The U.S. Supreme Court has issued its decision on the constitutionality of
The Patient Protection and Affordable Care Act (PPACA). What will this
decision mean to some of our investigative and security professionals to
comply with the provisions of this act? Now that we are no longer waiting
for the court's decision, plan sponsors should be focused on making certain
their plans and reporting practices comply with the components of the Act.
There are ERISA implications of making changes to comply with PPACA.
Fiduciaries, with documentation, are obligated to make certain that required
changes are made regarding amendments to their health plans.
Changes required by PPACA, which should already be in effect and amended,
include the following:
Auto Enrollment. Employers with more than 200 employees that offer coverage
must automatically enroll new full-time employees in coverage with the
opportunity to opt-out.
Pre-existing Exclusions. No pre-existing exclusions for enrollees under age
Dependent Coverage. Extension of coverage of adult children to age 26.
Coverage Rescissions. Coverage cannot be rescinded absent fraud or
intentional misrepresentation by the enrollee.
Lifetime Limits. No annual or lifetime dollar limits on "essential"
Appeals Procedures. Appeals process required to allow for appeals of
coverage determinations and claims (includes internal appeals and external
External Appeals. The regulations require group health plans and insurers to
comply with applicable external review process in states that have
implemented such a process.
Emergency Services. Must cover emergency services without prior
authorization and in-network.
Primary Care Provider. Must allow designation of OB/GYN and pediatrician as
Primary Care Provider.
Preventative Care. Must cover preventive care without cost sharing.
Future compliance issues are as follows:
W-2 Reporting - Employers must include aggregate cost of employer-sponsored
health coverage on annual Form W-2.
Summary of Benefits Coverage - Insurers and plan sponsors of self-funded
plans must provide summary of benefits to all participants and applicants,
based on format set by Secretary, using uniform definitions and stating
whether the plan provides minimum essential coverage and whether ensures the
plan's share of costs is at least 60 percent of actuarial value.
Advance Notice of Mid-Year Changes - Plan must provide 60-days advance
notice of changes to summary of benefits.
Quality of Care Reporting - Plans and insurers must report on plan benefits
and reimbursement structures that provide incentives for the implementation
of case management, care coordination, chronic disease management and
medication and care compliance activities for treatment or services under
the plan or coverage; the implementation of activities to prevent hospital
readmissions; improving patient safety and reducing medical errors through
best clinical practices, evidence based medicine and health information
technology; and the implementation of wellness and health promotion
Nondiscrimination - While originally intended to be effective in 2011,
nondiscrimination rules will generally apply to fully insured plans just as
they apply to self-insured plans as soon as guidance is issued. Further
guidance is expected to be issued in 2012.
Flexible Spending Account Changes - Limits FSA contributions to $2,500,
indexed in future years.
Employer notice requirements - Effective March 1, 2013, employer requirement
to provide written notice informing employees about the exchange, and their
potential eligibility for premium credits if the employer's share of costs
is less than 60 percent of the allowed total cost of benefits.
Penalties to Commence - Businesses having fifty or more employees will be
subject to a "free rider tax" for those employees obtaining subsidized
insurance from state health exchanges. For those businesses not offering
coverage under the minimum requirements for all of their full-time
employees, and have at least one full-time employee who qualifies for a
subsidy, such employers will be required to pay $2000 per year for each
full-time employee, except for the first thirty. Employers who offer
coverage meeting the minimum requirements for all full-time employees and
still have at least one full-time employee who qualifies for the subsidy
will be required to pay $3000 for each employee receiving a tax credit.
There will certainly be more clarification on these requirements,
particularly the notice requirement, once the rules related to the exchanges
ISPLA thanks the employment law practice of Fox Rothschild, LLP for
providing this timely and important information for our members.
ISPLA Director of Government Affairs
Resource to the Profession, Government, and to the Media
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