GBS Workplace Wellness Programs

Workplace Wellness Programs

This video provides a sample of the workplace wellness resources available through Group Benefits Strategies.

A Wellness Program gives you the employer an opportunity to offer your employees  discounts, cash rewards, gym memberships, and other incentives to participate. GBS can create a comprehensive wellness program for your team with programs including smoking cessation, diabetes management , weight loss , and preventative health screenings.

For more information contact http://gbs-consult.com

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Employee Benefit Plan Limits for 2018

Employee Benefit Plan Limits for 2018

By GBS Team

Group Benefit Strategies Audit and Claim

Many employee benefits are subject to annual dollar limits that are periodically updated for inflation by the Internal Revenue Service (IRS). The following commonly offered employee benefits are subject to inflation-adjusted dollar limits:

  • High deductible health plans (HDHPs) and health savings accounts (HSAs);
  • Health flexible spending accounts (FSAs);
  • 401(k) plans; and
  • Transportation fringe benefit plans.

The IRS typically announces the dollar limits that will apply for the next calendar year well in advance of the beginning of that year. This gives employers time to update their plan designs and make sure that their plan administration will be consistent with the new limits.

This Compliance Overview includes a chart of the inflation-adjusted limits for 2018. Although some of the limits will remain the same, many of the limits will increase for 2018.

INCREASED LIMITS

  • HSA contribution limits for individuals with self-only or family coverage under an HDHP
  • Employees’ elective deferrals to 401(k) plans, pre-tax and Roth
  • Health FSA limit for employee pre-tax contributions
  • Monthly limits for transportation fringe benefit plans
  • HDHP minimum deductibles and maximum out-of-pocket limits

UNCHANGED LIMITS

  • Tax exclusion for dependent care FSA benefits
  • Catch-up contributions to an HSA
  • Catch-up contributions to a 401(k) plan
Limit 2017 2018 Change
HSA Contribution Limit
Self-only $3,400 $3,450 Up $50
Family $6,750 $6,900 Up $150
Catch-up contributions* $1,000 $1,000 No change
HDHP Minimum Deductible
Self-only $1,300 $1,350 Up $50
Family $2,600 $2,700 Up $100
HDHP Out-of-pocket Maximum
Self-only $6,550 $6,650 Up $100
Family $13,100 $13,300 Up $200
Out-of-pocket Maximum on Essential Health Benefits (non-grandfathered plans)
Self-only $7,150 $7,350 Up $200
Family $14,300 $14,700 Up $400
Health FSA
Limit on employees’ pre-tax contributions $2,600 $2,650 Up $50
Dependent Care FSA*
Tax exclusion $5,000 ($2,500 if married and filing taxes separately) $5,000 ($2,500 if married and filing taxes separately) No change
Transportation Fringe Benefits (monthly limits)
Transit pass and vanpooling (combined) $255 $260 Up $5
Parking $255 $260 Up $5
401(k) Contributions
Employee elective deferrals $18,000 $18,500 Up $500
Catch-up contributions $6,000 $6,000 No change

Potential Impact of ACA Repeal on the Uninsured

Potential Impact of ACA Repeal on the Uninsured

By GBS Team

group benefits strategies graham cassidy repeal

There continues to be uncertainty regarding the outcome and impact of legislative efforts to repeal the Affordable Care Act (ACA). Proposed changes could have a significant impact on uninsured populations—affecting the proportion of uncompensated care provided by the healthcare organizations that serve them.

A recent study by Truven Health Analytics®, part of the IBM Watson HealthTM
business, demonstrated that projections of both uninsured inpatient care and
uninsured emergency department (ED) visits reveal substantial differences
across service lines and locality.

As healthcare providers begin to anticipate potential legislative changes to
the ACA, it will be important to gain an accurate picture of the impact of those
changes on the uninsured population in their specific markets.

Projected Increase in Uninsured Inpatient Discharges

Inpatient service lines could see the largest changes in facility charges for the uninsured by 2020 following a repeal of the ACA, as compared with current projections for 2020 under the ACA.

General Surgery

$3,526,000,000.00

General Medicine

$2,442,000,000.00

Cardiology

$2,361,000,000.00

Gastroenterology

$2,057,000,000.00

Psych/Drug Abuse

$1,685,000,000.00

Orthopedics

$1,634,000,000.00

All Others

$1,411,000,000.00

Pulmonary

$1,281,000,000.00

Neurology

$1,257,000,000.00

Thoracic Surgery

$975,000,000.00

OB/Delivery

$746,000,000.00

Trauma

$714,000,000.00

Neurosurgery

$609,000,000.00

Endo

$580,000,000.00

Dentistry

$573,000,000.00

Nephrology

$558,000,000.00

Open Heart

$509,000,000.00

Urology

$373,000,000.00

Oncology Medicine

$355,000,000.00

Total Projected 

$23,668,000,000,000.00

Overall Findings

At the national level, our study found that the potential impact in 2020 of an ACA repeal would include:

  • A projected increase of 735,000 uninsured inpatient discharges (approximately 59%) across the U.S.
  • An additional $23.6 billion charges for these uninsured discharges (of these charges, $11.2 billion in payments could be at risk of non-collection)
  • A projected 67% increase in uninsured ED visits

Methodology

This research was based on the latest Insurance Coverage Estimates (ICE) from Truven Health Analytics, released in June 2017.

The ICE release contained two scenarios: ACA reform and ACA repeal. Reform estimates reflected continued support of Medicaid expansion and health exchanges. The repeal scenario assumed a rollback of insurance coverage to pre-2014 levels.

Overall, the Truven Health model assumed that the uninsured population will increase by approximately 20 million by 2020. This is a more conservative scenario than other published estimates. The nonpartisan Congressional Budget Office, for example, projected a 24 million-person growth of the uninsured population by 2026 based on one recent legislative proposal. These Truven Health forecasts were distinct in that they estimated impact at a local ZIP code level, using publicly available enrollment figures for health insurance exchanges and expanded Medicaid, combined with U.S. Census Bureau figures of households in poverty. Truven Health then paired the population estimates with utilization models specific to each payer segment to produce utilization scenarios for changes in insurance coverage.

Inpatient Demand Estimates from Truven Health provided local, annual acute care admissions and patient days by diagnosis-related group (DRG) and three-digit ICD-9 diagnosis code. The estimates were reported by age, sex, and principal payer. Inpatient Demand Estimates were derived from all-payer state discharge data from 24 states and Medicare Provider Analysis and Review (MEDPAR) data. Truven Health Outpatient Procedure Estimates, as accessed through the Truven Health Market Expert® solution, provided local, annual procedure group and visit category estimates and forecasts by age, sex, principal payer, and site of service.

The estimates were derived from Truven Health commercial, Medicare, and Medicaid claims.

IRS Issues Pay or Play Enforcement Guidance

IRS Issues Pay or Play Enforcement Guidance

By GBS Team

On Nov. 2, 2017, the Internal Revenue Service (IRS) updated its Questions and Answers (Q&As) on the employer shared responsibility rules under the Affordable Care Act (ACA) to include information on enforcement. Specifically, these Q&As include guidance on:
• How an employer will know that it owes an employer shared responsibility penalty;
• Appealing a penalty assessment; and
• Procedures for paying any penalties owed.
The IRS also maintains a website on understanding Letter 226-J, as well as a sample letter, which will be used to inform employers of their potential penalty liability.

ACTION STEPS

No penalties have been assessed under the employer shared responsibility rules at this time. However, employers subject to these rules are still responsible for compliance. These Q&As indicate that, for the 2015 calendar year, the IRS plans to issue letters informing employers of their potential liability for an employer shared responsibility penalty, if any, in late 2017.

Background

The ACA’s employer shared responsibility rules require applicable large employers (ALEs) to offer affordable, minimum value health coverage to their full-time employees or pay a penalty. These rules, also known as the “employer mandate” or “pay or play” rules, only apply to ALEs, which are employers with, on average, at least 50 full-time employees, including full-time equivalent employees, during the preceding calendar year.

The employer shared responsibility rules took effect for most ALEs beginning on Jan. 1, 2015. However, some ALEs may have had additional time to comply with these requirements. An ALE may be subject to a penalty only if one or more full-time employees obtain an Exchange subsidy (either because the ALE does not offer health coverage, or offers coverage that is unaffordable or does not provide minimum value).

Prior to 2017, the IRS has been unable to identify the employers potentially subject to an employer shared responsibility penalty or to assess any penalties. The IRS previously indicated that it expected to begin sending letters in early 2017 informing ALEs that filed Forms 1094-C and 1095-C of their potential liability for an employer shared responsibility penalty for the 2015 calendar year (with reporting in 2016). However, at this time, no letters have been sent to any ALEs.

Enforcement Guidance

The general procedures the IRS will use to propose and assess the employer shared responsibility penalties are described in Letter 226-J. The IRS plans to issue Letter 226-J to an ALE if it determines that, for at least one month in the year, one or more of the ALE’s full-time employees was enrolled in a qualified health plan for which a premium tax credit was allowed (and the ALE did not qualify for an affordability safe harbor or other relief for the employee).

These letters are separate from the Section 1411 Certification sent by the Department of Health and Human Services (HHS) that employers began receiving in 2016. The Section 1411 Certifications are sent to all employers with employees who receive a subsidy to purchase coverage through an Exchange (including both ALEs and non-ALEs). Section 1411 Certifications do not trigger or assess any penalties for any employers.

Letter 226-J will include:

  • A brief explanation of Section 4980H;
  • An employer shared responsibility penalty summary table itemizing the proposed penalty by month and indicating for each month if the liability is under Section 4980H(a) or Section 4980H(b) (or neither);
  • An explanation of the employer shared responsibility penalty summary table;
  • Form 14764, Employer Shared Responsibility Payment (ESRP) Response, an employer shared responsibility response form;
  • Form 14765, Employee Premium Tax Credit (PTC) List, which lists, by month, the ALE’s assessable full-time employees (individuals who for at least one month in the year were full-time employees allowed a premium tax credit and for whom the ALE did not qualify for an affordability safe harbor or other relief—see instructions for Forms 1094-C and 1095-C, line 16), and the indicator codes, if any, the ALE reported on lines 14 and 16 of each assessable full-time employee’s Form 1095-C;
  • A description of the actions the ALE should take if it agrees or disagrees with the proposed employer shared responsibility penalty in Letter 226-J; and
  • A description of the actions the IRS will take if the ALE does not respond to Letter 226-J on time.

The response to Letter 226-J will be due by the response date shown on Letter 226-J, which generally will be 30 days from the date of Letter 226-J. Letter 226-J will contain the name and contact information of a specific IRS employee that the ALE should contact if the ALE has questions about the letter.

For the 2015 calendar year, the IRS plans to issue Letter 226-J informing ALEs of their potential liability for an employer shared responsibility penalty, if any, in late 2017.

For purposes of Letter 226-J, the IRS determination of whether an ALE may be liable for an employer shared responsibility penalty and the amount of the potential penalty is based on information reported to the IRS on Forms 1094-C and 1095-C and information about full-time employees of the ALE that were allowed the premium tax credit.

Appeals

ALEs will have an opportunity to respond to Letter 226-J before any employer shared responsibility liability is assessed and notice and demand for payment is made. Letter 226-J will provide instructions for how the ALE should respond in writing, either agreeing with the proposed employer shared responsibility penalty or disagreeing with part or all or the proposed amount.

If the ALE responds to Letter 226-J, the IRS will acknowledge the ALE’s response with an appropriate version of Letter 227 (a series of five different letters that, in general, acknowledge the ALE’s response to Letter 226-J and describe further actions the ALE may need to take). If, after receipt of Letter 227, the ALE disagrees with the proposed or revised employer shared responsibility penalty, the ALE may request a pre-assessment conference with the IRS Office of Appeals. The ALE should follow the instructions provided in Letter 227 and Publication 5, Your Appeal Rights and How To Prepare a Protest if You Don’t Agree, for requesting a conference with the IRS Office of Appeals. A conference should be requested in writing by the response date shown on Letter 227, which generally will be 30 days from the date of Letter 227.

If the ALE does not respond to either Letter 226-J or Letter 227, the IRS will assess the amount of the proposed employer shared responsibility penalty and issue a notice and demand for payment—Notice CP 220J.

Paying a Penalty

If, after correspondence between the ALE and the IRS (or a conference with the IRS Office of Appeals), the IRS or IRS Office of Appeals determines that an ALE is liable for an employer shared responsibility penalty, the IRS will assess the employer shared responsibility penalty and issue a notice and demand for payment (Notice CP 220J). Notice CP 220J will:

  • Include a summary of the employer shared responsibility penalty and reflect any payments made, credits applied and the balance due, if any; and
  • Instruct the ALE how to make a payment, if any.

ALEs will not be required to include the employer shared responsibility penalty on any tax return that they file or make a payment before notice and demand for payment. For payment options, such as entering into an installment agreement, refer to Publication 594, The IRS Collection Process

GBS Infographic •Common Payment Models

Overview of Common Payment Models

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FULLY INSURED PAYMENT MODELS

  • The carrier assumes the financial risk of providing health insurance, and the employer is charged a flat monthly fee.
  • The employer typically knows the costs ahead of time since it pays a flat fee every month.
  • Fully insured plans are subject to state rules and regulations.
  • With this type of payment model, costs are unlikely to decrease, even with a low previous-year utilization.

SELF – INSURED PAYMENT MODELS

  • The employer assumes the financial risk of providing health insurance and pays for medical claims out of pocket.
  • These models can be more easily customized to fit the specific needs of an employer’s workforce.
  • The employer can contract with providers, or a particular provider network, that will best meet the needs of its employees.
  • The employer will typically work with a third-party administrator (TPA), which assumes claims administration duties.
  • Self-insured health plans are not subject to state health laws, but rather federal laws. These plans are not subject to state health insurance premium taxes.

LEVEL FUNDING PAYMENT MODELS

  • Level funding models are sometimes thought of as a hybrid of fully insured and self-insured payment models.
  • In this type of model, the employer pays a set amount each month to a carrier, and the carrier then pays employees’ claims throughout the year.
  • If the employer’s monthly payments exceeded the amount of claims filed, the employer will receive a refund from the excess they paid in monthly claim allotments. If the employer’s monthly payments did not exceed the amount of claims filed, stop-loss insurance will typically cover the overage amount, if allowed by state law.
  • Typically, an employer will be assisted or advised by a TPA on the previous two bullet points.
  • Companies with smaller numbers of employees may benefit differently than those with larger numbers.

New Rules for Disability Benefit Claims May Be Delayed

New Rules for Disability Benefit Claims May Be Delayed

By GBS Team

On Dec. 16, 2016, the Department of Labor (DOL) released a final rule to strengthen the claims and appeals
requirements for plans that provide disability benefits and are subject to the Employee Retirement Income
Security Act (ERISA). The final rule is currently scheduled to apply to claims that are filed on or after Jan. 1, 2018. However, on Oct. 10, 2017, the DOL proposed to delay the final rule for 90 days—until April 1, 2018.

The DOL will review the final rule to determine whether it is unnecessary, ineffective or imposes costs that exceed its benefits, consistent with President Donald Trump’s executive order on reducing regulatory burdens.