A pandemic is probably the last event during which anyone wants to lose their health insurance. But unfortunately, due to major shake-ups in employment over the past year, that’s exactly what happened to many Americans. If you lost health insurance due to job loss, or other reasons, you have the option to continue your coverage under COBRA provisions.
In the past, COBRA coverage was theoretically possible, but not always practical. That’s because the premiums can run fairly high, especially for those who lose their healthcare plans due to job loss. But due to the challenges posed by the pandemic, the American Rescue Plan Act includes provisions to help the uninsured continue their healthcare coverage through COBRA.
As of April 1, and continuing through September 30, group health plans that provide COBRA coverage must also offer a 100 percent COBRA subsidy for “assistance eligible individuals” and their qualified beneficiaries.
This subsidy applies to major medical plans, along with dental and vision plans, but does not apply to health flexible spending accounts.
Who is “assistance eligible”?
Individuals who qualify for COBRA due to involuntary termination or a reduction in hours should be eligible for the 100 percent subsidy.
Those employees who voluntarily terminated employment, or are eligible for COBRA for some other reason, will not be able to claim the subsidy.
Those who would have been eligible for the COBRA subsidy in the past 18 months, but did not elect the coverage, might also be eligible to enroll and get help with premiums.
Premiums are advanced by the employer or the insurer and are reimbursed by the federal government via a payroll tax credit. This should save the insured individual some time and hassle, allowing easy enrollment for those who qualify and wish to do so. However, employers must be aware of and prepared for being responsible for these premiums. Since federal reimbursement comes in the form of a payroll tax credit, there will be a waiting period before employers will recoup the premiums.
If you have questions about this new legislation or your responsibilities as an employer, contact us right away. The program began on April 1 and will last through September if it is not renewed.
Most business owners know that hiring experienced and educated workers is just the first step to ensuring workplace efficiency and effectiveness. Those workers must also be supported, and their needs or concerns addressed, in order to help them continue to perform to their full potential.
That’s why a comprehensive group benefits program can be so helpful in attracting and retaining the best employees. But did you know that many Group Life or Group Disability plans also include something called Employee Assistance Programs (EAPs)? These programs can address a wide variety of employee needs and help to solve problems that could interfere with their work performance.
Over the past year in particular, we’ve all seen that anything going on outside of work (like a pandemic and the associated stress, for example) can affect happenings inside the workplace as well. Employee Assistance Programs are designed to provide assistance to employees and cover a wide range of personal and legal issues that can add stress to their lives or require time away from work for treatment.
What types of situations fall under the umbrella of an Employee Assistance Program? You might be surprised at the wide range of topics that your program could address, such as:
- Alcohol or other substance abuse treatment
- Child or elder care complications
- Financial and legal problems
- Marital or relationship discord
- Traumatic events
- Wellness matters
- Adoption assistance
- …and more
These services can be available via a variety of formats, such as email, phone, video chatting, or face-to-face meetings, as the situation warrants. They are delivered at no charge via EAP vendors or providers within the employee’s healthcare plan network.
Services are usually available to the employee as well as their spouse or domestic partner and children.
Many employers actually have Employee Assistance Programs available within their group benefits plans, and don’t even know it! For more information on EAPs and your group benefits plan, give us a call and we’ll be happy to explain your benefits.
If you’re preparing to file your 2020 federal and state income tax returns, remember that you need to document more than just your income. Because the Affordable Care Act and California’s own Individual Mandate law both require most people to maintain qualified health insurance coverage, you will need certain forms to accurately report your coverage status.
Forms 1095-A and 1095-B were designed for this purpose. You should receive these in the mail soon.
Form 1095-A is of particular importance to anyone who receives a tax subsidy to help with the cost of their healthcare premiums. By inputting the correct amounts on your tax return, you will reconcile the credit on your return with any advance payments of the premium tax credits.
Form 1095-B simply provides information about your health insurance coverage. Those who maintained minimum essential coverage for the year are not liable for the shared responsibility payment (essentially, a penalty for failing to maintain coverage).
Even though the shared responsibility payment under the ACA is now set at 0 dollars at the federal level – essentially meaning there is no penalty for failing to maintain coverage – the state of California does impose its own penalty. So, you do want to ensure that you receive 1095-B and report the information accurately on your return.
No, you aren’t actually required to file the forms with your tax returns. However, you will need the information contained within the form in order to accurately file your taxes. And, you should keep a copy of these forms in your files, just in case your tax return is ever audited.
Watch your mail closely for these forms, which should be arriving soon, and consult with your tax professional if you have any questions about how to use them.
It’s not difficult to imagine the dismay many patients have felt over the years, upon receiving a medical bill that exceeds expected costs by hundreds or thousands of dollars. Fortunately, surprise medical billing appears to be soon relegated to the past. In December 2020, Congress included direction within the coronavirus relief legislation and year-end spending bills to end this unpopular practice.
For example, in the event that a patient goes to a hospital normally covered under their health insurance policy, they cannot be surprise billed for services via an uncovered provider within that system. Insurance companies are now required to cover those bills. However, insurers and medical providers might still disagree over costs, in which case the bill sets forth a clear procedure to deal with those situations. This measure shifts responsibility for negotiations from the patient to the insurance company.
The new law requires parties to negotiate and agree upon a rate or bring the dispute to mediation. After batching together billing disputes, mediators will consider factors such as median in-network rates, the complexity of the medical case in question and relative market power of insurers versus doctors or hospitals.
Larger bills for out-of-network care are not outlawed entirely. If patients are informed that their insurance company will not cover the bill and notice of charges is provided at least 72 hours before onset of care, providers might still bill patients for the difference in what insurance companies would otherwise pay.
While imperfect, the new bipartisan law is expected to drastically reduce incidences of surprise billing and clarify procedures for patients, insurance companies, and healthcare providers. For more information on health insurance coverage and avoiding surprise billing, give us a call to discuss your concerns in more detail.
For those of you with 100 or fewer employees, who have endured lower revenues at this time, we have some good news. California is providing a new tax credit for small businesses that might help you.
The tax credit is available for the tax year 2020 only (for now), and is targeted toward businesses that were forced to lay off employees or dramatically reduce work hours earlier this year. If you’re now rehiring those employees, hiring new employees, or increasing work hours, this credit might help you.
In order to qualify, you must employ 100 or fewer employees (including part-time workers) as of December 31, 2019. You also must have experienced a 50 percent decrease in gross receipts from April 1, 2020 to June 30, 2020, as compared to April 1 to June 30 of 2019.
Business owners must reserve the credit with the California Department of Tax and Fee Administration. Reservations began on December 1 and will be taken until January 15, or whenever the $100 million credit allocation is reached.
The tax credit will amount to $1,000 for each net increase in qualified employees, up to a $100,000 maximum.
Take note: We believe the $100 million credit allocation will be reserved well before January 15, so we strongly recommend applying for this credit right away.
Contact your CPA now, to make sure that you can qualify for this credit. They will help ensure that you can reap the maximum amount of credit available, by counting your gross receipts and employees accurately.
You can find more information on this credit, including the documentation that you need to present, on the California Department of Tax and Fee Administration website.
Small business owners understand the value of providing group health insurance benefits to employees, but they don’t always feel capable of doing so. Between the high cost of premiums and the level of required employee participation (70 percent) many small business owners give up on the idea entirely.
If you know someone in this situation, please pass along this news: During Small Group Special Enrollment each fall, your employees can overcome these limitations and establish a group health insurance plan.
How does it work? It’s pretty simple. Only one employee needs to enroll in a plan. That’s it! There’s no minimum enrollment criteria, so each employee can make the decision that feels best for them, without any pressure.
As for the business owner’s part, they are not required to contribute to premiums. Or, they can contribute what they are able, and allow employees to pay for the rest. So if affordability has been an obstacle in the past, the Small Group Special Enrollment Period will allow employees to access a group healthcare plan of their choosing.
Aside from contribution and participation guidelines, all other normal underwriting guidelines are still in force. This means employees can still access high quality group plans while sidestepping what would normally be burdensome obstacles.
As a bonus, employees can access yet another benefit of these group plans. If the employer has established what is called a “cafeteria plan”, workers can pay for their premiums using pre-tax payroll deductions. This essentially serves as a significant tax deduction and savings, which any employee appreciates.
There is just one downside to this news: The Small Group Special Enrollment Period is only open for one month, between November 15 and December 15 (with plans taking effect January 1). Business owners must act fast to help their employees access these group healthcare plans, along with the potential tax savings. Contact us to learn more about how to get started.
Each year, prior to Medicare’s Annual Election Period, employers must send notices of creditable coverage to all employees over age 65 (or any other employee or dependent otherwise eligible for Medicare).
What is creditable coverage? If a health insurance plan (in this case, a group policy) is expected to pay, on average, as much as a standard Medicare Part D policy, that is called “creditable coverage”. It means that the prescription drug benefits of a healthcare plan is at least equivalent in coverage to what Medicare Part D plans would offer.
What must the notice of creditable coverage communicate? Prior to October 15 each year, employers must supply written notice to all
- Medicare-eligible employees
- COBRA-covered individuals
- retirees covered by the group health plan
- and all dependents of these employees or former employees
The notice simply certifies that the prescription drug plan offered by the group health plan qualifies as “creditable coverage” for the purposes of being equivalent with Medicare Part D.
Why does creditable coverage matter? The Medicare Modernization Act imposes a late enrollment penalty on individuals who do not maintain prescription drug coverage for 63 days or longer, following their initial date of Medicare eligibility. The notice serves to inform individuals that their group health plan does provide this coverage. Otherwise, if they are not maintaining coverage they should consider enrolling in Medicare Part D promptly, in order to avoid a penalty later.
How does Medicare know whether an individual has maintained creditable coverage? The law also requires employers to file an online disclosure to certify the creditable coverage status of their group health plan. This disclosure should be filed no later than 60 days from the beginning of the plan’s contract year, within 30 days of termination of a prescription drug plan, or within 30 days of any change to the status of creditable coverage.
Again, notices of creditable coverage must be sent to all affected employees and former employees by October 15. Medicare must also be notified of your plan’s creditable coverage status. Contact us with any questions regarding these notices, so that we can assist you in properly complying with the law.
Who could have predicted the changes 2020 has brought? Remote working, or working from home, was rising in popularity prior to this year. Even still, no one expected the swift and dramatic rise of remote work at the level we’re currently experiencing.
Because this change has happened so suddenly, many businesses found themselves somewhat unprepared for the transition. Institute these safe practices, and pass them along to your employees to help things run more smoothly.
Ensure that each device is protected. Employees should use a device dedicated to work; sharing with family members should be strongly discouraged. Remind them to install security updates when prompted, and to protect devices with passwords.
Use safe WiFi connections. Working from home sometimes also means working from hotels, cafes, other locations. Remind your employees that public WiFi connections are not secure, and can put your data and business operations at risk. As for home WiFi, make sure everyone is using a strong password and secure firewall.
Adopt a VPN. Institute a Virtual Private Network for company use, and make sure to update settings and limitations regularly.
Consider two-factor authentication. Your cloud system and any other processes should be protected with two-factor authentication, for optimal protection against data theft or loss.
Create a protocol guide. Update your old security protocol, or adopt a new guide, to clearly communicate your expectations to employees. Focus on the expected response in the event of device loss or theft, and for suspected or known security breaches. Each employee should know how to immediately proceed if one of these events occurs.
The above procedures can help protect your business from unwanted virtual viruses and more… But what about real-world viruses and other health risks? Check with your healthcare plan administrator about telemedicine (virtual healthcare appointments). This type of healthcare is not only time-saving; receiving healthcare from home can shelter us all from the inherent risks of waiting rooms.
If these benefits are available under your plan, communicate that information directly to employees. Review sick leave procedures and determine how you will handle telemedicine appointments as time away from “the office”. Working from home is still work, and together we can adopt procedures to keep each other safer at this time.
Telemedicine sounds like a new thing, but the origins of “remote” healthcare lie all the way back in the 1950s. Many decades ago, patients learned that they didn’t always need to visit their physician in person when a simple phone call would suffice.
Today, telemedicine is supported by high-speed internet access, allowing us to attend face-to-face virtual “visits” with our healthcare providers. And in the time of Covid-19 and shelter-in-place orders, many insurance carriers are now covering telemedicine appointments.
Telemedicine actually encompasses three areas of patient care:
- Interactive care allows patients and healthcare providers to “meet” virtually to discuss symptoms and other concerns
- Remote patient monitoring allows providers to collect data on patients remotely, such as blood sugar levels, blood pressure, and more
- Store and forward is a method of sharing a patient’s healthcare information with other providers and specialists (with the patient’s permission, of course)
While telemedicine does include all of these areas of practice, most of us associate the term with virtual medical appointments conducted via video call. These interactive care appointments can benefit the patient in a number of ways, including:
- No need to travel to an appointment; the visit can be conducted from home or anywhere else the patient is located
- No worries about obtaining childcare or juggling schedules in order to attend appointments
- Fewer hours missed from work and/or school
- Limiting exposure to other illnesses in hospitals or medical offices
- Quicker access to care
- Affordability of care; telemedicine appointments are often priced much lower than in-office consultations
- Covered by many health insurance plans
- Reimbursed by Medicare and Medicaid/Medi-Cal in many situations
Of course, telemedicine appointments should not be used for emergency situations. Patients should always call 911 or proceed to an emergency room if they suspect heart attack or stroke, have sustained a serious injury, or otherwise need immediate lifesaving care. But for routine care, minor illnesses and injuries, mental health treatment, and many other non-emergency situations, telemedicine provides safe and quality healthcare at greater convenience to the consumer.
Even better, the monetary savings help us all by helping to lower the cost of healthcare. Ask your healthcare provider if they offer telemedicine appointments, and familiarize yourself with the process so that you know what to do next time you need healthcare services.
From school openings to job security, to personal budgets and safety, we all have plenty to worry about right now. Luckily, your health insurance premium might not be one of them. Many health insurance providers have announced that they will be offering a variety of solutions to help consumers make their regular health insurance premium payments.
The pandemic situation has created a curious combination of events in these past few months. Due to fears of coronavirus, and shutdowns in many areas, the numbers of elective procedures and office visits at this time have sharply declined. With consumers avoiding both doctor appointments and emergency rooms, healthcare providers have reported a 30 percent drop in inpatient care, a 25 percent drop in outpatient care, and a 35 percent drop in physician services.
Naturally, such an enormous drop in healthcare services has equalled a decline in health insurance claims. Many of the major health insurance providers will be extending that savings to their customers, which can be great news if you’re worried about making premium payments right now or in the near future.
Depending upon your carrier, you might be able to take advantage of these provisions:
- A credit for premiums paid in previous months
- A discount on upcoming premiums due
- An extended grace period for making premium payments
- Suspension of out-of-pocket charges on some healthcare services
Look for a notice from your health insurance provider, or you can call them directly to discover what help they might be offering to their customers. Alternately, feel free to call us and we’ll assist you in locating answers.
This is all great news, but we do want to caution you about one potential problem: Considering that preventive care accounts for many of the healthcare services postponed at this time, some of those avoiding doctor visits might be at increased risk of chronic health problems in the future. Stay in touch with your doctor, and discuss with them alternate means of accessing care. They will advise you of which preventive tests or procedures are most important, considering your personal risk factors, and help you make a plan to catch up on preventive care.