PPACA for 2014 and what to expect for 2015

It is a busy time indeed for health insurance professionals and employee benefits attorneys!  I bring to you the following as a summary regarding PPACA for 2014 and what to expect for 2015.  I believe the article linked below is good in its entirety, however, I wanted to bring the following especially to your attention.

First, consider the following by Jessica Waltman, senior vice president of government affairs at the National Association of Health Underwriters in Washington, D.C.:

“…You have some employers who are compliant and other employers working on becoming compliant. They have to document. It's not just ‘I don't have to do it this year’; it's ‘I have to fill out and document it.’ A lot of employers were already offering coverage, but the new systems in place are a compliance burden that may be as much work as offering coverage in the first place.” [Emphasis Added]

The “documentation” Ms. Waltman speaks about is one of best practices rather than, for example, a single IRS form.  I compare the documentation to a level above what you would retain for your income tax records (after all, this is a tax, yet on the other hand it is also administered by several other bureaucracies, including the Department of Labor).  Therefore, the chance for an audit is at least two-fold.  Please keep in mind too that one should not put their broker in the position of attorney, and vice-versa.  That is, certain of the documentation must be prepared by an attorney, and certain provided by the broker.  I say this to protect the broker from giving you legal and tax advice, because their Errors and Omissions insurance normally won’t cover that, you won’t have compliant documents, and both parties lose.  Finally, I have reviewed several different software programs to track ACA requirements, where chain of custody is of utmost importance, therefore if you are interested in learning about this please contact us.  We can make a recommendation.

Second, the following is also instructive:

“What's happening is PPACA is just loaded with fear-inducing issues. So employers are freaking out,” Davis says. “Plus the law has changed 30–40 times so far, so everyone is asking if they’re in compliance. In health care, we call it the worry well. It creates stress, so brokers use that and deluge people with information. Within 24 hours of a change, we get the information. We keep up on it, but clients continue to freak out because they’re scared of missing something. The IRS went out and hired a bunch of new auditors last year and started auditing health plans. And those penalties can be huge. People are going to continue to peddle fear and offer hope,” Aaron Davis, president of Next Logical Benefit Strategies in Westminster, Maryland.

I was speaking to a well-regarded ERISA litigator friend the other day, and we both agreed that health and welfare plans in the past were never audited.  As a matter of fact, the only plan of that type he had ever seen audited was a Section 125 plan and that was because he felt the government was being “aggressive.”  Now, however, we both agreed the government will begin auditing healthcare plans the same as pension plans, which is a very active area of litigation.  Remember, if you offer any healthcare plan, you must have the documentation discussed above available to employees on a timely basis.  That is, if you have a group of 10 employees, the documentation requirements are substantially similar to if you have 1000 employees. 

Click HERE to see the entire article.”