S. Court of Appeals for the Fourth Circuit upheld that same IRS Rule. The Clerk of the Supreme Court has granted the government an extension until October 3, 2014, to respond to the petition for certiorari. The plaintiffs have urged the highest court render its decision as quickly as possible to resolve the circuit split. If the Supreme Court accepts King for review before mid-January, it could issue a ruling in the current term, which is scheduled to end in late June 2015.

Among the highest profile legal challenges to the ACA, Halbig and King seek to invalidate a May 2012 IRS Rule providing that health insurance premium tax credits will be available to all taxpayers nationwide, regardless of whether they obtain coverage through a state-based exchange or a federally facilitated exchanges (FFE). The plaintiffs (represented by the same lawyers in both cases) argued that the plain language of the ACA limits the availability of premium tax credits to only those taxpayers who reside in the 14 states (plus the District of Columbia) that set up their own exchanges, and thus nullifies the IRS Rule’s application to the 36 states operating exchanges through the FFE. Plaintiffs’ argument is based on language providing that premium tax credits are only available for plans “enrolled in through an Exchange established by the State under section 1311 of the [ACA].” ACA § 1401(a), enacting 26 U.S.C. § 36B(c)(2)(A)(i) (emphasis added). The government counters that other provisions of the ACA make clear that the subsidies are to be made available in the FFE states as well.

There are also two similar cases awaiting decisions by federal trial courts on motions for summary judgment. First, in Pruitt v. Burwell, pending in federal district court in Muskogee, Oklahoma, the state complains that the availability of the premium tax credit in FFE states forces the state to choose between the costs of providing coverage to its employees or paying the IRS a significant financial penalty. Second, in Indiana v. IRS, pending in federal district court in Indianapolis, the state and 39 of its public school districts argue that the IRS Rule directly injures the [...]

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Upcoming Health and Welfare Plan Requirements Checklist for Employers

by McDermott Will & Emery | Aug 21, 2014 | Health and Welfare Plans

As the mid-way point of 2014 approaches, employers should actively turn their attention to several upcoming compliance obligations for the health and welfare benefit plans they sponsor. Following is a checklist of upcoming health and welfare compliance initiatives that require action by employers, including preparation for upcoming fees and penalties under the Affordable Care Act, the filing of required forms and distribution of relevant notices.

Read the full article.

U.S. Appeals Courts Issue Conflicting Decisions on Whether ACA Permits Tax Subsidies of Health Care Coverage Purchased Through Federal Exchanges

by Anthony A. Bongiorno, Ankur J. Goel, Eric Zimmerman and H. Guy Collier | Jul 29, 2014 | Health and Welfare Plans

The U.S. Court of Appeals for the District of Columbia struck down the Internal Revenue Service (IRS) rule providing for federal tax credits for health insurance purchased through federal exchanges, while the U.S. Court of Appeals for the Fourth Circuit upheld the same IRS rule. If en banc review in the appeals courts does not resolve the circuit split, the matter likely will go to the Supreme Court of the United States for review. Tax subsidies under the IRS rule should remain available until such review, which is not expected before June 2015.

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Closely Held Corporations Can Be Exempt from ACA Contraception Provisions Based on Religious Objections

by Anthony A. Bongiorno | Jul 8, 2014 | Benefit Controversies

The Supreme Court of the United States ruled 5–4 in its highly anticipated Hobby Lobby decision that closely held for-profit corporations do not have to comply with the contraception mandate under the Affordable Care Act if doing so would violate their religious beliefs. The Supreme Court based its decision on the Religious Freedom Restoration Act, which protects “persons” from government actions that substantially burden their exercise of religion, unless those government actions are the least restrictive means of furthering a compelling government interest, and determined that because the contraception mandate is not the least restrictive means available to the government, it cannot apply to closely held for-profit corporations that religiously object to the contraception mandate.

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2015 Notice of Benefit and Payment Parameters

by Anthony A. Bongiorno, Ankur J. Goel and Jeremy Earl | Apr 3, 2014 | Health and Welfare Plans

The Centers for Medicare & Medicaid Services’ Final Notice of Benefit and Payment Parameters for 2015 contains numerous alterations to premium stabilization programs, cost-sharing requirements and employee counting provisions to account for lower-than-anticipated enrollment through the Exchanges and the Obama Administration’s decision to permit individuals to “keep their current plan” through 2016. All of these changes and the fluid regulatory environment create significant challenges for issuers, who must operationalize these changes, some of which are effective in 2014, and prepare for the 2015 benefit year.

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Final Regulations Issued Regarding Employer Shared Responsibility Under the ACA

by Jacob Mattinson | Mar 11, 2014 | Health and Welfare Plans

Recently issued final regulations on the employer pay-or-play rules under the Affordable Care Act (ACA) clarify the requirement that employers provide health coverage to full-time employees and their dependents, or pay a penalty and provide additional transition relief for 2015.

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Feds’ Argument in Favor of Premium Tax Credit Gains Momentum, Still Under Attack in Federal Courts

by McDermott Will & Schulte | Feb 27, 2014 | Health and Welfare Plans

A second federal district court judge has ruled in favor of the government on one of the most serious challenges to the Patient Protection and Affordable Care Act of 2010 (ACA). The court dismissed a challenge to the availability of premium tax credits under the ACA. The plaintiffs now have appeals pending in two federal circuits, and similar challenges remain pending in two other federal trial courts.

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Proposed Regulations Expand the Definition of Excepted Benefits

by Megan Mardy | Feb 6, 2014 | Health and Welfare Plans

Recently issued proposed regulations would expand the categories of excepted benefits under the Employee Retirement Income Security Act of 1974 (ERISA), the Internal Revenue Code (the Code) and the Public Health Service Act. In general, excepted benefits are exempt from the market reform and certain other requirements added to ERISA and the Code by the Affordable Care Act.

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New FAQs Released Regarding Implementation of the Affordable Care Act and Mental Health Parity

by Jacob Mattinson | Jan 21, 2014 | Health and Welfare Plans

Recent guidance clarifies important issues under the Affordable Care Act, including mental health parity requirements; coverage of preventive care services; cost-sharing requirements; and out-of-pocket maximums, wellness programs and expatriate plans.

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View From McDermott: Employer Pay-or-Play Mandates Under Health-Care Reform

by Jacob Mattinson | Jan 14, 2014 | Health and Welfare Plans

Open enrollment is well underway for individuals and small employers under the state and federally facilitated marketplace exchanges created by the Affordable Care Act.

As exchange coverage becomes available, many employers are in the process of evaluating whether, or at what level, to continue to offer health insurance benefits to their employees. Some employers are staying the course and offering robust medical plan choices to their employees. Others are turning to private health exchanges for solutions and still others are deciding that their employees may be better off obtaining subsidized coverage in the state or federally facilitated marketplace exchanges.

A large part of this decision turns on whether an employer will incur tax penalties for failure to offer adequate coverage to its employees and whether its employees will, in fact, be better off obtaining coverage elsewhere.

To read the full article, click here.

*Reproduced with permission from Bloomberg BNA Pension & Benefits Daily.

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