Private Employer Health Plans- and Implementation of the Public Health Services Act and the Accountable Care Act Mandates in 2014
Department of Labor requirements mandate that employers who offer ERISA health and welfare plans must report plan data in an annual Form 5500, which includes plan enrollment, funding, and other information. Form 5500 filings are required for pension and health and welfare plans. Generally employers who have 100 or more employees in their health plan must report, but self-funded plans with fewer participants must also report. And some other types of benefit programs, like Section 125, 127, or 129 flexible benefit plans may also require Form 5500 reporting, depending on the benefit program. This article uses information from Form 5500 filing data to provide a profile of private employer health plan status, with a view toward changes next year.
Department of Labor Health & Welfare Plan Reporting
Department of Labor(DOL) Form 5500 plan filings are typically reported ninety days after the end of the plan year, so generally between March 30, 2011 and September 30, 2011 for the 2010 plan years. The 2011 fiscal year 5500 reports were not due until as late as the fourth quarter of 2012, and hence not yet available as of this publishing date. The DOL indicates that 41% of private employers with health and welfare plans reported self insured plans under Form 5500. To be considered a self-insured plan the risk portion which funds the payment of health care services is separated from the administrative expenses of the plan. Another 4,000 employers had partially self funded plans, which are a cross between a fully insured and a self-insured plan. The remaining 25,000 employers reported traditionally insured health plans, like HMO’s.
ERISA or self-funded plans and Affordable Care Act Mandates
The Affordable Care Act amends portions of the precursor, the Public Health Services Act of 2010 including section 715 (a) (1) of the Employee Retirement Income Security Act (ERISA) to require self-insured or ERISA plans to conform to certain health plan mandates.These stipulations apply for plan years after January 2014:
1. Waiting Period before an employee is enrolled on a health plan cannot exceed ninety days
2. Employees who work 1,200 hours per year are considered full-time for purposes of qualifying for health plan participation
3. Public Health Services Act Section 2708 provides guidance for determining when an employee working variable hours must meet the criteria for inclusion in the health plan, including the 13 month rule when a variable hour worker must be added to the plan
4. DOL Technical Release 2013-01 extends the compliance phase-in period for the Uniform Health Carrier External Review Process as mandated by Public Health Services Act section 2719 (b) (1) from January 1,2014 to January 1,2016 if the organizations comply with the temporary National Association of Insurance Commissioner Standards.
Final Regulations for Qualifying Health Plan Wellness Programs
The Public Health Services Act section 2705 mandated Wellness coverage for medical insurance plans effective January 1, 2014. On November 26, 2012, Department of Labor regulations for the Accountable Care Act wellness benefit mandates for health insurance plans were issued, including amending HIPAA from 2006. Wellness plans may include any of the following components:
1. Cost of membership in a fitness center
2. Diagnostic testing which reward participation and do not punish participants for their outcomes
3. Monthly no-cost health education programs
4. Health risk assessment
5. Smoking aversion programs
6. Rewards for health contingent wellness plans, such as logging miles per week, weight loss, etc.
For more information on the regulations for the wellness plan mandates please feel free to read all 123 pages of the federal regulations. This article has provided employers with some crib notes on the pending 2014 health care reform mandates, but for more information, read Unraveling U.S. Health Care-A Personal Guide, available July 14th on Amazon or pre-order now from Rowman and Littlefield.
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