September 2019 Compliance Recap

Category: Compliance

September 2019 Compliance Recap

Posted On: October 8, 2019 | Categorized as: Compliance, Employee Benefits

September was a busy month in the employee benefits world. The U.S. Senate confirmed Eugene Scalia as the new Secretary of the Department of Labor (DOL). The Internal Revenue Service (IRS) published proposed rules regarding affordability safe harbors and Section 105(h) nondiscrimination rules as applied to individual coverage health reimbursement arrangements (ICHRAs). The IRS also announced that the health insurance providers fee will resume for 2020. The IRS released an information letter regarding transition relief and whether employer shared responsibility penalties may be waived under the Patient Protection and Affordable Care Act. The DOL, Department of Health and Human Services (HHS), and Treasury (collectively, the "Departments") released final FAQs on mental health parity. The DOL issued an opinion letter regarding delaying Family and Medical Leave Act (FMLA) leave. The DOL also issued an opinion letter regarding whether employer contributions to health savings accounts (HSAs) are earnings subject to wage garnishment…

DOL Overtime Rule Change

Posted On: October 2, 2019 | Categorized as: Compliance

On Sept 24th, the US Department of Labor (DOL) released a new rule, increasing the minimum salary level for exempt status to $35,568 per year for a full-time employee, effective January 1, 2020.  Read the full law, here: DOL Overtime Rule Change  The proposed rule creates the following changes:Raises the minimum salary for an exempt administrative, professional, or executive employee to $684 per week or $35,568 per yearRaises the minimum salary for an exempt "highly compensated employee" from $100,000 to $107,432Permits employers to include some non-discretionary bonuses and incentive payments (including commissions) to satisfy up to 10% of the minimum salary requirementAllows employers to make a one-time "catch up" payment to an employee whose annual salary will fall short of the new minimum in some circumstancesThe consequences of such a conversion can be serious for the unaware employer. Most employers do not trackhours worked by exempt employees.For assistance in assessing whether employees are properly…

August 2019 Compliance Recap

Posted On: September 6, 2019 | Categorized as: Compliance

August was a relatively quiet month in the employee benefits world. The Department of Labor (DOL) issued its updated Medicaid / CHIP Model Notice. The Centers for Medicare and Medicaid Services (CMS) revised its Medicare Secondary Payer User Guide and changed reporting requirements regarding prescription drug coverage beginning January 1, 2020. The Treasury, DOL, and Department of Health and Human Services (HHS) issued FAQs regarding enforcement of the Final 2020 Benefit and Parameters Rule. The Internal Revenue Service (IRS) released a private letter ruling addressing whether certain expenses qualify as Section 213(d) medical care expenses. The DOL issued an advisory opinion addressing whether intermittent Family and Medical Leave Act (FMLA) leave can be taken to attend special education meetings for an employee's children.   DOL Issues Updated Medicaid / CHIP Model Notice The Department of Labor (DOL) issued an updated Premium Assistance Under Medicaid and the Children's Health Insurance Program…

NJ Bans Salary History

Posted On: August 8, 2019 | Categorized as: Compliance

On July 25th, 2019, New Jersey's Acting Governor Sheila Oliver signed NJ Bill A1094 ("the Law"), which bans employers from asking applicants for their salary history. Read the full law here, NJ Bans Salary History, to learn: What is now illegal for an employer to do What the law allows employers to do The next steps New Jersey employers should take Next Steps for New Jersey Employers If your employment application includes questions about the applicant’s salary history, consider either deleting them or, if you are a multistate employer, including a clear instruction that New Jersey applicants should not provide this information. Be certain that you expressly direct your background check vendors not to ask for or share an applicant’s salary history information with the employer unless the applicant has expressly authorized the disclosure. Conduct training with your recruiters and managers about the new law prohibiting them from asking applicants…

Additional Preventive Care Benefits Permitted for High Deductible Plans

Posted On: August 8, 2019 | Categorized as: Compliance, Employee Benefits

In Executive Order 13877, issued June 2019, the Treasury Department and the IRS were directed to consider ways to expand the use and flexibility of HSA's and HDHP's. In response to the Executive Order, the Treasury Department issued guidance on July 17, 2019, that lists newly identified preventive care items and services that may now be covered by a high deductible health plan. Read the complete executive order details here, including the list of identified items: HDPS Additional Preventive Care HDHP sponsors should review the new guidance promptly. For some HDHPs, plan sponsors may seek to expand the list of preventive care items and services covered under the HDHP. For other HDHPs, which already treated certain chronic care expenses as preventive, plan sponsors will need to consider whether changes to that list of preventive items and services are now necessary or appropriate. If you have any questions regarding these additional…

July 2019 Compliance Recap

Posted On: August 8, 2019 | Categorized as: Compliance

July was a busy month in the employee benefits world. The Internal Revenue Service (IRS) released a notice that expands the list of preventive care benefits a high deductible health plan can provide without a deductible or with a deductible below the annual minimum deductible. The IRS also released the indexed affordability percentage for plan years beginning in 2020. The U.S. Preventive Services Task Force (USPSTF) published an "A" rating final recommendation. The Department of Health and Human Services (HHS) released an update to the notice requirements for plans using the HHS-administered federal external review process. A U.S. District Court upheld the 2018 short-term, limited-duration insurance final rule. The Third Circuit Court of Appeals affirmed a federal district court's preliminary injunction regarding contraceptive coverage exemptions. The Department of Labor (DOL) released an advisory opinion regarding association health plans (AHPs) and multiple employer welfare arrangements (MEWAs). The Fifth Circuit Court of…

Pennsylvania Medical Marijuana Updates

Posted On: July 23, 2019 | Categorized as: Compliance, Employee Benefits

Effective July 20, 2019, Pennsylvania will recognize anxiety and Tourette Syndrome as serious medical conditions in the medical marijuana program.   The Pennsylvania Department of Health stated that the decision came after a research-based recommendation by the state’s Medical Marijuana Advisory Board, followed by Health Secretary Rachel Levine’s careful review of the medical literature available about the conditions. You can read more in Pennsylvania’s press release: The Pennsylvania Medical Marijuana Act allows individuals with a serious medical condition to receive a certification to use medical marijuana obtained from a licensed dispensary in the Commonwealth. Employers need to be familiar with the Act and prepared to properly manage employees at the worksite that are certified to use medical marijuana. The Act provides protections for employees certified to use medical marijuana and in particular, it prohibits employers from discriminating or taking an adverse action against an employee “solely on the basis of the employee’s…

EEOC Component 2 Data Update

Posted On: July 18, 2019 | Categorized as: Compliance, Employee Benefits

On July 2, 2019, following initial notifications to employers of the upcoming Component 2 filing deadline, the EEOC updated the Component 2 website to include both Additional Information and Frequently Asked Questions (FAQs) sections. Under the Additional Information section, employers can find a sample form, an instruction booklet, a fact sheet, a sample initial Component 2 notification letter sent to employers, and reference documents. Under the FAQs section, employers can find answers to questions related to the filing deadline, the filing requirements, the summary compensation and hours worked data to be reported, multi-establishment reporting, the Component 2 online filing system, and confidentiality concerns. Many of the FAQs are consistent with previous guidance from EEOC. However, one particularly helpful and new FAQ is related to whether an employer must choose the same “workforce snapshot period” for Component 2 data that it chose for Component 1 EEO-1 reporting for 2017…

HRA Final Rules

Posted On: July 18, 2019 | Categorized as: Compliance, Employee Benefits

The Department of the Treasury (Treasury), Department of Labor (DOL), and Department of Health and Human Services (HHS) (collectively, the Departments) recently released their final rules regarding health reimbursement arrangements (HRAs) and other account-based group health plans. An HRA is a type of account-based group health plan funded solely by employer contributions that reimburses an employee for IRC Section 213(d) medical care expenses incurred by the employee, or the employee’s spouse, dependents, and children who are not age 27 as of the end of the taxable year, up to a maximum fixed-dollar amount during a coverage period. Link to IRC Section 213(d): These reimbursements are excludable from the employee’s income and wages for federal income tax and employment tax purposes. An HRA can allow amounts that remain at the end of the year to be available to reimburse medical care expenses incurred in later years. The final rules were…

June 2019 Compliance Recap

Posted On: July 17, 2019 | Categorized as: Compliance

June was a relatively busy month in the employee benefits world. The Department of Labor (DOL), the Department of Health and Human Services (HHS), and the Department of Treasury published final rules that removed the prohibition against integrating a health reimbursement arrangement (HRA) with individual health insurance coverage and recognized certain HRAs as limited excepted benefits. A U.S. District Court issued a permanent injunction against the Patient Protection and Affordable Care Act contraception mandate. The President signed an executive order directing federal agencies to issue guidance and regulations regarding high deductible health plans with health savings accounts, Section 213 medical care expenses, flexible spending arrangements, health plan communication of out-of-pocket costs, and surprise billing. The Department of Health and Human Services' Office for Civil Rights (OCR) issued frequently asked questions (FAQs) regarding HIPAA compliance for health plans during care coordination and continuity. DOL, HHS, and Treasury Publish Final Rules on Health…

NJ Now Has Greater Protections for Employees Who Are Cannabis Users

Posted On: July 17, 2019 | Categorized as: Compliance, Employee Benefits

On July 2, 2019, New Jersey Governor Phil Murphy signed a bill into effect that overhauls the state’s existing medical cannabis program and law, the Compassionate Use of Medical Marijuana Act (CUMMA), and greatly expands patient access to medical marijuana. For employers who must address the issue of employees and job applicants who use and test positive for cannabis, the New Jersey Assembly Bill A20 provides certain job protections for medical cannabis users. This is a significant change for employees and employers, since CUMMA previously did not explicitly contain such protections.  These changes are summarized below. The CUMMA Amendment Assembly Bill A20 now contains a non-discrimination provision which provides that an employer cannot take an adverse employment action against an employee “based solely on the employee’s status as a registrant” for medical cannabis. Unlike the previous draft of the bill, there is no carve-out in Assembly Bill A20 allowing an…

Compliance Alert: IRS Raises HSA/HDHP Limits for 2020

Posted On: June 18, 2019 | Categorized as: Compliance, Employee Benefits

Compliance Alert: IRS Raises HSA/HDHP limits for 2020 The IRS has announced that effective January 1, 2020, an individual in a High Deductible Health Plan (“HDHP”) with self-only coverage has a new maximum allowable annual contribution into a Health Savings Account of $3,550, increased from $3,500.  The maximum annual contribution for individuals with family coverage will increase from $7,000 to $7,100.  The catch-up contribution for people age 55+ remains at $1,000. See below for the updates to the annual contributions and cost sharing.   Because of the cost-sharing limits change for HDHPs in 2020, employers that sponsor High Deductible Health Plans may need to make plan design changes for plan years beginning in 2020.  Employers that allow employees to make pre-tax HSA contributions should review their benefit guides and election forms to reflect the updated HSA contributions limits for 2020.

New NJ Commuter Law

Posted On: June 17, 2019 | Categorized as: Compliance, Employee Benefits

Governor Murphy signed a new law on March 1, 2019, read here: Commuter Law, requiring certain employers to provide pre-tax commuter fringe benefits to employees.  New Jersey employers with at least 20 employees in the state will need to begin offering those employees pre-tax transportation fringe benefits covering commuter highway vehicle and mass transit costs. The program must be implemented by March 1, 2020, or the effective date of New Jersey Department of Labor and Workforce regulations, whichever occurs first. Covered Employers The benefit applies to employers and employees covered by New Jersey’s unemployment insurance law. Employers covered by a collective bargaining agreement (CBA) are exempt until any current CBA expires. The mandate doesn’t specify how soon after hire employers must be offered these benefits or impose any notice or posting requirements, but these issues may be addressed in the impending regulations. Mandated Benefit The pre-tax commuter benefit must comply with…

March 2019 Compliance Recap

Posted On: June 17, 2019 | Categorized as: Compliance, Employee Benefits

March 2019 Compliance Recap

March was a busy month in the employee benefits world. The Department of Justice (DOJ) announced that it will not defend the Patient Protection and Affordable Care Act (ACA) in the court case challenging the ACA's constitutionality. The Internal Revenue Service (IRS) updated two Q&As regarding ACA reporting for 2018. The Department of Health and Human Services (HHS) published its 2020 Actuarial Value Methodology and 2020 AV Calculator. HHS also released a bulletin that allows grandmothered plans to be extended through 2020. A U.S. District Court vacated the bona fide associations and working owner provisions contained in the Department of Labor's association health plans final rule. The Department of Labor (DOL) released two information letters. One information letter clarifies when an authorized representative may receive claim-related notices on behalf of an ERISA plan participant. The other information letter addresses whether employees may delay taking FMLA leave and whether the statutory…

February 2019 Compliance Recap

Posted On: March 20, 2019 | Categorized as: Compliance

February was a quiet month in the employee benefits world. The Internal Revenue Service (IRS) released an information letter addressing when an employer may seek recoupment of contributions made to an employee's HSA. A U.S. District Court held that the State of Maryland could not ask for a declaration that the Patient Protection and Affordable Care Act (ACA) is constitutional and enforceable. Four states and the U.S. House of Representatives joined the appeal of the court case that held the ACA to be unconstitutional. The Department of the Treasury, Department of Labor (DOL), and the Department of Health and Human Services (HHS) issued a request for information regarding grandfathered group health plans. UBA Updates UBA released one new advisor: Compliance Recap - 2018 Year in Review UBA updated or revised existing guidance: State Guide to COBRA Supplemental Requirements IRS Releases Information Letter on Returning HSA Contributions to an Employer Generally,…

Recent Updates in New Jersey Law

Posted On: March 12, 2019 | Categorized as: Compliance, Employee Benefits

A lot has been happening in New Jersey since the new year began, and there have been a few critical updates for New Jersey employers and employees. New Jersey Minimum Wage On January 17, 2019, Governor Phil Murphy and legislative leaders agreed on legislation that will incrementally increase New Jersey’s minimum wage to $15.00 an hour by the year 2024, making New Jersey one of the most progressive states in the nation on this topic.  The minimum wage is currently $8.85 as of January 1, 2019. New Jersey Earned Sick Leave law The New Jersey Earned Sick Leave law went into effect on October 29, 2018 and employees are eligible to start using this accrued leave as of February 26, 2019.  Don’t forget to carryover any time that accrued from October 29, 2018 through the end of 2018.  As a reminder, employees cannot accrue more than 40 hours in a…

January 2019 Compliance Recap

Posted On: February 13, 2019 | Categorized as: Compliance

January was a relatively quiet month in the employee benefits world. The Department of Labor (DOL) issued its annual adjustment of federal civil monetary penalties. The Centers for Medicare & Medicaid Services released a proposed rule for benefit payment and parameters for 2020. The Internal Revenue Service (IRS) released its 2018 Instructions for Form 8994 Employer Credit for Paid Family and Medical Leave and final Form 8994. The IRS released its "Tax Cuts and Jobs Act: A comparison for businesses" that provides a chart of how the Tax Cuts and Jobs Act changed deductions, depreciation, expensing, tax credits, and other tax items that affect employers. Two federal district courts made rulings on the final rules regarding contraceptive coverage exemptions. The DOL released an information letter that explains ERISA's preemption of certain state wage deduction laws. The Congressional Research Service (CRS) issued an updated Affordable Care Act (ACA) Employer Shared Responsibility…

December Compliance Recap

Posted On: January 14, 2019 | Categorized as: Compliance, Employee Benefits

December was a relatively quiet month in the employee benefits world. A U.S. District Court issued an order declaring that the Patient Protection and Affordable Care Act (ACA) is unconstitutional. The Equal Employment Opportunity Commission (EEOC) issued two final rules to remove certain wellness program incentives. The Department of Labor (DOL) updated its Form M-1 filing guidance for association health plans. U.S. District Court Declares ACA Unconstitutional On December 14, 2018, the U.S. District Court for the Northern District of Texas (Court) issued a declaratory order in ongoing litigation regarding the individual mandate and the Patient Protection and Affordable Care Act (ACA). The Court declared that the individual mandate is unconstitutional and declared that the rest of the ACA – including its guaranteed issue and community rating provisions – is unconstitutional. The Court did not grant the plaintiffs' request for a nationwide injunction to prohibit the ACA's continued implementation and…

NJ Consumer Protection Act goes into effect on August 29, 2018

Posted On: August 24, 2018 | Categorized as: Compliance

On August 29th, 2018, the “Out-of-network Consumer Protection, Transparency, Cost Containment and Accountability Act” will go into effect.  All fully-insured health plans must follow the New Jersey state mandate, while self-funded health plans can decide to opt-in.  Innovative Benefit Planning has prepared a brief on what employers should know about the new legislation.  What are Surprise Bills A surprise bill occurs when a consumer of healthcare goods and services visits an in-network provider and receives treatment from out-of-network healthcare professionals.  Often, the consumer does not know that they will receive a separate bill which is above and beyond their in-network cost-sharing limit.  Surprise bills are most common in ambulatory settings and emergency departments, where healthcare professionals are staffed based on patient volume.  While a surprise bill can be generated from virtually any physician, in most recent years consumers have seen an increase in surprise bills resulting from an emergency department…

Trump Administration Suspends Billions in Risk Adjustment Payments to Insurers

Posted On: July 10, 2018 | Categorized as: Compliance

Background The implementation of the Affordable Care Act brought uncertainty to many insurers.  To guard against adverse selection, and the threat of insurer insolvencies, the federal government enacted safety measures to stabilize the individual markets.  The “3 R’s of Health Insurance” sought to balance the risk pool by eliminating uncertainty for those insurers participating in state exchanges. What are the 3’R’s The Transitional Reinsurance Program lasted from 2014 and ended in 2016.  Its purpose was to provide funding to those insurance companies operating in state run exchanges that incurred high claim costs.  Since Adverse Selection was a major concern for insurers, and higher-cost individuals were more likely to enroll in exchange plans, the Transitional Reinsurance Program served to not only protect insurance companies from insolvencies, but also ensured that plans were affordable on state exchanges. Similarly, The Temporary Risk Corridor Program was short-lived and ended in 2016.  Under this program,…

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