Now that the U.S. Supreme Court has issued its decision to uphold most of the provisions in the Affordable Care Act, employersand the general counsel advising themneed to be looking at what their businesses need to do to comply with the health care law.
To help advise his clients, Ted Lewkowicz, an attorney in the employee benefits and executive compensation practice at Bond, Schoeneck & King, set out to devise a straightforward plan of action for tackling the dense, lengthy bill. (The New York Labor & Employment Law Report picked up on his guidance and published an abbreviated version of his recommendations.)
Since employers are no longer wondering if the ACA will be struck down by the Court, Lewkowiczs first suggestion is: Get started on compliance now. While election-year political chatter continues, Lewkowicz sees the Supreme Courts ruling on the ACA as definitiveat least until after Election Day, and even then its not clear that there would be immediate changes to the law. The next big tipping point people are pointing to is the November election, but even with a change in administration, there would also need to be a change in Senate, Lewkowicz said. And before policymakers could begin to make changes in 2013, he added, the health care law will catch up to employers.
There are certain deadlines that need to be met this year, he notes, and with deadlines in 2013, 2014, and beyond, you need start work now in order to comply. Lewkowicz recommends focusing on four compliance tasks with approaching deadlines:
- On or after September 23, 2012 (the first day of fall open enrollment for employer-based health care plans), most employers must provide group health plan participants and beneficiaries with a Summary of Benefits and Coverage. The summary should be a short explanation of employee plans and should include comparisons with other health plans. Employers should have been alerted to the summarys requirements for content and distribution, and will need to have updated materials ready.
- By January 1, 2013, employers that offer health care flexible spending accounts must comply with a $2,500 annual limit on contributions to the accounts. Prior to the beginning of the year, eligible employees must receive open enrollment materials explaining the new limit, and employers must ensure that the limit is implemented.
- By 2013, employers that provide applicable employer-sponsored coverage under a group health plan must be prepared for new W-2 reporting. Employers who are affected by this change must implement procedures for tracking and recording health coverage costs incurred in 2012 so that they can report these costs on the 2013 forms.
- On July 31, 2013, any employers that issue specified health insurance policies or sponsor self-insured health plans must coordinate payment of research fees. Before the end of this year, Lewkowicz recommends consulting with insurers and administrators of applicable plans to determine how the fees will be paid in a timely and correct fashion. The fees, which use IRS form 720, will be used to establish a private, nonprofit corporation that will conduct research to help involved parties make informed health care decisions.
In addition to these four steps, Lewkowicz highlighted additional requirements to start preparing for:
- On or after August 1, 2012, certain health plans must implement preventative care requirements for women.
- Starting August 2012, certain insurers will have to provide medical loss ratio rebates to applicable health plans; employers are tasked with deciding how to handle those rebates.
- In 2013, Medicare payroll taxes and FICA taxes will increase for certain highly compensated individuals.
- Starting March 2013, certain employers will have to notify employees about health insurance exchanges to take effect in 2014.
- In 2014, certain employers will have to comply with the employer mandate requirement, known as pay or play. Those employers will have to decide whether they will provide minimum essential health coverage to full-time equivalent employees or pay a fine.
