Small employers now have the ability to assist employees with the cost of health care through a qualified small employer health reimbursement arrangement (QSEHRA). Prior to the Affordable Care Act (ACA), small employers were able to offer stand-alone health reimbursement arrangements (HRAs) to help employees pay for medical care expenses, including health insurance premiums, on a tax-free basis. This changed with the passage of the ACA, under which stand-alone HRAs were generally considered group health plans that violated the ACA’s annual dollar limit prohibition (some stand-alone HRAs, such as retiree-only HRAs, remained valid). Consequently, employers who continued to offer such arrangements could face fines of up to $36,500 per employee per year (with a $500,000 total limit). With the passage of the 21st Century Cures Act, which incorporates key components of the Small Business Healthcare Relief Act, small employers may again offer this benefit to employees.
Eligible Employers To be eligible to offer a QSEHRA, an employer (1) cannot be an “applicable large employer” under the ACA, i.e., had fewer than 50 full-time employees, including full-time equivalent employees, on average during the prior year, and (2) cannot offer a group health plan to any of its employees. Qualified employers must offer the Continue reading →
Today, the United States Supreme Court upheld subsidies for individuals who purchase health care insurance through all health care exchanges regardless of whether the exchange was established by a state or the federal government. The case, King v. Burwell, is the latest ruling in a number of challenges to the Affordable Care Act (ACA). In the 6-3 ruling, the Court stated that this ruling will prevent the destabilization of the individual health insurance market into a death spiral.
What does this mean to the average American? If you purchase health insurance from an exchange and meet the eligibility requirements, then you may continue to receive subsidies to help pay for that coverage. It does not matter that you are in a state exchange or a federal exchange. So, essentially status quo.
What does this mean to the average employer? The subsidies available through the exchanges are the triggers for the penalties that may be imposed upon certain large employers if that employer either fails to offer coverage to its full time employees or offers coverage that is not affordable or does not provide minimum value. Had the subsidies been taken away, then employers in states with federal exchanges would likely have not been subject to the penalties because in order to be subject to a penalty, an employee would have to purchase insurance on an exchange AND receive a subsidy. Subsidies are not available to employees if they have an appropriate offer of coverage from an employer. So, if you are a large employer and were hoping that you would not be subject to the penalties under the ACA, you should review your policies and procedures to ensure compliance with the ACA.
The U.S. District Court for the District of Columbia struck down the U.S. Department of Labor’s regulations concerning the companionship services exemption to the minimum wage and overtime requirements of the Fair Labor Standards Act (FLSA). SeeHome Care Association of America v. Weil, No. 14-cv-967 (D.D.C. 2014). Under the FLSA, providers of home care services employed by a third party are deemed to fall within the FLSA’s domestic employee and/or companionship services exemptions. However, the Department of Labor’s Wage and Hour Division issued a Final Rule with an effective date of January 1, 2015 (but not to be enforced until July 1, 2015) effectively eliminating this exemption by revising the definition of “companionship services” and subjecting third-party providers to minimum wage and overtime requirements imposed by the FLSA.
The National Association for Home Care & Hospice, Home Care Association of America, and the International Franchise Association brought an action challenging the Final Rule under the Administrative Procedure Act arguing that the rule was arbitrary and capricious, and inconsistent with Congress’ intent. Specifically, the plaintiffs claimed the rule would “have a destabilizing impact on Continue reading →