Time flies when you’re having fun… or something like that?! Next month will mark the fifth year anniversary of the enactment of the Patient Protection and Affordable Care Act (as amended by the Health Care and Education Reconciliation Act). This is a law of many names including the ACA, PPACA, health care reform, Obamacare (amongst others that we can’t in good conscience commit to writing – especially in a professional publication) and a law of many facets. As we approach the five year mark of living with this law, many questions have been answered (at least in part, right?). After all, numerous reports have recounted the staggering number of pages of guidance issued in connection with the ACA – remember Rep. Richard Hudson’s exaggeration that we have 33,000 pages of guidance and Senator Mitch McConnell’s estimate at 22,000 pages? And both these figures were announced in the first half of 2013.
Theatrics and dramatic page-counting aside, there is no doubt that many government agencies having been working on all many cylinders to make sense of this transformative law. Even so, employers are only two months into the official employer mandate and there are countess questions still left unanswered on many ACA fronts.
The Republican-controlled Congress is hard-charging to repeal – or, more accurately, to repeal and replace – the law. If any version of the modification law makes it through the Senate and avoids a veto, that would inevitably undo much of our work (and most swiftly, perhaps, change the “full-time” definition as hinging on a 30-hour work week to a 40-hour week). Disregarding, for the moment, the political jockeying going on in Washington, for purposes of this check-in, we’ll discuss the law as it stands currently.
Since most large employers have (hopefully) worked through the kinks of the employer mandate and put systems in place to “pay or play” for 2015, we thought we’d step back and catalog some of the ACA issues that, five years after the law’s adoption, are still on the horizon for employers. Here is a partial list of the “biggies” we have on our radars:
- Information reporting (Code §§ 6055 and 6056) – requiring certain information reporting for insurers, sponsors of self-insured plans and other entities that provide “minimum essential coverage” and additional “large employer” information reporting. Mandatory reporting for applicable entities will be due Q1 2016.
- Nondiscrimination (PHSA §2716; Code §9815) – prohibiting insured group health plans from discriminating in favor of highly compensated individuals. While we expect some enforcement/compliance lag following this issuance of these rules, we expect the impact on current practices to be significant.
- Cadillac plan tax (Code §4980I) – imposing an excise tax on high cost employer-provided coverage. Effective in 2018, rich plans may trigger large excise tax penalties under the forthcoming regulations.
- Large plan automatic enrollment (FLSA §18A) – requiring an employer with more than 200 full-time employees to automatically enroll new full-time employees in one of the employer’s health benefits plans (subject to any waiting period authorized by law). This aspect of the law has been shoved aside and received little attention; however, once guidance is issued, this rule will impact how many large employers administer health plan enrollment. Implementation may be trickier than initially expected as the question will become whether the employer will (can?) require automatic enrollment in other health and welfare benefits aside from the mandatory group health plan.
- Final minimum value regulations (Code §36B) – regarding minimum value of eligible employer-sponsored coverage and other provisions relating to the health insurance premium tax credit. [Proposed regulations were published on May 3, 2013.] While this is unlikely to be an issue for insured plans since their insurers will have to make this determination, self-insured plans may be forced to tweak their assessments to ensure their plan provides MV.
Moral of the story? Whether it is the version of the law enacted by the Obama administration or some new replacement law adopted by the current Congress, employers are not “out of the woods” in terms of health care reform compliance. There’s more on the horizon, so stay tuned.