January 2012  |  Volume 3, Number 1

Contracts, Compliance and Research Updates
IRS Releases Additional Guidance on W-2 Reporting of the Cost of Group Health Coverage

On January 3, 2012, the Internal Revenue Service (IRS) released Notice 2012-09, which gave additional guidance on reporting the cost of employer-provided health care coverage on the 2012 Form W-2. The Notice, as described by the IRS, restates and clarifies the guidance provided in Notice 2011-28, including the information on how to report, what coverage to include, and how to determine the cost of the coverage.



  • Dental and vision coverage are not included in the calculation if they are free-standing plans.
  • EAP coverage, wellness programs and on-site clinics are not included unless a premium for that coverage is being charged to COBRA participants.
  • Base the reportable premium on the active rates, not the COBRA rates.

More information will become available as legal experts weigh in. Until then, the guidance can be viewed here



Proposed Guidance on Essential Benefits

On December 16, 2011, the Department of Health and Human Services (HHS) issued an informational bulletin that included proposed guidance on how states and health plans should comply with the "essential health benefits" provision of the Patient Protection and Affordable Care Act (PPACA).


As it turns out, the guidance offered little assistance to insurers and group health plans in determining exactly what to include as an essential benefit. Instead, the bulletin proposed to allow states four options to choose from when selecting a "benchmark" plan. The benefits of that plan would form the basis of the essential health benefits package in that state.

The four options are: 

  1. Any of the three largest small-group plans in the state; 
  2. Any of the three largest state employee health plans; 
  3. Any of the three largest employee health benefits program (FEHBP) options; or 
  4. The largest insured commercial non-Medicaid HMO plan operating in the state. 

If the plan that a state selects as its benchmark plan does not include all of the 10 required categories of benefits, then the plan must be modified to include the missing categories.


Read more from the informational bulletin


Additional information:

Essential Health Benefits Bulletin 

In This Issue
Contracts, Compliance and Research Updates
Wisconsin Updates


More information regarding Health Care Reform and other benefit resources is available on the HR360 website, available to BSG clients under the "Resources" menu of their HR Express website. HR360 includes new features such as step-by-step interactive guides which make the processes of hiring, termination, COBRA and FMLA so much easier. In addition, there are new online tools such as job description builder and salary benchmarking tool.

BSG subscribes to this service for your benefit. If you would like more information regarding this resource please contact your account management team at BSG. 
Wisconsin Updates

Wisconsin State Exchange ----  State Halts Health Exchanges Process

A recent decision by Gov. Scott Walker could give the federal government greater influence over the state's health insurance market ---- and that worries some in the industry. Walker announced late last month that the state would halt work on the online marketplaces, or exchanges, required under federal health care reform until the U.S. Supreme Court rules on the constitutionality of the law. One worry is that health insurers would face stricter regulations from the federal government than from the state Office of Free Market Health care.


Additional obstacles:

  • Walker betting against it ---- Walker, who opposes federal health care reform, said that moving forward with the exchanges could be a waste of time and effort if the law is declared unconstitutional.
  • Legislation needed ---- the state may need to pass legislation to set up an exchange. That would require a special session of the Legislature if the law is upheld.  

Click here to read the full JSOnline article.

To view the Kaiser map for state action toward creating health insurance exchanges, click here.


Additional information:

Information on recent health care reform can be obtained by visiting Wisconsin's web page for the Office of Free Market Health Care.



23 and 1/2 Hours: What is the Single Best Thing We Can Do For Our Health?

Dr. Mike Evan answers the old question "What is the single best thing we can do for our health?" in a completely new way. It's an excellent wellness message to share with employees. Consider playing the video in an all-employee meeting, or posting a link to the video on your intranet.


Dr. Mike Evans is the founder of the Health Design Lab at the Li Ka Shing Knowledge Institute, an Associate Professor of Family Medicine and Public Health at the University of Toronto, and a staff physician at St. Michael's Hospital.


Click here to view the full video message.

Enlighten is published by The Benefit Services Group, Inc., (BSG®) and is provided free of charge to select BSG client representatives and associates.

By providing links to other sites, BSG does not guarantee, approve or endorse the information or products available at these sites, nor does a link indicate any association with or endorsement by the linked site to BSG.

The preceding is not intended to be and is not offered as legal advice. We are prohibited from the practice of law. Compliance is the responsibility of the employer or Plan sponsor and affected employees who should seek their own legal counsel regarding questions about information presented in this newsletter.

Copyright© 2012 The Benefit Services Group, Inc. BSG® is a registered trademark of The Benefit Services Group, Inc.