Benefits Buzz
Predictions for 2016
Posted on December 31st, 2015
The New Year is expected to bring more regulatory changes which will impact employers and group health plans alike. Here are five predictions of things that are likely to happen in 2016.
- More Cadillac Tax Scrutiny. All the debate about the Cadillac Tax eventually brought about a two year delay of this Affordable Care Act (ACA) provision. Although the widely unpopular excise tax is now set to take effect in 2020, there will most likely be continued efforts from employer groups, unions, politicians and other opponents of this provision to make radical changes or even repeal the Cadillac Tax altogether.
- Employers will Scramble to File New Reporting. The Individual and Employer Mandates create new reporting obligations which require a significant amount of time and effort from employers. The phrase “total chaos” and other like phrases seem to be used frequently when the new reporting requirements are discussed. The good news is employers will have two additional months to provide copies of applicable forms to employees and three additional months to submit the reporting to the Internal Revenue Service (IRS). Refer to Notice 2016-4.
- Non-Discrimination Rules for Fully-Insured Plans. The IRS has informally commented that they expect to issue non-discrimination rules for fully-insured plans by the end of 2016. Non-discrimination rules were supposed to take effect in 2011 but were delayed pending further guidance. Once issued, the rules would generally prohibit fully-insured plans from discriminating in favor of highly compensated employees. Employers violating the non-discrimination rules would be subject to costly penalties.
- EEOC will Finalize New Wellness Rules. Although rules pertaining to wellness plans already exist, several employers have found themselves in a legal battle over whether their wellness plans violate the Americans with Disabilities Act (ADA) and/or the Genetic Information Nondiscrimination Act (GINA). The Equal Employment Opportunity Commission (EEOC) proposed additional wellness rules in 2015 which are likely to be finalized next year.
- More Employer Payment Plan Regulation and Enforcement. Some third-party administrators (TPAs) continue to promote the ability for employers to reimburse actively employed workers with pre-tax dollars for health plans that are purchased in the individual market. These types of arrangements are referred to by regulators as employer payment plans. November 2015 guidance posted to the Federal Register suggests that agency officials are aware of these situations, and they “intend to continue to address these specific instances of noncompliance.”
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The materials contained within this communication are provided for informational purposes only and do not constitute legal or tax advice.
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