ACA Cost-Sharing Subsidies to End

The ACA created two federal health insurance subsidies – premium tax credits and cost-sharing reductions – to help eligible individuals and families purchase health insurance through an Exchange. The premium tax credit assists eligible individuals with the cost of the health insurance plan, and the cost-sharing reductions assist eligible individuals with lower out-of-pocket costs (for example, lower deductibles and copays).

The ACA requires insurers that offer Exchange health plans to reduce cost sharing for eligible individuals, and requires the federal government to reimburse insurers for the cost of that reduction on a monthly basis.

On Oct. 12, 2017, the White House announced that it will no longer reimburse insurers for cost-sharing reductions made available to low-income individuals through the Exchanges under the Affordable Care Act (ACA), effective immediately. Because Congress did not pass an appropriation for this expense, the Trump administration has taken the position that it cannot lawfully make the cost-sharing reduction payments.

While the immediate impact of this announcement is unclear, it could have a significant impact on individuals who enroll through the Exchange during the upcoming open enrollment period, which begins on Nov. 1. Insurers that offer plans through the Exchange likely will not have enough time to make significant changes before open enrollment begins. This may cause a lot of confusion and uncertainty in the Exchanges, both for insurers and for consumers enrolling in Exchange coverage for 2018.

Contact your NEEBCo representative with any questions you may have.

White House Announces ACA Subsidies Will End

Healthcare Executive Order

On Oct. 12, 2017, President Donald Trump signed an executive order intended to change certain rules under the Affordable Care Act (ACA). The order does not make any changes to existing regulations.

The order would relax regulations on association health plans, and also directs the Departments of Labor, Health and Human Services, and the Treasury (Departments) to consider expanding the availability of low-cost short-term, limited-duration insurance and health reimbursement arrangements (HRAs).

An executive order is a broad policy directive that directs federal agencies to consider new regulations or guidance to implement the order’s policies. As a result, the executive order’s specific impact will remain largely unclear until agencies can issue further guidance.

The intention of the executive order is to reform the U.S. health care system by expanding choices and increasing competition to bring down costs for consumers. There are three major areas referenced:

Association health plans – An existing alternative option to traditional group health insurance, where several businesses pool funds together as a way to pay for benefits or buy group health insurance for their employees. Association health plans have been subject to state insurance laws for many years. The Obama administration tightened regulation of these plans by subjecting them to additional ACA requirements, such as coverage of essential health benefits and premium rating restrictions. The order directs the Departments to draft regulations expanding access to association health plans, potentially allowing employers to form groups across state lines and avoid certain ACA insurance requirements.

Short-Term Health Insurance – The executive order also directs the Departments to consider expanding coverage through low-cost short-term, limited-duration insurance, which is not subject to the ACA’s market reform requirements.

Health Reimbursement Arrangements – The executive order directs the Departments to expand employers’ ability to offer HRAs to their employees, and to allow HRAs to be used in conjunction with individual health insurance coverage.

Refer to the attached bulletin for more detail and contact your NEEBCo representative with any questions you may have.

President Signs Executive Order Designed to Change ACA Rules

ADA May Not Require Extended Leave

The U.S. Court of Appeals for the 7th Circuit has ruled that the Americans with Disabilities Act (ADA) does not require employers to provide long-term leave as a “reasonable accommodation” for individuals with disabilities.

The decision in Severson v. Heartland Woodcraft is consistent with the court’s prior ruling on a similar issue, but conflicts with rulings by other federal courts and the Equal Employment Opportunity Commission’s (EEOC) position. The EEOC is the federal agency responsible for enforcing the ADA. All employers subject to the ADA should be aware that the 7th Circuit’s decision conflicts with how the EEOC may enforce the ADA under its regulations and guidance.

Whether an employer may deny an employee’s request for leave as a reasonable accommodation under the ADA will depend on the specific circumstances of the situation. The 7th Circuit’s decision only affects employers in Wisconsin, Indiana and Illinois. Employers subject to the ADA in other states should be aware that other federal court decisions may apply to them.

For example, the U.S. Courts of Appeals for 1st and 9th Circuits have issued decisions holding that multi-month leave periods were reasonable accommodation under the ADA. Those decisions affect employers in Maine, New Hampshire, Massachusetts, Rhode Island and Connecticut (1st Circuit), and employers in California, Oregon, Washington, Nevada, Montana, Idaho and Arizona (9th Circuit).

Reference the attached Compliance Bulletin for details.

ADA does not Require Extended Leave

Contraceptive Mandate Changes

On Oct. 6, 2017, the Departments of Labor (DOL), Health and Human Services (HHS) and the Treasury (Departments) issued two interim final rules expanding certain exemptions from the Affordable Care Act’s (ACA) contraceptive coverage mandate.

The first interim final rule expands the availability of the exemption for employers that object to providing contraceptive coverage based on their religious beliefs. This exemption may apply to all types of nongovernmental employers, including:

  • Churches, integrated church auxiliaries, conventions or associations of churches, or religious orders;
  • Nonprofit organizations;
  • For-profit entities, regardless of whether they are closely held;
  • Institutions of higher education; and
  • Any other nongovernmental employers.

This exemption also applies to health insurance issuers offering group or individual insurance coverage that have sincerely-held religious or moral beliefs objecting to contraceptive or sterilization coverage.

The second interim final rule provides an additional exemption for certain employers that object to providing contraceptive coverage based on their moral convictions (but not religious beliefs). This exemption is narrower in scope than the exemption based on religious objections. It may only apply to the following types of nongovernmental employers:

  • Nonprofit organizations;
  • Privately held for-profit entities; and
  • Institutions of higher education.

Health insurance issuers offering group or individual insurance coverage that have sincerely-held moral objections to providing contraceptive or sterilization coverage may also qualify for this exemption. The Departments are requesting comment on whether this moral objection exemption should also be extended to all for-profit entities (regardless of whether they are closely held or publicly traded) and nonfederal governmental employers, such as local government hospitals.

This guidance, which is effective immediately, significantly expands the number of employers that are eligible for an exemption from the contraceptive coverage mandate.

Contact your NEEBCo representative with questions.

New Regulations Expand Exemptions from the Contraceptive Mandate

2017 Final ACA Reporting Forms Released

On Sept. 28, 2017, the Internal Revenue Service (IRS) released final 2017 forms for reporting under Internal Revenue Code (Code) Sections 6055 and 6056. The 2017 forms are substantially similar to the 2016 versions, except that sections related to expired Section 4980H Transition Relief were removed.

Final instructions for 2017 have also been released.

Individual statements for 2017 must be furnished by Jan. 31, 2018. IRS returns for 2017 must be filed by Feb. 28, 2018 (April 2, 2018, if filed electronically, since March 31, 2018, is a Sunday). While the IRS extended the due date for furnishing last year’s individual statements to the end of March, the IRS does not anticipate extending the filing or furnishing deadlines for 2017 reporting.

Contact your NEEBCo representative with any questions you have.

Final Forms for 2017 ACA Reporting Released

2017 1094-C Form

2017 1095-C Form

2017 1094C and 1095-C instructions


Student Loan Repayment Programs

Many employers have expressed interest in offering a student loan payment program as an employee benefit, both to attract and retain talent. While individuals have come to expect traditional benefits like health insurance and paid time off, many new graduates are looking for companies that offer non-traditional benefits like student loan repayment assistance. According to a study by iontuition, a student loan management company, 80 percent of individuals would like to work for a company that offers student loan repayment assistance with a matching opportunity, and 49 percent of those individuals would prefer student loan payment contributions over an employer-sponsored 401(k) plan.

There are several vendors that assist employers in processing payments toward employee’s eligible education loans by administering the transactions between the employer and the multiple student loan processors. Programs can also include employees with 529 plans, and parent loans if it is a qualified student loan. External vendors can help ensure compliance and make sure that payments are being distributed properly, especially if employees owe money to multiple lenders.

Contact your NEEBCo representative if you are interested in more information or a presentation of the service.

Student Loan Repayment Benefits

Massachusetts Implements Employer Penalties for Employees Receiving Medicaid

On Aug. 1, 2017, Massachusetts enacted a new law intended to help fund MassHealth, the state’s Medicaid program. The new law temporarily:

  • Increases the existing Employer Medical Assistance Contribution (EMAC) amount; and
  • Imposes an employer penalty for each employee who has subsidized health coverage through MassHealth or the state Exchange instead of the employer’s plan.

This new law, which took effect immediately, applies to Massachusetts employers with six or more employees. These new provisions apply only through the 2019 calendar year.

In 2014 Massachusetts enacted an Employer Medical Assistance Contribution (EMAC) to help fund subsidized health coverage for low-income residents. Employers with six or more employees are subject to the EMAC requirements. Affected employers must pay contributions on the first $15,000 of each employee’s wages paid during the calendar year. Contribution amounts are determined by multiplying these wages by an assigned contribution rate.

To accomplish the goals of discouraging employees eligible for employer coverage from enrolling on MassHealth, and to help fund the MassHealth program, the Act temporarily increases the EMAC contribution rate through the 2019 calendar year, as follows:

  • In general, from 0.34 percent of an employee’s wages to 0.51 percent of an employee’s wages; and
  • For employers that are newly subject to the EMAC requirements, from 0.12 percent of an employee’s wages to 0.18 percent of an employee’s wages.

The increased contribution rate applies through Dec. 31, 2019. Beginning with the 2020 calendar year, the EMAC contribution rates will return to their previous percentages (0.34 percent and 0.12 percent, respectively).

In addition, effective Jan. 1, 2018, the Act imposes a temporary employer penalty of up to 5 percent of the employee’s wages for each nondisabled employee who receives subsidized health coverage through MassHealth or the Massachusetts Exchange (called Massachusetts Health Connector), instead of enrolling in employer-sponsored coverage.

This employer penalty is also effective only through the 2019 calendar year, and is scheduled to automatically sunset beginning in 2020. By implementing this employer penalty, Massachusetts became the first state to penalize employers whose employees choose to enroll in government-subsidized health coverage. The Act directs state agencies to issue regulations implementing these new provisions, which are expected to be issued shortly.

Refer to the attached Compliance Bulletin and contact your NEEBCo representative with questions.

Massachusetts Implements Employer Penalties for Employees Receiving Medicaid

Minuteman Health Unsuccessful in Forming a New Company for 2018

Minuteman Health announced it has been unable to secure financing in order to form a new company that would offer plans on the state’s exchange in 2018.

The Massachusetts-based health insurance co-op announced in June that it would stop writing business as of January 1, 2018, and its intentions to form a new for-profit company in that would offer plans for 2018.

The leadership of Minuteman Health had been working to secure funding in order to have a new company licensed in time to submit proposed health insurance plans for 2018 to the New Hampshire Insurance Department by the federal deadline of August 16th.

Current Minuteman policyholders will receive a communication directly from the company in the coming weeks. Refer to the below press release for additional information and contact your NEEBCo representative with questions.

NH Insurance Department – Minuteman Health Announcement

Harvard Pilgrim Confirms Exchange Participation

Harvard Pilgrim has confirmed to the New Hampshire Insurance Department they will offer plans on the state’s exchange in 2018, joining Anthem and Ambetter.

“Today’s announcements by Anthem and Harvard Pilgrim mean that New Hampshire residents will now be able to count on having three companies to choose from in 2018,” said New Hampshire Insurance Commissioner Roger Sevigny. “Thanks in part to the uncertainty coming from Washington, D.C., individual markets around the country are facing unprecedented instability. To have three insurance companies recommit to staying in New Hampshire in 2018 is incredibly encouraging.”

Refer to the below press releases for additional information and contact your NEEBCo representative with any questions you may have.

NH Insurance Department – Harvard Pilgrim Exchange Participation

Carriers Confirm Exchange Participation

Due to volatility in the individual markets, insurance companies have been considering whether to continue to offer exchange coverage in New Hampshire and around the country.

As of today, Anthem and Ambetter have confirmed to the New Hampshire Insurance Department they will offer plans on the state’s exchange in 2018.

Harvard Pilgrim has not yet confirmed its plans.

Minuteman Health did announce in June that it would not offer exchange plans in 2018 as it is ceasing its functions as a co-op. However, Minuteman Health management is in the process of forming a new insurance company and hopes to be able to offer plans on New Hampshire’s exchange under the new company for 2018.

Last week, the federal government extended the rate-filing deadline from August 16 to September 5 for companies to file revised rates with the states for review. Companies may file rates with the assumption that the federal government will not offer reimbursements called “Cost Sharing Reduction payments” to the companies in 2018. While the Insurance Department is prohibited from releasing rate information prior to open enrollment (November 1), the federal government has made publicly available proposed rate increases of 10% or more on its rate review website.

Refer to the below press releases for additional information and contact your NEEBCo representative with any questions you may have.

NH Insurance Department – Anthem Exchange Participation
NH Insurance Department – Ambetter Exchange Participation