Bring Rescue - The Exodus Road

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You Can Help Bring Rescue Too

This Christmas we are happy we are able to provide financial support to The Exodus Road on behalf our clients.  But, we wish it wasn't necessary.  

Our small and mid-sized business clients provide a safe working environment, excellent wages and benefits in organizations where their employees thrive.  By contrast, around the world (including here in the US) there are more slaves today than there have been at anytime throughout history.  While this in and of itself is a horrific travesty, it is dwarfed by the number of minor children that are forced into slavery and in particular sexual slavery.

There are many fantastic organizations and individuals working to fight human trafficking and slavery.  One organization that we've teamed up with this The Exodus Road.   If you'd like to know more about the work they are doing please read on and follow the links to further their efforts.


Covered California Posts Details, Premium Rates for SHOP Plans

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On Thursday, Covered California released plan details and premium rates for the exchange's Small Business Health Options Program, the Sacramento Business Journal reports (Arns, Sacramento Business Journal, 8/1).

Background on SHOP

Under the Affordable Care Act, the Small Business Health Options Program allows small businesses to offer either a...


PPACA employer mandate delayed until 2015

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Photo credit: Associated PressPhoto credit: Associated Press

The Obama administration unexpectedly announced Tuesday it is delaying the employer mandate under the Patient...


Challenge raised whether businesses can be forced into exchanges

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Rep. Darrell Issa, R-Calif. (File photo)Rep. Darrell Issa, R-Calif. (File photo)

Republicans are asking whether officials in Vermont and the District of Columbia really have the authority to force some or all health insurance business onto the new Patient Protection and Affordable Care Act exchanges.

Rep. Darrell Issa, R-Calif., and other leaders of the House Oversight and Government...


15 PPACA provisions that will take effect in 2014

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15 PPACA provisions that will take effect in 2014

The effective date of the Patient Protection and Affordable Care Act (PPACA) was March 23, 2010, although various provisions have their own effective dates from January 1, 2010, (the small business income tax credit) through 2018. The start of 2013 saw the launch of a number of key provisions, among them Medicare tax increases, limits on Health FSA deferrals and the requirement that W-2 reporting note employer and employee payments for certain health care items in 2012.

But 2014 is the year when most core pieces of PPACA will be put into effect, notably the mandates that employers with 50+ employees provide health insurance and that individuals obtain minimum essential health coverage for themselves and their dependents, whether or not they have access to coverage through their employer.



Companies with ‘discriminatory’ plans face stiff PPACA fines

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Photo credit: freedigitalphotos.netPhoto credit:

If you’re a top gun at your company, you may have a ticking time bomb in your array of health benefits t...


California unveils state exchange details

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California unveils state exchange details

For a quick overview of Covered California's individual rates vs. current small group rates - click here

As many as 5 million Californians will be able to shop for insurance from 13 health insurance plans next year, officials at Covered California, the state agency tasked with setting up its exchange, said Thursday.

Those plans are a combination of large commercial insurers and smaller regional plans. The state’s biggest carriers — Kaiser Permanente, Anthem Blue Cross of California, Blue Shield of California and Health Net Inc. — are participating, while some of the nation’s biggest carriers — UnitedHealth, Aetna and Cigna — are sitting out the Golden State altogether.


Reform still baffling small businesses

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Re: Reform still baffling small businesses

Even though it’s been three years since President Obama signed the Patient Protection and Affordable Care Act into law, most small business owners say they still don’t get how the law affects them.

The majority incorrectly believe health reform requires them to provide health insurance for employees in 2014, or that they’ll be taxed if they don’t of...


Napa, Sonoma and Marin - New Health Plan Options

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Businsses of all sizes in Napa, Sonoma and Marin counties finally have a cost effective alternative to Anthem/Blue Cross, Blue Shield and Kaiser for their group medical plans.  Western Health Advantage (WHA) is expanding their service area beginning January 1, 2013. 


MLR Rebate FAQ

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How long does the employer have to apply the rebate to future premiums or distribute the rebate via employee checks?
According to the US Department of Labor (DOL) Technical Release 2011-04:
“In the case of these types of plans, with respect to which a trust is not established in reliance on TR 92-01, the Department would treat the trust relief under TR 92-01 and the limited reporting exemptions in 29 CFR 2520.104-20 and 104-44 as available for premium rebates that are plan assets if they are used within three months of receipt by the policyholder to pay premiums or refunds as provided in 2520.104-20 and 2520.104.44”

Can an employer use the rebate for end of the year bonuses?
This does not appear to be permissible because carriers had to get rebate checks to policyholders by August 1, 2012.  Consequently, December 2012 would not be “…within three months of receipt by the policyholder…” (See page 4 of DOL Technical Release 2011-04.)   
Can the employer just keep the whole rebate and not share it with the employees or deposit the rebate check in the company account then use it to pay the employer portion of future medical premiums (leaving employee contributions the same)?
If the employees contributed to the employee and/or dependent premium for the rebate-eligible plan then this method of handling the rebate does not appear to be allowable according to the following section of the DOL Technical Release Bulletin 2011-04:
“In any case, employers that sponsor group health plans that use insurance policies to provide benefits would be prohibited by ERISA section 403©(l) from receiving a rebate amount greater than the total amount of premiums and other plan expenses paid by the employer.”  (See paragraph 2 of page 3.)
The DOL Technical Release 2011-04 refers to ERISA. 

My organization has less than 20 employees and provides health benefits through a small group insurance policy purchased from a carrier.  I do not think these ERISA references apply to this company.  Am I correct?
We are not ERISA attorneys or labor experts so we recommend you seek expert counsel regarding a specific company.  However, it is our understanding that most employer-sponsored group health plans (even small group plans), except church plans and government plans, are subject to at least some aspects of ERISA Title 1.  Often, these small employers are not aware of their ERISA responsibilities.  Consequently, we urge you to review the fiduciary responsibilities related to the MLR rebates contained in this document.  Please contact the Employee Benefits Security Administration (EBSA) division of the Department of Labor (DOL) for more information on ERISA.  For your convenience, here is a link to the DOL “elaws – Health Benefits Advisor for Employers” where you can answer a few questions to determine which portions of ERISA Title I apply to their company.

Can you provide a chart showing which plans were required to provide MLR rebates for easy reference?
Yes, we've made available an MLR Rebate Caculator for your easy reference.  To determine the percentage of rebate subtract the carrier’s actual Medical Loss Ratio (MLR) from the Medical Loss Ratio (MLR) Standard for the type of plan (80% for individual and small group plans.85% for large group plans).  The result is the rebate percentage.  For example, a small group HMO plan had an MLR in 2011 of 78%.  The MLR Standard for small group is 80%.  Therefore, the rebate percentage is 2%.

Is the MLR rebate based on medical premiums only or does it include ancillary products also?
Currently, the rebates are for medical plans only that did not reach the required Medical Loss Ratio (MLR).  Consequently, your should ask your payroll company or payroll person to provide a breakdown of the medical only contributions; separate from ancillary products.  If your payroll company, or payroll person, does not have a separate breakdown then you will need to determine if the time spent having someone go back to determine the medical only portion of these employee contributions is cost-effective.  The employer can elect to include the employee contributions for ancillary products in the calculation for employee rebates.
The employees will get a slightly higher rebate but this may be a less labor-intensive and, thus, more costeffective way of handling this matter.  There is no penalty for an employer who provides a greater rebate amount to employees than what is required by law.  

How do you calculate the rebate amount for each employee when the employer pays a different percentage (or amount) for employees than for dependents; or when the employer pays a percentage (or amount) based on a particular plan design?
We have great news!  Here is a link to the updated MLR Rebate Calculator which makes it easy for you  to handle any of these scenarios.  You will note this calculator requires entry of the amount paid by each employee in 2011 for their employee + dependent medical premium based on your records.  
These amounts already should reflect the appropriate employer and employee contributions; even if these contributions changed at renewal in 2011. If your records are correct & the entries are accurate then this calculator should provide the correct rebate amounts no matter how complicated the employer/employee contributions.


Are employers required to send a portion of the MLR rebate to former employees who were covered on the rebate-eligible plan for part or all of 2011?
According to US Department of Labor Technical Release 2011-04:
“In deciding on an allocation method, the plan fiduciary may properly weigh the costs to the plan and the ultimate plan benefit as well as the competing interests of participants or classes of participants provided such method is reasonable, fair and objective.  For example, if a fiduciary finds the cost of distributing shares of a
rebate to former participants approximates the amount of the proceeds, the fiduciary may properly decide to allocate the proceeds to current participants based on a reasonable, fair and objective allocation method.” 
Please note this Technical Release uses the term “former participants” rather than “former employees”. Employers can have former employees who are current participants because they elected CalCOBRA or COBRA coverage.


A little late for health reform 101

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I’ve spent two years sifting through health reform legislation and trying to interpret it for employee benefits professionals.

I can’t complain — it’s kept me employed.

And when the Supreme Court unveils its decision this month, much like benefits managers, I’m likely to spend years trying to understand what will either be a complete rebuild of the h...



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