Human Capital Management Blog

Yes, it’s true, the House Ways and Means Committee has released their portion of the Affordable Care Act “repeal and replace” bill. Already, this is generating a lot of churn and discussion in the media regarding individual and employer mandate reporting requirements for 2017. This is where we advise everyone to pause, and take a breath.

With less than 3 weeks between today and Inauguration Day, there is a lot of speculation about the future of the Affordable Care Act. In this blog we’ll be reviewing the likely tactic of Budget Reconciliation that Congress will use to rapidly repeal the ACA, and discuss which provisions can and cannot be impacted by this tactic.

On December 13, 2016, the 21st Century Cures Act was signed into law, allowing for small group employers not offering employer-sponsored health plans to offer stand-alone Health Reimbursement Arrangements (HRAs). The change is significant, given that most stand-alone HRAs have been prohibited by the Affordable Care Act since 2014. This new type of HRA, called a “qualified small employer HRA,” is effective for plan years starting on or after January 1, 2017. So, what’s this mean? Employers that currently do not sponsor a health plan may consider implementing a qualified small employer HRA in order to help employees pay individual insurance premiums or qualified medical expenses.

With much buzz in the media surrounding the future of the Affordable Care Act (ACA) amidst a Trump-administration, I’d like to focus on a few points to help us better frame a realistic discussion about the future of the ACA and American healthcare. Beyond the millions of Americans reliant upon government subsidies for affordable healthcare, there is also roughly 20% of America’s gross domestic product, according to a recent report, that is fueled by stakeholders in the insurance or healthcare industry. In other words, there are a lot of lobbyists that will be weighing in on discussions surrounding the future of American healthcare. So what do we know?

While we were not expecting it, we certainly are not complaining. On November 18, 2016, the IRS issued Notice 2016-70, granting Applicable Large Employers (ALEs) under the Affordable Care Act (ACA) an additional month to furnish individual employee 1095-C and 1095-B Returns. The IRS cited the reason for the extension being that the Treasury Department had determined a significant number of ALEs and insurance providers would need the additional time to analyze 2016 reporting data and complete their reports on time. Here are a couple of key points to keep in mind regarding Notice 2016-70:

Good news! The IRS received and applied some of the feedback they received on simplifying the 1095-C.

In the employer market, deductibles have increased 67% since 2010. As more employers steer plan participants toward High Deductible Health Plans (HDHPs), Health Savings Accounts (HSAs) can often sweeten the transition. HSAs are a benefit available only to members participating in a HDHP. Both employers and employees can make pre-tax contributions into the account, and store up pre-tax cash to pay down deductibles when they incur claims. To boot, employees can take their HSA with them once they leave the employer. Employee's contribute pre-tax, the accounts grow tax-free, and withdrawals for qualifying expenses are made tax-free. It has some great benefits. That being said, employers already offering a Flexible Spending Account (FSA) to employees ought to keep a few potential pitfalls in mind as they transition.

It’d be nice to have another 2 month extension this year for ACA filing. It'd also be nice If I could see the Chicago Bears win the Superbowl again before I die. I’m not holding my breath. To comply with in-house resources, or outsource ACA compliance—that is the question! As we approach our second year of mandatory IRS filing (wow that was fast) Applicable Large Employers subject to the Employer Shared-Responsibility Mandate of the Affordable Care Act are faced yet again with the decision on how they will complete their annual filing requirements. For those conducting the cost-benefit analysis of in-house filing, here are ten costs to consider when looking to comply with in-house resources. Brace yourself, this might sting a little.