Here are digests of recent benefits rulings that will affect your Payroll operations.
Payroll off the hook for CLASS Act withholding
The Department of Health and Human Services (HHS) shelved the CLASS Act. According to HHS Secretary Kathleen Sebelius, the program can’t be put on an actuarially sound footing.
The CLASS Act—short for the Community Living Assistance Services and Supports Act—was part of the 2010 health care reform law. It would have permitted individuals with functional limitations to stay in their homes by allowing them to purchase nonmedical community assistance services and support. Employees would have paid for benefits through voluntary withholding.
Compliance with summary of benefits and coverage rules postponed
In a new set of FAQs, the Department of Labor and the IRS have stated that until final regulations are issued, health plans and insurers don’t need to comply with the requirement that all group health plans (including grandfathered plans, self-insured plans and plans not covered by ERISA) provide employees and beneficiaries with a simple explanation of their benefits and a uniform glossary covering basic health insurance and medical terms.
Proposed regs had set an original compliance date of March 23, 2012.
HRA reporting under the Medicare-as-secondary-payer rule
Under the Medicare-as-secondary-payer rules, group health plans with health reimbursement accounts (HRAs) must file quarterly electronic reports with the Centers for Medicare and Medicaid Services (CMS). Reporting applies to insurers and third-party administrators. For self-insured and self-administered plans, administrators or fiduciaries report.
The CMS has increased the reporting threshold to HRAs with annual benefit levels of at least $5,000 (up from $1,000), including amounts employees roll over.
Along with other information, plans must submit a notice of termination to the CMS’ Coordination of Benefits Contractor for employees who exhaust their HRAs if no additional funds will be added to employees’ HRAs for the rest of the benefit coverage term.