A federal spending bill enacted at the end of 2019 repealed three major taxes and fees under the Affordable Care Act (ACA)—the Cadillac tax, the medical devices excise tax and the health insurance providers fee.

The law also extended the PCORI fees for an additional 10 years.

The ACA created the Patient-Centered Outcomes Research Institute (PCORI) to assist health decisions by advancing comparative effectiveness research. The Institute’s research is funded, in part, by fees paid by health insurance issuers and sponsors of self-insured health plans.

For self-insured employers and employers with Health Reimbursement Arrangements (HRAs), PCORI fees are required to be paid annually on IRS Form 720 by July 31 of each year. They were scheduled to expire for policy or plan years ending on or after Oct. 1, 2019. Under the new law, the PCORI fees will now apply for the 2020-2029 fiscal years.

The next PCORI fee payment will be due July 31, 2020.

Contact your NEEBCo representative with questions.

PCORI Fees Reinstated Through 2029

On Dec. 20, 2019, President Trump signed into law a spending bill that repeals the following three taxes and fees under the Affordable Care Act (ACA):

• The Cadillac tax on high-cost group health coverage, beginning in 2020;
• The medical devices excise tax, beginning in 2020; and
• The health insurance providers fee, beginning in 2021.

The law also extends PCORI fees to fiscal years 2020-2029. Under the ACA, the PCORI fees were scheduled to apply to policy or plan years ending on or after Oct. 1, 2012, and before Oct. 1, 2019. The 2019 continuing spending resolution reinstates PCORI fees for the 2020-2029 fiscal years. As a result, specified health insurance policies, applicable self-insured health plans, and employers with Health Reimbursement Arrangements (HRAs) must continue to pay these fees through 2029.

Refer to the below compliance bulletin for details and contact your NEEBCo representative with questions.

Cadillac, Other Key ACA Taxes Repealed 12-23-19

The Internal Revenue Service (IRS) has released an updated version of its W-4 form. This form should be used by all new hires, and employees who wish to amend their withholding in 2020.

This new form does not invalidate prior versions, and employers are not expected to replace prior W-4 forms with the new 2020 version.

The new form no longer uses allowances tied to personal exemptions. Due to changes in law, employees do not claim personal or dependency exemptions. The new form asks employees to declare multiple sources of income, and uses a 5 step process. Only steps 1 (where the employee enters personal information) and 5 (signature) are required. Steps 2-4, while not required, will assist the employee with a more accurate withholding amount. Employees can also use the Tax Withholding Estimator available at www.irs.gov/W4app to provide maximum accuracy.

If a new employees does not submit a W-4 they will be treated as a single filer with no other adjustments.

Employee and employer FAQs are attached below. Contact your NEEBCo representative with questions.

IRS FAQs 2020 Form W4 IRS Issues 2020 Form W-42020 W-4 Form

For fully insured employer health plans, NH’s infertility bill, passed earlier in 2019, is slated to go into effect for 2020. Depending on the insurance carrier, coverage may go into effect 1/1/20, or upon the renewal date in 2020.

Insurance carriers will be required to provide coverage for diagnosis, fertility treatment and fertility preservation. Experimental procedures, voluntary sterilization reversal and surrogate costs are excluded from the mandate.

The mandate does not apply to individual plans, SHOP plans or self-insured employer plans.

Contact your NEEBCo representative with questions.

The IRS has again determined that some employers, insurers and other providers of Minimum Essential Coverage (MEC) need additional time to gather and analyze the information and prepare the 2019 Forms 1095-B and 1095-C to be furnished to individuals. Therefore, they have provided an additional 31 days for furnishing the 2019 forms to employees.

Notice 2019-63 provides employers with an extended due date from Jan. 31, 2020, to March 2, 2020 to provide employees with the 2019 1095 forms.

Notice 2019-63 does not extend the due date for filing forms with the IRS for 2019. The due date for filing with the IRS remains Feb. 28, 2020 (paper filing) or March 31, 2020 (if filing electronically).

Refer to the below bulletin for additional details, and contact your NEEBCo representative with any questions you may have.

IRS Provides Transition Relief for 2019 ACA Reporting

According to the National Association of Insurance Commissioners (NAIC), health insurance and medical fraud is one of the most common frauds in terms of frequency and average cost. Fake insurance companies can defraud consumers by collecting premiums with no intention or ability to pay claims. These “companies” may offer policies at costs that are significantly lower than the traditional market price in order to woo consumers who are trying to save money.

Consumers should be on the lookout for the following warning signs, as they may indicate that an insurance company is fake:

• If an agent or broker is very aggressive and pressures a consumer by saying they must sign up for a policy right away (sometimes adding…or the premiums will go up).
• The premiums from one company are a lot lower (more than 15-20% less) than other companies’ comparable coverage.
• When a consumer tries to call the insurer to get more details or ask a question, they can’t find a listed phone number, or it is very difficult to get through on the phone.

The NAIC advises consumers to stop and confirm the company they are about to do business with is legitimate before signing an application for an insurance policy or writing a check to an insurance company. The state insurance department can quickly verify whether an insurance company exists and is authorized to sell insurance in their state.

See the attached link for additional information and contact your NEEBCo representative with questions.

NAIC – Insurance Fraud

NH Insurance Department

The Internal Revenue Service (IRS) released Revenue Procedure 2019-44, which increased the health FSA dollar limit on employee salary reduction contributions to $2,750 for taxable years beginning in 2020. It also includes annual inflation numbers for 2020 for a number of other tax provisions.

An employer may continue to impose its own health FSA limit, as long as it does not exceed the ACA’s maximum limit for the plan year. This means that an employer may continue to use the 2019 maximum limit for its 2020 plan year.

Contact your NEEBCo representative with questions.

Health FSA Limit Will Increase for 2020

Beginning Jan. 1, 2020, some employers will be able to offer individual coverage health reimbursement arrangements (ICHRAs) to help employees pay for health insurance.

As a result, on Sept. 30, 2019, the Internal Revenue Service (IRS) published proposed regulations on how the following federal requirements will affect ICHRAs:

• The Section 4980H employer shared responsibility rules under the Affordable Care Act (ACA); and
• The federal nondiscrimination requirements in Internal Revenue Code (Code) Section 105(h).

Comments on the proposed rule will be accepted until Dec. 30, 2019.  Taxpayers generally may rely on the guidance provided in the proposed rule prior to a final rule being issued.

Contact us today to learn more about the proposed rule.

Impact of ICHRAs on ACA

Even the healthiest of people can come down with the flu. In the wake of back-to-back deadly flu seasons, experts are urging people to properly prepare this year. It’s time to take action to protect your workplace as much as possible. Contact us today for all the resources you need to prevent an office-wide flu outbreak.

Flu shots – Get the Facts

Knowing how your benefits—which are a major attraction and retention tool—compare to those of employers across the country is key. Don’t wait any longer to ask for your copy of a summary of the 2019 Employer Health Benefits Survey, an annual survey of employer-sponsored health benefits from the Kaiser Family Foundation and the Health Research & Educational Trust.

Summary of the 2019 Employer Health Benefits Annual Survey