On Monday, December 28, 2015, the Internal Revenue Service announced in Notice 2016-4 that employers will have additional time to file annual reports required under the Patient Protection and Affordable Care Act (“ACA”). The ACA requires certain employers to report minimum essential coverage annually on Forms 1094 and 1095. These forms were originally due to employees on February 1, 2016 and employers had until March 31, 2016 to file the forms electronically with the IRS (February 29, 2016 for non-electronic filers). However, Notice 2016-4 extends both of those deadlines for all employers required to file Forms 1094 and 1095.
Articles about the Employee Retirement Income Security Act (ERISA) and other issues relating to employee benefit topics
A Holiday Gift to Applicable Large Employers – 2015 ACA Reporting is Delayed
In Notice 2016-4, the IRS has extended the due dates for certain 2015 Affordable Care Act information reporting requirements.
Congress Gives Commuters a Christmas Present
On Friday, December 18, 2015, when President Obama signed the Protecting Americans from Tax Hikes (PATH) Act into law, one of the provisions included in the law made the monthly limit on qualified transportation benefits for public transportation equal to the monthly limit applicable to parking benefits. This means that, for 2016, instead of $130 per month as was recently announced by the IRS, the limit on commuting benefits that could be provided tax free will be nearly doubled, to $255 per month. (Technically, the limit for this year increased as well, to $250 per month, but since there’s only a week left before the end of the year, that increase is fairly moot.) This increase is permanent – or as permanent as tax reductions are – unlike the temporary increase enacted in 2009.
Employee Benefits Newsletter – Winter 2015
Here in the middle of the holiday season, we’ve been busy putting the finishing touches on the next issue of our practice group’s quarterly newsletter, “Employee Benefits for Employers.” The newsletter is a reimagined version of some earlier efforts to provide this audience with useful information on the rapidly evolving areas of employee benefits and executive compensation. You may have noticed our first issue when it came out in September, but if not, please take a moment to check it out here.
Employee Benefits for Employers – Winter 2015
A Troubling Expansion of Successor Liability. Under the Employee Retirement Income Security Act (“ERISA”), as amended by the Multiemployer Pension Plan Amendments Act (“MPPAA”), an employer that has assumed an obligation to contribute to and subsequently withdraws from a collectively-bargained and jointly-administered defended benefit pension plan (a “multiemployer plan”) is liable for its allocable share of any underfunding. This “withdrawal liability” has become a significant issue since 2008, due to the economic and investment impact of the recession, historically low interest rates, declining plan participation, and an increase in the number of retirees, among other things.
The Obergefell Effect: Applying the SCOTUS Decision to Qualified Retirement and Health and Welfare Plans
On December 9, 2015, the IRS issued Notice 2015-87 [link below], which provides guidance on the application of the recent United States Supreme Court (“SCOTUS”) decision in Obergefell v. Hodges [link below] to qualified retirement and health and welfare plans.
Don’t Forget Year-End Amendment to Cafeteria Plans Allowing Revocation for Marketplace Coverage
As the calendar year comes to an end, group health plan sponsors must remember that if they took advantage of the ACA relief of IRS Notice 2014-55, amendments to their cafeteria plans by year end are needed.
Undoing Form 5500 Extensions
Over this past summer, the Surface Transportation and Veterans Health Care Choice Improvement Act of 2015 (the “Surface Transportation Act”) included a provision that extended by a month the automatic extension that is available to Form 5500-series filers, to be effective with the filing of the 2016 returns. (See our Legal Alert dated September 9, 2015.) Whether you appreciated it or not, that extension was short-lived, and has now been repealed before even taking effect.
Million Dollar HIPAA Settlements Are About Compliance, Not Harm to Individuals
In the last two weeks, the Office for Civil Rights (OCR) announced two substantial settlements under HIPAA that together totaled $4.35 million. These large amounts seem to be driven not by actual harm to individuals, but in significant part by alleged HIPAA compliance failures identified by OCR following investigations commenced in response to receipt of data breach reports. It is a mistake to believe that timely and otherwise compliant reporting of supposed “no harm, no foul” data breaches will result in minor, if any, enforcement activity; that is, if the agency believes you have not satisfactorily complied with the privacy and security standards.
Healthcare Worker Gives New Employer Patient Records, Old Employer Pays $15,000 to NY Attorney General For HIPAA Violation
One of your employees discloses your organization’s patient information to a soon-to-be new employer for use in generating business at the new employer’s competing business, and your company has to settle with the New York State Attorney General for HIPAA violations. Make sense?
ERISA Claims Procedures For Disability Benefits To Get An ACA Make Over
The Employee Benefits Security Administration (EBSA) of the Federal Department of Labor plans to publish on November 18, 2015, new claims procedures for adjudicating disability benefits designed to enhance existing procedures for those benefits under Section 503 of the Employee Retirement Income Security Act (ERISA). EBSA’s goal is to apply to disability benefits many of the new procedural protections and safeguards that have been applied to group health plans under the Affordable Care Act (ACA). Interested parties may submit comments to these proposed regulations no later than 60 days after publication.
Supreme Court to Review Birth Control Mandates Under Affordable Care Act Once More
For the third time in four years, the U.S. Supreme Court will hear a challenge to a portion of the Affordable Care Act (ACA), President Obama’s signature health reform law passed in 2010. On November 6, 2015, the Supreme Court issued a writ of certiorari in seven cases addressing the ACA’s birth control mandates and the rights of religious employers.1
Premium Reimbursement Arrangements – Part Deux
Last November, Melissa Ostrower wrote an excellent blog on the perils of employers reimbursing employees for health care premiums. (See: http://www.benefitslawadvisor.com/2014/11/articles/health-care-reform-legislation/premium-reimbursement-arrangements-employers-beware/) At the time of her article, the Department of Labor had just published a new FAQ which stated, in general, that where an employer provides cash reimbursements to employees for the purchase of an individual market health care policy or provides cash in lieu of coverage to employees with high claims risks, such action would be considered part of a plan, fund or arrangement governed by the Affordable Care Act (“ACA”). Because these arrangements — by their nature — can never comply with the ACA group health plan provisions, they may subject employers providing such arrangements to penalties.
ACA Auto-enrollment Requirement Repealed
Since the enactment of the Affordable Care Act (ACA), larger employers have wondered about an auto-enrollment provision that the ACA added to the Fair Labor Standards Act (FLSA). Under that provision, employers that are subject to the FLSA and which employed more than 200 full-time employees would have been required to automatically enroll new full-time employees in one of the employer’s health benefits plans (subject to any waiting period authorized by law). Certain notices would have been required giving employees an opportunity to opt out of any coverage in which the employee was automatically enrolled.
Equity and “Phantom” Equity Based Compensation for LLCs
Due to the popularity of limited liability companies (LLCs) as a form of business entity, we have been approached lately more than ever to structure equity and “phantom” equity based compensation for LLC businesses, including private equity firms and other businesses that embrace an employee ownership culture. Phrases such as “restricted stock”, “stock options” and “stock appreciation rights”, all applicable to corporations, are commonly known. There are, however, equivalent terms applicable to LLCs.