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 Health
Care Reform
New
England
At Group Insurance Management Services, we are constantly keeping
abreast of the landmark Massachusetts Healthcare Reform Act which
became effective October 1, 2006 and subsequent legislative changes
taking place in other New England states. Affecting New
England
residents and employers, we are here to keep our clients informed and
prepared for the changes and regulation requirements.
How does the Massachusetts Health
Care Reform Law Affect You?
Massachusetts
Commonwealth Health Insurance Connector Authority
- is an independent authority created, under c. 58 of the
Acts of
2006, as part of the sweeping reform designed to increase access to
health care in Massachusetts. The Connector serves as a bridge
between eligible individuals, small employers, and health plans to
promote affordable private health insurance to uninsured residents of
Massachusetts.
* www.mass.gov/connector
MassAHU -
Massachusetts Association of Health Underwriters has organized this
extension web site to address and answer commonly asked questions for
both employers and individuals on how the Health Reform Act affects
them.
* www.masshealthreformact.com
* www.massahu.org
SUMMARIES - Main Points of
Concern for Employers
Free
Rider Surcharge
A surcharge on employers who do not comply with the requirement to
establish a qualified Section 125
plan and is assessed for
"state-funded health services" that are incurred by employees and/or
their dependents.
An employer may be subject to the Free Rider Surcharge if he/she meets
all these criteria:
1) The employer has more than 10
employees*, AND...
2) Employees or their dependents received "state-funded health
services" AND...
3) These employees were not offered a qualified Section 125, AND...
4) These "state-funded health services" are at least $50,000 in one
hospital fiscal year.
*An employer has more than 10
employees if - the sum of total payroll hours
for ALL employees for the
period from October 1 through September 30 divided by 2,000 is greater
than 10. Payroll hours include regular, vacation, sick, Federal Medical
Leave of Absence, short term disability, long term disability, overtime
and holiday payroll hours.
Fair
Share Contribution
>Overview
>General Information and
Regulations
>Employer
FSC Filing - Annually
10/1 through 11/15
>Employer
HIRD Filing - Filed as part of FSC annual filing.
>FSC
vs. UHI
- Do not confuse the Fair Share Contribution (FSC) with the
Unemployment Health Insurance (UHI) contribution in effect since 1990.
Employee
Health Insurance Responsibility Disclosure (HIRD) Form -
Effective July 1, 2007
Each employee of an employer with 11 or more full time
equivalent
employees (35 hrs/wk) that declines to enroll in his/her
employer-sponsored insurance or declines to use his/her employer's
Section 125 Plan must complete an Employee Health Insurance
Responsibility Disclosure (HIRD) form. The employer must
provide a copy of the signed Employee HIRD Form to the employee and
retain a copy for three years.
Employer
Health Insurance Responsibility Disclosure (HIRD) Filing
- Employers with more than 10 employees (full and part time, seasonal
and
temporary, but not independent contractors) must file with
the state as of September 30th and due by November
15th
annually about health insurance it offers to employees.
The Employer HIRD Filing will not
be a separate filing, but incorporated as part of the Employer FSC filing to the state.
Section
125 - Required for employers with 11 or more full-time
equivalent employees
who work 35 or more hours per week (fully insured and self-insured
groups). Employers must establish a
Section 125 Plan under Internal
Revenue Code 125 and in accordance with Commonwealth
Connector regulations. The plan must
be
filed
with the Commonwealth Connector. Employers do not need to make a
contribution to the Section 125 plan but must arrange for the payroll
deduction. Employers that comply with the Section 125 mandate
will not
be liable under the "free rider" surcharge.
>Massachusetts
Commonwealth Connector Section
125 Handbook
Insured
Group
Plan NonDiscrimination Requirement - Mandates health
insurance policies
and contracts include a provision under which employers must provide
the same levels of coverage and contributions to all their full time
employees.
>Department
of Insurance Bulletin 2007-04; Non-discriminatory Offer and Equal
Contribution by Employers of Insured Group Health Benefit Plan
Contracts Pursuant to Chapter 58 of the Acts of 2006, as amended
- April 6, 2007
>Summary
Advisory
Dependent
Coverage - Provides
coverage for dependents up to age 26, or for two years after the loss
of dependent status under the Internal Revenue Code, whichever occurs
first. Stand-alone dental plans and self-insured health plans
are not subject to the dependent coverage, but may offer it.
>Dependent Age 19-26 Application for Coverage
>IRS Qualifying Child/Relative Test
>Imputed Income
For
further info... CONTACT
US or Massachusetts
Commonwealth Connector Employer
Handbook
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