Key Provisions in Healthcare Reform Legislation
Oasis has a team of experts dedicated to enhancing our PEO clients’ understanding of how the changes will impact their business. We’ve been at the forefront of the legislative process since the beginning, and we keep in constant communication with healthcare experts, regulators and independent advisors to make sure we have a thorough understanding of all facets of Healthcare Reform.
This page provides you with a brief overview of how Healthcare Reform can potentially impact your business. Keep in mind, this information is only intended to be used as a summary of some of the key provisions of the law; for additional information on how to address Healthcare Reform in your company, please call us at 866-709-9401 or click here to Request a Free Consultation.
Small Business Tax Credit
Targeted Business Size: Less than 25 full-time employees with an average wage below $50,000.
Key Provision: The maximum credit is 35% of total premiums paid for small business employers (2010-2013). There will be a maximum tax credit of 50% of premiums paid by eligible small employers that are a part of the SHOP Exchange. The credit is available for employers for a maximum of two consecutive years (2014).
How we can help: Oasis conducts a review of all new clients to advise them if they may be eligible for this credit. Supporting payroll documentation is provided as required to assist in capturing all available tax credits.
Targeted Business Size: 50 or more full-time employees
Key Provision: Pre-existing conditions restriction eliminated for children under the age of 19 and lifetime maximums must be eliminated (2010). Pre-existing conditions restriction eliminated for everyone (2014).
How we can help: All Oasis plans comply with this requirement.
2012 and Beyond
Targeted Business Size: Employers who issued at least 250 W-2s in the prior year
Key Provision: Employers must report the aggregate value of employer-provided coverage that is taken into account for purposes of the excise tax on high-value health coverage.
How we can help: Oasis includes the aggregate value of the employer-provided coverage on employees’ W-2s (2013 for the 2012 tax year).
New Plan Disclosure Obligations
Targeted Business Size: All
Key Provision: Plan sponsors must supply participants at enrollment or re-enrollment, a new form of plan summary that must include information on benefits exclusions and cost-sharing requirements. Businesses are subject to a $1,000 penalty for each failure.
Key Provision: Employers must provide written notice regarding the existence of the Insurance Exchange and that the employee might qualify for subsidies.
Key Provision: Plan sponsors will be required to provide an annual statement to the government and covered individuals reflecting the months during the calendar year for which the individual had “minimum essential coverage.” Businesses are subject to a $50 fine for each missed statement to an employee up to a maximum of $100,000.
How we can help: Oasis will supply all required disclosures for clients participating in an Oasis-sponsored medical plan.
Health FSA limits
Targeted Business Size: All
Key Provision: Employee contributions to FSA are limited to $2,500/year.
How we can help: Oasis has set the correct limit for FSA contributions and distributes that information to new and current employees during annual enrollment.
Employer Mandate/Shared Responsibility
Targeted Business Size: Businesses that average 50 or more full-time equivalent employees
- Plan design is expected to pay at least 60% of allowed charges (2015).
- Employee share of single premium contribution must not exceed 9.5% of employee’s W-2 income (2015).
- Employers with 50 to 99 full-time or full-time equivalent employees: The requirement won’t be enforced until plan years with effective dates on or after January 1, 2016, if certain conditions are met.
- Employers with 100 or more full-time or full-time equivalent employees: These employers will need to offer minimal essential coverage (MEC) to at least 70 percent of full-time employees in 2015 and at least 95 percent in 2016 and beyond for the penalty not to be triggered.
Penalty for noncompliance: Employers that do not offer MEC to all full-time employees and eligible dependents face a tax penalty of $2,260 (2017) for each of their full-time employees, until they offer such coverage. This applies if one FT employee purchases a qualified health plan in an Exchange and receives a federal subsidy. This penalty is subject to an exemption for the first 30 full-time employees. Employers who offer coverage that is “unaffordable” or not of “minimum value,” will pay a penalty of $3,390 (2017) for each full-time employee who turns down employer coverage, purchases a qualified health plan in an Exchange and receives a federal subsidy.
How we can help: Oasis plans cover at least 60% of the allowed charges. Oasis will consult with clients and provide tools for clients to determine affordability based on employee contribution.
Targeted Business Size: All
Key Provision: Plans may not impose a waiting period of more than 90 days (60 days in some states).
Penalty for noncompliance: Employers with 50 or more employees will be fined for waiting periods between 60-90 days ($600 per full-time employee in waiting period).
How we can help: The Oasis payroll system will enroll eligible employees as directed by the client. The Oasis plans will require a waiting period of no longer than the first of the month following 60 days (30 days in some states).
IRS Section 6055/6056 Annual Reporting
Targeted Business Size: Varies
Key Provision: (6055) – All employers that offer minimal essential coverage (MEC) must provide annual reporting. Additionally, a statement to each responsible individual, including information from the annual report, is required (2016 for 2015 tax year). (6056) – Large employers must provide annual reporting of health coverage. Additionally, a statement to each FT employee, including information from the annual report, is required (2016 for 2015 tax year).
Penalty for noncompliance: TBD
How we can help: Oasis will assist in this reporting for all clients participating in an Oasis-sponsored medical plan.