‘Benefit Plan Compliance: Would your Plans Survive an Agency Audit?’ Webinar

This Webinar will be presented on March 15th, 2012 11:00am -12:30pm EST.

In this webinar, we’ll start with a brief highlight of current health reform issues, including the latest regulations on the Uniform Summary of Benefits and Coverage as well as recent guidance on preventive care requirements as they relate to religiously-affiliated employers.

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Presented by Stacy Barrow from the Boston office of Proskauer Rose.

Space is limited. Reserve your Webinar seat now.

We’ll also discuss:

• The impact of the Supreme Court’s decision in CIGNA v. Amara on plan documents and summary plan descriptions.
• Plan documentation requirementses and Form 5500 reporting obligations.
• Brief overview of audit issues related to HIPAA’s Portability, Privacy, and Security rules.
• Cafeteria plans as well as wellness plan issues, particularly the impact of the recent Seff v. Broward County case in Florida.

‘Social Networking: An Employers Primer on their Legal Ramifications’ Webinar

This Webinar was presented on February 16th 2012 at 11:00am. We covered topics that affect your company and your employees in the world of social media. Copies of this webinar are not be available for download.

Presented by Joseph Bartoulis from the law firm of Fletcher Tilton.

Not only is social media used by individuals to interact on personal matters, they are also used by employees as a means to network. Likewise, many companies use social media to keep in touch with their customers and to promote their products. Given the breadth of uses for social media, it is no surprise that there are several legal implications that arise from the use of social media. This webinar will focus on the labor and employment law implications of social media.
Listeners also learned….

• Why every company needs a social media use policy.
• What every social media policy needs to contain.
• The risks of accessing social media to make hiring decisions.
• How to deal with disparaging statements by employees on social media.
• The legal ramifications of “friending” between superiors and subordinates.
• Protecting trade secret from being disclosed.
• and more.

‘Health Care Reform and Your Business’ Webinar

‘Health Care Reform and Your Business’ Webinar What are the impacts you experienced and what can you expect?
Webinar presented on January 31, 2012 download a copy of the slide deck Covering topics that will affect you in 2012: Compliance and Legislative Changes Judicial Challenges  Upcoming Mandates: Uniform Summary of Benefits 60-day Advanced Notice Rule W-2 Reporting Requirement Changes to Health FSA Revised Medical Loss Ratio Rules And More…

IRS issues guidance on W-2 reporting

On January 3, 2012, the Internal Revenue Service released Notice 2012-9 (an ammendment of Notice 2011-28) providing interim guidance on the W-2 reporting requirement. The guidance clarifies that employers distributing fewer than 250 W-2s in 2011 are not required to report the the cost of employer-sponsored health insurance on the Form W-2 issued in 2012.

This requirement has been extended to January 2013, when employers issue W-2s for the 2012 tax year. In addition, Notice 2012-9 restates and amends its guidance to clarify several points and address additional issues. Here are some highlights.

• Employers subject to the requirement: the revised guidance clarifies that federally recognized Indian tribal governments are exempt until further guidance is issued.
• Types of healthcare coverage that will not be reported: the reporting requirement does not apply to health FSA coverage that is solely funded through the employee; the cost of coverage under a dental or vision plan (previously this exception was described as dental or vision plan “not integrated into a group health plan providing additional health care coverage.”); any coverage for long-term care; any amounts contributed to Health Saving Account (HSA); any coverage for a specified disease or illness and hospital indemnity or other fixed indemnity insurance, if the employee pays the premiums for the coverage on an after-tax basis; the cost of coverage under a Health Reimbusrment Account (HRA); the cost of coverage under a multiemployer plan; the cost of coverage provided under a self-insured group health plan that is not subject to any federal continuation coverage requirements.
• Calculating the cost of coverage: Employers may calculate the cost of coverage under a plan using the applicable COBRA premium for the coverage. Other permissible cost calculation method is to use the premium charged by the insurer in the case of insured plans.The chosen method of reportable cost of coverage must be used consistently.
• Other Issues. The guidance explains that the reportable cost of coverage may be based on the information available to the employer as of December 31, and need not be adjusted for later elections or notifications (e.g., a divorce or other change in family status) that retroactively affect coverage during the prior year. Other issues addressed include how the reporting requirement applies to related employers, reporting for programs that include health and non-health benefits, and coverage provided during a payroll period that straddles two calendar years.

For additional information on this topic, please see Notice 2012-9 on the IRS page.

HIPAA Audits

As part of its HIPAA enforcement efforts, the Department of Health and Human Services (HHS) has put in place an audit pilot program with the intent to verify and prevent security breaches.

• Target companies: HHS plans to audit 150 entities, healthcare providers and employers who sponsor group health plans. Companies with specific risk factors, such as the amount of data they control or those with highly sensitive records, such as health records of celebrities are most likely to be audited. Targeted entities must provide the requested information within 10 days of being contacted by the HHS.
• Information: the requested information will include, at minimum, documentation of their privacy and security compliance efforts (e.g. policies, forms, notices, training materials, etc.). Additionally, on-site visits will be included in every audit. Fieldwork may last up to 10 business days, during which time the auditor will be conducting interviews with key personnel and observing the covered entity’s operations for compliance.
• Corrective actions: entities who experience a HIPAA breach must provide notice to affected individuals and take steps to prevent further breaches, among other things. To correct HIPAA violations, HHS has, among other actions, required covered entities to improve technology security, enter into a business associate agreement, train staff, and counsel employees who violate HIPAA policies.
• Potential penalties: monetary penalties for HIPAA violations are based upon whether a covered entity knew of the HIPAA breach, whether the breach was due to willful neglect, and whether proper corrections were made. There are tiers of penalties per violation ranging from $100 to $50,000.
• Practical tips for a possible audit and everyday compliance: the pilot audit program objective is to ensure HIPAA compliance. For covered entities this is a good time to revisit their current HIPAA policies and procedures for compliance with privacy and security standards. If you receive an audit notification letter speak with your attorney immediately to ensure your documentation and operations are in compliance with the regulation. Give the auditor a copy of your HIPAA privacy and security policies and procedures in writing. This will be most likely the starting point for the HHS.

Additional information on this topic can be found at www.hhs.gov

Introducing Jon Clark, the newest member of Aisling Partners

It is with great pleasure that I introduce to you, Jon Clark, Senior Consultant and the newest member of Aisling Partners. Jon has had a long and successful track record as an employee benefits consultant since 1995. Prior to joining Aisling Partners, he was a founding partner of a highly successful employee benefits brokerage and with him, brings over 11 years of agency management experience.

Jon has earned a reputation from peers and clients alike, for being an incredibly thorough, proactive and creative broker whom takes the time to know every one of his client’s needs. Jon prides himself on taking part in every step of the benefits process from vendor negotiations to employee education. It is his goal to deliver to every client the most customized benefits package that will achieve both the highest level of employee workplace satisfaction while at the same time, assisting the employer with controlling their costs.

Jon has been a crucial addition to our growing employee benefits focused firm and we’re thrilled to have him on board with us.

Contact information:

Jon Clark
446 Main Street
20th floor
Worcester, MA 01608

508.799.9100 work
617.721.4928 cell
508.546.7999 fax

jclark@aisling-partners.com

Healthcare Reform Developments, Updates & Timeline

While the Patient Protection and Affordable Care Act (PPACA) required significant changes for group health plans in the past 20 months, some additional implementations are still required for 2012 and beyond.

Brief overview of the 2010-2011 events pertaining to healthcare reform:

• Rate Review - The US Department of Health and Human Services (HHS) must now review, on an annual basis, “unreasonable” increases in medical insurance premiums.
• Consumer Information - HHS established an awarding grant program for states to provide health insurance assistance for consumers. The assistance includes filing complaints and appeals, educating consumers regarding health coverage rights and responsibilities, assistance with enrollment, etc.
• Temporary Reinsurance for Early Retirees - This program was temporarily created to reimburse eligible employers that sponsor retiree coverage for 80% of claims (between $15K and $90K). Only individuals who are not active workers or dependents of an active worker – and not eligible for Medicare – may be reimbursed.
• Small Business Tax Credit (35%) - Up to 35% of employer costs for employees’ health insurance is provided as a tax credit for small employers.
• Grandfathered and Non-grandfathered Plans Reforms - Effective for plan years beginning on or after September 23, 2010 all plans must not impose exclusions for preexisting conditions for enrollees under 19 years old; extend coverage for adult children to age 26 (unless child is eligible for coverage with elsewhere); annual or lifetime limits restrictions on essential health benefits.
• Non-grandfathered Plans Reforms - Effective for plan years beginning on or after September 23, 2010, these plans must not discriminate in favor of highly compensated individuals for insured health plans; cover emergency services without pre-authorization; allow designation of obstetrician, gynecologist or pediatrician as primary care provider; cover immunizations and preventive care in full.
• HSA, FSA and HRA Changes - Medical expense for these accounts was amended to exclude over-the-counter medicine, unless obtained with a prescription. An additional 20% tax will now be charged on the portion of HSAs that are not used for qualified medical expenses.
• Medicare Part D Discounts - Enrollees who enter the lapse in coverage (also known as the “donut hole”) that occurs when an individual reaches the coverage limit under Medicare Part D (Prescription Drug Coverage) will be provided a $250 rebate.

Key Provisions Requiring Attention in 2012:

• Summary of Benefits- A Summary of Benefits and Coverage format set by HHS, using uniform definitions, must be used by insurers and plan sponsors of self-insured health plans and provided to all participants and applicants prior to enrollment or re-enrollment. Distribution date starts on March 23, 2012.
• W-2 Reporting- Employers must report the aggregate cost of applicable employer-sponsored coverage on an employee’s Form W-2 starting January 2013 for the 2012 tax year.

2013 and Beyond:

• Health Flexible Spending Account Limit - On January 1, 2013, healthcare FSA contributions will be limited to $2,500 per year.
• Employer Notice Requirement- By March 1, 2013 employers will be required to provide written notices to inform employees of the upcoming health insurance exchanges to be established by all states in 2014.
• Retiree Drug Subsidy Deduction - Effective January 1, 2013 the deduction for the portion of healthcare expenses that are reimbursed to the employer through the Medicare Part D subsidy program will no longer be available.
• Medicare Tax - An additional 0.9% of Medicare tax on wages and self-employment income will be taxed to individuals earning more than $200K ($250K if married filing jointly).
• Automatic Enrollment - Expected to be in effect in 2014, employers with more than 200 employees will be required to automatically enroll new full-time employees in health coverage, with the opportunity to opt out.
• Individual Mandates and Subsidies - Starting in 2014, individuals will be required to obtain minimum essential coverage. Noncompliance penalty will be the greater of $95 per individual or 1% of household income. Financial subsidies will be made available to individuals who qualify due to low income.
• Employer Provisions - 2014 – Minimum essential coverage must be offered to employees by employers with more than 50 employees.
• Health Insurance Exchanges - 2014 – State-based medical benefits will be available for individuals and small employers to purchase.
• Individual Mandates Penalty Increase - 2015/2016 – Increase will be of $325 or 2% in 2015 and $695 or 2.5% in 2016.
• Large Employers in Health Insurance Exchange - 2017 – States will make purchase of coverage available to large employers.
• Tax on High-Cost Plans - 2018 – An excise tax of 40% will be imposed on employer-sponsored health plans with aggregate expenses that exceed $10,200 for individual coverage and $27,500 for family coverage.

Aisling Partners Questionnaire

To our Valued Clients:

We would like to thank you for the partnership over the years and for allowing us the continued opportunity to provide advice, guidance and counsel to your organization. Our business relationship is something that we do not take for granted, as such, our firm is constantly trying to improve our value proposition to ensure that we continue to provide “best in class” services and resources for our trusted clients.

To this end, we have attached a brief questionnaire for your completion which can be done in the traditional paper format or we also welcome an electronic submission as well. The primary purpose of this request is to ensure that we have the most current and accurate information in our agency management systems so that we can provide applicable and timely information related to compliance, product developments, HR tips and HR strategies, etc.

As part of our continued development as a firm, we are also pleased to announce that we are in the developmental stages of launching a learning institute that we have proudly named, Aisling University.  Our vision for Aisling University is to provide our employees as well as our clients an educational resource center that will provide seminars, webinars, industry tools & benchmarking, compliance updates, etc. in an effort to remain a leader in the ever changing healthcare world. As you would expect with a learning institute, we welcome your suggestions and feedback.

Thank you for your continued vote of confidence in our firm and for assisting us with the questionnaire. We look forward to our continued partnership in the coming years.

Questionnaire

Appreciatively,

Todd McDonald

President

Medicare Part D – Creditable Coverage Annual Notice to Eligible Individuals

Many employers remain unaware that under Medicare Part D regulations, entities offering prescription drug coverage to Medicare Part D eligible employees and retirees must disclose annually to individuals whether their health plan has creditable or non-creditable prescription coverage.   This requirement stems from the fact that Medicare eligible individuals who are not covered by creditable prescription drug coverage and who choose not to enroll before the end of their initial enrollment period, and enroll at a later date, will most likely pay higher premiums.  To this end, Centers for Medicare and Medicaid Services (CMS) has issued guidance on this matter over the past few years and have done so through various channels of communication.   In addition, our firm has also disseminated information since the inception of this legislation in 2005 and health insurance carriers have also provided additional information on this topic as well as. It is our understanding that your plan has been deemed creditable (see attached standards), but if you have changed your prescription plan or if you are unsure if the creditable standard will still be met, please feel free to contact our office directly for assistance.

NOTE:  No action is needed on your behalf if you do not have Medicare Part D eligible individuals.   See below for list of included individuals / beneficiaries.

DISCLOSURE TO MEDICARE PART D ELIGIBLE INDIVIDUALS:

Who must receive the disclosure Notices?

The disclosure notice (creditable sample attached) must be provided to Part D eligible beneficiaries (individuals) enrolled in or seeking to enroll in the employer’s prescription drug coverage.  This includes the following Part D eligible beneficiaries:  Active employees, spouses, dependents, disabled employees, retired employees, individuals eligible for Medicare due to a disability or end stage renal disease.  A communication plan may include a general notice to all employees followed by a targeted effort to those individuals you know are affected by Medicare D.  It is our recommendation that you provide this information to all employees at your renewal each year as part of the open enrollment process in order to remain in compliance with CMS.  Employers may also consider posting a disclosure notice on their intranet, include the notice with their Summary Plan Description (SPD), or include information/updates on this topic within other employee communications.

When must the notices be provided?

At a minimum, Disclosure Notices for creditable and non-creditable coverage must be provided as follows:

1. Prior to the Medicare D Annual Coordinated Election Period – October 15th each year.
2. Prior to an individual’s Initial Enrollment Period for Part D
3. Prior to the effective date of coverage for any Medicare eligible individual that joins the plan
4. Whenever prescription drug coverage ends or changes so that it becomes creditable or is no longer creditable
5. Upon a beneficiary’s request

NOTE:  If you have Medicare Part D beneficiaries and have not provided a disclosure notice in the past, we would recommend you send out the model notice with a short cover letter stating that your plan has been creditable since 2006 and continues to be creditable.

DISCLOSURE TO CENTERS FOR MEDICARE AND MEDICAID SERVICES (CMS):

Entities that provide prescription drug coverage to Medicare Part D eligible individuals must also disclose to CMS whether the coverage is “creditable prescription drug coverage”.  This disclosure is required whether the entity’s coverage is primary or secondary to Medicare.  The form that needs to be completed and submitted to CMS can be found at www.cms.gov

NOTE:   If you have Medicare Part D beneficiaries and have never filed online with CMS, please do so for 2006 through 2011 and within 60 days of your 2012 renewal.   There are currently no penalties for not having filed so please take this opportunity to bring your filings up do date.

Additional information on the creditable coverage disclosure requirements can found at www.cms.gov.

Walgreens turns away from Express Scripts negotiations

You may have received word that Walgreens and Express Scripts have a retail agreement that will expire on 12/31/2011. There had been ongoing negotiations between both parties to come up with a new retail agreement for 1/1/2012 until negotiation conversations recently broke down. Express Scripts is hopeful that they will be able to return to the negotiating table with Walgreens and resolve any outstanding items that are hindering the process.

Please see the link below to the Express Scripts website that provides some additional details:

http://phx.corporate-ir.net/phoenix.zhtml?c=69641&p=irol-newsArticle&ID=1576686&highlight

If negotiations don’t continue or are unsuccessful, Walgreens will no longer be in the Express Scripts pharmacy network as of 1/1/2012. It is hopefully that Express Scripts and Walgreens will reach an agreement so that members will not be impacted. Express Scripts is doing what they can to ensure minimal inconvenience for their members. In the event that an agreement can not be reached,  Express Scripts will provide members with the names and locations of convenient, nearby pharmacies.

Please stay tuned for further information.