Feds Answer Questions on Special Enrollment, Women’s Preventive Health

Federal departments have answered common questions about special enrollment for group health plans and coverage of women’s preventive health services. A summary of their responses is below.

Special enrollment for group health plans

Q1: If an individual who enrolled in individual market health insurance coverage, including coverage purchased through a Marketplace, loses eligibility for that coverage, is the individual entitled to a special enrollment period in an employer-sponsored group health plan for which the individual is otherwise eligible and had previously declined to enroll?

A: Yes

Coverage of Preventive Services under the ACA

Q2: The Health Resources and Services Administration (HRSA) updated its Women’s Preventive Services Guidelines on Dec. 20, 2016. When must non-grandfathered group health plans and health insurance issuers begin offering coverage for preventive services without cost sharing based on the updated guidelines?

A: Women’s preventive services are required to be covered without cost sharing in accordance with the updated guidelines for plan years (or, in the individual market, policy years) beginning on or after Dec. 20, 2017. Until the new guidelines become applicable, non-grandfathered group health plans and health insurance issuers are required to provide coverage without cost sharing consistent with the previous HRSA guidelines and the Public Health Service Act section 2713 for any items or services that continue to be recommended.

Based on recommendations developed by the Women’s Preventive Services Initiative, the updated guidelines complement and build upon recommendations from organizations such as the U.S. Preventive Services Task Force. To view the new guidelines, follow this link.

The questions and complete answers are contained in “FAQs about Affordable Care Act Implementation Part 35,” which was released on Dec. 20, 2016, by the U.S. Departments of Labor, Health and Human Services and the Treasury. Follow this link for the complete document.

 

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IRS Stops Rejecting Individual Tax Returns ‘Silent’ on Coverage

As a result of reviewing the Jan. 20, 2017, executive order from President Trump, the Internal Revenue Service is no longer rejecting individual taxpayers’ tax returns that do not indicate, or are “silent,” on whether they complied with the Affordable Care Act’s individual mandate, according to the IRS website.

The individual mandate requires Americans to carry health insurance, qualify for an exemption or pay a penalty. Federal regulations required them to indicate on their tax returns whether they have health coverage. However, the executive order directed federal agencies to exercise authority and discretion to reduce potential burdens to taxpayers.

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2018 Cost-Sharing Limits

Cost-sharing limits for the 2018 plan year have been released by the U.S Department of Health and Human Services (HHS).

A group health plan’s annual in-network out-of-pocket maximum for Essential Health Benefits for the 2018 plan year cannot exceed $7,350 for a self-only plan and $14,700 for other than self-only coverage, according to HHS.

The in-network individual out-of-pocket maximum applies to all individuals, regardless of whether an individual has a self-only plan or other than self-only coverage (including a high-deductible health plan).

The 2018 cost-sharing limits represent a 2.8 percent increase from 2017 cost-sharing limits of $7,150 for a self-only health plan and $14,300 for other than self-only coverage, including family coverage.

 

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Court Ruling on Anti-Discrimination Regulations

A U.S. District Court judge has issued a nationwide preliminary injunction prohibiting the U.S. Department of Health and Human Services (HHS) from enforcing certain provisions of the rules in Section 1557 of the Affordable Care Act (ACA).

The plaintiffs, eight states1 and three private entities2, argued the rules extending anti-discrimination protections to transgender individuals and allegedly requiring the performing of and coverage of pregnancy terminations conflict with their beliefs. The federal government argued that the rules do not mandate any particular procedure, rather the rules require only that covered entities provide nondiscriminatory health services and health insurance in a nondiscriminatory manner.

Court ruling

On Dec. 31, 2016, the preliminary injunction was issued after the judge determined that the federal government exceeded its authority with rules that extended anti-discrimination protections to transgender individuals and that the rules likely violated certain laws, including religious freedom protections for the private entities regarding pregnancy terminations. Other provisions of the anti-discrimination rules issued under Section 1557 of the ACA were not affected by the preliminary injunction.

More on the ACA’s anti-discrimination regulations

The U.S. Office for Civil Rights issued anti-discrimination rules under the ACA’s Section 1557 that prohibit covered entities from discriminating in the provision of a health program or activity based on race, color, national origin, sex, age or disability.

Section 1557 rules apply to the following “covered entities”:

  • health plans, insurers, hospitals, doctors and other medical providers that receive federal funding from HHS, including Medicaid and Medicare Parts A, C and D payment (prescription-drug subsidies) but not Medicare Part B;
  • qualified health plans offered on either state or federal Health Insurance Marketplaces, also known as exchanges; and
  • all of a health insurance issuer’s operations, including the issuer’s third-party administrator services or ASO services, if an issuer receives federal financial assistance from HHS.

A covered entity that does not comply with Section 1557 may face:

  • enforcement mechanisms under federal law that ultimately may result in loss of federal funding, and
  • lawsuits from individuals, with the potential for compensatory damages.

Moving forward

Clients should consult with their attorney regarding compliance with Section 1557 rules before making any changes to their previously decided course of action.

For more information on Section 1557 rules, follow this link.

1Plaintiffs include eight states: Arizona, Kansas, Kentucky, Louisiana, Mississippi, Nebraska, Texas and Wisconsin.

2Plaintiffs also include three religiously affiliated private entities: Franciscan Alliance, Inc., its wholly owned entity Specialty Physicians of Illinois, LLC, and the Christian Medical & Dental Society.

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Deadlines Approaching for 6055 and 6056 Reporting

Deadlines for IRS Sections 6055 and 6056 reporting are approaching. Employers must provide a statement to the primary covered individual by March 2, 2017, and file paper returns by February 28, 2017, or electronic returns by March 31, 2017. Starmark® is providing a spreadsheet, available in the Document Center the week of January 9, 2017, that includes Social Security numbers we have on file for employees and dependents. For help with completing the forms or filing with the IRS, see your accountant, tax advisor and/or payroll services company.

Reminder: The ACA Reinsurance Assessment Fee will not be assessed for the 2017 benefit year; therefore, if you previously chose the option to have Starmark collect a monthly contribution fee, it is no longer included on your monthly bill.

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Changes Proposed for Form 5500

Federal agencies are proposing changes to improve Form 5500 Annual Return/Report. If adopted, the changes would generally apply for plan years beginning on or after Jan. 1, 2019.

View this flyer to learn what these proposed revisions are intended to do and what plans would be affected.

 

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Transitional Reinsurance Deadline Approaching

Employers must submit the 2016 Transitional Reinsurance Program Annual Enrollment and Contributions Submission Form and schedule payment no later than Nov. 15, 2016 on Pay.gov.

In 2016, the fee is $27 per average covered life. The first installment of $21.60 per average covered life is due no later than Jan. 17, 2017, and the second installment of $5.40 per average covered life is due no later than Nov. 15, 2017. Plan sponsors can also pay the fee in full by the deadline of the first installment.

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