The State of the Union Address and the Employee Benefits Market

The State of the Union Address and the Employee Benefits Market

On Tuesday, Feb. 5, 2019, President Donald Trump delivered the 2019 State of the Union Address (SOTU). The SOTU is an annual message delivered by the president to a joint session of Congress at the beginning of each year. At this year’s SOTU, President Trump discussed issues that have the potential to impact the employee benefits industry, including pre-existing conditions, lower prescription drug prices and nationwide paid family leave. (more…)

ACA Remains in Place After Being Struck Down by Federal Court

ACA Remains in Place After Being Struck Down by Federal Court

On Dec. 14, 2018, a federal judge ruled in Texas v. United States that the entire Affordable Care Act (ACA) is invalid due to the elimination of the individual mandate penalty in 2019. The decision was not stayed, but the White House announced that the ACA will remain in place pending appeal.

This lawsuit was filed by 20 states as a result of the 2017 tax reform law that eliminates the individual mandate penalty. In 2012, the U.S. Supreme Court upheld the ACA on the basis that the individual mandate is a valid tax. With the penalty’s elimination, the court in this case ruled that the ACA is no longer valid under the U.S. Constitution. (more…)

Furnishing Deadline Delayed for 2018 ACA Reporting

Furnishing Deadline Delayed for 2018 ACA Reporting

On Nov. 29, 2018, the Internal Revenue Service (IRS) issued Notice 2018-94 to:

  • Extend the due date for furnishing forms under Sections 6055 and 6056 for 2018 from Jan. 31, 2019, to March 4, 2019; and
  • Extend good-faith transition relief from penalties related to 2018 information reporting under Sections 6055 and 6056.

Notice 2018-94 does not extend the due date for filing forms with the IRS for 2018. The due date for filing with the IRS under Sections 6055 and 6056 remains Feb. 28, 2019 (April 1, 2019, if filing electronically, since March 31, 2019, is a Sunday). (more…)

Proposed Rule Would Expand Options for HRAs

Proposed Rule Would Expand Options for HRAs

On Oct. 23, 2018, the Departments of Labor (DOL), Health and Human Services (HHS) and the Treasury (Departments) issued a proposed rule that would expand the usability of health reimbursement arrangements (HRAs). Effective in 2020, the proposed rule would:

  • Allow HRAs to be used to reimburse the cost of individual market premiums on a tax-preferred basis, subject to certain conditions; and
  • Allow employers that offer traditional group coverage to provide an HRA of up to $1,800 per year (as adjusted) to reimburse certain qualified medical expenses.

This proposed rule was issued in response to a 2017 executive order directing federal agencies to expand access to HRAs. (more…)

Final Forms for 2018 ACA Reporting Released

Final Forms for 2018 ACA Reporting Released

In late Sept. 2018, the Internal Revenue Service (IRS) released final 2018 forms and instructions for reporting under Internal Revenue Code (Code) Sections 6055 and 6056.

  • 2018 Forms 1094-C and 1095-C (and related instructions) are used by applicable large employers (ALEs) to report under Section 6056, as well as for combined Section 6055 and 6056 reporting by ALEs who sponsor self-insured plans.
  • 2018 Forms 1094-B and 1095-B (and related instructions) are used by entities reporting under Section 6055, including self-insured plan sponsors that are not ALEs.

The 2018 forms and instructions are substantially similar to the 2017 versions. (more…)