Starting this week, Starmark® employers with a self-funded plan design will receive letters via mail providing information on the status of dependent social security numbers (SSNs). This will help with their 2017 ACA 6055/6056 filing requirements by letting them know if we are missing SSNs for any covered dependents. The broker of record will receive a copy of their group(s) letter.
If the employer has any covered dependents in 2016 with missing SSNs, or adds a dependent later with a missing SSN they can log in to the Starmark website and update the information under Manage My Group > Dependent SSN Update. The initiative by the employer to obtain and update all missing information will help to ensure that the January 2017 report available in the Document Center will be as complete as possible.
It is the employers’ responsibility to collect the pertinent information and file the appropriate documents with the IRS for all employees. Employers should consult a professional benefit adviser or legal counsel regarding how the law may impact their business and specific self-funded benefit plan.
View the letters below:
Social security numbers missing
On June 30, 2016, the IRS issued a QuickAlert about the electronic Affordable Care Act’s (ACA) Sections 6055 and 6056 information return filing.
While the deadline to electronically file ACA information returns with the IRS was June 30, 2016, the ACA Information Returns (AIR) system will remain up and running after the deadline, according to the alert.
Applicable large employers, self-insured employers and other health coverage providers that were not able to submit all required ACA information returns by June 30, 2016, should complete the filing of returns after the deadline.
According to the IRS alert:
- The AIR system will continue to accept information returns filed after June 30, 2016. In addition, the required system testing can still be completed after June 30, 2016.
- If any transmissions or submissions were rejected by the AIR system, filers have 60 days from the date of rejection to submit a replacement and have the rejected submission treated as timely filed.
- Entities that submitted information returns and received “Accepted with Errors” messages may continue to submit corrections after June 30, 2016.
The IRS is aware that some filers are still in the process of completing their 2015 tax year filings. According to the IRS alert:
- As is the case for other information returns, penalties may be associated with the submission of the ACA information returns for failure to timely file required returns.
- As the IRS has publicly stated in various forums in recent months, filers of Forms 1094-B, 1095-B, 1094-C and 1095-C that miss the June 30, 2016, due date will not generally be assessed late filing penalties under section 6721 of the IRS Code if the reporting entity has made legitimate efforts to register with the AIR system and to file information returns, and it continues to make such efforts and completes the process as soon as possible.
- Consistent with existing information reporting rules, filers that are assessed penalties may still meet the criteria for a reasonable-cause waiver from the penalties.
Entities that are not electronic filers and missed the May 31, 2016, paper filing deadline for ACA information returns should also complete the filing of paper returns as soon as possible, the IRS stated.
For more information on Sections 6055 and 6056, follow this link.
When a group health plan administrator sends out the COBRA model election notice, it may include, in or along with, additional information about the Health Insurance Marketplace, according to federal departments.
The federal Departments of Labor, Health and Human Services and the Treasury report that plan administrators may include other information about the marketplace (or exchange), such as:
- how to obtain assistance with enrollment in the marketplace or exchange (including special enrollment);
- the availability of financial assistance;
- information about marketplace websites and contact information;
- general information regarding particular products offered on the marketplace; and
- other information that may help in choosing between COBRA and other coverage options.
The federal departments indicate that COBRA election notices are required to be easily understood by the average plan participant, and therefore, should not be too lengthy or difficult to understand.
This information is contained in “FAQs about Affordable Care Act Implementation (Part 32),” which was released on June 21, 2016. For more information, follow this link.
COBRA generally applies to all group health plans maintained by private-sector employers with 20 or more employees, or by state or local governments. COBRA does not apply to plans sponsored by the federal government or by churches and certain church-related organizations.
Federal departments issued final rules to ensure that Essential Health Benefits are not subjected to annual and lifetime dollar limits, as mandated by the Affordable Care Act (ACA).
The final rules require that, for plans years beginning on or after Jan. 1, 2017, large group insurers and self-funded plans that are not required to provide Essential Health Benefits* (including ERISA self-funded plans) must define the Essential Health Benefits provided in their plan consistent with one of the following:
- one of the 51 EHB benchmark plans in a state or Washington, D.C., or
- one of the three Federal Employee Health Benefit Programs.
As a result of the rules, both large group insurers and self-funded plans will, in effect, be selecting a benchmark plan or federal program to support their application of any annual or lifetime dollar limits contained in their plan. The rules apply regardless of the size of the self-funded plan and regardless of grandfathered status. The federal Departments of the Treasury, Labor and Health and Human Services issued the final rules on Nov. 18, 2015. For more information on such benchmark plans or federal programs, follow this link.
Please note: Starmark® health plan designs do not include any dollar maximums to ensure compliance with the ACA mandate prohibiting annual and lifetime dollar limits. Therefore, election of a benchmark plan or federal program would appear to be unnecessary for self-funded plans administered by Starmark.
*ERISA self-funded plans do not have to include 10 categories of benefits known as Essential Health Benefits (EHBs). However, if such self-funded plans do include EHBs, they are prohibited from imposing lifetime or annual dollar limits on these benefits. Certain non-ERISA self-funded plans may be required by applicable state laws to provide Essential Health Benefits.
By the end of this week, Starmark® employers with a self-funded health plan design who are required to pay the Patient-Centered Outcomes Research Institute (PCORI) fee will receive a letter via mail providing their group’s “average covered lives” during the plan year ending in 2015 (using the Snapshot Count method).
As a courtesy, the Broker of Record will receive a duplicate copy of the letter sent to their group(s). The letter will also be posted to the Document Center on the Starmark website for the employer, the Broker of Record and the broker’s managing general agent to view.
The Patient Protection and Affordable Care Act and associated regulations requires health insurance issuers and plan sponsors of self-funded group health plans to file and pay an annual PCORI fee.
Plan sponsors of self-funded health plan years ending in 2015, are required to send the fee to the IRS on Form 720 by July 31, 2016.
Click here to view a sample letter
Employers can use a newly enhanced flyer to help determine if they are complying with the Employer Mandate or whether they may face penalties. The flyer, which provides an at-a-glance look at the Employer Mandate, displays an easy-to follow graphic illustration of the requirements along with a glossary of terms.
For more detailed information about the Employer Mandate, including specifics about when the rules apply, how to determine full-time employees, penalties, and more, view the Employer Mandate: Guide. This guide also includes an example using a fictional company to help illustrate the steps an employer must take to determine its obligation under the Employer Mandate.
Federal agencies have released a new set of commonly asked questions and answers about Affordable Care Act implementation, which address coverage of preventive services, mental health benefits and women’s cancer benefits.
The links from the bullets below provide summarized answers to questions contained in the original document. For complete answers to the questions and to read the original document, follow this link.
Source: FAQs about Affordable Care Act Implementation (Part 31); published April 20, 2016