We have access to a program that will explore all options for employers and help make this determination Judgment Day is fast approaching for employers that must determine whether to pay or play in the public HIX marketplace. One such step involves assessing the minimum value of their health plans (60% actuarial value) so that they provide appropriate recipients required notifications under the Affordable Care Act (ACA) by October 1. It’s also worth checking previous minimum value determinations to properly reflect wellness program incentives, health savings account (HSA) and health reimbursement account (HRA) contributions, suggests a PricewaterhouseCoopers June issue brief. PwC has analyzed newly issued IRS guidance that will help employers determine, disclose and report whether their health plans meet these coverage standards. It clarifies methods for determining minimum value, as well as the effect of wellness incentives, HSAs and HRAs on minimum value and affordability determinations. Under the proposal, PwC says safe harbors may be used as a proxy for household income so that employers can avoid paying penalties based on affordability. “If an employee’s cost of single coverage under the employer’s health plan does not exceed 9.5% of the employee’s rate of pay, the plan will be deemed to be affordable for that employee, and the employer will not be liable for penalties,” according to the issue brief. PwC is encouraged that high deductible health plans are considered as part of the minimum-value equation. Interestingly enough, some PwC clients who participated in a series of recently convened roundtables in New York, Chicago, and Atlanta are considering providing a health plan that does not meet the minimum value requirement, but instead fulfills the minimum essential coverage requirement in order to avoid paying a penalty under ACA rules. Knowing whether their plans meet minimum value requirements also could sway some organizations toward a private-exchange solution, though it’s not expected to happen anytime soon. “Some private exchanges may offer group coverage that would enable employers to offer employees a minimum value plan that meets the IRS requirements,” notes Amy Bergner, a managing director in the PwC’s human resource services consulting practice. “But employers will have to carefully vet the private exchange offerings to make sure they offer group coverage for active employees, and meet other requirements.” She says while PwC has noticed “a growing number of employers interested in the concept of a private exchange for some or all of their employees,” fewer are expected to adopt this approach for 2014. For those that decide to pursue this avenue, she recommends obtaining a certification and guarantee from the vendor that the plans offered will meet the IRS minimum value requirements. Of the PwC roundtable participants recently polled, 35% said they would not consider moving employees to a private exchange within the next two years and another 50% were undecided. In fact, none actually planned to immediately sign up for a private exchange or taken steps in that direction.
Posted on: Wed, 12 Jun 2013 00:32:50 +0000