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Compliance Still Required


The Treasury Department's communication, earlier this month, advised that two provisions of the Affordable Care Act (ACA) would be delayed for one year. These provisions are the Shared Responsibility for employers (Pay or Play penalty tax) [Code § 4980H] and the Reporting of health insurance coverage [Code §§ 6055 and 6056]. While some employers may feel a sense of relief, it is important to realize that this is only a portion of the requirements set to begin on January 1, 2014. Several other requirements are still on target for implementation and continuing to prepare for the impact of these requirements is extremely important.

Today, there are no indications of additional delays. We should remain focused on the compliance deadlines.

Some of the provisions that still require your attention are as follows:

  • » Health Insurance Exchanges, both federal and state run, are still required to begin open enrollment on October 1, 2013. Employers are required to distribute notices to ALL employees about the availability of coverage through the Exchange by October 1, 2013.

  • » Benefit requirements for self-funded employers have not been modified or delayed. Coverage will continue to be required in order to remove all pre-existing condition limitations, avoid a waiting period greater than 90 days, remove annual dollar limits, and offer coverage to all dependents under the age of 26. Non-grandfathered plans will also have to comply with clinical trials coverage requirements, provider non-discrimination rules, and apply the out-of-pocket limits.

  • » PCORI and Transitional Reinsurance fees will also apply to all self-funded plans, just as they did prior to the delay.

  • » The individual mandate will still be implemented on January 1, 2014. This means that employers who do not provide minimum coverage could still subject their employees to the individual mandate penalty if the employer provided coverage does not meet minimum value requirements.



ACA requirements that take effective as noted below.



Provision/Requirement Effective
Annual Limits prohibited on essential benefits (Transitional period expires) [PHSA § 2711] Plan years beginning on or after January 1, 2014
Dependent coverage for children under age 26 (for all groups) [PHSA § 2714: HCERA § 2301] Plan years beginning on or after January 1, 2014 for grandfathered health plans
Clinical trial coverage [PHSA § 2709] Plan years beginning on or after January 1, 2014 (exception for grandfathered health plans)
Cost-sharing limitations [PPACA § 1302(c)] Plan years beginning on or after January 1, 2014 (exception for grandfathered health plans)
Excessive waiting periods prohibited [PHSA § 2708] Plan years beginning on or after January 1, 2014
Nondiscrimination against health care provider [PHSA § 2706] Plan years beginning on or after January 1, 2014 (exception for grandfathered health plans)
Nondiscrimination based on health status [PHSA § 2705] Plan years beginning on or after January 1, 2014 (limited exception for grandfathered health plans)
Pre-existing Conditions Exclusion prohibition (for all groups) [PHSA § 2704] Plan years beginning on or after January 1, 2014 (previously prohibited under at 19)
Shared responsibility for individuals (Individual Mandate) [PPACA §§ 1501.10106: Code § 5000A] Beginning in 2014
Taxes/Fees on Plans Effective
Patient-Centered Outcomes Research Trust Fund (Institute) (PCORI) [Code §§4375.4376; PPACA § 6301] Policy/plan years ending after September 30, 2012 until September 30, 2019 (payable by July 31 of following year)
Reinsurance payments Beginning 2014 through 2016
Previous Provision/Requirements still effective Effective
Summary of benefits and coverage (SBC) [PHSA § 2715] Earlier of a plan's open enrollment period or first plan year beginning on or after September 23, 2012.
W-2 reporting: cost of employer-sponsored health coverage [Code § 6051(a)] 2012 taxable year (w-2s sent no later than January 31 or each year)
Exchange notice [FLSA § 18B] Exchange notices must be delivered by October 1, 2013

This communication is designed to provide a summary of significant developments to our clients. Information presented is based on known provisions. Additional facts and information or future developments may affect the subjects addressed. It is intended to be informational and does not constitute legal advice regarding any specific situation. Plan sponsors should consult and rely on their attorneys for legal advice.