ACA HEALTH CARE REFORM

ACA HEALTH CARE REFORM HAS BEGUN

For many business owners, the Patient Protection and Affordable Care Act, or PPACA, introduces confusion into an already complicated business environment. Discovery offers a powerful, competitive edge to you by providing a dedicated service team, ready to provide you with answers. Our clients trust that Discovery has the answers and the team to support your business so you can focus on growth. DID YOU KNOW? Discovery has the experts! Weve strengthened our team with the Nations Leading Compliance Experts!

THREE IMPORTANT QUESTIONS TO ASK.

WHAT IS HEALTH CARE REFORM?

Health care reform actually consists of two laws enacted in March 2010 the Patient Protection and Affordable Care Act (PPACA) and the Health Care and Education Reconciliation Act (HCERA). Together, these laws change the rules that guide and control government health programs, individual health coverage and employer-sponsored group health plans. Although parts of health care reform were initially challenged as unconstitutional, the U.S. Supreme Court upheld the individual mandate requiring all Americans to obtain health insurance or pay a penalty. This means Health Care Reform is here to stay. Scheduled to be implemented over an eight-year period from 2010 through 2018, the Affordable Care Act is designed to provide:

Greater access to coverage Improved quality of coverage More affordable coverage Insurance carrier accountability

HOW DOES HEALTH CARE REFORM IMPACT MY BUSINESS?

For all employers, Health Care Reform will be complicated to understand. For many, it will be difficult to comply with and implement. But no matter what size your company may be, there are three key areas of concern: Complexity Workforce demographics will need to be thoroughly understood in order to facilitate sound decision-making regarding health plan offerings. This will require year(s)-long data tracking from human resources, payroll and benefits administration systems. Cost Such sweeping reform doesnt come cheap. Health care premiums are expected to rise because new taxes and fees will impact insurance carriers and health care providers. Extreme price volatility is expected up to and throughout 2014. Compliance While regulations for businesses with less than 50 employees have yet to be defined, the guidelines for larger companies are clear. Businesses with 50 or more employees will be subject to a host of new requirements, including the requirement to provide health coverage or face possible tax penalties, as well as the requirement to file reports containing information about their workforce and health plan offerings. What this means is that business owners, whether small or large, cant afford to wait to get health care reform assistance. More health care reform regulations are being issued every week. And if you wait, you place your company and your employees at risk of increased costs and tax penalties.

HOW WILL DISCOVERY HELP MY BUSINESS?

Our expert PEO consultants are ready to give you a free analysis and save you time and money. See why we are the number one Colorado PEO. Every client has a dedicated service team and escalations take minutes, not days. We are the leading Colorado Based PEO and have a team of experts whose focus is HR, Payroll and benefits. And ever since Health Care Reform was enacted in early 2010, weve been actively building our compliance team with experts and have the tools in place to ensure that our clients are always prepared and always in compliance.

ACA CHECKLIST 2013

The Patient Protection and Affordable Care Act (PPACA), also referred to as health care reform, introduced several new laws and regulations that impact businesses of all sizes. The following health care reform checklist outlines 10 key PPACA compliance issues employers may need to complete in 2013. Whether a business needs to complete each item depends on the type of employee health benefits offered, and business size. For example, if a business offers an employer-sponsored group health insurance plan, the requirements are different than if the business offers a stand-alone Health Reimbursement Arrangement (HRA).

1. Grandfathered Plan Status A grandfathered health insurance plan is defined as being in existence when health care reform was enacted on March 23, 2010. If you make certain changes to your plan, your plan is no longer grandfathered. 2. Annual Limits PPACA prohibits health insurance plans from imposing annual or lifetime limits on essential health benefits (EHB). For plans beginning 9/23/12 - 1/1/14, the annual limits cannot be less than $2 million. Starting in 2014, annual limits are prohibited. If you offer a group plan: Confirm the plan's annual limits are in compliance with 2013 amounts, and prepare for 2014 when annual limits are prohibited. If you offer a stand-alone HRA: Confirm the HRA plan design meets the definition of one of the five HRAs excluded from annual limit requirements. 3. Summary of Benefits & Coverage (SBC) The Summary of Benefits and Coverage (SBC) is a required, easy-to-understand summary of the benefit. Generally speaking, your insurer, HRA provider, or third-party administrator will provide the SBC. Provide the SBC to eligible participants at least thirty (30) days before plan year begins. 4. Decide Your Play or Pay Strategy PPACA requires all applicable large employers (50+ FTE employees) to either provide qualified, affordable health insurance or pay a penalty based on full-time employees. Originally slated to begin with plan years starting on or after January 1, 2014, the Play or Pay mandate, also referred to as the

Employer Mandate, has been delayed until 2015 for employers with 100 or more full-time equivalent (FTE) employees, and 2016 for employers with between 50 and 99 FTEs, provided the employer meets certain requirements. If you have over 50 FTE employees, conduct a cost anasis to decide if you will play, pay, or play differently: Play: Offer a qualified, affordable group health insurance plan. Pay: Choose to not offer a group health insurance plan, and pay applicable penalties. Play Differently: Choose to not offer a group health insurance plan, pay penalties, and offer a defined contribution health plan (aka a stand-alone HRA).

IMPORTANT: Employers with less than 50 FTE employees are not subject to this requirement. For employers with less than 50 FTE, the "play differently" allows a business to offer a cost-effective health benefit, and take advantage of the individual premium tax subsidies. 5. W-2 Reporting Requirements Beginning with the 2012 tax year, employers with 250 or more W-2 Form Employees must report the aggregate cost of employer-sponsored group health coverage on employees W-2 Forms. Determine if this requirement applies to you. W-2 reporting for smaller employers, and for stand-alone HRAs, is optional until further guidance is issued. 6. Sixty (60) Day Notice of Plan Changes A health plan or issuer must provide 60 days advance notice of any mid-year material modifications to the plan. Notice can be provided in an updated SBC or a separate summary of material modifications. 7. Notice of Coverage Options through the Marketplaces Employers must provide written notice to all current employees (regardless of full-time/part-time status) about coverage options through the Marketplaces by October 1, 2013. The Department of Labor has provided two templates employers can use: one for employers offering a group health plan, and one for employers not offering a group health plan. 8. PPACA Fees Under PPACA, there are 3 fees impacting the cost of employer sponsored health coverage: The Patient-Centered Outcomes Research Institute (PCORI) Fee: Designed to provide evidence-based research that is intended to help patients, clinicians, payers, and the public make informed health decisions. The Institutes research is to be funded, in part, by fees paid by health insurance issuers and sponsors of self-insured health plans. These fees are called comparative effectiveness research fees or CER plan fees. Self-funded plans and

health insurance issuers (including stand-alone HRAs) must pay a $1 per covered life fee for comparative effectiveness research. Fees are effective for plan years ending on or after Oct. 1, 2012. Fees increase to $2 the next year and will be indexed for inflation after that.

Full payment of the research fees will be due by July 31 of each year. It will generally cover plan years that end during the preceding calendar year. Health Insurance Industry Fee: This fee is assessed to help fund the subsidies that individuals can receive through the health insurance exchanges. We expect the fee to be about 2 to 2.5 percent of total premium cost. This fee is expected to be permanent. Transitional Reinsurance Fee: The ACA establishes a program to help stabilize premiums for coverage in the individual market from 2014 through 2016. HHS has proposed that the assessment will be $63 per year per individual enrolled in a health plan. The fee will be phased out in 2016.

9. Flexible Spending Account (FSA) New Annual Limits New limits of $2,500 for health care FSAs apply to plan years beginning on or after January 1, 2013. Note: The limit does not apply to non-health care FSAs, such as dependent care FSAs. 10. Womens Preventive Care Mandate Effective for plan years beginning on or after August 1, 2012, non-grandfathered health plans must cover specific preventive care services for women without cost-sharing requirements. See this list of preventive care services covered under PPACA. If you have a non-grandfathered group plan: Confirm that your plan covers specified preventive care services for women without cost sharing. If you have a stand-alone HRA: While there has not been final rule on how this regulation affects HRAs, we recommend you do not limit this expense in any way.