Don’t Forget About HIPAA When Addressing Data Security

Filed under: HIPAA Privacy and Security

Among the many data security and breach laws that exist, covered health care providers and health plans must also contend with the Health Insurance Portability and Accountability Act of 1996 (HIPAA). A recent settlement with the Department of Health and Human Services (HHS), Office for Civil Rights (OCR) emphasizes the importance of not only having a data security policy, but of following and updating such a policy.

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No Good Deed...: Allowing Part-Time Employees to Make Health FSA Contributions May Trigger ACA Penalties

Filed under: Health Care Reform, Health Plans, Cafeteria Plans

When it comes to health coverage, many employers draw a distinction between full-time and part-time employees. To be eligible to enroll in the employer’s health plan, an employee must work a minimum number of hours per pay period. But many of those same employers then allow even part-time employees to contribute to a health flexible spending account (“health FSA”). After all, doing so costs the employer nothing (and even saves a modest amount in employment taxes), and why not at least give those employees an opportunity to pay some of their medical expenses on a pre-tax basis? Unfortunately, this paternalistic approach may now subject an employer to substantial daily penalties under the Affordable Care Act (“ACA”).

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Agencies Plug Several Holes in the ACA Dike

Filed under: Health Care Reform, Health Plans, Group Health Plans

In recent guidance, the agencies charged with enforcing the Affordable Care Act (“ACA”) have sharply restricted the utility of “minimum-value” plans that exclude coverage for inpatient services, imposed strict constraints on an employer’s ability to subsidize its employees’ purchase of individual health insurance coverage on even an after-tax basis, and given state insurance regulators a green light to impose minimum attachment points in stop-loss policies.

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Employee Benefits Plans – 2015 Inflation

Filed under: Dollar Limits, Plan Administration

Following recent announcements by both the IRS and the Social Security Administration, we now know most of the dollar amounts that employers will need to administer their benefit plans for 2015.

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When Does 9.5% Equal 9.56%?

Filed under: Health Care Reform, Health Plans, Plan Administration

Although 9.5% has been a key threshold in determining the “affordability” of employer health coverage, the IRS has just announced (in Revenue Procedure 2014-37) that this threshold will be adjusted to 9.56% for 2015. This adjustment reflects the fact that health insurance premiums have risen more rapidly than incomes.  Similar adjustments have also been announced for related percentage thresholds.

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National Health Plan Identifiers Required by November

Filed under: HIPAA Privacy and Security, Group Health Plans

The HIPAA Electronic Transactions and Code Sets rule requires most group health plans to obtain new health plan identifier numbers (HPIDs) by November 5, 2014. While insurers will likely obtain the HPID on behalf of fully insured plans, the task of obtaining the HPID for a self-funded plan will fall upon the plan sponsor. While the process is relatively simple, plan sponsors should begin identifying which group health plan arrangements are subject to the HPID requirement and communicating with plan vendors regarding the requirements.

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Additional Action Required by Late Filers of Form 5500 (Even Those That Have Already Filed)

Filed under: Pension Plans, Reporting and Disclosure, Voluntary Correction Programs, Qualified Retirement Plans, Plan Administration

Plan administrators who fail to timely file Form 5500 annual reports for their retirement plans may be subject to penalties under both ERISA and the Tax Code. Under previous guidance from the IRS, correcting such a late filing under the Department of Labor’s Delinquent Filer Voluntary Compliance (“DFVC”) Program could relieve the filer from penalties assessed by both the Department of Labor (“DOL”) and the Internal Revenue Service (“IRS”). However, under new guidance from the IRS, relief from its penalties now depends on a separate filing. Moreover, this new IRS requirement will apply retroactively to DFVC Program filings made since 2009.

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Agencies Revise COBRA and CHIPRA Notices; Announce Special Marketplace Enrollment for COBRA Beneficiaries

Filed under: COBRA, Health Care Reform, Health Plans

The federal agencies charged with administering the Affordable Care Act (“ACA”) have issued revised versions of the model COBRA and CHIPRA notices. Moreover, current COBRA beneficiaries have been given a special one-time window in which to enroll in Marketplace coverage.

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IRS Announces 2015 Amounts for HSAs, HDHPs, and Out-of-Pocket Limits; Creates Another Trap for HDHP Sponsors

Filed under: Dollar Limits, Health Care Reform, Health Plans, Plan Administration

In Revenue Procedure 2014-30, the IRS has announced the 2015 inflation-adjusted amounts for health savings accounts (“HSAs”) and qualifying high deductible health plans (“HDHPs”), all as determined under Section 223 of the Internal Revenue Code. The maximum annual out-of-pocket expense amounts for all “essential health benefits” under non-grandfathered health insurance plans and policies will also increase for the 2015 plan and policy years. Unfortunately, there will now be a “disconnect” between the maximum HDHP out-of-pocket amount and the maximum amount allowed under other non-grandfathered plans.

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IRS Issues Same-Sex Guidance: Many Qualified Plans Must Amend By Year-End

Filed under: 401(k) Plans, 403(b) Plans, Pension Plans, Qualified Retirement Plans

The IRS has issued additional guidance regarding how the Supreme Court’s 2013 decision in Windsor v. United States (regarding same-sex marriage) applies to qualified plans and Section 403(b) arrangements. Notice 2014-19 provides that plans must operationally comply with the Windsor decision as of June 26, 2013, although certain same-sex marriages are not required to be recognized until September 16, 2013. Plans with language that is inconsistent with the Windsor decision must generally be amended by December 31, 2014 (although certain plans may have additional time to amend). The related FAQs provide that Section 403(b) plans are also subject to the same operational effective dates, but are not required to be amended at this time. Plan sponsors should consult with counsel to determine whether their qualified plans must be amended to comply with Windsor and to discuss correction of any operational failures that may have occurred since June 26, 2013.

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Spencer Fane’s Employee Benefits Group has earned a national reputation developing innovative benefits solutions to meet client needs. From left to right: Larry Jenab, Rob Browning, Chadron Patton, Ken Mason, Melissa Hinkle, Julia Vander Weele and Greg Ash.

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