New Guidance: 

• On July 9th the IRS
  issued Notice 2013-45 which is the formal guidance that implements the delay announced on July 2nd of certain parts of the Affordable Care Act until 2015. The Notice formalizes that the employer reporting requirements related to play or pay mandates and the assessments of penalties related to the play or pay mandates are delayed until 2015. The IRS notes that the premium subsidies to individuals will still be available and that no other provision of the Act is delayed as a result of this transition relief.
• On July 10th, the Department of Health and Human Services announced that the new health insurance exchanges would not need to verify the income and health insurance status of individuals seeking to receive subsidies to help buy insurance in 2014; rather, this will be based on the "honor system". The Department of Health and Human Services noted in their announcement that it would not be able to provide verification assistance to the exchanges until 2015. This final rule will be published in the Federal Register on July 15th.
• The IRS has announced that "later in 2013" the government will issue new proposed regulations under Code Sec. 6055 (reporting of insurance by employers and insurers) as well as Code Sec. 6056 (reporting by employers of coverage provided to employees). "The proposed regulations will help people know what to do". When reporting begins, employers will have to identify each of their full-time employees and indicate whether they were offered health insurance coverage. Reports for 2015 will be filed in 2016. At that point, the IRS will look at whether any employees received health insurance premium tax credits; then the IRS will notify the employer of potential penalties. The IRS will determine through Code Sec. 6055 reporting who has minimum essential coverage. Any individual penalty will be collected through refund offsets.

Employer Obligations:

• The Patient-Centered Outcomes Research Institute Fee (PCORI) charged to the providers of fully insured medical plans and to the "plan sponsor" of self-insured plans is still applicable. For plans ending in 2013, the Fee is $1.00 per covered individual per year and for plans ending in 2014 - September, 2019 the Fee is $2.00 per covered individual per year. For all employers this Fee will likely increase insurance plan costs as insurers will undoubtedly pass these fees along to policyholders.
• Virtually all employers must still prepare and deliver the applicable Notice of Health Insurance Marketplace (also known as Exchanges) Coverage Availability by October 1, 2013 (either the Notice if the employer offers health coverage or the Notice if the employer does not offer health coverage - these Model Notices are linked to the June RGL Pipeline which is archived on our website-www.rglconsultants.com. These Notices must also be prepared and delivered to all employees hired on or after October 1, 2013, within 14 business days of hire.
• Beginning October 1, 2013, COBRA Notices must include information related to the availability of coverage through the Exchanges. This Model Notice is also linked to the June RGL Pipeline which is archived on our website.
• Employers who file 250 or more W-2 Forms in 2013 must report the annual cost of health plan coverage on the W-2 Form filed in 2014, including the portion paid by the employee (this was voluntary in 2012 for W-2 Forms filed in 2013).
• Employers must ensure that their health benefit plans offered in 2014 and beyond meet the minimum standards for offering "essential health benefits" and eliminate pre-existing condition exclusions; and amend their plans if they do not. There is also a prohibition against annual or lifetime limits that go into effect in 2014. These changes may well contribute to higher premiums.
• For plan years beginning on or after January 1, 2014, waiting periods for new employees to become eligible to enroll in your health plan cannot be more than 90 days.

What's Next:

• Anybody's guess!
• The Obama Administration maintains that the exchanges will be ready to begin enrollment on October 1, 2013. This seemingly conflicts with the GAO (Government Accounting Office) analysis that this process is well behind schedule (see the July Pipeline which is archived on our website).
• Our guess is that there will be additional "bumps in the road" which we will monitor and bring to your attention as soon as practical.