25 July 2016 In Blog style

It's that time of year again.  The State of New Jersey will be sending your new AC-174 Form (Notice of Employer Contribution Rates - sample attached), which provides your new Employer Rate for the STD benefits (66 2/3% to $615 per week).

 If your benefits are currently administered by the State, did you know that a private insurance carrier can administer these benefits too?

 There are many reasons to consider moving the program to a private carrier:

 Significant cost savings – typical savings is at least 20% AND the carrier absorbs the annual State assessment fee.

  • Better administration, customer service, claims turnaround, employer reporting, and coordination with your Long Term Disability program, if offered.
  • You can cover your employees who work outside New Jersey with the same benefits.
  • Opportunity to provide better benefits than what the state requires, either paid for by the company or as a voluntary buy-up for the employees.
20 July 2016 In Blog style

healthCareRefor

The ACA created the Patient-Centered Outcome Research Institute, also known as PCORI, which is funded through fees paid by health insurance issuers and self-insured health plan sponsors. If you have a Health Reimbursement Arrangement (HRA) with or without a fully insured medical plan, you (as the plan sponsor) could also be responsible for the PCORI fee on your HRA.  The table below explains which HRA plan sponsors must pay the PCORI fee.

Type of HRA

Special Rule

Stand-alone HRA

If the plan sponsor has no other applicable self-insured health plans, the sponsor must pay the PCORI fee based on the average number of lives covered by the HRA, counting only one life per participant.

HRA offered with insured coverage

If a plan sponsor has other coverage that is fully insured, the plan sponsor generally must pay the PCORI fee for the average number of lives covered by the HRA, counting only one life per participant, in addition to the PCORI fees that will be paid for the insured plan by the insurer. However, the plan sponsor may disregard the lives covered solely under the fully insured option when counting the number of lives for HRA purposes.

HRA offered with self-insured coverage

If the same plan sponsor has another applicable self-insured health plan with the same plan year, then each person covered by both plans is only counted once. The individuals covered by both plans are counted using the counting method for the other plan (so the one life per participant rule does not apply to them). If the HRA covers anyone who is not also covered under the other plan, the sponsor must pay the fee for those individuals using the one life per participant rule.

The PCORI fee is due by July 31 of each year using IRS form 720.  The fee is calculated based on the average number of lives enrolled during  the plan year multiplied by the below rate:

·         $2.08 for plan years ending on or after Oct. 1, 2014, and before Oct. 1, 2015 (see Notice 2014-56).

·         $2.17 for plan years ending on or after Oct. 1, 2015, and before Oct. 1, 2016 (see Notice 2015-60).

While on the subject of HRAs, they are a great way to reduce the high premium costs associated with traditional copay and low deductible medical plans.  By moving your group plan to a high deductible health plan you will see a decrease in premium cost.  This increase in deductible can be offset by the utilization of an HRA, in essence keeping your employees whole and decreasing your company spend.

08 July 2016 In Blog style

healthInsurance

The ACA requires that certain employers (those with at least 50 full-time equivalent employees) provide health insurance coverage to their employees that is considered both “Affordable” and meets “Minimum Value” guidelines.  If your medical plans did not meet those requirements and an employee purchases individual insurance through the Marketplace (or Exchange or “ObamaCare”), he/she may be eligible for a subsidy for the individual insurance.  If the employee receives a subsidy, this may trigger a penalty from the IRS. 

  • If you had 50 or more full-time equivalent employees last year and the employee received a subsidy through the Exchange, you will not be assessed a penalty if the coverage you offered met the Affordability and Minimum Value requirements.
  • If you had less than 50 full-time equivalent employees last year and the employee received a subsidy through the Exchange, there will be no penalty because the Employer Mandate does not apply and the coverage you offer does not need to meet the Affordability and Minimum Value requirements.

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