Microbusiness Quick Start Guide

Transcription

1 Microbusiness Quick Start Guide

2 Impact of the Patient Protection and Affordable Care Act The Microbusiness Quick Start Guide covers TASC s taxadvantaged benefit Plans that are compliant with the Affordable Care Act (ACA) and outlines the basic steps to properly administer these Plans. See the AgriPlan and Biz- Plan Client Administration Manual for complete details. One Employee Plan Health Reimbursement Arrangements (HRAs) with one employee are exempt from the Affordable Care Act (ACA) and are unaffected by these regulations. TASC refers to these as the One Employee Plan. One Employee Plan Clients do not have to pay a Patient-Centered Research Outcome Institute (PCORI) Fee and file a IRS Excise Tax Form 720 or File IRS 1094-B or 1095-B ACA Minimum Essential Coverage Forms. Your Plan is not subject to Department of Labor audits or document requirements. And your Plan is not subject to the Health Insurance Portability and Accountability Act (HIPAA). (See Page 3 for more detail.) Limited Purpose HRA A Limited Purpose HRA provides coverage for dental, orthodontia, vision or long-term care only. These are considered excepted benefits. (See Page 4 for more detail.) No Limit Plan The No Limit Plan is a self-funded health Plan that meets all Healthcare Market Reform requirements; your tax savings remain the same! There is no limit to the amount of claims submitted. The risk to this type of Plan design is the potential of receiving a high amount of medical claims, written off through your business, in any given year. This is likely more of a concern to employers with non-related family members. Since this is a self-funded Plan, there is no need for you to also sponsor Group Insurance. (See Page 5 for more detail.) Multi-Employee HRA with Group Insurance Employers with multiple employees who sponsor Group insurance can participate in an HRA as they had prior to IRS Notice The only difference is that you must limit enrollment in your Plan to employees who are enrolled in your Group Health Plan, or who certify they are covered under Group insurance sponsored by another employer (a spouse s Plan). elected, these services will incur an additional fee. Please contact your TASC Provider or Regional Sales Director; or contact a Microbusiness Specialist at Extension to learn more. QSEHRA Small Business HRA IRS Notice issued in September 2013 limited the ability of small business owners with more than one eligible employee to utilize Stand-Alone HRAs (i.e., HRAs not integrated with Group insurance). In December 2016, The Cures Act and H.R. 34 containing provisions that establish Qualified Small Employer HRAs (QSEHRA) overturned guidance issued in IRS Notice and once again allows employers with more than one but fewer than 50 employees to utilize HRAs as a pre-tax health & welfare benefit without sponsoring Group insurance. In fact, the employer may not sponsor or offer Group insurance to any employee in order to offer a QSEHRA. (See Page 7 for more detail.) At the start of each Plan Year, download, complete and distribute new compliance documents online from: If you prefer that we send you a hard copy of the required forms and documents in the mail, please submit a MyService Request online after logging into your MyTASC account at Or call us toll-free at , Monday through Friday, 8:00 a.m. - 5:00 p.m. (all time zones). Please have your 12-digit MyTASC ID available so we can help you as quickly as possible. If you sponsor Group insurance or any Group-sponsored health and welfare benefit, your reporting requirements related to the Affordable Care Act (ACA), the Employee Retirement Income Security Act (ERISA), and the Health Insurance Portability and Accountability Act (HIPAA) are very stringent. TASC can help you meet these additional requirements and avoid hefty Department of Labor penalties and fines with its Microbusiness Compliance Suite. If 2 Microbusiness Quick Start Guide

3 One Employee Plan (Section 105 Health Reimbursement Arrangement or a Self-Administered HRA) One Employee Administration Great news, because of the countless hours of research that TASC s legal, compliance and governmental affairs departments spent researching IRS Notice , we were able to simplify One Employee Plan administration! This means less work on your behalf. Your One Employee Plan DOES NOT REQUIRE: A Summary Plan Description. A Summary of Benefits & Coverage. Patient-Centered Research Outcome Institute (PCORI) Fee and IRS Excise Tax Form 720 filing. Marketplace Notices. ACA Reporting of Minimum Essensial Coverage to the IRS and covered employees using IRS Tax Forms 1094-B and 1095-B. In addition, your Plan is NOT subject to: Employee Retirement Income Security Act (ERISA). Health Insurance Portability and Accountability Act (HIPAA). Consolidated Omnibus Budget Reconcilliation Act (COBRA). Follow these simple steps to set up and operate your Plan. For more information refer to the Client Administration Manual. Find the electronic version of the Manual at Please Note: The hiring of family members is closely scrutinized. It s crucial that related employees are formally hired and that the relationship between employed family members and the business owner is legitimate and necessary. As a best practice, we recommend that your business treats non-related and family member employees identically. 1. Written Plan Document* A written Plan Document must be in place and officially adopted by the employer in order to provide pre-tax benefits. TASC keeps your Plan Document on file should the need ever arise where you are required to produce this documentation. 3. Determine Reasonable Compensation Compensation paid for duties performed may be a combination of cash wages and benefits (e.g., health insurance, medical reimbursement, etc.). It is vital that the employee s total compensation (sum of wages and benefits) be reasonable for the duties being performed. 4. Keep a Time Log of Hours Track hours worked by all employees, regardless of whether the employees are salaried or paid hourly. This should be done consistently and may be in the format of a time sheet, calendar, or a variation thereof. 5. Pay a W-2 Wage* Pay your employee s W-2 wages from the business/farm account. These payments may be cashed or deposited into the employee s personal or family account. Regular monthly or quarterly payments are recommended. 6. File Appropriate Payroll Taxes* Cash compensation is subject to the appropriate payroll withholdings, including timely tax deposits. Complete a W-2, W-3, and W-4, and file a Form 941/943/944 as required. 7. Reimburse Medical Expenses* Reimburse the eligible expenses of your employee(s) via the TASC Card or by check from the business account to a personal account set up by the employee. 8. Submit Expenses/Get a Year-End Report* The fastest, easiest way to submit your expenses and get your Year-End Report is through the M ytasc website. When you use the TASC Card, those expenses are automatically recorded online. You only need to add any additional expenses. After you ve finished entering all of your medical expenses for the year, requesting your Year-End Report is as easy as a click of a button. Or, if you prefer that we send you a personalized Transmittal worksheet in the mail, just give us a call. 9. Renew your Plan* AgriPlan and BizPlan are employee benefit Plans that must be operated on a pre-planned basis. Renew and pre-pay your Plan each year, before the new Plan Year begins (or request annual or quarterly electronic payment). 2. Establish an Employment Agreement Distribute a written Employment Agreement that clearly outlines job duties and responsibilities, hours worked, and compensation to all eligible employees. Update and sign this agreement annually. You and your employee should each retain a copy. *Applies to all Plan designs. Microbusiness Quick Start Guide 3

4 Limited Purpose HRA (Section 105 Health Reimbursement Arrangement or a Self-Administered HRA) Follow these simple steps to set up and operate your Plan. For more information refer to the Client Administration Manual. Find the electronic version of the Manual at In all cases, whether you sponsor Group Insurance or not, you can offer a AgriPlan BizPlan Limited Purpose HRA plan. This HRA plan covers only dental, orthodontia, vision and long-term care. All of your employees can be covered, whether they are enrolled in Group Insurance or not. There is no salary reduction requirement. Please Note: There is currently no way for TASC to limit your employees reimbursements to only dental and vision services via the TASC Card. In addition to the asterisked items for a One Employee Plan (see Page 3), additional requirements apply in order to keep your Plan compliant and retain TASC s Audit Guarantee: 1. Written Plan Document* A Written Plan Document must be in place and officially adopted by the employer in order to provide pre-tax benefits under a Health Reimbursement Arrangement (Section 105). TASC keeps your Written Plan Document on file should the need ever arise where you are required to produce this documentation. 2. Distribute a Summary Plan Description The Summary Plan Description (SPD) lists benefits, elections, eligibility requirements, and other terms and conditions of your Plan. Download and complete your Summary Plan Description. Verify the information to ensure that your Plan is set up correctly, and then distribute a copy to every Participant on your Plan. 3. Summary of Benefits and Coverage The Departments of Treasury, Labor, and Health & Human Services (HHS) require you to distribute a uniform explanation of coverage or Summary of Benefits and Coverage (SBC) to HRA Plan participants as part of the Patient Protection & Affordable Care Act (PPACA). 4. PCORI Fee The Patient-Centered Outcomes Research Institute (PCORI) collected fee will help fund the private, nonprofit institute that has been created to evaluate the quality and effectiveness of various medicines and treatments and to conduct comparative clinical effectiveness research. PPACA requires health insurance issuers and sponsors (i.e., the employer) of self-insured health plans to pay fees to help finance the institute s research. The PCORI fee will need to be recorded on IRS Excise Tax Form 720 and paid by July 31st of the calendar year immediately following the last day of the Plan year. 5. File Forms 1094-B and 1095-B If applicable, employers are required to submit a 1094-B Transmittal Form and 1095-B Individual forms for each covered employee to the IRS by February 28th, or March 31st if filing electronically if they sponsor a self-insured rather than a Group-sponsored Plan. In addition, they must distribute IRS Form 1095-B to affected employees by January 31st (deadline delayed for 2016). Employees will use this form when completing their own individual income tax returns as proof of health insurance coverage for the prior calendar year. 6. ERISA Notices Employers with more than one employee are required to provide their employees with Employee Retirement Income Security Act (ERISA) notifications. TASC has condensed ERISA and PPACA notices and language into a simplified easy-tounderstand ERISA Compliance Feature Pack to distribute to your employees. You can download, complete and distribute copies of the Notices to your Plan Participants from www. tasconline.com/microbusiness-service-offerings. If you sponsor Group insurance or any Group-sponsored health and welfare benefit, your ERISA and PPACA reporting requirements are much more stringent and go beyond the information contained within our Feature Pack. TASC can help you meet these additional requirements and avoid hefty Department of Labor penalties and fines with its Microbusiness Compliance Suite services. Please contact your TASC Provider or Regional Sales Director; or contact a Microbusiness Specialist at extension for more information. 7. HIPAA Compliance Provisions under the Health Insurance Portability and Accountability Act of 1996 (HIPAA) are applicable to your Plan. 8. Marketplace Notices As of October 1, 2013, there is a new way to buy health insurance: the Health Insurance Marketplace. In compliance with the Affordable Care Act as it concerns new Health Insurance Exchanges, employers must complete the appropriate Model Notice and distribute it to the following: All employees (regardless of enrollment, part-time, or full-time status) COBRA Participants New hires within 14 days of employee start date. 4 Microbusiness Quick Start Guide *Applies to all Plan designs.

5 No Limit Plan (Self-Funded Health Plan) Follow these simple steps to set up and operate your Plan. For more information refer to the Client Administration Manual. Find the electronic documents referenced below at Please Note: A No Limit Plan is a self-funded Plan that meets all Healthcare Market Reform requirements. It is not an HRA. The risk to this type of Plan design is if you have non-related employees or employees with high, unexpected claims that must be reimbursed through the business. In addition to the asterisked items for a One Employee Plan (see Page 3), additional requirements apply in order to keep your Plan compliant and retain TASC s Audit Guarantee: 1. Written Plan Document* A Written Plan Document must be in place and officially adopted by the employer in order to provide pre-tax benefits. TASC keeps your Plan Document on file should the need ever arise where you are required to produce this documentation. TASC has added an addendum to its existing Written Plan Document to allow for the unlimited reimbursement of premiums and out-of-pocket medical expenses. 2. Distribute a Summary Plan Description The Summary Plan Description (SPD) lists benefits, elections, eligibility requirements, and other terms and conditions of your Plan. Download and complete your Summary Plan Description. Verify the information to ensure that your Plan is set up correctly, and then distribute a copy to every Participant on your Plan. 3. Summary of Benefits and Coverage The Departments of Treasury, Labor, and Health & Human Services (HHS) require you to distribute a uniform explanation of coverage or Summary of Benefits and Coverage (SBC) to HRA Plan participants as part of the Patient Protection & Affordable Care Act (PPACA). 4. PCORI Fee The Patient-Centered Outcomes Research Institute (PCORI) collected fee will help fund the private, nonprofit institute that has been created to evaluate the quality and effectiveness of various medicines and treatments and to conduct comparative clinical effectiveness research. PPACA requires health insurance issuers and sponsors (i.e., the employer) of self-insured health plans to pay fees to help finance the institute s research. The PCORI fee will need to be recorded on IRS Excise Tax Form 720 and paid by July 31st of the calendar year immediately following the last day of the Plan year. TASC will assist by providing instruction and a pre-filled IRS Excise Tax Form File Forms 1094-B and 1095-B If applicable, employers are required to submit a 1094-B Transmittal Form and 1095-B Individual forms for each covered employee to the IRS by February 28th, or March 31st if filing electronically if they sponsor a self-insured rather than a Group-sponsored Plan. In addition, they must distribute IRS Form 1095-B to affected employees by January 31st (deadline delayed for 2016). Employees will use this form when completing their own individual income tax returns as proof of health insurance coverage for the prior calendar year. TASC will assist by providing instruction and fillable forms at the end of each year. 6. ERISA Notices Employers with more than one employee are required to provide their employees with Employee Retirement Income Security Act (ERISA) notifications. TASC has condensed ERISA and PPACA notices and language into a simplified easy-tounderstand ERISA Compliance Feature Pack to distribute to your employees. You can download, complete and distribute copies of the Notices to your Plan Participants from www. tasconline.com/microbusiness-service-offerings. If you sponsor Group insurance or any Group-sponsored health and welfare benefit, your ERISA and PPACA reporting requirements are much more stringent and go beyond the information contained within our Feature Pack. TASC can help you meet these additional requirements and avoid hefty Department of Labor penalties and fines with its Microbusiness Compliance Suite services. Please contact your TASC Provider or Regional Sales Director; or contact a Microbusiness Specialist at extension for more information. 7. HIPAA Compliance Provisions under the Health Insurance Portability and Accountability Act of 1996 (HIPAA) are applicable to your Plan. 8. Marketplace Notices As of October 1, 2013, there is a new way to buy health insurance: the Health Insurance Marketplace. In compliance with the Affordable Care Act as it concerns new Health Insurance Exchanges, employers must complete the appropriate Model Notice and distribute it to the following: All employees (regardless of enrollment, part-time, or full-time status) COBRA Participants New hires within 14 days of employee start date. *Applies to all Plan designs. Microbusiness Quick Start Guide 5

6 Multi-Employee HRA with Group Insurance (Section 105 Health Reimbursement Arrangement or a Self-Administered HRA) Follow these simple steps to set up and operate your Plan. For more information refer to the Client Administration Manual. Find the electronic documents referenced below at As a result of IRS Notice , you must limit enrollment in your Plan to employees who are enrolled in your Group Health Plan, or who certify they are covered under Group insurance sponsored by another employer (a spouse s Plan). In addition to the asterisked items for a One Employee Plan (see Page 3), additional requirements apply in order to keep your Plan compliant and retain TASC s Audit Guarantee: 1. Written Plan Document* A Written Plan Document must be in place and officially adopted by the employer in order to provide pre-tax benefits under a Health Reimbursement Arrangement (Section 105). TASC keeps your Written Plan Document on file should the need ever arise where you are required to produce this documentation. 2. Distribute a Summary Plan Description The Summary Plan Description (SPD) lists benefits, elections, eligibility requirements, and other terms and conditions of your Plan. Download and complete your Summary Plan Description. Verify the information to ensure that your Plan is set up correctly, and then distribute a copy to every Participant on your Plan. 3. Summary of Benefits and Coverage The Departments of Treasury, Labor, and Health & Human Services (HHS) require you to distribute a uniform explanation of coverage or Summary of Benefits and Coverage (SBC) to HRA Plan participants as part of the Patient Protection & Affordable Care Act (PPACA). 4. PCORI Fee The Patient-Centered Outcomes Research Institute (PCORI) collected fee will help fund the private, nonprofit institute that has been created to evaluate the quality and effectiveness of various medicines and treatments and to conduct comparative clinical effectiveness research. PPACA requires health insurance issuers and sponsors (i.e., the employer) of self-insured health plans to pay fees to help finance the institute s research. The PCORI fee will need to be recorded on IRS Excise Tax Form 720 and paid by July 31st of the calendar year immediately following the last day of the Plan year. TASC will assist by providing instruction and a pre-filled IRS Excise Tax Form File Forms 1094-B and 1095-B If applicable, employers are required to submit a 1094-B Transmittal Form and 1095-B Individual forms for each covered employee to the IRS by February 28th, or March 31st if filing electronically if they sponsor a self-insured rather than a Group-sponsored Plan. (For Group-insured health Plans, this requirement lies with the insurance carrier.) In addition, they must distribute IRS Form 1095-B to affected employees by January 31st (deadline delayed for 2016). Employees will use this form when completing their own individual income tax returns as proof of health insurance coverage for the prior calendar year. 6. ERISA Notices Employers with more than one employee are required to provide their employees with Employee Retirement Income Security Act (ERISA) notifications. TASC has condensed ERISA and PPACA notices and language into a simplified easy-tounderstand ERISA Compliance Feature Pack to distribute to your employees. You can download, complete and distribute copies of the Notices to your Plan Participants from www. tasconline.com/microbusiness-service-offerings. If you sponsor Group insurance or any Group-sponsored health and welfare benefit, your ERISA and PPACA reporting requirements are much more stringent and go beyond the information contained within our Feature Pack. TASC can help you meet these additional requirements and avoid hefty Department of Labor penalties and fines with its Microbusiness Compliance Suite services. Please contact your TASC Provider or Regional Sales Director; or contact a Microbusiness Specialist at extension for more information. 7. HIPAA Compliance Provisions under the Health Insurance Portability and Accountability Act of 1996 (HIPAA) are applicable to your Plan. 8. Marketplace Notices As of October 1, 2013, there is a new way to buy health insurance: the Health Insurance Marketplace. In compliance with the Affordable Care Act as it concerns new Health Insurance Exchanges, employers must complete the appropriate Model Notice and distribute it to the following: All employees (regardless of enrollment, part-time, or full-time status) COBRA Participants New hires within 14 days of employee start date. 6 Microbusiness Quick Start Guide *Applies to all Plan designs.

7 QSEHRA Small Business HRA Follow these simple steps to set up and operate your Plan. For more information refer to the Client Administration Manual. Find the electronic documents referenced below at Please Note: In December 2016, The Cures Act and H.R. 34 containing provisions that establish Qualified Small Employer HRAs (QSEHRA) overturned guidance issued in IRS Notice and once again allows employers with fewer than 50 employees to utilize HRAs as a pre-tax health & welfare benefit without sponsoring Group insurance. In fact, the employer may not sponsor or offer Group insurance to any employee in order to offer a QSEHRA. In addition to the asterisked items for a One Employee Plan (see Page 3), additional requirements apply in order to keep your Plan compliant and retain TASC s Audit Guarantee: 5) Distribute 90-Day Notice An employer must provide all eligible employees a 90-Day Notice within 90 days of the original Plan start date. For renewing Plans, the employer must provide this notice 90 days prior to Plan start date. 6) Minimum Essential Coverage (MEC) Notice The employer must obtain certification from eligible employees as to whether or not they have Minimum Essential Coverage as defined by the ACA. 7) HIPAA Compliance Provisions under the Health Insurance Portability and Accountability Act of 1996 (HIPAA) are applicable to your Plan. 1) Written Plan Document* A written Plan Document must be in place and officially adopted by the employer in order to provide pre-tax benefits under a Health Reimbursement Arrangement (Section 105). TASC keeps your Plan Document on file should the need ever arise where you are required to produce this documentation. 2) Distribute a Summary Plan Description The Summary Plan Description (SPD) lists benefits, elections, eligibility requirements, and other terms and conditions of your Plan. Download and complete your Summary Plan Description. Verify the information to ensure that your Plan is set up correctly, and then distribute a copy to every Participant on your Plan. 3) Adhere to Employer Contribution Limits Employer annual contributions are capped at $4,950 for a single employee and $10,000 for an employee with a family. These numbers will be indexed annually for inflation. QSEHRA Plan Administration: A QSEHRA Employee Plan DOES NOT REQUIRE: A Summary of Benefits & Coverage. Patient-Centered Research Outcome Institute (PCORI) Fee and IRS Excise Tax Form 720 filing. Marketplace Notices. ACA Reporting of Minimum Essential Coverage to the IRS and covered employees using IRS Tax Forms 1094-B and 1095-B. In addition, your Plan is NOT subject to: Employee Retirement Income Security Act (ERISA). The Consolidated Omnibus Budget Reconciliation Act (COBRA) 4) 90-Day Employee Eligibility Requirement The QSEHRA has a 90-day maximum enrollment waiting period for all eligible employees. Microbusiness Quick Start Guide 7

8 TOTAL ADMINISTRATIVE SERVICES, INC International Lane, Madison, WI fax The information in this communication is confidential and may be used by the authorized recipient only, for its intended purpose only. Any other use or disclosure is prohibited. AB