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Posts by bahim


Although the Affordable Care Act resulted in healthcare coverage for the vast majority of Californians, a small percentage still are not enrolled in an insurance plan. Now, with the federal income tax penalty for coverage failure set at 0 dollars, some policymakers expressed concern that the number of uninsured California residents could grow. With that fear in mind, the state has now instituted its own mandate. Those who remain uncovered by a health insurance policy in 2020 will be subject to a penalty, this time on their state tax return rather than federal. The penalty will amount to $695 per uncovered adult in the household, and half of that amount for each uncovered child. The penalty goes into effect with regard to the 2020 tax year, with penalties charged in Spring of 2021 when California residents file their state income tax returns. Some exemptions to the law do apply. In order to avoid the potential penalty, health insurance coverage must be maintained throughout 2020. That makes the current Open Enrollment season vitally important for all Californians. If you are not currently enrolled in a health insurance plan, you must choose one by December 15 in order for coverage to begin on January 1, 2020. Get started today, so that you have time to adequately compare plans and select one that best suits your needs. Give us a call and we’ll be happy to help you protect your family, while avoiding any unnecessary tax penalties in...

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Many companies in the small group market want to offer health insurance coverage to employees, but are unsure of how to make that happen. What about the cost? Will employee participation be high enough? Will we get turned down if enough employees don’t want to participate? The small group special enrollment period is the answer to these questions. What is the small group special enrollment period? Once per year, the small group special enrollment period allows smaller companies to establish a group health insurance plan for employees without the usual minimum participation or contribution rates. During this one-month enrollment period, your company does not need to contribute to premiums. And, you only need one enrolled employee in order to establish a group plan. A tax-friendly strategy. As an added bonus, you can help your employees earn a valuable tax benefit as they pay their premiums. Premiums can be deducted from paychecks on a pre-tax basis, meaning they will reduce income tax liability by that amount each year. The strategy works in a manner similar to 401(k) contributions, adding a valuable benefit for your employees. When is the small group special enrollment period? This opportunity comes around each November 15, and lasts until December 15. During the special enrollment period, the usual participation and contribution requirements are not enforced. Those who enroll by the deadline of December 15 will have coverage that begins on January 1. Certain rules regarding employer contributions can feel a bit tricky to navigate. Contact us before November 15 so that we can answer your questions about the small group special enrollment period, and help you decide how to proceed with this important benefit for your...

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Know Your Open Enrollment Period

Know Your Open Enrollment Period


Posted By on Sep 12, 2019

For those who need to enroll in a new healthcare plan, or change from one plan to another, Open Enrollment is the time to complete those tasks. More to the point, unless special circumstances apply, you can only enroll in a plan or make changes during this time. Therefore it is extremely important to anticipate your Open Enrollment period, and be ready to complete the process during that window of time. But wait! You might have noticed that there is more than one Open Enrollment period for health insurance. You will need to understand which enrollment window applies to your situation, and then complete the correct steps to select a health insurance plan. Individual Open Enrollment. This enrollment period applies to the general health insurance marketplace for individuals – that is, people who are not covered by health insurance through their employers. In California you will complete your enrollment through Covered California, either online, over the phone, or with assistance from an independent health insurance broker. This year, Open Enrollment for individuals runs from November 1 to December 15, 2019. Coverage under your new plan will begin on January 1, 2020. Group Open Enrollment. Your initial enrollment period for group health insurance will occur at the time you become employed and eligible for that company’s healthcare plan. From that point on, Group Open Enrollment occurs annually upon the anniversary of the company’s enrollment in the plan. So, for example, if an employer originally enrolled in a group policy on October 1, 2015, their Open Enrollment period will occur on the first of October every year thereafter. When you experience a change in your circumstances, allowing for a change to your plan (you get married or have a baby, for example), you can make that alteration to your plan at the time it occurs. Contact your human resources department for more information on your group health insurance plan, or to make necessary changes to that policy. Special Open Enrollment for Small Groups. The Affordable Care Act acknowledged that many smaller employers might want to offer a group health insurance plan, but do not meet standard employer contribution or employee participation ratios. For those cases, the Special Open Enrollment for Small Groups window exists, and will run from November 15 to December 15. Eligible small groups will receive coverage beginning January 1. In the context of small group health insurance, an employer cannot require employees to enroll unless they cover 100 percent of the employee’s premiums. Have more questions about Open Enrollment? Give us a call, and we will help you determine what you need to do...

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Do You Have a Federal COBRA Game Plan?

Do You Have a Federal COBRA Game Plan?


Posted By on Aug 12, 2019

In the event that one of your employees is no longer employed by you, federal law might require that they are allowed to temporarily continue their health insurance plan. The Consolidated Omnibus Budget Reconciliation Act, or COBRA, asserts that former workers and their dependents are entitled to maintain group health insurance coverage for a period of time after their eligibility ends, if one of the following conditions apply: Job loss, whether voluntary or involuntary (except in cases of gross misconduct) Work hours are reduced and the employee otherwise loses eligibility for benefits A dependent is divorced or legally separated from an employee The employee becomes eligible for Medicare An employee’s child loses their dependent status An employee dies (in this case COBRA applies to their dependents) Are you required to provide COBRA health insurance coverage? COBRA applies to private-sector employers, with twenty or more full-time employees (or full-time equivalents) in 50 percent of the calendar year, who provide group health insurance benefits. However, COBRA coverage might not apply to all of your employees. You don’t have to provide COBRA to: Employees who haven’t worked for you long enough to be eligible for group health insurance benefits Those who declined to participate in a group benefits plan Those who are enrolled in Medicare Even smaller employers should be aware of COBRA requirements. Your company could grow in the near future. Even if you employ just under 20 workers, become familiar with COBRA so that you can comply with the law when the time comes. Employees must be notified. COBRA also requires that you notify workers of their COBRA rights within 90 days of their eligibility for your group plan. You must also notify them of COBRA eligibility within 14 days of a qualifying event (as listed above). The former employee, or dependent, has 60 days to opt into COBRA coverage. COBRA applies to all health plans. If a former employee (or dependent) elects COBRA coverage, it must apply to all plans in which they were formally enrolled. Examples include medical flexible spending accounts, dental plans, vision plans, or drug plans. COBRA is subject to certain time limits. For employees, COBRA coverage lasts up to 18 months. For dependents, coverage under COBRA can extend to 36 months after the qualifying event. Other rules apply in cases of disability. Who pays for COBRA? The employer can require that the former employee or dependent pays 100 percent of the cost of coverage under the group plan. Premiums cannot exceed the full cost of coverage plus two percent for administrative expenses. Noncompliance can cost you. Failure to comply with COBRA requirements can result in...

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Now that the federal Individual Mandate requirement for health insurance has loosened – since setting the penalty at 0 dollars, the law is effectively nullified – individual states are now passing their own mandate laws. With passage of the Minimum Essential Coverage Individual Mandate, California is poised to join those ranks. Effective January 1, 2020, the mandate requires all Californian residents (along with spouses and dependents) to enroll in a qualified insurance plan for each month of the year. Those who fail to maintain health insurance coverage will be subject to a Shared Responsibility Penalty , to be determined and collected by the Franchise Tax Board. Some exceptions to the law do apply, according to financial hardship and religious belief as dictated by Covered California. Currently, 93 percent of the state’s population is covered by a health insurance plan. New affordability provisions within the law aim to close that gap, so that the state can achieve 100 percent coverage. Currently, individuals and families with incomes between 100 and 400 percent of the federal poverty level can obtain government subsidies to make health insurance premiums more affordable. The new law will expand that bracket up to 600 percent, so that more Californians can obtain coverage. The new legislation also raised Medi-Cal’s age cut-off for undocumented residents, from 18 to 26. In the wake of the new law, we can expect to see a ripple effect upon other policies regarding health insurance. For example, the legislation also calls for additional reporting requirements under Internal Revenue Code 6055. “Applicable entities”,such as health insurance companies and companies which provide health insurance coverage, will be required to provide proof of coverage to the Franchise Tax Board each year. Penalties will be imposed upon companies that fail to complete their filings. We will keep you updated on these changes as they occur. In the meantime, please don’t hesitate to contact us if you have questions about the new health insurance mandate law. We can assist both individuals and employers to ensure that you’re in compliance with the...

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