Under age 30: $2,000
Between 30 and 39: $2,500
Between 40 and 49: $3,000
Between 50 and 59: $3,500
Over age 60: $4,000

The credit is available for each person. The credits are additive for a family, but capped at $14,000. The credits will be adjusted for inflation.
The tax credits are available in full to those making $75,000 per year ($150,000 joint filers). The credit phases out by $100 for every $1,000 in income higher than those thresholds.
5. Late Enrollment Insurance Surcharge
In lieu of the individual insurance mandate is a continuous coverage incentive of the Proposed Legislation that is designed to limit adverse selection in health care markets. Under this provision, if, during the 12-month period preceding the enrollment in new insurance, an applicant had a lapse in coverage for greater than 63 consecutive days, then the insurer may assess a flat 30 percent late-enrollment surcharge on top of the base premium.
In the case of an individual who ceased to be eligible for dependent coverage because of age, the surcharge will apply if the individual does not apply for coverage during the first open enrollment period following the date of the termination of coverage.
The late-enrollment surcharge may be assessed for 12 months.
The late-enrollment insurance surcharge will apply to special enrollments occurring during the plan year 2018, and for open enrollments occurring on and after January 1, 2019.
6. Delay (But Not Yet the Full Repeal) of the Cadillac Tax
The ACA imposed a 40 percent excise tax on high-cost, employer-sponsored health coverage, known as the “Cadillac Tax.” The Cadillac Tax is scheduled to go into effect in 2020.
The Proposed Legislation changes the effective date of the tax. Specifically, the tax will not apply until plan years beginning on or after January 1, 2025 (unless, of course, it is fully repealed before then).
7. Repeal of Other ACA-Imposed Taxes and Restrictions
The Proposed Legislation would eliminate a number of taxes created by the ACA, effective for tax years beginning after December 31, 2017. The taxes slated to be repealed include those mentioned below:
OTC Drug Cost Reimbursements. Under current law, over-the-counter medications cannot be reimbursed under FSAs, HRAs, or other tax-advantaged health savings accounts. The Proposed Legislation provides for the removal of this prohibition.
Repeal of Limitations on Contributions to FSAs. The ACA limits the amount an individual may contribute to a health FSA ($2,600 for 2017). The Proposed Legislation removes the limit (although an employer, through plan design, may impose its own).
Increased HSA Contribution Limit. The Proposed Legislation increases the basic limit on aggregate HSA contributions for a year to equal the maximum on the sum of the annual deductible and out-of-pocket expenses permitted under a high deductible health plan. Thus, the basic limit will be at least $6,550 in the case of self-only coverage and $13,100 in the case of family coverage, beginning in 2018.
Repeal of Net Investment Tax and Medicare Tax. The ACA imposes a net investment tax, applying a rate of 3.8 percent to certain net investment income of individuals, estates, and trusts with income above certain amounts. It also imposes a Medicare Hospital Insurance (“HI”) surtax based on income at a rate equal to 0.9 percent of a highly compensated employee’s wages or a self-employed individual’s income. Both taxes will be eliminated.

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The annual fee to fund the Patient-Centered Outcomes Research Institute (PCORI), paid by employers that sponsor self-insured health plans, will rise next year by an additional 9 cents per plan enrollee. Fully insured and self-insured plans providing accident or health insurance for individuals living in the U.S. are subject to the fee.

IRS Notice 2016-64, issued on Nov. 4, provides that the PCORI fee for plan years ending on or after Oct. 1, 2016, and before Oct. 1, 2017, including 2016 calendar year plans, is $2.26 per each person covered, up from $2.17 for the previous plan year.

Paying PCORI Fees

For self-funded plans, the self-insured employer/plan sponsor is responsible for submitting the fee and accompanying paperwork to the IRS. Third-party reporting and payment of the fee is not permitted for self-funded plans.

Employers subject to the fee must submit it by July 31 of the year following the last day of the plan year. For the coming year, self-insured health plan sponsors should use Form 720 for the second calendar quarter to report and pay the PCORI fee by July 31, 2017.

If you have questions regarding the PCORI fees, call 1.800.250.2741 or email us at solutions@gsanational.com.

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As in previous years, employers must report and pay the fee via IRS form 720 by July 31 of each year. The filing will cover the plan year that ended during the preceding calendar year.

If you have questions regarding the PCORI fees, call 1.800.250.2741 or email us at solutions@gsanational.com to contact one of our Healthcare Reform subject matter specialists.

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Questions and answers regarding the key provisions of the 2016 Employer Notice Program are below.‎

Q. Which employers will be notified through the employer notice program in 2016? ‎

A notice will be sent to an employer if any of its employees received an APTC for at least one month in ‎‎2016, and the employee provided the Marketplace Exchange with a complete employer address.  The notice will identify the ‎specific employee, and will include a statement that the employee is enrolled in Marketplace Exchange coverage and ‎has been determined to be eligible for the APTC.  For a sample of the 2016 Employer Notice, click here.

Q. Will the notice be sent only to large employers providing group health coverage?‎

No.  The notice will be sent to all employers with one or more employees enrolled in the Marketplace Exchange who are receiving an APTC.  Therefore, the notice will be sent:‎‎

• without regard to whether the employer is an “applicable large employer” that is potentially ‎subject to penalties under the ACA for not providing qualified coverage;‎
• without regard to whether the employee at issue is a full-time employee;
• without regard to whether the employer actually provides group health plan coverage to its ‎employees; and
• without regard to whether the group health coverage is insured or self-insured.

Q. To whom will the notice be sent?

The notice will be sent to the mailing address of the employer provided by the employee on his or ‎her application for Marketplace Exchange coverage.  As such, the notice for a particular employee will not ‎necessarily be sent to the employer’s corporate office.  Rather, if an employer has multiple plants and ‎facilities, and if an employee lists the address of a ‎plant in his or her Marketplace Exchange coverage application, the notice will be sent to that plant.‎

Therefore, employers need to alert their facilities to be on the lookout for the notices‎.

Q. When will the notices be sent?‎

The CMS guidance indicates that the notices will begin being sent in the “Spring.”  Since Spring will soon ‎end, we can expect that the notices will arrive soon.‎

The notices will be sent in batches throughout the year.  The first batch will be the largest, covering ‎employees who enrolled in the Marketplace Exchange during the normal 2016 open enrollment period.  Subsequent notices will cover ‎employees enrolled mid-year pursuant to the Marketplace Exchange special enrollment rules.‎

Q. What if an employer disagrees with an employee’s claim that he or she was not offered qualified ‎coverage?‎

An employer may appeal an employer notice and assert that it either offered the employee ‎qualified (affordable, minimum value) coverage, or that the employee is enrolled in employer ‎coverage.  In either case, the employee is ineligible for an APTC.  If the Marketplace Exchange agrees with the employer, it will send a notice to the employee encouraging the employee to update his or ‎her Marketplace Exchange application to reflect that he or she has access to or is enrolled in other coverage.  The ‎notice will also explain that failure to update the application may result in a tax liability to the employee. ‎

Q. When and how does an employer submit an appeal of an employer notice? 

An employer has 90 days from the date of the notice to request an appeal.  To access the Employer Appeal Request Form, click here: https://www.healthcare.gov/marketplace-appeals/.  The completed form must be either mailed or faxed to the CMS at the indicated address.

Q. Can an employer designate a third party to assist in the appeal?‎

The Employer Appeal Request Form allows an employer to authorize a “secondary contact” to act on ‎behalf of the employer in regard to an appeal request.  However, the form requires the ink signature ‎of an authorized “primary contact” within the employer organization. Therefore, an employer will ‎need to retain some involvement with the appeal process.‎

Q. Does the Employer Notice Program expose an employer to ACA non-coverage penalties?‎

No.  The CMS Employer Notice Program is separate and distinct from the IRS non-coverage excise tax ‎penalty rules.  The HHS regulations expressly hold that an appeal decision made under the ‎Employer Notice Program does not foreclose any rights the employer may have to appeal an ‎assessment of penalties under the Code Section 4980H employer responsibility provisions.‎

Therefore, an employer is not required to file an appeal under the Employer Notice Program in order ‎to preserve the right to challenge an assessment of a non-coverage penalty tax.  However, it may wish ‎to do so to assist in responding to any IRS penalty notice.‎

If you have questions regarding the Employer Notice Program, we are always happy to have a consultative discussion. Call us today at 1-800-250-2741, or email us at solutions@gsanational.com.

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• Which Employer Characteristics Predict Program Availability and Use of Incentives?
•  How Are Wellness Programs Configured?
• Are Incentives Increasing Program Uptake?

Analysis of Wellness Program

• What Employee Characteristics Predict Employee Uptake of Programs?
• How Do Incentives Alter an Employee’s Decision to (or Not to) Participate?
• Do Health Care Utilization Patterns Change Following Program Participation?
• Is There a Differential Effect of Various Programs on Medical Costs?
• Is There a Dose-Response Effect on Medical Costs in the Intensity of Program Interventions?
• Is There Evidence that Program Participation May Create Long-Term Gains in Health?

If you have questions about this report, please contact us at 1-800-250-2741 or solutions@gsanational.com.

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Code Section 6055 (“All Group Health Plan”) Reporting

What information must be reported to the IRS under the Code Section 6055 rule?‎
The annual Code Section 6055 report to be filed with the IRS must include the following information:

• The name, address, and employer identification‎ number (“EIN”) of the employer;
• ‎The name, address, and tax identification number‎ ‎(“TIN”) (or date of birth if a TIN is not available) of each employee (including any retiree or employee on COBRA) with respect to whom coverage is provided;‎
• ‎The name and TIN (or date of birth if a TIN is not‎ available) of each individual who is covered under the plan;
• ‎For each covered individual (employee and dependents), the months for which, the individual was enrolled in coverage and entitled to receive benefits; and
• Any other information required by the instructions to the transmittal form or future guidance.

Which employees must receive the annual statement?
The Code Section 6055 statement must be provided to each employee who is enrolled in the plan at some point during the year. This includes covered employees who died during the year.
A statement is not required to be provided to employees who were offered coverage, but who did not enroll in the plan.
What information must be included in the statement to employees?‎
The same information outlined two questions above must be provided to each enrolled employee.

Code Section 6056 (“Applicable Large Employer Only”) Reporting

What are the Code Section 6056 reporting requirements?‎
Applicable large employers are required to file an information return with the IRS that reports the scope of the employer-sponsored health plan coverage offered to full-time employees for the applicable year.‎
The IRS and employees will use the information provided on the Code Section 6056 report and the employee statement to determine whether an employee is eligible for a premium tax credit.‎
Which employees are included in the report and required to be provided statements?
The Code Section 6056 report will cover, and a statement will need to be provided to, each employee who is deemed to be a full-time employee under the play-or-pay rules for any part of the year. Consequently, the reporting and furnishing of statements will be required even for full-time employees who declined to enroll in the plan.
The IRS has deferred until 2016 the application of the ACA “play-or pay” rules to applicable large employers ‎having between 50 and 99 full-time equivalent employees. Does this transition relief also ‎postpone the reporting obligation of a mid-size employer that is eligible for the play-or-pay deferral?‎
No, it does not. Even though a mid-size employer is exempt from the play-or-pay penalty rules ‎for 2015, a plan that is sponsored by the employer remains subject to the IRS reporting and employee statement ‎obligations for that year.‎
What information must be included in the report?‎
Subject to certain alternative reporting methods discussed below, the annual Code Section 6056 report for an applicable large employer must include the information described below (plus any additional information required by future guidance,‎ forms, and instructions).
A. Full Disclosure Information
The annual report must provide the following information in full:

• ‎The name, address, and EIN of the employer;
• The calendar‎ year for which the information is reported;‎
• The name and telephone number of the employer’s contact person;‎
• A certification of whether the employer offers its full-time employees‎ ‎(and their dependents) the opportunity to enroll in‎ minimum essential coverage, by calendar month;‎
• The months during the calendar year for which minimum essential coverage under the plan was available;
• Each full-time employee’s share of the lowest cost monthly premium (self-only) for coverage providing minimum value offered to that full-time employee under the plan, by calendar month;
• The number of full-time employees for each month during the calendar year; and
• The name, address, and TIN of each full-time employee during the calendar year and the months, if any, during which the employee was covered under the plan.

B. Information Via Indicator Code
The following information will be required to be reported via an indicator code:

• Whether the coverage offered to‎ full-time employees and their dependents under an employer-sponsored plan provides minimum value;
• Whether the employee had the opportunity to enroll his or her spouse in the coverage;‎
• The total number of employees, by calendar month;‎
• Whether an employee’s effective date of coverage‎ was affected by a permissible waiting period, by calendar month;‎
• Whether the employer had, or did not have, any employees who were credited with any hours of service during any particular month, by calendar month;‎
• Whether the employer is a‎ member of a “controlled group of companies,” and, if so, the name and EIN of each member of the controlled group on any day of the calendar year for which the information is reported;‎
• If an employer is a contributing employer to a collectively-bargained multiemployer plan, whether, with respect to a full-time employee, the employer is not subject to payment of an employer penalty by reason of the employer having made contributions to the multiemployer plan; and
• If a third party is reporting on behalf of an employer, the name,‎ address, and EIN of the third party.‎

C. Anticipated Additional Information
The IRS has indicated that it anticipates that the additional information below will also be required to be reported for each full-time employee for each calendar month using a code.

• Whether coverage meeting minimum value was offered to:
  • The employee only;
  • The employee and the employee’s dependents only;
  • The employee and the employee’s spouse only; or
  • The employee, the employee’s spouse, and dependents.

• Coverage was not offered to the employee:
  • But the failure to offer coverage will not result in a play-or-pay penalty (for example, because the employee was in a waiting period);
  • The employee was not a full-time employee;
  •  The employee was not employed by the employer during that month; or
  •  No exception applies.

• Coverage was offered to the employee for the month, although the employee was not a full-time employee for that month.
• The employee was covered under the plan.
• The employer met one of the “affordability safe harbors” with respect to the employee.

What information must be included in the employee statement?‎
The statement to full-time employees must include:

• All of the information included in the IRS report (see Q-11 above) that pertains to the full-time employee; and
• The name, address, and contact information of the employer or third party that filed the report with the IRS.

What reporting is required of members of a controlled group?
All employers that are part of a controlled group of companies are combined for purposes of determining the “large employer status” of the group. If the group is determined to be an applicable large employer on an aggregated basis, each individual employer in the controlled group is required under Code Section 6056 to separately report for its employees. In addition, each employer must furnish an employee statement to its own employees.‎
May an employer-member use a third party to assist in completing the IRS reports?‎
Yes. However, engaging a third party does not transfer any responsibility from the employer for ‎the failure to file the reports or provide the statements. It is expected that the IRS will issue ‎supplemental guidance as to the manner in which a third party may assist in the reporting ‎process.‎
Alternative Methods for Section ‎6056 Reporting‎
In certain circumstances, the final regulations permit the use of optional, alternative reporting methods. These alternate reporting methods are described below.‎
Reporting based on certification of “qualifying offers.”
An applicable large employer will be entitled to prepare a simplified Code Section 6056‎ report and provide a simplified employee statement with respect to each full-time employee for whom it made a “qualifying offer.” A “qualifying offer” is one that:

• Offers employee-only coverage providing‎ minimum value at an employee cost not exceeding 9.5% of the federal poverty line for a single individual; and
• ‎Allows the enrollment of the‎ employee’s spouse and dependents.‎

For 2014, the federal poverty level for a single individual is $11,670. If that amount stays the same (which is not likely), then in order to have a qualifying offer, the cost to an employee for employee-only coverage cannot exceed $92.39 per month (9.5% of $11,670 ÷ 12).
If an employee had a qualifying offer for all 12 months of the calendar year, the employer would only need to include in its annual report the employee’s name, Social Security number, address, and an indicator that a qualifying offer was made. The employer could then simply provide the employee with either a copy of the IRS report, or a general statement informing the employee that the employee, and the employee’s spouse and dependents (if any), are generally ineligible for a premium tax credit for all 12 months.‎
If an employee received a qualifying offer for fewer than 12 months of the calendar year, the employer must use the general reporting and statements methods for the months in which the qualifying offer was made.
Certification of the qualifying offer will be required.
2015-only alternative method based qualifying offers:
Only for 2015, an employer certifying that it has made qualifying offers to at least 95% of its full-time employees will be eligible to use an even simpler alternative reporting method. It is anticipated that the employer will only need to report the employee’s name, address, and Social Security number, and the months for which the qualifying offer was made. Further guidance is to be provided.
Option to report without separate identification‎ of full-time employees if certain conditions related to offers of coverage are satisfied.
The final regulations allow an employer to provide Section 6056 reporting without determining whether each employee offered coverage is a full-time employee, and without specifying the number of the employer’s full-time employees. For this option to apply, the employer must certify on its transmittal form that it offered affordable coverage to at least 98% of the employees on whom it reports in its Code Section 6056 return (which may include part-time employees).‎ This option relieves the employer from having to determine which covered employees are full-time for each month.
For further information or questions regarding these updated ACA reporting requirements, please contact the us at800.250.2741 or email solutions@gsanational.com.

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• The 2014 fee is $63 per covered life, with scheduled collection in two installments: $52.50 in January, 2015, and $10.50 in the fourth quarter of 2015.
• The 2015 fee is confirmed at $44 per person.
• The fee for 2016 has not yet been announced.

In contrast to the comparative effectiveness fee payment rules, third-party administrators may make the transitional reinsurance fee payments on behalf of a self-insured plan. Also in contrast to the comparative effectiveness fee payment rules, the transitional reinsurance fees may be paid from plan assets, including Trust assets.
If you have questions regarding the payment calculation methodology of this fee, feel free to contact us atsolutions@gsanational.com, or 1.800.250.2741.

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For the second time since last year, the White House is giving certain employers a grace period before they must offer health insurance to almost all their full-time workers.
Under the new rules announced this week, medium-sized employers (50 to 99 employees) will be given until 2016 before they must offer health insurance to their full-time employees.
While no such moratorium has been announced for large employers with 100+ employees, they too will be given a different kind of one-year grace period. Instead of being required to offer coverage to 95 percent of full-time workers in 2015, these larger employers can avoid penalties by offering insurance to 70 percent of them next year.
As the Affordable Care Act and the mandates surrounding it continue to change and unfold, we welcome you to contact us with questions on how it might effect your PPACA compliance efforts, call us at 1.800.250.2741 or emailsolutions@gsanational.com. Or, post your questions below and our subject matter specialists will respond.

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