Affordable Care Act Update Q1 2013
Internal Revenue ServiceIn December, the IRS published the Proposed Final Regulations on Shared Responsibility, the rules surrounding the employer mandate to provide coverage or pay a penalty. While mostly familiar to those who have kept up with all the various proposed rules that came out earlier in 2012, there were a few new items as well. The core rules requiring employers to provide affordable coverage to its full-time employees, setting the bar at 30 hours per week for full-time status, and the availability of various safe harbors to measure employee status and affordability, all remain intact.
The IRS has also published guidance with respect to the individual mandate (which also goes by the same phrase Shared Responsibility). Here, the IRS refined the provisions that apply to all taxpayers starting on January 1, 2014 that required comprehensive health insurance coverage or the application of a tax penalty. Again, as with the employer Shared Responsibility guidelines, the regulations for individuals largely reinforced prior publications.
Department of LaborThe Department of Labor has also been busy. Given the fact that the Exchanges are still being designed and built, and that regulations hadnt been published in a timely manner, the one remaining 2013 notice for employers to distribute to employees regarding the existence of the healthcare Exchanges, how they operate, and the consequences of waiving employer coverage and purchasing Exchange coverage instead has been moved from March, 2013 to later in the year. We dont have an exact distribution date yet, but expect it to be sometime between July and October, 2013. Exchanges have also been renamed to Healthcare Marketplaces due to how Exchange translates into Spanish, but various government publications still use the term Exchange; expect both to be used through the end of 2013.
Health and Human ServicesFinally, Health and Human Services has published the final regulations for Essential Health Benefits, which apply to insurance carriers and providers of coverage through the Exchanges/Marketplaces. This guidance is important as its the last significant missing piece of guidance needed to get the Exchanges up and running. Of importance to employers, though, is the confirmation of plan design parameters that employer plans need to abide by. Again, no major changes were incorporated, but tweaks were made.
Stay on Track2014 is fast approaching, and much work remains to be done, but the government appears to be on track to meet their two major remaining deadlines with respect to the ACA:
- October 1, 2013 launch of the Exchanges/Marketplaces
- January 1, 2014 implementation of the final rules
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