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Ten ACA Changes for 2017

Posted on September 6th, 2016

The Affordable Care Act (ACA) continues to evolve. Here are 10 changes expected to take effect in 2017. 

  1. The Health Insurer Tax, which is approximately 2.3% of premium, will be suspended. This tax on health insurance companies will only be suspended in 2017.
  2. The Transitional Reinsurance Program (TRP) will end.  The TRP charged fees to health plans as an effort to stabilize premiums in the individual market.  
  3. The reporting requirements of the ACA will be due earlier. Copies of Forms 1095-B and/or 1095-C will need to be provided to employees and individuals by January 31, 2017. Reporting to the IRS will be due by February 28, 2017 if filing manually and March 31, 2017 if filing electronically.
  4. The Employer Mandate penalties will adjust for inflation.  Penalties under Code Section 4980H(a) are expected to increase to $2,260 per full-time employee (up $100) and penalties under Code Section 4980H(b) are expected to increase to $3,390 per full-time employee (up $150). The IRS has yet to officially confirm these increases. 
  5. The $695 penalty related to the Individual Mandate will also be inflation-adjusted to a higher amount, although the maximum penalty will remain at 2.5% of income. 
  6. The Medicare Part D “doughnut-hole” will continue to shrink. Those individuals covered by a Part D plan will receive a 49% discount on generic drugs and a 60% discount on brand name drugs while in the doughnut hole.
  7. The maximum out-of-pocket limits for non-grandfathered plans will increase to $7,150 for single coverage and $14,300 for family coverage.
  8. Transitional health plans can continue to be renewed up until October 1, 2017, however, coverage must not extend beyond December 31, 2017.
  9. Section 1332 of the ACA becomes effective, allowing states to request “innovation waivers” to pursue certain parts of the ACA differently than the standard.
  10. On January 20, 2017, a new president will take office. Regardless of who that person is, that person is expected to seek some level of change as it relates to the ACA and health care in general. 

 Subscribe to this blog at the top left navigation by entering your email address to learn more with Flexible Benefit Service LLC (Flex). The materials contained within this communication are provided for informational purposes only and do not constitute legal or tax advice. 

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