Employers Get Ready and Make the Most of the Dollars You Spend

The ACA (Affordable Care Act) also known as Obamacare is still the law. One of the most important provisions is what is known as the “mandate” requiring all individuals to have health insurance coverage. The IRS recently released a statement declaring that electronically filed tax returns that do not address the health coverage requirement of the ACA will not be accepted until the taxpayer indicates whether they had coverage, an exemption or will make the “shared responsibility payment”.

So, taxpayers must pay particular attention to Line 61 of the Form 1040 used to file their taxes. No postcard tax filing yet!

The deadline for employers to provide form 1095-C to employees is January 31, 2018. At this writing there is no extension on the horizon, so employers need to be preparing to provide this information. Penalty for not doing so is $260 for each form not filed. In general this applies to large employers with 50 or more employees.

We have found that providing an electronic enrollment platform to our clients eases the burden, since the ability to generate the forms and reports are included in the platform.

Firms with under 50 employees are not required to provide Form 1095C. If the firm is providing group insurance, the insurance company will provide the covered employee with form 1095B confirming that they have coverage. The 1095A is sent to individuals who have obtained their insurance through the Exchanges such as Covered CA.

As we begin the open enrollment season for 2018 benefits, we are finding that small group insurance rates are actually lower than individual rates in some cases. So more small groups are looking at providing health insurance again for their employees. As the individual market continues to be destabilized, the employer who provides health benefits will have an even greater advantage in recruiting and retaining the best employees.

It’s important to understand that while employees may be able to get subsidized coverage through the Exchange, the products are very different than those offered in the small group market. The group insurance plans provide access to the full provider network of the carrier, rather than the narrow network of the individual plans.

In fact, for 2018 Anthem Blue Cross is offering their EPO (Exclusive Provider Organization) product in the individual market in only 3 rating regions of CA this year. Those regions covered the following counties. : 1 – Alpine, Amador, Butte, Calaveras, Colusa, Del Norte, Glenn, Humboldt, Lake, Lassen, Mendocino, Modoc, Nevada, Plumas, Shasta, Sierra, Siskiyou, Sutter, Tehama, Trinity, Tuolumne, Yuba    7– Santa Clara 10  >Mariposa, Merced, San Joaquin, Stanislaus, Tulare.

The plans only cover Anthem Pathway EPO providers in those geographic regions. Since the plan is not available in LA, no medical providers in that area are covered. Insureds in Area 1 will be grateful to they have granted an exception to allow our members access to hospitals and medical groups at UCSF and UCDavis. That is a big relief, since those are the primary referral centers for people in the north state.

In today’s unstable insurance market employees are increasing looking at the value of insurance benefits. Local employers are finding it more difficult to find quality workers at our typically lower wages, according to one business recruiting organization. They are finding that they must pay more than minimum wage. With this in mind, it’s important that employers help employees understand the value of their total compensation. It’s important that the employer show the employee the value of all the other benefits provided in addition to wage.

We provider our employers enrollment software that also allows employers to provide a “total compensation” statement showing the dollar value of paid time off, social and commercial insurance benefits and retirement. The most forward thinking employers will provide these statements periodically. Some employers choose to include the statements with a holiday bonus at year end or during the employee’s annual review process.

The online enrollment process is much more efficient for open enrollment as well. It’s much like other online shopping that consumers use. It allows them to compare benefits side by side and do “what-ifs” for enrolling dependents. These platforms used to be available only to the very large employer. Now smaller employers can access the efficiencies of these systems such as guaranteeing complete and legible forms as well as giving the employer an easy way to track open enrollment progress. These efficiencies free up time for everyone.

Margaret R. Beck
Margaret Beck  CLU, ChFC, CEBS started her insurance practice in Redding in 1978. As an insurance broker/consultant,  she represents businesses and individuals as their advocate.  She assists in choosing proper products, compliance with complex benefit laws and claims issues once coverage is placed. All information in her column is provided to the best of her knowledge, subject to final regulation by the respective agencies. Questions to be answered in this column can be submitted to info@insuranceredding.com. Beck's column is also published in the Redding Record Searchlight.
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