Quarterly Review — April 2011

April 29th, 2011 Comments Off

PPACA 1 Year Later

Waivers and Exchanges: States Empowered to Innovate

In March, the Departments of Health and Human Services (HHS) and Treasury proposed new rules outlining the steps states may take to receive a State Innovation Waiver under the Patient Protection and Affordable Care Act (PPACA). The Waiver, if granted, recognizes a state’s right to implement health care reform initiatives on its own.
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Internal Claims & Appeals: Extension of Non-Enforcement Period

Last September (9/20/10) the Department of Labor issued Technical Release 2010-02 (T.R. 2010-02), which granted an enforcement grace period until July 1, 2011 for compliance with certain new provisions of health care reform: internal claims and appeals for non-grandfathered plans. The projected costs to implement the new claims and appeals procedures had employers scrambling to keep their grandfathered plans.
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Health Care Reform W-2 Reporting; Guidance Issued

PPACA requires employers to report the value of “applicable employer sponsored coverage” in Box 12 on each employee’s annual Form W-2; this includes both the employer and employee contributions (regardless of the tax status of the contributions) and is generally determined according to the applicable premium definition used for COBRA. Last October (10/12/10), the IRS announced a delayed start date, with optional reporting beginning 2011. The delay was deemed necessary to provide employers time to make changes to their payroll systems or procedures. The new revised Form W-2 was published for employers who were ready to begin the required changes. We now have additional interim guidance in the form of IRS Notice 2011-28.
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Uh-Oh, Not all States Conform to Federal Tax Law

There are 16 states with state tax laws where the definition of dependent does not conform to federal tax law. Why should you care? If you have a Premium Only Plan (POP) or a full Cafeteria Plan in which your health premiums may be tax favored and you live in one of the following states/commonwealths, read on.
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$4.3 Million Civil Penalty – Ouch!

Privacy Violation

A Maryland health care provider was charged in February with violating 41 patients’ rights by denying them access to their medical records when requested between September 2008 and October 2009. A primary tenant of HIPAA is that patients own their health records not doctors and upon request patients must be provided access within a reasonable time (60 days maximum).
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Wellness Program Wins Discrimination Case

In 2009, a Florida based employer introduced a Value Based Benefits Design plan into its overall health plan. Its wellness program provided employees an opportunity to complete a Health Risk Assessment (HRA) and a biometric screening, both of which were provided by the health care provider. Employees were not required to participate in the wellness program; however, employees who chose to voluntarily participate received a $20 bi-weekly discount toward their health plan premiums.
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Corporate Governance Post Dodd-Frank

Do Whistleblowers have too Much Power?

No one who has followed the rise and fall of executives and companies such as Enron or AIG, or the corruption leading to the collapse of financial institutions has doubted the need for reform. We have all heard the testimony of too many employees or former employees that they tried to raise red flags but were ignored or dismissed in retaliation.
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