Michigan Auto Reform: How Health Insurance Can Reduce Car Insurance Premiums

Beginning July 2nd, 2020, auto policy coverage requirements in Michigan are changing. With these new law changes, drivers with qualified health coverage could potentially save money by reducing their auto insurance coverage. Anyone with a car insurance policy that begins or renews on or after July 2nd will have the option of choosing a lower coverage amount for their personal injury protection (PIP) coverage. Previously, Michigan drivers were required to have unlimited PIP coverage, but options now range from unlimited to no coverage at all  Continue reading

New York to Begin Paid Family Leave Program

On April 4, 2016, New York Governor Andrew Cuomo signed a new law which will allow eligible employees to receive paid family leave benefits. New York is the fourth state to enact legislation requiring paid family leave, following California, New Jersey and Rhode Island. The paid family leave benefits will gradually be implemented, eventually statue-of-liberty-962268_1280reaching a maximum of 12 weeks of leave by January 1, 2021.

The new paid leave will be funded by New York’s disability benefits fund through mandatory employee payroll deductions of approximately $1.00 per week. Employers will not be obligated to pay employees for time off under the new paid family leave program.

Employees will be eligible for paid family leave benefits after six consecutive months of employment with the same employer. All employees working at least 6 months at a single employer are eligible, regardless of the company size or the number of hour
s the employee has worked for that employer. Continue reading

Vacation Pay: Optional or Mandatory?

1428638_61478545An employee leaves without giving any advance notice.  Are you required to compensate that employee for unused vacation and personal time?

You are not required under any federal or state laws to offer vacation or personal time off benefits, with or without pay. (Note: Some cities and states do require paid sick leave). But if you offer vacation time with pay, sick leave with pay and/or paid time off (PTO), you need to be aware of possible regulations in your state regarding compensation.

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Does COBRA Still Matter Post ACA?

A lot has happened over the past few years. The Affordable Care COBRAAct, or ACA, has transformed the way millions of people obtain health insurance coverage for themselves and their families. But it’s a complicated law, with a lot of moving parts. Many consumers, workers and human resources professionals/employers are confused about whe
re their role in covering workers ends and the ACA begins. This is particularly true in instances where a worker has left the job and is no longer eligible for coverage under the employee group plan. Here are answers to some of the most frequently asked questions:

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What Happens If There is a Breakdown of COBRA Compliance?

At some companies, there may not be a well established system in place for handling the tasks necessary to comply with COBRA. Here’s a brief overview of COBRA as well as a question from a concerned employer about the implications of not complying, along with a detailed answer.

COBRA Basics
The Consolidated Omnibus Budget Reconciliation Act (COBRA) gives eligible workers and their families who lose their health benefits the right to choose to continue group health benefits for limited periods of time under certain circumstances. The life events that enable an individual to become eligible for COBRA include voluntary or involuntary job loss, reduction in the hours worked, transition between jobs, death and divorce. Qualified individuals may be required to pay the entire premium for coverage up to 102 percent of the cost to the plan. — The U.S. Department of Labor

Question: Our company sponsors a group health plan for its employees. What are the consequences if we fail to comply with COBRA?

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Small Employers Get Reprieve on Health Premium Reimbursement Plans

business-world-541431_1280Historically, employers that wanted their employees to be protected with health coverage, but didn’t want the hassle of having a company health plan, could simply give them an amount of money sufficient to reimburse them for the cost of buying that coverage or some portion of it.  As long as the individuals provided evidence that they used those funds for that purpose, the dollars were excludable from taxable income for the employees.

Alternatively, employers could just pay the premiums directly to the insurance carrier.

Back in November 2014, however, the Department of Labor (DOL) declared that companies reimbursing employees for medical care instead of offering a health care plan is equivalent to a health plan and is subject to the Affordable Care Act (ACA).  And since those reimbursement arrangements failed to meet ACA requirements in two ways — that is, the condition that group health plans have no annual limits on benefits, and also that no co-pay for certain preventive health services must be paid — they were ruled to be noncompliant with the law.

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Paying Employees to Buy Health Coverage? Know the Ground Rules

dollar-551932_1280Does your company’s health insurance plan include health reimbursement arrangements (HRAs) or flexible spending accounts (FSAs)?  If so, you should know these plan components are both subject to the Affordable Care Act (ACA) and its “market reform” provisions.  The Department of Labor and other principal agencies have issued another round of guidance to answer some of the frequently asked questions about health care reform, including questions about the use of HRAs and FSAs.

According to the new guidance, HRAs and FSAs are covered by the Affordable Care Act’s prohibition on annual benefit limits and are required to provide the same set of preventive health benefits as any other compliant health plan.  The sticking point comes when you try to bolt HRA or FSA accounts onto an “individual market” policy.  This cannot be done.

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COBRA for Employees’ Family Members

family-730320_1280When an employee drops dependents and spouses from our company’s group health plan during open enrollment, we provide the dropped individuals COBRA election materials.  But our new COBRA third-part adviser is telling us that we don’t have to provide a COBRA election notice to dependents and spouses who are dropped at open enrollment.  Is our plan required to offer COBRA coverage to these individuals?

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Benefits Cost Employers a Bundle

bag-147782_1280The national average paid out by employers for employee benefits is 39 percent of total payroll costs.

This figure comes from the U.S. Chamber of Commerce, based on a survey of nearly 400 U.S. companies of various sizes, industries and geographic locations.

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Affordable Care Act: Milestones for America’s Small Businesses

balance-335980_12802010 – The Affordable Care Act Becomes Law

  • Many small businesses become eligible for a tax credit worth up to 35% of the employer’s contribution to the employees’ health insurance (up to 25% for tax-exempts) to help them provide insurance benefits.
  • A new Patient’s Bill of Rights goes into effect, addressing the worst abuses of the insurance industry.

2011 – The Affordable Care Act Holds Insurance Companies Accountable

  • To ensure premium dollars are spent primarily on medical care, the law’s “80/20” rule requires that at least 80% of premium dollars collected by insurance companies must be spent on benefits and quality improvement.
  • Another tough reform requires insurance companies to publicly justify premium rate increases of 10% or more, holding insurers accountable to the small businesses they serve, which has led to a sharp decline in double-digit rate hikes.  To date, these two protections alone have already saved small businesses and consumers more than $2 billion.

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