Plans, Perks & Pay | Employee Benefits & Executive Compensation Blog

Illinois passed the Consumer Coverage Disclosure Act (CCDA) in 2021. In a nutshell, the CCDA requires all employers to send employees a notice comparing their health benefits to a list of the state of Illinois’ Essential Health Benefits (EHBs). Depending on the size of the employer and how the law is interpreted, the civil penalties for non-compliance could run anywhere from a nuisance fee to astronomically high.

At the beginning of this year, we wrote about changing standards applicable to audits of financial statements of employee benefit plans subject to ERISA. Specifically, we explained that the Auditing Standards Board (ASB) of the American Institute of Certified Public Accountants (AICPA) issued new standards for what are currently known as “limited-scope audits.” Initially, the changed audit standards were effective for plan years ending on or after December 15, 2020, but due to the COVID-19 pandemic the AICPA delayed the implementation of the standards to audits of plan years ending on or after December 15, 2021. We want to remind plan sponsors of employee benefit plans required to include an auditor’s report as part an annual Form 5500 filing that the changed audit standards create new responsibilities for plan sponsors in 2022.

As previously noted, the individual mandate under the Patient Protection and Affordable Care Act (also known as the ACA, or more informally as Obamacare) still applies in 2018. Finding affordable coverage to avoid the penalty is essential.

One option available to individuals and families is joining a “health care sharing ministry” (HCSM) under Section 5000A of the Tax Code. If an individual is covered by an HCSM in any given month in 2018, then the individual will not be subject to the tax penalty for that month.

In Executive Order 13813, President Donald Trump made it the official policy of the executive branch to find ways to expand the use of Association Health Plans (AHPs) as a means of providing quality, affordable coverage across state lines.

On January 4, 2018, the U.S. Department of Labor issued a proposed rule designed to do just that. Based on 2015 figures, the proposed rule has the potential to impact the health coverage of about 44 million people, whether by expanding coverage to the uninsured, by making more affordable coverage available to sole proprietors and small employers, or by cutting back some individuals’ benefits.

The federal agencies charged with administering the Affordable Care Act released interim final regulations Oct. 6, 2017, that extended the exemption from providing contraceptive coverage to more employers and individuals effective immediately. Days later, the government settled dozens of lawsuits filed by organizations challenging the so-called “contraceptive mandate.” But several new cases challenging the expanded exemption were filed.

Thanks to the 21st Century Cures Act, beginning Jan. 1, 2017, some employers can now offer employees a new type of health reimbursement arrangement, called a Qualified Small Employer HRA. Primarily governed by 26 U.S.C. § 9831(d), these HRAs are designed to help subsidize employees’ purchase of health coverage on the exchange, although they can also be used to help pay for other medical expenses.

The following questions and answers explain how these new HRAs work.