Last week, the US Treasury Department announced that they would delay the enforcement of the PPACA Employer Mandate (the “pay or play” penalties) for groups of more than 50 full-time equivalent employees (FTEs). Under PPACA, larger employers would be subject to reporting certain requirements to the government and to offer healthcare benefits that meet minimum Essential Health Benefits (EHBs) to all employees, at an affordable cost. Should the employer not comply with these requirements, they would be subject to penalties and fines. Reporting and fines are to begin January 1, 2015.
For small employers with less than 50 FTEs and individuals who purchase their own insurance, nothing has changed and we are continuing on with the Initial Enrollment Period (IEP) that begins October 1, 2013 for a January 1, 2014 effective date. The IEP will remain open for 6 months to allow citizens to enroll in either an individual health insurance option, through the Exchange, or through their employers. The federal Health Insurance Exchange (HIX), or Health Insurance Marketplace, is the where individuals who qualify for federal subsidies may purchase health insurance. People who do not have employer- sponsored or individual health insurance plans by the end of the IEP, which ends March 31, 2014, will be fined $95 or 1% of their income, whichever is greater.
The Treasury Department also announced that they will not be able to get a “cross-checker” in place by the time for the IEP beginning October 1st. What this means is that when an applicant applies for health insurance and a possible subsidy trough the Exchange/Marketplace, there will be no way for them to cross-check the applicant’s employer-sponsored plan (or lack thereof), the premium and whether it has all the required EHBs (Essential Health Benefits) and the applicant’s income. So basically, the first year is on the “Honor System” and each applicant will be taken at their word as to their current health insurance, the cost and plan design and their income. The plan is to have a system in place for the AEP (Annual Enrollment Period) on October 1, 2014.
We’re still rolling toward Open Enrollment on October 1st. We’ll be bringing you information and updates on the ACA as we move closer to the date. Make sure you follow our blog for the latest information on ACA!
