Now we know why Congress passed the Patient Protection Affordability Care Act of 2010 (PPACA) without reading the document – it’s far too complex and mind-numbing for most everyone to understand.
That was clear after an hour-long webinar presentation Thursday (Dec. 13) by KPA LLC, a dealer services and Internet marketing provider based in Lafayette, Colo. Speakers outlined highlights of the new law and then answered a bevy of questions posed by some of the 613 registered listeners from RV, auto and truck dealerships across the U.S. The RV Learning Center and the Recreation Vehicle Dealers Association (RVDA) promoted the event within the RV industry.
Two major takeaways from the session:
• All employers are encouraged to contact their insurance broker for specific questions related to their businesses.
• Everyone should “keep their pencils sharpened” because new details of the controversial law are becoming public daily.
Failure to comply with the new law comes at a high price: the Internal Revenue Service is responsible for conducting audits to make sure employers are in compliance.
Thursday’s presenters were: Kristin Kahle, senior vice president and compliance officer for the Benefits Exchange Alliance; Kathryn Carlson, director of HR Management Products for KPA; and John Gregory, vice president at Benefit Exchange Alliance, a KPA partner.
Copies of the Power Point presentation were sent out to all participants later in the day. Carlson told RVBusiness that she expects upward of 1,000 downloads of that presentation in the coming weeks as listeners and others take advantage of the points raised during the program.
Highlights of their presentation and a fact sheet distributed before the webinar follow.
Definition of Large and Small Employers
Each employer will fall into one of two categories – either a small employer or a large employer. The “rule of 50” determines the dividing line and this is important because certain penalties for failure to comply with the new law will be applied only to larger companies
A large employer has 50 or more full-time or full-time equivalent employees. A full-time employee is one who works 30 hours a week or more. The hours of part-time workers are also computed to determine a total employment number. Take the number of hours worked by all part time workers in a month and divide by 120 to determine the full-time equivalency.
For example, an employer that has 40 part time workers who average 21 hours per week would have the equivalent of 28 fulltime workers (40 X 21 X 4 weeks divided by 120 = 28).
2014 Coverage Mandates
Employers with 50 full-time or full time-equivalent employees or more that do not offer coverage to their employees will be subject to penalties if any employee receives a government subsidy for health coverage. The penalty amount is up to $2,000 annually for each full-time employee, excluding the first 30 employees. Employers who offer coverage, but whose employees receive tax credits, will be subject to a fine of $3,000 for each worker receiving a tax credit, up to an aggregate cap of $2,000 per full-time employee. Employers will be required to report to the federal government on health coverage they provide.
Grandfathered Plan Status
A grandfathered health plan is one that was in existence when health care reform was enacted on March 23, 2010. Grandfathered plans are exempt from some of the health care reform requirements. A plan’s grandfathered status will continue to affect its compliance obligations from year to year.
• Determine if you have a grandfathered plan. Contact your insurance broker or plan representative if you have questions about whether your plan is grandfathered.
• Determine whether your plan will maintain its grand- fathered status. If you make certain changes to your plan that go beyond permitted guidelines, your plan is no longer grandfathered. Contact an insurance broker or plan representative if you have questions about changes you have made, or are considering making, to your plan.
Summary of Benefits and Coverage
Plans and insurance issuers must provide a Summary of Benefits and Coverage (SBC) to participants and beneficiaries.
• The SBC is a concise document – no more than four double-sided pages – providing simple and consistent information about health plan benefits and coverage in plain language.
• A template for the SBC is available, along with instructions and examples for completing the template and a uniform glossary of terms.
The final SBC regulations provide that plans and issuers must start providing the SBC as follows:
• Issuers must provide the SBC to health plans effective Sept. 23, 2012.
• Plans and issuers must provide the SBC to participants and beneficiaries who enroll or re-enroll during an open enrollment period beginning with the first day of the first open enrollment period that begins on or after Sept. 23, 2012.
• For participants who enroll in coverage other than through an open enrollment period (for example, newly eligible individuals and special enrollees), plans and issuers must provide the SBC beginning on the first day of the first plan year that begins on or after Sept. 23, 2012.
For more information or to view the webinar click here.