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Welcome to the Benefits, Inc. Newsletter!
Thank you for being part of Benefits, Inc. The landscape of the business world is changing every day. This newsletter is provided in order to inform you of up to date and accurate information regarding federal and state legislation, HR trends, compliance, and benefit strategies.
We appreciate your business and if you have any questions please feel free to contact us at 615-446-3303.
Kevin Smith and Tim White
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NONDISCRIMINATION FINAL RULING UPDATE
The Office of Civil Rights (OCR) in the Department of Health and Human Services (HHS) issued a final rule on May 13, 2016, implementing Section 1557 of the Affordable Care Act (ACA). This section of the ACA applies to protected classes of individuals whose health coverage may not be denied, cancelled, limited or refused on the basis of race, color, national origin, sex, age, or disability and it builds on other federal civil rights laws to do so.
The final rule clarifies existing nondiscrimination requirements and sets forth new standards for implementation of Section 1557, particularly with respect to the prohibition of discrimination on the basis of sex in health programs and activities.
Timing
This rule is effective July 18, 2016. All provisions of the rule are effective on that day, with two exceptions. First, provisions that require changes in health insurance or group health benefits design are applicable on the first day of the plan or policy year beginning on or after January 1, 2017. Second, portions of the law that address persons with limited English proficiency are effective beginning on October 16, 2016.
Overview
The law is broad and will affect health insurance issuers and employers that receive federal financial assistance from HHS.
- Expanded protection for transgender individuals: Covered entities cannot limit health services due to an individual's sex assigned at birth, gender identity, or recorded gender.
- Required language assistance: Covered entities must provide "taglines" to explain how individuals can obtain language services. These taglines must be provided in at least the top 15 non-English languages spoken in a given state.
- Communication assistance for individuals with disabilities: Covered entities must provide information explaining how individuals with disabilities can receive support for communication services without charge.
Entities affected by Section 1557
Section 1557 applies to health programs and activities, any part of which receives Federal financial assistance provided or made available by HHS, as well as every health program or activity administered by HHS, and any health program or activity administered by a Title I entity.
Expatriate health plans or insurers or employer plan sponsors of expatriate plans, as defined in the Expatriate Health Coverage Clarification Act (EHCCA), Medicare Part B and health programs and activities administered by Departments other than HHS are not included under Section 1557.
This article is just a general overview of the final ruling. If you have questions or need further information, please feel free to contact our office anytime.
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PCORI Fees Due by August 1st for Employers Sponsoring HRAs and Other Self-Insured Plans
As a reminder, fees to fund the Patient-Centered Outcomes Research Institute (PCORI) are due no later than August 1, 2016 from employers who sponsor certain self-insured health plans, including health reimbursement arrangements (HRAs) that are not treated as excepted benefits. Under Health Care Reform, PCORI fees are imposed for each plan year ending on or after October 1, 2012, and before October 1, 2019.
How to Calculate the Fee
For plan years ending on or after October 1, 2015 and before October 1, 2016, the fee for an employer sponsoring an applicable self-insured plan is $2.17 ($2.08 for plan years ending on or after October 1, 2014 and before October 1, 2015) multiplied by the average number of lives covered under the plan. Permissible methods for determining the average number of lives covered under a plan are explained in IRS guidance. Reporting and Payment Deadline
In general, plan sponsors of applicable self-insured health plans are required to report and pay the fee no later than July 31st of the calendar year immediately following the last day of the plan year to which the fee applies. However, because July 31st falls on a Sunday this year, the due date is August 1, 2016. Fees are reported and paid using IRS Form 720, Quarterly Federal Excise Tax Return.
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Increased Penalty for Violating EEOC Posting Requirements
Effective July 5, 2016, the maximum penalty for employers violating the notice-posting requirements under certain nondiscrimination laws enforced by the U.S. Equal Employment Opportunity Commission (EEOC) increases from $210 to $525 for each separate offense.
The "EEO Is The Law" Poster
Employers with 15 or more employees who have worked for the employer for at least 20 calendar weeks (in this year or last) are required to post a notice describing the federal laws prohibiting job discrimination based on race, color, sex, national origin, religion, age, disability, or genetic information. The notice must be posted in a conspicuous location in the workplace where notices to applicants and employees are customarily maintained. Posting Guidelines and Tips
The EEOC provides the following additional guidelines and tips for employers regarding the required "EEO Is The Law" poster:
- In addition to posting the notice, employers are encouraged to display the electronic notice on their internal websites in a conspicuous location. In most cases, electronic posting supplements physical posting but does not itself fulfill the basic obligation to physically post the required information in the workplace. In some situations (e.g., for employees who telework and do not visit the employer's workplace on a regular basis), electronic posting may be required in addition to physical posting.
- The Americans with Disabilities Act requires that notices of federal laws prohibiting job discrimination be made available in a location that is accessible to applicants and employees with disabilities that limit mobility.
- Printed notices should also be made available in an accessible format, as needed, to persons with disabilities that limit the ability to see or read. Notices can be recorded on an audio file, provided in an electronic format that can be utilized by screen-reading technology, or read to applicants or employees with disabilities that limit seeing or reading ability.
Note that many states have their own nondiscrimination laws with notice-posting requirements that apply to smaller employers.
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5 Must-Have Forms and Records for New Hires
As an employer, one of your most important responsibilities when hiring new employees is to complete and secure necessary forms and records. The following are key requirements under federal law:
- Form I-9: Federal law requires employers to verify that each new employee is legally eligible to work in the United States. Within 3 business days of the date employment begins, employers must complete and sign Section 2 of Form I-9, Employment Eligibility Verification, using original documents presented by the employee that show his or her identity and authorization to work in the U.S.
- Employee's Social Security Number (SSN):Employers are required to get each employee's name and SSN for purposes of completing year-end Forms W-2. After an employee is hired, the employer should ask to see his or her social security card and record the new employee's name and SSN from the card. Any employee without a social security card should apply for one.
- Form W-4: To know how much income tax to withhold from employees' wages, employers should have a Form W-4 , Employee's Withholding Allowance Certificate, on file for each employee. Ask all new employees to give you a signed Form W-4 when they start work, and make the form effective with the first wage payment.
- New Hire Reporting: Federal law requires that employers report any new employee to a designated state new hire registry within 20 days (or shorter, depending on the state) of the date of hire. Many states accept a copy of Form W-4 with employer information added. The federal government maintains a list of links to state agencies where employers can learn more about reporting new hires and the specific requirements they must meet.
- Notice of Coverage Options (Exchange Notice): Employers are required to provide each new employee a written notice with information about a Health Insurance Exchange at the time of hiring, within 14 days of the employee's start date. Model language is available from the U.S. Department of Labor.
Keep in mind that many states require additional forms and other records to be completed when a new employee begins work. Certain states and localities may also require employers to provide specific notices to newly hired employees. Other key steps in the new hire process are featured in our Onboarding section.
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Sample Notice Helps Employers Comply With New ADA Wellness Program Rules
A sample notice is now available from the U.S. Equal Employment Opportunity Commission (EEOC) to help employers satisfy new requirements for wellness programs under the federal Americans with Disabilities Act (ADA). The ADA applies generally to employers with 15 or more employees who worked for the employer for at least 20 calendar weeks (in this year or last).
New ADA Wellness Program Notice
Among other things, the new rules require employers offering wellness programs that collect employee health information to provide a notice to employees informing them what information will be collected, how it will be used, who will receive it, and what will be done to keep it confidential.
The requirement to provide the notice takes effect as of the first day of the plan year that begins on or after January 1, 2017. Employees must receive the notice before providing any health information, and with enough time to decide whether to participate in the wellness program.
Q&As Provide Additional Guidance
To help employers comply with the new notice requirement, the EEOC also released a set of Q&As which clarify, among other things:
- Who must provide the notice;
- The format in which the notice should be provided;
- Whether an employee's signed authorization is required as part of the notice requirement; and
- Whether the current notice required under the federal Health Insurance Portability and Accountability Act (HIPAA) satisfies the new notice requirement under the ADA.
More information on the new ADA rules is available in previously released Q&As and a fact sheet from the EEOC.
Visit our section on Wellness Programs for additional details.
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Benefits, Inc. is a full service employee benefits agency. However we also offer Business Insurance, Work Comp, and Risk Analysis. Contact us
today at 615-446-3303 for more information.
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