Healthcare Reform Update: Final Regulations on the Mandate for Large Employers Released

Earlier this week, the IRS announced the final regulations regarding the Employer Mandate. There is a lot of confusion regarding the health care reform employer mandates and the release of the final regulations by the IRS will help significantly. We know there has been a lot of information in the news and we want to provide in-depth analysis and additional knowledge when releasing information to assist you with understanding this complex topic. Our partners at the Benefit Advisors Network have released a Legal Alert crafted by Peter Marathas with Proskauer Rose Law Firm. Additionally, Proskauer Rose is reviewing the law in detail and will provide us with additional updates which we will continue to share with you.

For Large Employers (100+ Employees)

• The employer mandate will go into effect January 1, 2015. Please review the Legal Alert for clarification on several new rules. Aldrich Benefits will be working with you to ensure your 2015 plan meets the requirements.

For Mid-Size Businesses (50-99 Employees)

• The new rules state businesses of this size will be exempt from the employer mandate for one more year. Groups of this size will be required to have a qualified health plan by January 1, 2016. Please review the Legal Alert to learn more about the reprieve and what you can expect in the future.
• Also, to clarify, there are some requirements that have not changed but continue to cause confusion. These include the following:

For Small Businesses (2-49 Employees)

• Small businesses are not mandated to provide coverage to employees and there is no intention of the government (that we know of at this time) to require small businesses to provide coverage.
• There is also no penalty assessed to small businesses, however, each individual who works at a small business is required to have health insurance and small group plans offer many benefits to employers including tax incentives and greater plan options.

For Individuals

• The individual mandate went in to effect as of January 1, 2014. All US citizens living in the United States (except for a select few) are required to be enrolled in a health insurance plan, either in an individual plan or an employer-sponsored plan.
  • An individual must be enrolled 9 months out of the year and is allowed one consecutive 3-month gap.
    Individuals have until March 31st, 2014 to be enrolled in a plan, without a penalty, and cannot have an additional gap during the year.
  • The penalty for non-enrollment in 2014 is 1% of the household income per adult and .5% per child or $95 per adult and $47.50 per child. Whichever is higher.
  • The penalty will be collected by the IRS on an individual’s 2014 tax filing and due in April 2015.
  • For more information visit: Penalty Healthcare.gov
• Individuals who are eligible for health insurance through their employer or a spouse plan and children (under age 18) who are eligible for a parent plan are not eligible for a subsidy through State nor Federal Exchanges.
  • Children may still be eligible for Medicaid, just not the subsidized Exchange plans.
  • Individuals who accept a subsidy through their State or Federal Exchange but should not have received it due to eligibility with a group plan or who receive a subsidy higher than they should have based on their income will be responsible for returning all the discounted premium to the IRS on their tax filing.

Please contact Benefit Advisors at 503.588.0002 or 877.588.0002 for any questions or concerns.