Pub. 11 2012-2013 Issue 4

N e w J e r s e y C o a l i t i o n O f A u t o m o t i v e R e t a i l e r s 33 new jersey auto retailer w w w . n j c a r . o r g ment was delayed fromMarch 1 to “late summer or early fall” of 2013). w Pay or budget for the Patient Centered Outcomes Research (PCOR) fee (due on July 31 of each year for the next seven years; $1 per covered individual the first year, $2 the second year and adjusted annually thereafter; applicable to fully insured and self-insured plans). w Begin to prepare for the decision of whether or not their organization will “pay or play” as of 2014 (“Play” mean- ing offer health insurance coverage to all full-time employees working an average of 30 or more hours a week that meets certain minimum standards set by the government or “Pay” meaning pay an excise tax penalty to the government for not offering health insurance or for providing health insurance that does not meet minimum standards. Employers may be subject to these taxes if any full- time employees get a premium tax credit on an exchange). w Determine who is a “full-time” em- ployee and how they will measure these employees going forward. w Prepare a financial analysis of the im- pact of the potential penalties on the organization. w Again, assess whether any “grandfa- thered” plan will remain grandfathered. Make sure that all changes are made if that status is lost (this will need to be done any time something in your plan changes, if your plan is “grandfathered”). Beyond 2013, there are some more very important requirements including: w “Play or Pay” (see above); w Wellness program incentives increase to up to 30% (up to 50% for tobacco cessation); w Remove any waiting periods in excess of 90 days; w Pay or budget for the Insurers Fee (roughly 2.0% to 2.5% of premium; applicable to fully insured plans only); w Pay or budget for the Transitional Rein- surance Taxes – a temporary assessment applicable to the 2014-2016 plan years, which is imposed on insurance carriers for fully insured plans and third-party administrators for self-insured plans in order to stabilize premiums in the indi- vidual markets (estimated to be $63 per covered individual in 2014; applicable to fully insured and self-insured plans); w Pre-existing conditions removed from health plan; w Nondiscrimination testing for fully insured plans (awaiting guidance and an effective date; government not en- forcing the testing until after guidance is issued); w Automatic enrollment in health plans (suspended until guidance is issued); and w Cadillac Tax (2018; a 40% excise tax on the amount of the insurance over certain dollar limits). Continuing Developments While the current law and regulations allow for certain compliance steps to con- tinue to be taken by employers to comply with healthcare reform, we are still in the developmental stages of the implementa- tion of this law. Future regulations imple- menting the law will continue to provide employers with something to think about and plan for during the next number of years (as well as greater clarification – we hope – of how to deal with some of the current requirements). We know that the government is preparing to audit employers in the near future to make sure that the law is being followed (and to raise revenue). Since no employer wants to fail to be in compliance with the law, it is strongly recommended that you consult with experts to determine a strategy for achieving and maintaining compliance. The Takeaway This article serves as an overview of the issues that are already in effect or are com- ing soon. There is a lot of work to be done to avoid noncompliance with healthcare reform. Those organizations that are not compliant are opening themselves up to the potential for unnecessary liability. By working with an experienced broker, deal- ers can be guided through each phase of implementation in order to make sure that their organization can focus on selling cars, without worrying about the government knocking on the door to “discuss” their compliance efforts with the law. Benjamin S. Lupin, an ERISA attorney, is the Senior Vice President of Compliance at Corporate Synergies Group. He can be reached at 856-813-1512 or at Benjamin. Lupin@corpsyn.com.