Avoiding news of 2010’s health care reform would have been impossible, and keeping up with the many changes that it has brought can feel impossible, too. Along with the law came a slew of regulations, and employers bear the responsibility for responding to and complying with those regulations, which just keep coming.
Here are the regulations that this year brought.
W-2 Reporting
An important thing to note: starting with the 2012 Form W-2s, all employers must include the total cost of health care coverage received by their employees—both the employer and employee contribution amounts. That total is specific to each employee’s coverage classification(s) for the year.
If, for example, there was a change in an employee’s coverage election or a rate change mid-year, you have to take those things into consideration when calculating the contribution figure.
Some types of benefit plans (such as HSAs and certain stand-alone dental and vision plans) are exempt from this reporting requirement.
If you file fewer than 250 Form W-2s, you’re eligible for transitional relief.
Summary of Benefits & Coverage
Effective for plan years beginning on or after September 23, 2012, employers must provide a Summary of Benefits & Coverage (SBC) to plan participants, including all eligible employees and all enrolled dependents.
When do you provide an SBC? Depends on the situation:
- For plan participants who enroll or re-enroll for coverage during an open enrollment period, you need to provide an SBC on or before the first day of the open enrollment period.
- If the plan has no open enrollment time period for changing coverage elections, you need to provide the SBC 30 days prior to the plan year-end.
- When a plan participant requests one, you must furnish an SBC within seven business days.
Additional Medicare Tax
Effective January 1, 2013, the Medicare tax rises by 0.9% to 2.35% for wages exceeding $200,000 for single filers, or $250,000 for joint filers. This additional withholding over $200,000 applies even though the employee’s wages combined with his or her spouse’s wages may fall below the $250,000 threshold for joint filers.
New FSA Limits
Effective for plan years beginning on or after January 1, 2013, employee salary reduction contributions made to a flexible spending arrangement (FSA) account are limited to $2,500.
This limit does not include insurance premiums withheld on a before-tax basis under a cafeteria plan. In addition, if the employee or the employee’s spouse is eligible for more than one FSA account participation, the $2,500 limit is applied to each account instead of to the joint total.
Annual Notice Requirements
Don’t forget to furnish the following notices before the year is out:
- “Grandfathered” Plan Notice: This notice is required every year that the plan retains “grandfathered” status.
- Women’s Health & Cancer Rights Act Notice: Distribute at least once each year to all covered persons.
- HIPAA Notice of Privacy Practices: Distribute to plan members at the time of initial enrollment in the group health plan and every three years thereafter.
- Children’s Health Insurance Program Reauthorization Act Notice. Distribute at least annually to all eligible employees who reside in a state where there is a premium assistance subsidy available under Medicaid or CHIP, whether or not they are enrolled for group health coverage,
If you have questions about new regulations under health care reform, give us a call. We’re here to keep our clients compliant with the ever-changing regulations that affect health care.