On July 2, the Department of the Treasury announced a one-year delay in the implementation of certain parts of the Affordable Care Act’s reporting requirements, as well as a delay in the assessment of “pay-or-play” penalties. Although this delay will be helpful to many employers, all employers need to know which provisions are delayed and which are not.
- Reporting requirements: Mandatory reporting of health coverage information by large employers is postponed until January 1, 2015.
- Penalties: Assessment of employer penalties under the “pay-or-play” rules (for failure to offer adequate health coverage to employees) is postponed until January 1, 2015.
- Individual mandate
- Health insurance exchanges
- Exchange notices: Employers are still required to issue exchange notices to employees starting on October 1, 2013. Click here to see available model notices.
- Summaries of benefits and coverage: A short, language-appropriate description of the employer’s health coverage to be distributed to employees, effective for plan years starting on or after September 23, 2012. Click here for templates.
- Patient Centered Outcomes Research Institute fee: This fee, first due on July 1, 2013, is assessed against insurers and self-insured plans.
- W-2 reporting: No changes have been made to this requirement. Employers issuing more than 250 W-2s are required to report health insurance costs on those W-2s. Employers issuing 250 or fewer W-2s are not required to comply with this requirement.
- Expiration of annual limit waivers: Annual limit waivers will not continue after December 31, 2013.
- Limit on medical FSAs: The $2,500 limit, effective as of January 1, 2013, remains in effect.
- Insurance market reforms: The prohibition of annual and lifetime limits, the prohibition of waiting periods in excess of 90 days and other market reforms are still planned to take effect on January 1, 2014.
Use Additional Time to Develop Compliance Strategies
Delays in the implementation of major tax provisions are not uncommon. Based on our experience with rollouts of other laws, we believe that the underlying infrastructure and requirements of the ACA will remain in place during the delay, with further guidance coming from the IRS and other regulatory agencies. We strongly encourage employers to use this additional time to develop and tweak their compliance strategies. The Treasury plans to begin issuing additional guidance within the next week.
For more information about the Affordable Care Act, contact Steve Gerlach.
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