June 2021 Compliance Recap

Category: Compliance

June 2021 Compliance Recap

Posted On: July 23, 2021 | Categorized as: Compliance

June 2021 Compliance Recap June 2021 was not a busy month in the benefits industry, largely due to the summer vacation season and the Independence Day holiday. Importantly, however, the U.S. Supreme Court upheld the constitutionality of the Patient Protection and Affordable Care Act (ACA). Additionally, the IRS unveiled a tool to assist families in taking advantage of the monthly Advance Child Tax Credit payments and issued a revised 2021 version of Form 941, Employer’s Quarterly Federal Tax Return, to in part reflect the tax credit in connection with 100% COBRA subsidy under the American Rescue Plan Act (ARP). The Department of Labor (DOL) also issued guidance on the information to be disclosed pursuant to a participant’s request during a claims dispute. We continue to monitor and advise on the Blue Cross Blue Shield Association (BCBSA) Antitrust Settlement as the claim deadline nears. The ACA Upheld On June 17, 2021,…


IRS Issues Draft Form 1095-C

Posted On: July 22, 2021 | Categorized as: Compliance

IRS Issues Draft Form 1095-C The Internal Revenue Service (IRS) recently issued the 2021 Draft Form 1095-C, which is required to be filed with the IRS by applicable large employers (ALEs), to report the offer of health coverage to employees. New Codes An ALE that offers an individual coverage health reimbursement arrangement (ICHRA) can now use two previously-reserved codes in order to report offers of coverage: 1T. Individual coverage HRA offered to employee and spouse (no dependents) with affordability determined using employee's primary residence location ZIP code. 1U. Individual coverage HRA offered to employee and spouse (no dependents) using employee's primary employment site ZIP code affordability safe harbor. Additional Copies of Page 3 Permissible The 2021 instructions also clarify that self-funded plans that are required to complete Part III of Form 1095-C, and that have more than 13 covered individuals on a single Form 1095-C, may use additional copies of…


The IRS Issues the Most Recent Update to Form 941

Posted On: July 22, 2021 | Categorized as: Compliance

The IRS Issues the Most Recent Update to Form 941 On June 24, 2021, the Internal Revenue Service issued the most recent update to Form 941, the Employer’s Quarterly Federal Tax Return. The form has several new lines added to obtain credits for the COBRA subsidies offered under the American Rescue Plan Act (ARPA). Employers should be using this new revision for filings in the second quarter, due by August 2, 2021. Additionally, some revisions have been made to align Form 941 with the extension and amendments made to the Emergency Paid Family Sick Leave and Extended FMLA provisions included in ARPA. Employers should discard any unused Form 941 with revision dates earlier than June 2021. The new Form 941 may be downloaded here. If you have any questions, please contact us at icomply@ibpllc.com.   This Compliance communication is not intended to be exhaustive nor should any discussion or opinions…


EEOC Extends EEO-1 Deadline for 2019 and 2020 Data Submissions

Posted On: July 22, 2021 | Categorized as: Compliance

EEOC Extends EEO-1 Deadline for 2019 and 2020 Data Submissions The New Deadline Gives Employers Another Month–Until August 23– To Complete Their Reports   Employers now have some extra time to submit equal employment opportunity (EEO-1) workforce data from 2019 and 2020, the U.S. Equal Employment Opportunity Commission (EEOC) announced on June 28, 2021. These reports were previously due by July 19, 2021. Employers now have until Aug. 23, 2021, to complete their submissions. The EEOC’s collection of this data, the portal for which opened on April 26, 2021, had been delayed numerous other times due to the coronavirus pandemic. Under Title VII of the Civil Rights Act, the EEO-1 Report is usually due by March 31 every year. If you have any questions, please contact us at icomply@ibpllc.com.   This Compliance communication is not intended to be exhaustive nor should any discussion or opinions be construed as legal advice. Readers should…


No Surprise Billing: Interim Final Regulations Part 1

Posted On: July 13, 2021 | Categorized as: Compliance

No Surprise Billing: Interim Final Regulations Part 1 On July 1, 2021, the U.S. Departments of Health and Human Services, Labor, and Treasury, along with the Office of Personnel Management (collectively, the Departments), issued an interim final rule (IFR) to explain provisions of the No Surprises Act (the Act) that passed as part of sweeping COVID-19 relief legislation signed in December 2020. The Act and IFR aim to protect consumers from excessive out-of-pocket costs resulting from surprise and balance medical billing. This Advisor provides a high-level summary of the IFR. Background Under the Act, group health plans, or health insurance issuers offering group or individual health insurance coverage, that provide or cover any benefits for services in an emergency department of a hospital (including a hospital outpatient department that provides emergency services) or an independent freestanding emergency department (in-network or out-of-network, also referred to as participating and nonparticipating), must cover…


EEOC Issues Updated COVID-19 Vaccination Assistance

Posted On: June 22, 2021 | Categorized as: Compliance

EEOC Issues Updated COVID-19 Vaccination Assistance The Center for Disease Control (CDC) and the Equal Employment Opportunity Commission (EEOC) have issued this information related to vaccinations: Employers must be aware that certain individuals may opt to not be vaccinated, either for religious reasons or for medical reasons Under the Americans with Disabilities Act (ADA) and Title VII, reasonable accommodations must be offered to these persons instead of requiring them to be vaccinated. Reasonable accommodations approved by the EEOC include: Face masks Social distancing from co-workers Working different shift hour Telecommuting and working from home Reassignment to a different role Employers may not require vaccinations for such employees unless they can show that the unvaccinated employee poses a direct threat to the employee's health and safety in the workplace. If you have any questions, please contact us at icomply@ibpllc.com.


Supreme Court Effectively Upholds ACA in Texas v. United States Ruling

Posted On: June 18, 2021 | Categorized as: Compliance, Employee Benefits

Supreme Court Effectively Upholds ACA in Texas v. United States Ruling On June 17, 2021, the U.S. Supreme Court upheld the constitutionality of the Patient Protection and Affordable Care Act (ACA) by a 7-to-2 vote. The Court heard oral arguments in the case, California v. Texas, on November 10, 2020, which was a consolidation of 20 cases filed by state attorneys general and governors. The three main issues in California v. Texas were: Whether Texas, the accompanying states, the federal government, and two individual plaintiffs have “standing” to sue, which means having a sufficient connection to and harm by the ACA as a precondition to challenging the law. Whether the elimination of the ACA’s penalty for individuals who do not maintain minimum essential coverage (MEC), also known as the individual mandate, renders the individual mandate unconstitutional. If the individual mandate is unconstitutional, whether the remainder of the ACA’s provisions are…


May 2021 Compliance Recap

Posted On: June 10, 2021 | Categorized as: Compliance

May 2021 Compliance Recap May 2021 was a somewhat busy month in the benefits industry. The absence of a significant of amount of agency guidance during the summer months is to be expected. However, the IRS finally issued guidance on the temporary 100% COBRA subsidy mandated by the American Plan Rescue Act of 2021 (the ARP), following guidance issued by the U.S. Department of Labor (DOL). The IRS also issued guidance on the Dependent Care Assistance Program (DCAP) carryover of unused benefits and on the child tax credit under the ARP. In addition, the IRS issued the 2022 limits for health reimbursement arrangements (HRAs) and health savings accounts (HSAs). The Biden Administration lowered the cost of marketplace plans and the DOL issued guidance on fiduciary cybersecurity obligations under ERISA covered plans. IRS COBRA Subsidy Guidance On May 18, 2021, the IRS issued IRS Notice 2021-31 in the form of FAQs,…


BCBSA Antitrust Settlement Classes Eligible for Proceeds

Posted On: June 9, 2021 | Categorized as: Compliance, Employee Benefits

BCBSA Antitrust Settlement Classes Eligible for Proceeds November 5, 2021 is the deadline for filing a claim in connection with the Blue Cross Blue Shield Association (BCBSA) $2.67 billion settlement reached in October 2020. The class action lawsuit was filed more than eight years ago by subscribers seeking injunctive and compensatory relief arising out of BCBSA’s alleged violation of federal antitrust laws. Although final court approval for the settlement has not been granted, the official administrator of the BCBSA has established a website to provide information and instructions for filing claims online and by mail. Payment of the settlement proceeds will be distributed to the settlement classes from the settlement fund after final court approval of the settlement. Settlement Classes Eligibility for settlement proceeds extends to individuals, insured groups (and their employees) and self-funded arrangements (and their employees) that purchased or were enrolled in a Blue Cross or Blue Shield…


IRS Draft Form 941 Reflects COBRA Subsidy Tax Credit

Posted On: June 9, 2021 | Categorized as: Compliance

IRS Draft Form 941 Reflects COBRA Subsidy Tax Credit The IRS recently released a draft of the revised 2021 version of Form 941, Employer’s Quarterly Federal Tax Return, in order to, in part, reflect the tax credit in connection with the 100% COBRA subsidy under the American Rescue Plan Act (ARP). The COBRA subsidy is required to be provided to eligible individuals who experience an involuntary termination of employment or reduction in hours and that have not exhausted the maximum COBRA coverage period as of April 1, 2021. The ARP extended to those individuals an opportunity to make a COBRA election during a special election period that began on April 1, 2021, and ends on May 31, 2021. The duration of the COBRA subsidy period is six months, ending on September 30, 2021. Under the ARP, employer are entitled to a 100% tax credit for subsidizing COBRA on behalf of…


Upcoming Challenges with ACA in 2021

Posted On: June 9, 2021 | Categorized as: Compliance

Upcoming Challenges with ACA in 2021 IRS Eliminates Transition Relief and Removes Threshold Expanding Eligibility In previous year, the IRS has provided relief of penalties to reporting entities that report incomplete or incorrect information as long as these entities can show they made a good-faith effort to comply with the information reporting requirements. In late 2020, the IRS released Notice 2020-76, which among other things, provided for a good-faith waiver for 2020 ACA Reporting to apply to missing and inaccurate taxpayer identification numbers and birthdates, as well as other information. Unfortunately, in this same Notice the IRS states: “As this good-faith relief was intended to be transitional relief, this is the last year the Treasury Department and the IRS intend to provide this relief.” However, the IRS did renew their request for comments related to furnishing requirements under 6055 and 6056 of the ACA regulations. They further state: “Unless we receive comments that explain why this…


Frequently Asked Questions About the Patient-Centered Outcomes/Comparative Effectiveness (PCORI Fee)

Posted On: June 9, 2021 | Categorized as: Compliance

Frequently Asked Questions About the Patient-Centered Outcomes/Comparative Effectiveness (PCORI Fee) Q1: What plans does the PCORI fee apply to? A1: All plans that provide medical coverage to employees owe this fee. Medical coverage includes preferred provider (PPO) plans, health maintenance organization (HMO) plans, point-of-service (POS) plans, high deductible health plans (HDHPs), and health reimbursement arrangements (HRAs). The fee does not apply to: Stand-alone dental and vision plans (stand-alone means these benefits are elected separately from medical, or the benefits are provided under separate insurance policies from the medical coverage) Life insurance Short- and long-term disability and accident insurance Long-term care Health flexible spending accounts (FSAs), as long as the employee also is offered medical coverage and any employer contribution is (in most cases) $500 or less Health savings accounts (HSAs) Hospital indemnity or specified illness coverage Employee assistance programs (EAPs) and wellness programs that do not provide significant medical care…


2021 Patient-Centered Outcomes Research Institute (PCORI) Fee

Posted On: June 9, 2021 | Categorized as: Compliance

2021 Patient-Centered Outcomes Research Institute (PCORI) Fee The Patient-Centered Outcomes Research Institute (PCORI) fee deadline is around the corner. In Notice 2020-84, the IRS adjusted the applicable dollar amount to be multiplied by the average number of covered lives for purposes of calculating the fee for policy years and plan years that end on or after October 1, 2020, and before October 1, 2021. The fee for the forgoing period is $2.66. Although the PCORI fee is based on the plan year, the reporting and fee due date is always July 31. However, for 2021 the deadline will be August 2, instead of the usual July 31 deadline because the 31st falls on a Saturday. The Affordable Care Act (ACA) requires health insurers and sponsors of self-funded group health plans to pay the fee using IRS form 720. The PCORI fee is based on covered lives. Accordingly, both employees and…


April 2021 Compliance Recap

Posted On: May 12, 2021 | Categorized as: Compliance

April 2021 Compliance Recap April was a busy month in the benefits industry, largely due to the temporary 100% COBRA subsidy mandated by the American Plan Rescue Act of 2021 (the ARP). The Departments of Labor, Treasury and Health and Human Services (the Departments) jointly issued FAQs regarding the amendments to the Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) made by the Consolidated Appropriations Act, 2021, enacted December 27, 2020 (CAA). Additionally, the Biden Administration encouraged every employer in America take advantage of the ARP tax credit by offering full pay to their employees for any time off needed to get vaccinated and for any time it takes to recover from the after-effects of vaccination. The Department of Labor (DOL) also issued important information on self-funded plans. COBRA Subsidy The COBRA Subsidy is required to be provided to eligible individuals who have not exhausted the maximum COBRA…



The DOL Issues ARPA COBRA Subsidy Forms

Posted On: April 9, 2021 | Categorized as: Compliance

The DOL Issues ARPA COBRA Subsidy Forms On April 7, 2021, the Department of Labor (DOL) issued the much awaited COBRA Model Notices required under the American Rescue Plan Act of 2021 (ARPA), implementing the 100% COBRA Subsidy for eligible individuals. In order to assist plan sponsors with implementing the subsidy as required under the ARPA, the DOL has established a dedicated COBRA Subsidy web page. Additionally, FAQs are available here. Model Notices: General Notice and Election Notice Notice in Connection with Extended Election Period Alternative Notice Notice of Expiration of Premium Assistance Summary of the COBRA Premium Assistance Provisions Please review our latest blog on the COBRA Subsidy. If you have any questions, please contact your Innovative account team or contact us at icomply@ibpllc.com.


March 2021 Compliance Recap

Posted On: April 6, 2021 | Categorized as: Compliance

March 2021 Compliance Recap The employee benefits guidance issued in March 2021 was largely focused on providing relief to individuals and businesses impacted by the continuing COVID-19 pandemic. Significantly, on March 11, 2021, the American Rescue Plan Act of 2021 (the Act) was enacted into law which, in part, mandates that eligible individuals receive a six-month 100% COBRA. The following summarizes other important regulatory developments during March 2021. ACIP Recommends the Janssen (Johnson & Johnson) Vaccine On February 28, 2021, the Advisory Committee on Immunization Practices (ACIP) issued an interim recommendation for use of the Johnson & Johnson vaccine in persons aged 18 or older for the prevention of COVID-19, which must be covered as preventive care no later than March 19, 2021. Under the CARES Act, non-grandfathered individual and employer-sponsored group health plans are required to cover the entire cost of preventative services by not imposing cost-sharing in the…


PPE as Section 213(d) Qualified Medical Expenses

Posted On: March 31, 2021 | Categorized as: Compliance

PPE as Section 213(d) Qualified Medical Expenses The Internal Revenue Service (IRS) released Announcement 2021-7 providing that amounts paid for personal protective equipment (PPE) such as masks, hand sanitizer and sanitizing wipes, for the primary purpose of preventing the spread of COVID-19, are qualified medical expenses under Internal Revenue Code Section 213(d). Therefore, these expenses are eligible for reimbursement from account-based plans, including health flexible spending arrangements (health FSAs), Archer medical savings accounts (Archer MSAs), health reimbursement arrangements (HRAs), and health savings accounts (HSAs). Note that if the expense is reimbursed under an account-based plan, it is not deductible for the taxpayer under Section 213 (no double benefit). The IRS provides that group health plans, including health FSAs and HRAs, will need to be amended if the plans prohibit reimbursement of PPE. Group health plans may be amended to provide for such reimbursement of PPE expenses incurred for any period…


American Rescue Plan Act Brings Several Health Plan Provisions

Posted On: March 15, 2021 | Categorized as: Compliance

On March 11, 2021, President Biden signed the American Rescue Plan Act of 2021 (Act). The Act is a $1.9 trillion legislative package that includes pandemic relief for individuals and families. The Act contains several provisions including funding to the Centers for Disease Control and Prevention, stimulus checks, unemployment benefits, the child tax credit, tax credits for paid sick leave and family and medical leave, the Paycheck Protection Program, grants to state educational agencies, and low-income family assistance. The Act also contains several provisions affecting group health plans. Below is a high-level overview based on Innovative Benefit Planning’s review of the Act but more detailed information on the COBRA relief can be found in a link following the COBRA explanation. COBRA Continuation Coverage Subsidies The Act provides COBRA relief for assistance-eligible individuals. An assistance-eligible individual is an individual who is eligible for COBRA due to a COBRA qualifying event of…


February 2021 Compliance Recap

Posted On: March 8, 2021 | Categorized as: Compliance

February 2021 Compliance Recap February was a relatively busy month in the employee benefits world. The Department of Labor (DOL) issued EBSA Disaster Relief Notice 2021-01 regarding the end of the COVID-19 outbreak period. The Internal Revenue Service (IRS) issued Notice 2021-15 providing guidance on health flexible spending arrangements (FSAs), dependent care flexible spending arrangements (DCAPs), and cafeteria plan relief. The DOL, the Department of Health and Human Services (HHS), and the Department of the Treasury (Treasury) (collectively, the Departments) issued additional FAQs regarding coverage of COVID-19 testing and vaccines. The Department of Justice (DOJ) sent a letter to the U.S. Supreme Court (Supreme Court) regarding its position in the court case challenging the constitutionality of the Patient Protection and Affordable Care Act (ACA). The Equal Employment Opportunity Commission (EEOC) withdrew its previously released proposed wellness program rules. The District of Columbia Circuit Court of Appeals agreed to a delay…


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