FINAL RULE RELEASED ON HRA'S

On June 13, 2019, the Departments of Labor, Health & Human Services and Treasury released final rules concerning Health Reimbursement Arrangements (HRAs).  The 497-page rule includes the creation of two new types of HRAs, the "Individual Coverage HRA” and the "Excepted Benefit HRA."

Advantages of the Individual Coverage HRA include, but are not limited to:

• Funds can be used to reimburse the employee's premiums for an individual health insurance policy.
• Reimbursements made to employees do not count towards the employee's taxable wages.
• The employer can choose to roll-over unused amounts into the following year.
• Coverage can be offered to different classes of employees (e.g.; full-time, part-time, seasonal, salaried, hourly)
• An offer of the Individual Coverage HRA represents an "offer of coverage" under the employer mandate, however, contributions must meet affordability guidelines. The IRS will release further guidelines regarding this later.

The Individual Coverage HRA also comes with restrictions and regulations including but not limited to:

• An offer of an Individual Coverage HRA cannot be made to any employee that is offered a traditional group health plan.
• If an offer of coverage is made to a class of employees, there is a minimum class size that is required. Size is typically 10% of that specific class of employees. For example, if an employer has 200 employees, a minimum of 20 employees would have to be in a specified class.
• Contributions can be in any amount that the employer chooses, but contributions must be consistent for all employees in a specified class.
• The employer must provide notice of the Individual Coverage HRA to employees.
• The employer must be able to substantiate that the employee is enrolled in an individual plan or Medicare (model notices are available).
• The employer must notify employees on an annual basis that the individual health insurance is NOT subject to ERISA.

The final rule also created the "Excepted Benefit HRA" which, starting in January of 2020, will permit employers to finance additional medical care. Employees can use the HRA without having to be enrolled in the group's traditional health plan.

The requirements associated with the "Excepted Benefit HRA" include, but are not limited to:

• The annual contribution is capped at $1,800.
• It must be offered in conjunction with a group health plan, but there is no requirement for the employee to enroll in that plan.
• The "Excepted Benefit HRA" cannot be used to fund group health or Medicare premiums.
• It can fund premiums for dental, vision, or short-term limited duration insurance.

Employers who want to offer the "Individual Coverage HRA" for January 1, 2020, can do so but employees will need to enroll in an individual plan during the 2019 open enrollment period (November 1, 2019 - December 15, 2019).

From Benefitmall, June 20, 2019

Evergreen Receivership Conference Call

August 22, 2017

Today we spent an hour with the Maryland Insurance Administration, Attorney for the Maryland Attorney Generals Office, Insurance Commissioner Al Redmer and spokespeople for the receivers of Evergreen Health.

Since insurance companies can't go bankrupt, they go into receivership.  The receivers will run the company with one main goal in mind, to protect the consumer.  There are not going to be any renewals with Evergreen or new business written.

Many of your employees have received letter indicating that HMO's are not covered under the Guarantee Fund.  This is correct.  However they are protected under court order and Maryland Statute.

Claims that were being processed before the Receivers took over (Around 8-1) are put on the back-burner and paid at the discretion of the Receivers. Some may never be paid.   Claims after 8-1 are given priority and paid first.  According to the Court Order, page 7, section 13, providers are not allowed to balance bill you, try to seek payment from you for claims submitted beyond your normal co-pay and/or refuse to see you.  Those that are, are violating the court order.  

Also, here are a list of FAQ's regarding the Receivership of Evergreen.

We have been in touch with each and every Evergreen client and are planning a strategy to best work with this situation that makes sense for your firm.  

As always, please feel free to contact me at 410-239-5009.

Respectfully,

Ben

Exchange Notice Requirement Under ACA

FLSA section 18B, added to the labor statute by the Patient Protection and Affordable Care Act (PPACA), requires employers that are subject to the FLSA (most employers) to provide to each of their employees, and to all new employees at the time of hiring, a written notice.  The notice is to remind employees of the availability of the health insurance exchange.  

The notice must be provided to each employee, regardless of plan-enrollment status or part-time or full-time status. Employers are not required to provide a separate notice to dependents or retirees, but an employer's obligation to provide the notice may extend to its independent contractors and leased workers, depending on the nature of their relationship with the employer as determined under the FLSA's "economic reality" test.  Below is a link for a Model Notice that can be used to satisfy the requirement.

http://www.dol.gov/ebsa/pdf/FLSAwithplans.pdf

1.1 Million Carefirst Members In D.C-Data Breach

As many as 1.1 million Washington, D.C., BlueCross BlueShield members may have had their information accessed in a cyber-breach that occurred in June of 2014.

CareFirst BlueCross BlueShield announced Wednesday it had been the target of a "sophisticated cyberattack," the company said in a release.

The attackers could have potentially acquired members' names, birth dates, email addresses and subscriber identification numbers.

However, CareFirst said its user names must be used in conjunction with a member-created password to gain access to underlying member data on the website.

The database that was breached did not include these passwords, which were encrypted and stored in a separate system as a safeguard against such attacks.

That means the attackers did not have access to member Social Security numbers, medical claims, employment, credit card, or financial information, CareFirst said.

The company is blocking member access to the accounts that might have been compromised, and is asking members to create new user names and passwords for them.

All affected users will be sent letters granting them two years of free credit monitoring and identity theft protection, the company said in a statement posted on its site.

The attack came to light when CareFirst hired Mandiant, the cyber-forensics unit of computer security company FireEye, to review its security in the wake of recent cyber attacks on other health insurers.

"The intrusion was orchestrated by a sophisticated threat actor that we have seen specifically target the health care industry over the past year," said Charles Carmakal, managing director of Mandiant.

The fact that the health care company's members are primarily based in Northern Virginia, Maryland and Washington D.C. is not lost on people in the security community.

"Obviously, we know what's there," said Rick Holland with Forrester Research, contemplating the heavy concentration of government, military and contractors in the region.

There has been speculation that previous health care computer breaches could also be linked to China, including those at Anthem, Premera and Community Health System.

Industrial spying by China is well known. On Tuesday federal prosecutors made public charges against a Chinese espionage ring that included two professors who studied together at the University of Southern California. The ring stole trade secrets and gave them to Chinese companies.

 Elizabeth Weise, USATODAY6:31 p.m. EDT May 20, 2015

Maryland Parental Leave Law for Employers with 15-49 Employees

Beginning October 1, 2014, all Maryland businesses with 15-49 employees will be required to provide six weeks of unpaid leave to an employee upon the birth of their child or the placement of an adopted or foster care child. This new law requires that the employer hold the employee’s job and benefits for up to six weeks or return the employee to an “equivalent position” when the employee returns within the six week leave period. Premiums for benefits may be recovered by the employer if the employee fails to return to work after the leave ends 

This new Maryland law is geared to providing employees who work for smaller employers with a watered-down version of federal Family and Medical Leave Act (FMLA).  Under FMLA employers with 50 or more employees must offer 12 weeks of unpaid leave for a medical condition or to provide care for a family member with a medical condition.   .

Employers may want to draft policy and take necessary steps to comply with the new law.

ANOTHER DELAY TO ACA....THIS TIME: NON-DISCRIMINATION

On January 1, 2014 one of the provisions that was to go into place was taking away the ability of companies to discriminate towards highly compensated employees as it relates to health insurance.  In other words companies were/are able to offer richer plans or pay more towards the cost of health plans for those top earners in an organization.  Under the ACA that would not be allowed starting this year.  However, no penalties will be applied until the IRS offers guidance on the rule.  Since this hasn't happened yet, there isn't  anything that would prevent companies from continuing the practice.  It's becoming more and more apparent that nobody was ready for this law to be implemented.    

3:1 AND WHY THIS RATIO IS HUGELY IMPORTANT

As part of Health Reform (Affordable Care Act), one of the requirements is that insurance carriers can't charge the oldest members more than three times the cost of coverage of the youngest policyholders.  What this means in a nutshell is that the younger, healthier, minimal users of health care are going to be paying as much as 40% more than they do now.  With medical costs and insurance costs spiraling out of control, hitting the youngers with higher costs is simply going to make them stay out of the market, pay their penalty and get guaranteed issue coverage when they need care.  We need the younger population getting coverage to offset the older users.  If not, the majority of people with health coverage are going to be the older population and those who need it.  So what this leaves us is less dollars coming in and more dollars being spent because now we will have guaranteed issue coverage and the older, higher users of medical care paying less to satisfy the 3:1 ratio.  Currently, the "Liberty Act", HR 544 is being kicked around a bit.  This would change the ratio from 3:1 to 5:1. This could potentially make it more attractive to the younger population and gain more premium dollars.