PPACA & Employers

Major Provisions

• Group Health Plan Requirements. The Affordable Care Act  establishes a number of new requirements for group health plans. More information is available on the websites of the Departments of Health and Human Services and Labor and in additional guidance. See also:
• Grandfathered Health Plans.
  • USDOL. Regulation • Fact Sheet • FAQs • Provisions Summary Chart • Model Notice • Public Comments • Amendment to Interim Final Rules • Fact Sheet
  • Grandfathered Health Plans Under the Patient Protection and Affordable Care Act (PPACA) (Congressional Research Service)
  • Grandfathered Plan Requirements in the PPACA (NAHU)
  • Legal Analysis of Grandfather Proposed Rules (Groom Law Group)
  • PowerPoint Presentation of Proposed Grandfather Rules (American Benefits Council)
  • Grandfathering of Health Insurance Coverage (NAIC)

• Early Retiree Health Insurance.PPACA established a temporary program under which the federal government will reimburse retiree health plans for high-cost medical claims. This Early Retiree Reinsurance Program will pay 80 percent of each claim that exceeds $15,000, up to $90,000. The program began in June 2010 and is slated to operate until the end of 2013. It is intended to slow the decline in employer health coverage for retirees and to help tide people over until 2014, when other provisions of the law go into effect. At that point, it will theoretically be easier for early retirees to obtain coverage through new state health insurance exchanges, often with the aid of subsidies.
  • US DOL. Early Retiree Reinsurance Program: Regulation • Fact Sheet • Program Web Site
  • US DHHS. Early Retiree Reinsurance Program, General ERRP Program Overview, August 2010.
  • Health Affairs Policy Brief. Early Retiree Insurance
  • NAHU. Reinsurance Program for Early Retirees.
  • Employee Benefit Research Institute. The Early Retiree Reinsurance Program: $5 Billion Will Last About Two Years (July 2010).
• Nondiscrimination Provisions. IRS Notice 2011-1 Affordable Care Act Nondiscrimination Provisions Applicable to Insured Group Health Plans

• Coverage of Preventive Services.
  • USDOL. Regulation • Fact Sheet • Recommended Preventive Services • Public Comments
  • USDOL. Value-Based Insurance Design in Connection with Preventive Care Benefits Request for Information
• Preexisting Condition Exclusions, Lifetime and Annual Limits, Rescissions, and Patient Protections. USDOL: Regulation • Fact Sheet • Patient Protection Model Notice • Lifetime Limits Model Notice • Public Comments
• Extension of Coverage For Adult Children. USDOL: Regulation • Fact Sheet • FAQs • IRS Guidance • Model Notice • Public Comments
• Pre-Existing Condition Insurance Plan Program. USDOL: Regulation • Program Information • Program Map • FAQs
• Internal Claims and Appeals and External Review.
  • US DOL. Interim Procedures for Internal Claims and Appeals • Revised Model Notice of Adverse Benefit Determination
  • US DOL. Interim Final Rules on Internal Claims and Appeals and External Review Processes: Regulation • Fact Sheet • NAIC Uniform External Review Model Act • Public Comments
• Federal External Review Process.
  • US DOL. Request for Information • Public Comments
  • US DOL. Interim Procedures for Federal External Review. Regulation • Technical Release • Model Notice of Adverse Benefit Determination • Model Notice of Final Internal Adverse Benefit Determination • Model Notice of Final External Review Decision

• Changes to Flexible Spending Arrangements. Effective Jan. 1, 2011, the cost of an over-the-counter medicine or drug cannot be reimbursed from Flexible Spending Arrangements or health reimbursement arrangements unless a prescription is obtained. The change does not affect insulin, even if purchased without a prescription, or other health care expenses such as medical devices, eye glasses, contact lenses, co-pays and deductibles. The new standard applies only to purchases made on or after Jan. 1, 2011, so claims for medicines or drugs purchased without a prescription in 2010 can still be reimbursed in 2011, if allowed by the employer’s plan. A similar rule goes into effect on Jan. 1, 2011 for Health Savings Accounts (HSAs), and Archer Medical Savings Accounts (Archer MSAs). Employers and employees should take these changes into account as they make health benefit decisions for 2011. For more information, see IRS news release IR-2010-95, Notice 2010-59, Revenue Ruling 2010-23 and questions and answers.

• Employer-Provided Health Coverage — Not Taxable. Starting in tax year 2011, the Affordable Care Act requires employers to report the value of the health insurance coverage they provide employees on each employee’s annual Form W-2. However, to provide employers the time they need to make changes to their payroll systems or procedures in preparation for compliance with this requirement, the IRS will defer the reporting requirement for 2011, making that reporting by employers optional in 2011. This reporting is for informational purposes only, to show employees the value of their health care benefits so they can be more informed consumers. The amount reported does not affect tax liability, as the value of the employer contribution to health coverage continues to be excludible from an employee’s income, and it is not taxable. For information, see IRS news release, draft form and guidance. See also New Employer Form W-2 Health Insurance Reporting Requirements in the PPACA (NAHU).
• Small Business Health Care Tax Credit. This new credit helps small businesses and small tax-exempt organizations afford the cost of covering their employees and is specifically targeted for those with low- and moderate-income workers. The credit is designed to encourage small employers to offer health insurance coverage for the first time or maintain coverage they already have. In general, the credit is available to small employers that pay at least half the cost of single coverage for their employees. Learn more at
• IRS. Small Business Health Care Tax Credit for Small Employers.
• Establishing SIMPLE Cafeteria Plans for Small Businesses (NAHU)

On-line Resources

• American Benefits Council | Health Care Reform. The Council is a preeminent advocate of employer-sponsored benefit programs in Washington, D.C.
• Anthem, Making Health Care Reform Work is one-stop resource for reform information for small and large businesses.
• Endowment for Health Pilot | Small Business/Employers is a portal site for reform information, including resources for small bu
• HealthReformReport.com, Business provides detailed information about provisions affecting business, listed by topic and providing an implementation timeline focused on these changes.

Print Guides

• Word & Brown Companies, Health Reform Guide
• U.S. Chamber of Commerce, Critical Employer Issues in the PPACA
• NAHU, Wellness and Prevention Provisions
• NAHU, The New Small Business Tax Credit

Frequently Asked Questions

• US DOL. FAQs on Health Care Reform and COBRA
• US DOL. ACA Implementation: FAQs Part I
• US DOL. ACA Implementation: FAQs Part II
• US DOL. ACA Implementation: FAQs Part III
• US DOL. ACA Implementation: FAQs Part IV
• US DOL. FAQs About Affordable Care Act Implementation Part V and Mental Health Parity Implementation
• ReformJunction provides a politically neutral place for brokers and employers to find answers to questions associated with health care reform.

Calculators

• H&R Block small business tax credit calculator.
• Anthem grandfathering decision tool.
• Smallbusiness.org tax credit calculator.

Research and Analysis

• How Will PPACA Affect Small, Medium and Large Businesses? (Urban Institute)
• Eibner, C., F. Girosi, A. Miller, A. Cordova, E. A. McGlynn, N. M. Pace, C. C. Price, R. Vardavas, and C. R. Gresenz, Employer Self-Insurance Decisions and the Implications of the Patient Protection and Affordable Care Act as Modified by the Health Care and Education Reconciliation Act of 2010 (ACA), Santa Monica, Calif.: RAND Corporation, TR-971-DOL, 2011.
• Eibner, C., F. Girosi, C. C. Price, A. Cordova, P. S. Hussey, A. Beckman, and E. A. McGlynn, Establishing State Health Insurance Exchanges: Implications for Health Insurance Enrollment, Spending, and Small Business, Santa Monica, Calif.: RAND Corporation, TR-825-DOL, 2010.

• Maxwell, Nan. The Health and Wealth of a Nation: Employer-Based Health Insurance and the Affordable Care Act. Kalamazoo, MI: W. E. Upjohn Institute for Employment Research, 2012. 203 pp. $20.00 paper.

News

• ObamaCare Watch, Business Impact includes latest business-related health reform news.