IRS Issues Publications on Electronic Filing of Health Care Coverage Information Returns

The Patient Protection and Affordable Care Act (PPACA) implemented information reporting requirements for employers. Known as information returns, the employer supplied information allows the government to ascertain whether the employer is meeting their requirements under the PPACA. The type of information submitted pertains to the type of employer health-coverage offered, specific employee coverage, and other various requirements under the act.

In order to facilitate the information returns, the Internal Revenue Service (IRS) allows these filings to be submitted electronically. Known as the “AIR” system, the IRS issued publications to guide employers wishing to submit the PPACA information returns electronically. In order to submit the information returns, the employer must first create an account at least 28 days prior to submitting information. For some employers, such as those with over 250 of one type of information return, the returns must be submitted via the AIR system.

The AIR filings are subject to very specific instructions and requirements. To retrieve these publications, please visit the following website. http://www.irs.gov/for-Tax-Pros/Software-Developers/Information-Returns/Affordable-Care-Act-Information-Return-AIR-Program?utm_source=Mondaq&utm_medium=syndication&utm_campaign=inter-article-link

© 2015 Houghton Vandenack Williams
For more information, Contact Us

CMS Proposes New Exceptions to the Stark Law

The Centers for Medicare and Medicaid Services (“CMS”) has proposed revisions to the regulations governing enforcement of the physician self-referral law, commonly known as the Stark Law.   The changes are part of a 282-page proposed rulemaking that establishes the 2016 Medicare Physician Fee Schedule.  According to CMS, the proposed changes to the Stark regulations are intended to accommodate delivery and payment system reform, to reduce regulatory burdens, and to facilitate compliance.  Many aspects of the proposal appear to be in response to physician self-disclosures of highly technical violations that have been submitted under the Medicare self-referral disclosure protocol (“SRDP”) adopted as part of the Patient Protection and Affordable Care, also known as Obamacare.

The Stark law  generally prohibits a physician from making referrals for certain designated health services (“DHS”) that are payable by Medicare to an entity with which he or she (or an immediate family member) has a financial relationship (ownership or compensation), unless an exception applies.  Among other things, the proposal would add two new exceptions, primarily targeted at rural and underserved areas.  As with all things Stark-related, the proposed exceptions are highly technical.

The first new exception to Stark would permit a hospital, federal qualified health center, or rural health center to subsidize a physician’s payment of a nonphysician practitioner’s salary.  The proposed exception would apply only where the nonphysician practitioner is a bona fide employee of the physician or the physician’s practice and the purpose of the employment is to provide primary care services to the physician’s patients.  To qualify under this exception, a non-physician practitioner would have to be a physician assistant, nurse practitioner, clinical nurse specialist, or certified nurse midwife.  The subsidy would also be subject to a financial cap and two year time limitation.

The second new exception would expressly permit “timeshare arrangements,” and is intended to benefit communities where there is a need for certain specialty services but that need is not great enough to support a full-time physician specialist.   Under timeshare arrangements, a hospital or local physician practice may ask a specialist from a neighboring community to provide the services in space owned by the hospital or practice on a limited or as-needed basis. In such circumstances, the visiting physician may not have exclusive use of the premises and there may not be a one-year arrangement as required by the current exception for leased office space.

The proposed timeshare exception would provide relief from Stark where the visiting physician is a temporary licensee of the space rather than a lessor.  However, the proposed exception includes numerous technical requirements, including limitations on certain types of equipment that may be used in connection with the license.  In addition, the proposed exception would not protect a license of office space that is primarily used to furnish DHS to patients.

The proposed rule impacting the Stark Law can be found at the following link: http://www.gpo.gov/fdsys/pkg/FR-2015-07-15/pdf/2015-16875.pdf

© 2015 Houghton Vandenack Williams
For more information, Contact Us

IRS Issues Notice Regarding PPACA Excise Tax

Part of the Patient Protection and Affordable Care Act (“PPACA”) efforts to reduce healthcare costs include an excise tax on health insurers that provide benefits to employees above a threshold limit. This tax is designed to discourage insurance programs that allow employees to receive unusually generous benefits under the insurance plan, which is believed to encourage heavy usage of healthcare. By reducing the overall usage, it will decrease costs. Moreover, it is expected that this tax will help fund the PPACA and off-set the cost of healthcare for those who are not enrolled in a qualified welfare plan. The 40% excise tax is set to take effect in 2018 for the cost of an applicable coverage plan that is above the threshold limit.

In preparing for the implementation of the excise tax, the Internal Revenue Service (“IRS”) has issued Notice 2015-16. This notice serves to clarify “the definition of applicable coverage,” “the determination of the cost of applicable coverage,” and “the application of the annual statutory dollar limit to the cost of applicable coverage.” The notice also seeks input on these issues.

This notice is only the start of implementing the new excise tax and the IRS anticipates issuing further notices. Eventually, the IRS intends to propose regulations and will invite further comments. For details regarding Notice 2015-16, the notice may found at the following link: http://www.irs.gov/pub/irs-drop/n-15-16.pdf .

© 2015 Houghton Vandenack Williams

For more information, Contact Us

Update to FMLA Definition of “Spouse”

The Department of Labor (“DOL”) has updated selected regulations to the Family and Medical Leave Act (“FMLA”). The updates change the definition of spouse to mean: “husband or wife refers to the other person with whom an individual entered into marriage as defined or recognized under state law for purposes of marriage in the State in which the marriage was entered into . . . .”

Essentially, the change now requires employers to recognize FMLA leave for same sex individuals if the marriage is recognized and valid in the state where they were married. This change departs from the previous rule that requires recognition of the marriage by the state where the employee resides. This update will impact several parts of FMLA regulations, including leave for pregnancy, adoption, next of kin, and the care of a parent.

Although this new rule brings FMLA closer to the definition of spouse in other federal regulations and Supreme Court precedent, it does not include domestic partners. It must be a legally recognized marriage, including common law marriage, but it does not include a domestic partnership.

For employers, this may mean updating employee manuals and handbooks, as well as being aware of the laws of the various states when an individual applies for FMLA leave. The DOL does not expect compliance with the new regulations to add substantial cost.

The update to the federal regulations can be found at the following link: https://s3.amazonaws.com/public-inspection.federalregister.gov/2015-03569.pdf

© 2015 Houghton Vandenack Williams
For more information, Contact Us

Potential Employer Requirements Due to Anthem, Inc. Data Breach

On February 4, 2015, Anthem Inc., one of the largest U.S. health insurers, notified the public that their data systems were breached. This breach potentially left customer names, social security numbers, and other personal information vulnerable. Subsequently, Anthem Inc. has already seen a customer lawsuit filed in California over the breach, with many more expected.

Health plan participants that have been affected will be notified in compliance with federal law. However, as this investigation continues, this may place additional burdens on employers. Depending upon the nature of the breach, of which further details are expected soon, employers may have to issue breach notifications under the Health Insurance Portability and Accountability (HIPAA). Until it becomes clear what information was taken, specific notification requirements are unclear. For example, a key question is whether protected health information was taken.

Depending upon the type of health plan an employer offers, it will have a varying impact upon the obligations for each company. The requirements will become clearer once further information is released. Beyond the federal HIPAA requirements, 47 states have unique breach notification laws that may impose obligations.

If you have questions pertaining how this may impact your requirements under the law, please contact Houghton Vandenack Williams for further information.

© 2015 Houghton Vandenack Williams

For more information, Contact Us

Corporate Wellness Programs Receive Scrutiny From the EEOC

The United States Equal Opportunity Commission (EEOC) has filed a petition, their third in three months, regarding a corporate wellness program. The latest petition alleges that Honeywell International, Inc. violated the Americans with Disabilities Act (ADA) and the Genetic Information Nondiscrimination Act (GINA) through the administration of workplace biometric screening.

The program is similar to those seen at companies across America. The employee receives health care discounts and other financial benefits for undergoing workplace biometric screening and choosing healthy lifestyles. The EEOC claims the program violates the law because it is an involuntary, non-work related, medical inquiry. Second, the EEOC alleges the employer is illegally inducing employees to provide family medical history. If the court views the program similarly, it would be a violation of the ADA and GINA.

It is unclear what this challenge will mean for corporate wellness programs.  In the short term, with the end of year approaching, it will unlikely have an immediate impact. However, it will be important to monitor the evolution of the challenges because it could  change how these programs must be administered or even whether these programs can be offered.

© 2014 Parsonage Vandenack Williams LLC

For more information, Contact Us

HHS Issues Temporary and Proposed Rules on Contraceptive Coverage

The Department of Health and Human Services (“HHS”) has recently issued rules to address the Supreme Court’s recent Hobby Lobby ruling. Under a temporary final rule, religious nonprofit organizations can notify the government of their objection to providing contraceptive coverage for employees, rather than having to authorize the coverage themselves. The government will then arrange for contraceptive coverage. HHS also issued a proposed rule that would extend similar accommodations to closely-held, for-profit religious employers.

© 2014 Parsonage Vandenack Williams LLC

For more information, Contact Us