lvena

thanks.

Yes, the employer has a maximum cost stated up-front and if the claims come in higher than predicted by the carrier, the carrier loses.

Sorry. It is a self-insured group medical plan. Some people refer to it as "partial self-funding", others refer to it as level-funded, self-insurance. Employer is billed a "premium equivalent" rate, meaning it appears the same as a fully-insured. Within that premium equivalent rate is monies for fixed (administration) and variable (claims) expenses. By way of an example, fixed (admin) is $200,000 per year and variable (claims) is $400,000 per year, with a total cost of $600,000 per year. If no claims are submitted, the entire $400,000 is refunded. If $450,000 in claims are submitted, the employer owes nothing. If claims submitted are $350,000 the employer has $50,000 remaining in the claims account and is the property of the employer.

Saw your response and thought you might have an answer for a similar question. Employer group purchases a level-funded, self-insured plan. The premium equivalent consists of the fixed costs and money to fund a claims account. At the end of the contract the claims account has a surplus, which belongs to the employer. Assume that the employer has decided to take a refund of the amount. Assume the premium equivalent consists of both employer monies and employee contributions that were run through their 125 Premium Plan. Since the refund includes both employer and employee monies; 1)does the employer need to allocate out to the employees their share, 2) is there a tax event for the employer, and 3) is there a tax event for the employees share? Thanks.

Here you go, see the link. Govt not exempt, only Fed govt. https://www.dol.gov/ebsa/publications/cobraemployer.html

Without reviewing any documents, I would say that this is ok. As long as the employer has a written policy outlining the time period, has communicated it to the employees, and has followed it, there should be no discrimination issue. The discrimination issue would arise if the employer did not follow it for all, for example, if with a new hire the employer allowed that person to come on quicker.

Yes it does, PHI, Certificate of Creditable Coverage. As for the residence part of your question, I do not really now. If pushed to bet, I would say it goes to the dependents address that you have on file. That is what my plan does. I would defer to others on the address though.

Sorry, been away from this for a few days. I stand by my statement that any monies refunded to the employer from a claim account that had employee contributions, the employer needs to refund a proportional percentage back to them. I am not arguing, just stating that no one has yet to prove to me that I am wrong. A couple of things I have picked up on this thread. ERISA Technical Release 2011-04, which is referenced in the original post, applies to possible refunds due to the Minimum Loss Ration provision of ACA. This does not apply to stop-loss contracts that are used in self-funded plans. I am still a little confused about where the refund is coming from. As I stated above, if the refund is from excess monies left-over in the claims account, a proportion goes to the employee, if the employer takes it in cash. If the employer takes the excess monies as a credit for future months payments, it is not. However, if we are talking about amounts reimbursed by the stop-loss carrier as a result of large claims exceeding the attachment point, these are not plan assets and are the property of the plan sponsor (usually the employer). I like to describe these policies as a risk management tool for the employer.

A couple of things, and I know you are not going to like the first. The entitlement is something I learned a long, long time ago and I cannot easily find any references to it now. Sorry. The second is that they are not entitled to any adjustments made by the stop-loss carrier. They are entitled to any surplus remaining in the claims account. I may have misunderstood your statement above about this, and if I did I apologize. But the funds are kept by the tpa, not the reinsurer. Did this make sense?

Sounds like what is commonly referred to as Level Funded, Self-Insurance. As a rule, any funds returned to the employer become a taxable event and if there were employee contributions, the employer would need to calculate their portion of the refund and return. As such, most employers will apply the surplus as a future payment, thus avoiding the tax event and refunding to employees. I am a little confused by what you refer to as “no group health insurance contract” in your statement. There should be documents available, such as SBC’s, a SPD, stop loss contract, etc. Can you expand?

Does not look good, but I do not have all the info. If you are covered under a medical plan, without a Section 125 premium conversion (pre-tax) then you can cancel your medical plan at anytime. Deductions would end when appropriate. However, if you are covered under a Section 125 premium conversion plan, things are different. If you are covered under the 125 plan, as a general rule, your election(s) are irrevocable for the plan year (see the plan docs if you do not know your plan year). Employers are not required (aside from HIPAA special enrollment rights) to allow for off anniversary changes, but many/most do. You should have received a copy of the plan documents, please review and see what you find.

Highly unlikely, if I understand your post. Once an employee terminates coverage under a group health plan any dependents are also terminated. The HRA is funded by employer dollars and usually the employee does not have any rights to those dollars after they terminate membership in the plan, unless termination is due to retirement and the plan allows for it.

Relatively simple, with the caution that S Corp owners/hce have some restrictions. Must set-up a Plan Document and Summary Plan Descriptions (SPD). Give each employee option to participate with salary reduction. You may want to obtain some kind of outside help, at least at first, until you get your arms around the various issues. good luck.

We have something similar with about 10 groups, the TPA is responsible for collecting the proof, issuing the check, and then reporting out, by person. Hard to believe the carrier did not anticipate this. Could it be that there is some other entity responsible for this?

I have seen this done in the past, but with a slightly different twist. Group had a self-funded plan and a fully-insured HMO plan. If a person in the self-funded plan exceeded a certain threshold of claim cost they were forced onto the HMO. So my gut tells me that it may still be possible, but cannot verify for you. Agree with G Burns, there are so many laws that come into play that this could easily blow-up in the employer face. If they are even slightly considering doing this, they should seek out legal advice.

Keep in mind that I do not have any of the documents to review, and I am not familiar with Illinois law. It is very possible for this to occur, through use of a carve-out group. Carve-outs are usually structured around DOL approved groups, such as; salaried/non-salaried, union/non-union, etc. Or perhaps the non-salaried group is offered coverage through another offering. Often times the carrier will look at the size of the eligible class (carve-out) and assign it to the large or small based on that number. GBurns and you are correct that this now needs to be viewed through the ACA requirements. But even with ACA, this situation could still persist. Hope this helps.

Whether the employer offers a self-funded or insured plan, the notification is the same, the employer will receive a bill for the penalty amount owed. Keep in mind though, the penalty is only applicable if the employer plan failed the benefits and/or affordability test. When applying for the subisidy at the exchange, the exchange will verify if the individual is eligible for the subsidy based on the information provided by the employer. Doubt very much if anyone would ask an employee to answer these types of questions at OE. At OE the employer should have ALL employees complete the enrollment form, and for those who want to opt out of employer sponsored coverage, they will check off no coverage and should provide a reason, such as other coverage, due to cost, etc. Running salaries is needed to determine the affordability testing, so they should do it. As Chaz said, you have missed much. Don't know your situation, but you should start reaching out to whomever you can to get your arms around this stuff. Start with the govt websites (IRS, DOL, etc) as well as any vendor/partners you can. This forum is not a good place to get into this type of discussion because it is so deep and complicated. Good luck.

Bear with me, since I do not have the plan documents available to review. But you state that the HRA is available to employees who; 1) Opt out of your sponsored plan, and 2) provide proof of alternative coverage. Assuming that the plan documents are well written, then this employees appears to have failed the test. She may have opted out of your plan as an employee, but did not satisfy the second (having alternative coverage) because her coverage is still your plan. Suggest reading of the plan documents.

If you are referring to self-funded medical, we do. Another department than mine, but would be willing to pass along or make introduction, whatever you want. Lee lee.vena@amwins.com or 704-749-2722

As usual, I am a little confused by your question, so please bear with me as I answer. An integrated HRA must benefit only employees wo are covered by the primary group plan offered by the employer. So even if someone is eligible for covereage, but they have declined to enroll, they cannot participate in the HRA. Is it possible the tpa is denying the spouse access to the HRA because the spouse is covered under the group plan as the other employees dependent?

But Employer had the responsibility to provide Employee with a notice of HIPAA Special Enrollment Rights upon learning of the pregnancy, correct? I believe that Employer provided Employee with an SPD when she enrolled. But I fear that Employer did not provide the HIPAA SER when the baby was born. The responsibility to provide the notice is not at the pregnancy, it is at or before the time an employee is offered the opportunity to enroll. Since the employee was already on the medical plan I am assuming that the Special Enrollment rights notice was provided with the original packet of information was given to the employee.

Let me caution you first that there could be a variety of answers for this question and it is best to read the employer health document. But as a general rule, it is the employee's responsiblity to enroll the new dependent. In the case of a new born, the employee has 31 days to enroll. Usually, the newborn is automatically COVERED, NOT ENROLLED, by the plan and coverage will only be continued if enrolled by the employee within the 31 days. Short of providing the employee with enrollment materials, there is no legal requirement that the employer notify or remind the employee later on.

Employees 65+ who are still working can delay enrolling in Part B without a penalty, but this is not the case if the coverage is continued under COBRA. Your husband needed to sign-up for Part B when first eligible (maybe part d too, not sure) to avoid penalties. Penalties are 10% premium penalty per year. This has been standard since inception of COBRA 20+ years ago. Suggest you follow-up with Medicare staff/office and find out more about your options. Good luck.

No double dipping allowed, sorry. See revenue ruling 2002-03 and 2002-80.

Little confused by your question, sorry. But the group still needs to structure the benefits within the same guidelines required by PPACA. Just because there is an HRA (or some other funding vehicle) below the high deductible plan does not matter.