Adjustments to the Affordable Care Act offer relief for small employer compliance challenges, but proposed solutions may also create more confusion for employers and their advisers, says Sally Wineman, area SVP, compliance counsel, at Gallagher Benefit Services.
While more tweaks, delays, or wishful repeals may also be coming from Washington, she says employers and their advisers should not delay in preparing to comply with the law as it already exists.
Small and mid-size employers are still lagging far behind large employers in their understanding of ACA compliance issues, mostly due to a lack of resources, Wineman told attendees of EBA’s Workplace Benefits Summit in Orlando this week. But starting in 2016, they will need to comply.
The government, she added, is attempting to make some tweaks to the law to make that more feasible for small to mid-size employers.
For instance, she said, under the Surface Transportation and Veterans Health Care Choice Improvement Act, signed into law by President Barack Obama on July 31, 2015, employers can exclude full-time employees who served in the U.S. military — and who currently receive veterans’ health insurance — from the ACA’s 50-or-more full-time employee threshold count.
In order for the exclusion to apply, the veterans’ coverage must be either through Tricare, the federal veterans' health program, or through the Veterans Affairs Department.
The exclusion, she said, is intended to encourage employers to hire more veterans by giving them some relief from the ACA’s employer mandate.
This week, she said, the House also tried to seek some relief for small to mid-size employers by passing the Protecting Affordable Coverage for Employees Act (PACE). The ACA proposes that effective Jan. 1, 2016, the definition of a small group employer increases from 1-50 employees to 1-100 employees. The PACE bill would maintain the current definition of a small group market as 1-50 employees and give states the flexibility to expand the group size if they feel the market conditions in their state necessitate the change.
However, that flexibility could lead to confusion, she said.
Similar legislation passed the Senate on Thursday, but, she said, the PACE Act will undoubtedly be vetoed by President Obama.
Still, the legislation and its bipartisan support could lead to conversations in Washington that may lead to further tweaks in the health care reform law.
Employers are also concerned about the Cadillac tax, Wineman told attendees, but a lack of guidance on the subject leaves employers and advisers wondering how to avoid the excise tax.
While the IRS has, this year, released proposals that offer some insight into Cadillac tax compliance, nothing has been finalized and there are still many questions, she said.
While many employers remain hopeful the tax will be repealed, Wineman said it’s best for employers to plan for the tax and “be happily surprised,” if it is repealed.
“Employers should be looking at ways to cut plan costs now,” she advised.
Employers remain concerned about other aspects of the health care reform law, as well, including a lack of guidance on nondiscrimination, automatic enrollment, quality of care reporting or a new SBC template.
Employers and advisers have heard little in the way of guidance from Washington on how to address those issues, she said, but that should delay both parties from preparing for the requirements they do have guidance on and preparing as best they can for those they do not.
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