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

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.

W-2 Reporting Requirement – New Guidance Released by the IRS

This will mean increased adminstrative responsibility for employer and third-party vendors who complete company W-2s. It will also help employers – and the government – to track the value of tax free health insurance premiums. The penalties for failure to comply are the same as those applicable to W-2 reporting. They range from $30 to $100 per W-2 and is capped for small businesses.

What impact does the reporting have on employees?

Individuals are not impacted by this information on their W-2. The cost of the benefits reported will not increase their taxable income.

Additional information is provided at the IRS website at www.irs.gov

Health Savings Account – 2012 Limits

The IRS has announced the annual limitation on deductions for the 2012 calendar year for individuals and families who have coverage under a high deductible health plan.

The table below reflects a summary of the 2012 HSA contribution and HSA compatible health plan limits.

For additional information go to the US Department of Treasury web site at www.treasury.gov

Voluntary Benefits 101

Are you offering enough value services to attract and retain a quality workforce?

Rising health insurance premiums are not new to employees, high deductible plans are. One of our value services is offering effective and creative ways you can use to help alleviate some of the high deductible burdens your employees are starting to experience. Voluntary benefits are an effective tool to utilize as an employer. These benefits are 100% employee paid through payroll and offer a wide array of coverage, including, but not limited to life insurance, disability and accident insurance.

Voluntary benefits offer a way to off-set the out of pocket costs of the employee’s medical plans with a small per-payroll deduction. They also offer a way to supplement any group life or disability.

In a study conducted by MetLife, you can see the value that voluntary benefits hold in the eyes of employees. Adding these benefits to your arsenal gives employees another reason to stay, and gives prospective employees another reason to consider you.

If you are interested in learning more about the voluntary options, please contact our office at: 508-799-9100

2011 – Upcoming Changes & Reminders

Changes to Flexible Spending Accounts – January 1, 2011
The cost of over-the-counter medicine or drug will no longer be reimbursed, unless a prescription is obtained from a physician. For more information please visit the IRS website or IRS Notice 2010-59.

Reporting Requirement Optional in 2011
Starting in tax year 2011, employers are required to report the aggregate cost of employer sponsored healthcare coverage on Form W-2. The reporting is optional in 2011 for tax year 2010. The IRS has released a revised draft of Form W-2, which includes the codes that employers may use for cost of coverage reporting. The prupose of this reporting is to show employees the value of healthcare benefits. The amount reported has no impact on tax liability.

Prescription Drug Discounts – January 1, 2010
Seniors, who experience the “Donut Hole” coverage gap in Medicare Part D, are entitled to receive a 50% discount when buying covered brand-named prescription drugs. Seniors will continue to receive additional savings on prescription drugs over the next ten years, until the coverage gap is closed in 2020.

Small Business Tax Credit Form
A new Form 8941 with instructions for small businesses was recently released by the IRS. The form is to be used by eligible employers to calculate the tax credit amount for the 2010 tax year. The number is then to be used as part of the general business credit on an employer’s tax return.

For additional information please visit www.irs.gov or www.healthcare.gov.

Todd McDonald: MDA’s Most Wanted Citizen

Dear friend,

I am being “arrested” and need your help!

As one of the business leaders in the Worcester Community, I have been charged with aiding and abetting the Muscular Dystrophy Association with the intent of helping area residents with muscular dystrophy. As a result, I am being “arrested” on June 23, 2010 and will be held in a “Maximum-Appreciation Facility” until I am able to make bail.

As one of Worcester’s “Most Wanted”, I need your help in hopes that they will let me out on good behavior! Please consider contributing to my bail by donating to the MDA because together, we can help fight the cause.

Click here to make a secure donation online.

By particpating in this event you are providing HOPE to thousands of local individuals! Your “bail money” will benefit MDA’s local health care service program as well as worldwide research efforts.

Thank you for making a difference in the fight against muscular dystrophy.

Much appreciated,
Todd C. McDonald