Tuesday April 7th, 2015
It is no secret that the Affordable Care Act (ACA) is burdensome and complex. Employers, insurance brokers, vendors and anyone else who provides or services any insurance product, funds an insurance product or needs one has been effected either positively or negatively by this law. It’s been five years since the law was passed and yet there is still so much uncertainty and noncompliance.
Building on the Foundation
What if you’re not ready for 2015? Perhaps you weren’t even ready for 2014 or 2013, but you get the picture. Preparedness could be used to describe growth strategies, technology advancements, audits, tax preparation, infrastructure and so much more. This law was implemented regardless of whether the foundation was strong on the national, state, carrier, local, health care, employer or individual level. For nearly 100 years there have been employer-related laws that have been passed that have both amended and built on the foundation that the previous laws laid.
The onset of the ACA is no different. We can look far and wide to how many different laws or sections of our tax code have been amended because of this law, but this article focuses on two: Employee Retirement Income Security Act (ERISA) and the Fair Labor Standards Act (FLSA).
At this point, it might seem impossible to comply with a law that you weren’t prepared for, but let’s look at several building blocks in the foundation and work on shoring up those compliance areas to better prepare for what’s next.
ERISA itself does not require employers to offer a group health plan, but it does start governing once they do, if they are subject to ERISA. ERISA requires a host of notices and disclosures including plan documents, SPDs, Form 5500, SMM and the like. The ACA has amended ERISA to an extent that requires amendments to current documents and notices as well as creating new ones.
Plan documents and SPDS have been amended to include necessary reforms. Summary of Benefits and Coverage (SBC) is a new document that requires plan sponsors to explain their plan terms in an easier-to-understand format. New disclosures include Grandfathered Plan Notice, Patient Protection Rights Notice and the Marketplace Notice. Updated notices include the COBRA General and Qualifying Event Election Notices.
COBRA amended ERISA and the ACA has amended COBRA once again. For a law that everyone thought the ACA would be its demise, COBRA is more complicated and necessary than before. For example, consider how to administer COBRA for reduction of hours during the stability period. HIPAA also amended ERISA and the ACA has amended HIPAA Portability almost out of the door. There are several requirements of HIPAA Portability that remain such as Special Enrollment and plan discrimination rules; however, requirements surrounding preexisting conditions basically disappeared after December 31, 2014.
In part 2, we’ll review our review on the affects the ACA has on FLSA.