Businesses faced turbulent times in 2012 with the Presidential election and related tax uncertainties.  The New Year appears to bring more challenges and continued uncertainty for businesses with the enactment of the American Taxpayer Relief Act of 2012 (ATRA).  In addition in 2013, we anticipate that businesses will continue to struggle with significant employee benefits compliance issues.  The following is a list of top employee benefit issues for businesses to consider in 2013.

Health Care

Employers continue to implement numerous regulations and guidance related to The Patient Protection and Affordable Care Act (PPACA) enacted in 2010.  Some of the more important compliance matters are addressed below:

Summary of Benefits and Coverage (SBC) and Uniform Glossary.  Group health plans must provide an SBC and Uniform Glossary to open enrollment and renewal plan participants and beneficiaries as of September 23, 2012.  In other circumstances, the SBC must be provided on the first day of the first plan year that begins on or after September 23, 2012. For calendar year plans this date is January 1, 2013.

Generally, the SBC is a four-page, double-sided document that uses plain language and a consistent format to summarize information about an employer's health plans.  The SBC includes a description of the benefits and coverage under a plan including cost-sharing requirements and any information regarding exceptions, reductions or limitations and examples of cost-sharing under the health plan for coverage of two common scenarios: having a baby and managing Type 2 diabetes.  The SBC must also reference a Uniform Glossary that provides definitions of health coverage and medical terminology.

A group health plan that willfully fails to provide the SBC may be subject to a $1,000 fine per plan participant for each failure.  However, the Departments of Health and Human Services, Labor and Treasury announced during this first year of applicability, that they will not impose penalties on plans that are working diligently and in good faith to comply with the rules.

Additional PPACA Requirements in 2013. By March 1, 2013 employers will be required to distribute a written notice of the existence of health benefit exchanges to employees containing certain information. The Department of Labor is expected to issue a model exchange notice, but notices may vary by state.

For Plan Years ending on or after October 1, 2012 and before October 1, 2019, employers sponsoring self-insured group health plans are required to report and pay a new excise tax to fund the Patient-Centered Outcomes Research (PCORI).  The tax is equal to $1 per covered life for the first such Plan Year, $2 per covered life for the second year with increasing fees thereafter "based on increases in the projected per capita amount of National Health Expenditures."  Such excise taxes are reported on IRS Form 720 due by the July 31 immediately following the end of each such Plan Year.  The final rules provide alternative methods for calculating the average number of lives covered, make clear that they apply to retiree plans and that COBRA participants must be counted, and self-funded arrangements with the same plan year may be treated as one plan.

Taxes

Internal Controls