03 Sep Compliance Check – September 2021
Over the last couple of months, we have seen a number of interesting developments. Take a moment to review some of the developments, upcoming deadlines, and industry buzz so you can better prepare for how these updates may impact you.
Next 60: Upcoming Deadlines
September 30th – MLR Rebates
Employers with fully insured plans that qualify must receive their MLR premium rebate from applicable carriers. Once a group plan receives a MLR rebate, they must begin the distribution process if any portion of the rebate is considered a “plan asset.”
September 30th (for calendar year plans) – SAR Deadline
Group health plans with Form 5500 requirement (who did not file a Form 5500 extension) must distribute a summary annual report to plan participants.
September 30th – FFCRA Paid Leave Credits Expire
ARPA further extended both the paid sick leave credit and paid family leave credit to apply to wages paid through September 30, 2021, for employers that wish to extend leave into 2021.
September 30th – COBRA Subsidies End
ARPA’s 100% COBRA subsidies for assistance eligible individuals are scheduled to end.
October 14th – Deadline to Issue Medicare Part D Notices to Plan Participants
Employers providing Rx coverage to Medicare Part D eligible individuals must provide a disclosure about their plan to participants before the Medicare Annual Election Period begins.
Proposed ACA Information Reporting Requirements Overhaul
The IRS recently issued proposed regulations that, if finalized, would substantially expand mandatory electronic filing of information returns, including Forms 1094-C and 1095-C for purposes of Affordable Care Act (ACA) information reporting for groups under the current 250-return threshold.
THESE ARE SIMPLY PROPOSED REGULATIONS AND DO NOT CHANGE THE LAW. MONITOR COMPLIANCE CHECK UPDATES FOR ADDITIONAL DEVELOPMENTS OR FINALIZED RULES.
What would change?
- The threshold for mandatory electronic filing of Forms 1094-C/1095-C would be lowered from 250 to 100.
- Employers would be required to aggregate the number of different returns they file when determining whether the return threshold has been met.
- Creates lower thresholds for mandatory electronic filing of the returns affecting other employee benefit plans.
Who would this impact?
The proposed requirement to aggregate returns when calculating electronic filing thresholds, combined with the lower thresholds themselves, will likely result in almost all applicable large employers (ALEs) electronically filing these forms in 2022. ALEs will want to monitor this development as, if implemented, could require mandatory filing as soon as March 31, 2022 for the 2021 calendar year.
What forms would be impacted?
In addition to Forms 1094-C/1095-C, the Proposed Rules would set lower thresholds for mandatory electronic filing for a number of other returns as well:
- Forms 1094-B/1095-B,
- Form 1099 series,
- Form 5498 series,
- Form W-2,
- Form 5330 (effective for taxable years ending on or after the date final regulations are published), and
- Form 8955-SSA (effective for plan years beginning on or after January 1, 2022, but only for filings due after July 31, 2022).
Consolidated Appropriations Act (CAA) Price Transparency Rules Delayed
8/20/2021: FAQ guidance issued by the agencies implementing the Consolidated Appropriations Act, 2021 (CAA) delays enforcement of some of the CAA’s most challenging health plan transparency requirements. The FAQ guidance delays enforcement of the following rules: the requirement to disclose new “advanced explanations of benefits” providing good-faith estimates of the out-of-pocket costs for scheduled medical services; a “price comparison tool” to enable participants to compare cost-sharing amounts for specific network providers; extensive drug cost information that was required to be reported to federal regulators in December 2021; and health plan pricing disclosures (required to be disclosed to the public) related to in-network rates, out-of-network allowed costs, and prescription drug prices.
IRS Clarifies Health FSA Issues Under COBRA and COVID-19 Relief
8/19/2021: The IRS has issued guidance (IRS Information Letter, 2021-0004 and IRS Information Letter, 2021-0005) clarifying how employers can claim the tax credit for the 100% COBRA premium subsidies available under the American Rescue Plan Act of 2021. Employers and plan sponsors may need to make last-minute changes to (or amend) their Form 941 IRS filings for claiming these tax credits, due on August 2, 2021.
Change May Be on the Horizon for ACA Contraceptive Coverage Mandate
8/16/2021: The new FAQ guidance advises that the agencies are considering changes to the exemptions to the ACA’s contraceptive coverage requirements “in light of recent litigation” and intend to initiate rulemaking to amend the current regulations (issued in 2018) within the next six months.