Our Benefits Blog

On April 23, 2014, the Internal Revenue Service (IRS) issued Revenue Procedure 2014-30, which increases limits for health savings accounts (HSAs) effective for calendar year 2015.

 2015 HSA Contribution Limits

HSA contribution limits

For 2015, the annual HSA contribution limit for an individual with self-only coverage under an HDHP is $3,350 (up from $3,300 for 2014).

For 2015, the annual HSA contribution limit for an individual with family coverage under an HDHP is $6,650 (up from $6,550 for 2014).

HDHP Out-of-pocket expense limits

The maximum out-of-pocket expense (deductibles, copayments and other amounts, but not premiums) limit for self-only HDHP coverage for 2015 is $6,450, which is up from $6,350 for 2014.

For family HDHP coverage, the maximum out-of-pocket expense limit for 2015 is $12,900, which is up from $12,700 for 2014.

HDHP MINIMUM deductibles

For 2015, the deductibles under an HDHP must be at least $1,300 for self-only coverage (up from $1,250 for 2014) and $2,600 for family coverage (up from $2,500 for 2014).

Effective date

These new limits are effective for calendar year 2015.

more information

For a copy of IRS Revenue Procedure 2014-30, see www.irs.gov/pub/irs-drop/rp-14-30.pdf.

For a printer frendly version click here.

On Tuesday April 1st President Obama signed HR 4302 commonly known as the "Doc Fix Bill" primarily designed to delay a 24% reduction in Medicare payments to doctors as well as providing a number of other fixes.

One "fix" that will have a significant impact on the small group market is the elimination of the deductible limits of $2,000 for a single and $4,000 for any other plan under the Affordable Care Act. The original limit was outlined in section 1302(c) on page 48.

HR 4302 states:

SEC. 213. ELIMINATION OF LIMITATION ON DEDUCTIBLES FOR EMPLOYER-SPONSORED HEALTH PLANS.

(a) In General- Section 1302(c) of the Patient Protection and Affordable Care Act (Public Law 111-148; 42 U.S.C. 18022(c)) is amended--

(1) by striking paragraph (2); and

(2) in paragraph (4)(A), by striking ‘paragraphs (1)(B)(i) and (2)(B)(i)’ and inserting ‘paragraph (1)(B)(i)’.

(b) Conforming Amendment- Section 2707(b) of the Public Health Service Act (42 U.S.C. 300gg-6(b)) is amended by striking ‘paragraphs (1) and (2)’ and inserting ‘paragraph (1)’.

(c) Effective Date- The amendments made by this Act shall be effective as if included in the enactment of the Patient Protection and Affordable Care Act (Public Law 111-148).

You can read the full bill here HR 4302.

Most small employers have been very concerned about how they are going to handle the increased premiums that most likely will ocurr from the ACA.  

A simple fact of insurance is that the sooner the insurance company has to write a check to cover services the higher the premium they have to charge to cover those costs.  So the elimination of the deductible limits is very welcome because it gives the employers much needed flexibility to design plans that fit their budgets and fit their employees needs.

To get more information download our Health Care Reform Bulletin.

Talon Benefits is dedicated to bringing our client partners the best solutions and timely information.  We are here to help you navigate the ever changing regulations of health care reform.

As the Afordable Care Act or Obamacare is rolled out the unintended consequenses are starting to hit people from all directions.  The latest group to openly criticize the ACA are the Unions.  In an open letter to Nancy Pelosi they expressed their concerns.  Here is a copy of their letter.

Dear Leader Reid and Leader Pelosi:

When you and the President sought our support for the Affordable Care Act (ACA), you pledged that if we liked the health plans we have now, we could keep them. Sadly, that promise is under threat. Right now, unless you and the Obama Administration enact an equitable fix, the ACA will shatter not only our hard-earned health benefits, but destroy the foundation of the 40 hour work week that is the backbone of the American middle class.

Like millions of other Americans, our members are front-line workers in the American economy. We have been strong supporters of the notion that all Americans should have access to quality, affordable health care. We have also been strong supporters of you. In campaign after campaign we have put boots on the ground, gone door-to-door to get out the vote, run phone banks and raised money to secure this vision.

Now this vision has come back to haunt us.

Since the ACA was enacted, we have been bringing our deep concerns to the Administration, seeking reasonable regulatory interpretations to the statute that would help prevent the destruction of non-profit health plans. As you both know first-hand, our persuasive arguments have been disregarded and met with a stone wall by the White House and the pertinent agencies. This is especially stinging because other stakeholders have repeatedly received successful interpretations for their respective grievances. Most disconcerting of course is last week’s huge accommodation for the employer community—extending the statutorily mandated “December 31, 2013” deadline for the employer mandate and penalties.

Time is running out: Congress wrote this law; we voted for you. We have a problem; you need to fix it. The unintended consequences of the ACA are severe. Perverse incentives are already creating nightmare scenarios:

First, the law creates an incentive for employers to keep employees’ work hours below 30 hours a week. Numerous employers have begun to cut workers’ hours to avoid this obligation, and many of them are doing so openly. The impact is two-fold: fewer hours means less pay while also losing our current health benefits.


Second, millions of Americans are covered by non-profit health insurance plans like the ones in which most of our members participate. These non-profit plans are governed jointly by unions and companies under the Taft-Hartley Act. Our health plans have been built over decades by working men and women. Under the ACA as interpreted by the Administration, our employees will treated differently and not be eligible for subsidies afforded other citizens. As such, many employees will be relegated to second-class status and shut out of the help the law offers to for-profit insurance plans.

And finally, even though non-profit plans like ours won’t receive the same subsidies as for-profit plans, they’ll be taxed to pay for those subsidies. Taken together, these restrictions will make non-profit plans like ours unsustainable, and will undermine the health-care market of viable alternatives to the big health insurance companies.

On behalf of the millions of working men and women we represent and the families they support, we can no longer stand silent in the face of elements of the Affordable Care Act that will destroy the very health and wellbeing of our members along with millions of other hardworking Americans.

We believe that there are common-sense corrections that can be made within the existing statute that will allow our members to continue to keep their current health plans and benefits just as you and the President pledged. Unless changes are made, however, that promise is hollow.

We continue to stand behind real health care reform, but the law as it stands will hurt millions of Americans including the members of our respective unions.

We are looking to you to make sure these changes are made.

James P. Hoffa
General President
International Brotherhood of Teamsters

Joseph Hansen
International President
UFCW

D. Taylor
President
UNITE-HERE

So what is a large employer?

Unfortunately the health care reform law doesn't have a consistent answer, it changes based on what part of the legislation we are talking about.

Here are some examples:

• W2 reporting it's 250 or more employees during the course of the year.
• Automatic Enrollment 200 employees is our number.
• SBC's, 60 Day Notice, $2,500 FSA Limit, Excessive Waiting Periods all groups.
• Pay or Play Penalties it's 50 full-time employees, including full-time equivalents (FTE's)

Today Our Focus Is On Determining Employer Size Related To Pay Or Play Penalties.

To qualify as a large employer for "Pay or Play", an employer must employ on average at least 50 full-time employees, including full-time equivalents (FTEs) on business days during the preceding calendar year. Full-time means 30 or more hours of service each week. Hours worked by employees with fewer than 30 hours per week must be counted—and then divided by 120 per month—to determine the number of FTEs. The number of FTEs is then added to the actual full-time employee count.

Employers will determine each year, based on their current number of employees, whether they will be considered a large employer for the next year. For example, if an employer has at least 50 full-time employees, including FTEs, for 2013, it will be considered a large employer for 2014.

All employers that employ at least 50 full-time employees, including FTEs, are subject to ACA’s pay or play rules, including for-profit, nonprofit and government employers. Seasonal employees and employees working abroad can be excluded under certain circumstances.  Also there are rules for common ownership that can take a company that might otherwise be a small employer and move them to large employer status.

The employee size calculation will be used later in the series when we discuss affordability and penalties.  In fact we have a calculator/spreadsheet that looks at all of the variables in the "Pay or Play" equation and will tell you what if any fines your company might have.  My main goal today is to make sure you understand the concept so we can dig deeper later.

Action Items:

• Calculate your total employees taking into account FTE's.
• Understand the Transition Rule for 2014 and determine what periods you will use.
• Review the common ownership rules if applicable.

Recommended Legislative Briefs:

• Large Employers Subject to "Pay or Play" Penalties
• "Pay or Play" Penalty - Identifying Full-time Employees
• "Pay or Play" Penalty - Common Ownership Aggregation Rules

In light of the Supreme Court’s June 28, 2012, decision to uphold the health care reform law, or Affordable Care Act (ACA), employers must continue to comply with ACA mandates that are currently in effect. Employers must also prepare to comply with ACA changes that will go into effect in the future. To prepare for upcoming changes, employers need to be aware of the ACA mandates that will go into effect in 2013.  

This Talon Benefits Legislative Brief provides a compliance checklist for employers for 2013. Please contact your Talon Benefits representative for assistance or if you have questions about changes that were required in previous years.