WASHINGTON—The House Ways and Means Committee is expected to vote on and pass legislation that would overturn an unpopular provision in the health care reform law that restricts the use of flexible spending accounts and health savings accounts to reimburse employees for over-the-counter medications.
Under that provision, FSA reimbursement is permitted only if the employee obtains a prescription for the medication, while in the case of HSAs, OTC reimbursement is permitted without a prescription, but a 20% federal tax is imposed on the distribution.
The bill, H.R. 5842, to be considered Thursday by the committee, would eliminate the OTC restrictions in the Patient Protection and Affordable Care Act of 2010.
The restrictions are very unpopular among employers. Sixty-two percent of employers responding to a Midwest Business Group on Health survey said they favored repeal of the provision, which made it the second most unpopular health care reform law provision among respondents. The most unpopular was the provision, effective in 2013, that will place a $2,500 annual cap on FSA contributions.
To view the original artcile click here
Wednesday, May 30, 2012
Tuesday, May 22, 2012
Regulators Provide Additional Guidance on SBC's
Adding additional certainty to previous guidance, federal regulators made clear that they will not impose financial penalties on employers that do not fully comply with health care reform law requirements that will require them to distribute to employees a new summary of benefits and coverage statement.
In February, the Obama administration delayed by six months the requirement to distribute to employees the new summary of benefits and coverage statement.The requirement will go into effect for plan years that begin on or after Sept. 23, 2012. For example, if a plan year begins on Jan. 1, 2013, and the employer's open enrollment period is from Oct. 1 to Nov. 1, the new SBC would have to be available by Oct. 1, 2012.At the time, regulators said they did not “intend” to impose penalties during the first year the requirement is in effect so long as employers are working in “good faith” to comply.In the latest guidance, released as part of frequently asked questions and answers, regulators said during the first year the requirement is in effect agencies “will not impose penalties on plans and issuers that are working diligently and in good faith to comply.”Benefit experts welcome the latest clarification.
To view the FAQ's click here and here
To view the sample template of the SBC click here
In February, the Obama administration delayed by six months the requirement to distribute to employees the new summary of benefits and coverage statement.The requirement will go into effect for plan years that begin on or after Sept. 23, 2012. For example, if a plan year begins on Jan. 1, 2013, and the employer's open enrollment period is from Oct. 1 to Nov. 1, the new SBC would have to be available by Oct. 1, 2012.At the time, regulators said they did not “intend” to impose penalties during the first year the requirement is in effect so long as employers are working in “good faith” to comply.In the latest guidance, released as part of frequently asked questions and answers, regulators said during the first year the requirement is in effect agencies “will not impose penalties on plans and issuers that are working diligently and in good faith to comply.”Benefit experts welcome the latest clarification.
To view the FAQ's click here and here
To view the sample template of the SBC click here
Monday, April 30, 2012
HSA Limits Announced for 2013
The IRS has issued the cost of living contribtuion and coverage adjustments for 2013. They are as follows:
2013 Individual Deductible: $3250
2013 Family Deductible: $6450
2013 Catch Up Contrib: $1000
2013 Maximum Out-of-Pocket Amounts: $6250 (ind) / $12,500 (fam)
2013 Minimum Deductible Amounts: $1250 (ind) / $2500 (fam)
To view the IRS release click here
2013 Individual Deductible: $3250
2013 Family Deductible: $6450
2013 Catch Up Contrib: $1000
2013 Maximum Out-of-Pocket Amounts: $6250 (ind) / $12,500 (fam)
2013 Minimum Deductible Amounts: $1250 (ind) / $2500 (fam)
To view the IRS release click here
Monday, April 23, 2012
IRS Proposed Rule on Comparative Effectivness Fee
Proposed Internal Revenue Service regulations would resolve numerous questions employers and others have raised about a fee that is to be imposed on health care plans issued by insurers and self-funded employers.
That fee—mandated by the health care reform law to fund research on medical outcomes—will be $1 per plan participant for the first plan year ending after Sept. 30, 2012, and $2 per participant in succeeding years. For plan years starting after Sept. 30, 2014, the fee would be indexed to reflect the percentage increase in national medical expenditures as published by the Department of Health and Human Services.The fee is to be paid annually by July 31 of the next plan year. Many questions have been raised about the fees and to which type of health plans they would apply. “This has been on employers' 2012 health care reform radar screen,” said Andy Anderson, a partner with Morgan, Lewis & Bockius L.L.P. in Chicago.
For example, the proposed regulations that the IRS issued Thursday make clear that the fee would be imposed on retiree-only health care plans, even though such plans are largely exempt from the health care reform law.In addition under the proposed rules, an employer with a health reimbursement arrangement linked to a self-funded high-deductible health care plan would be liable for the fee only for participants in its plan. It would not pay a second fee for participants in the HRA. On the other hand, the fee would be imposed on HRAs if the arrangement were linked to an insured health care plan. In that situation, the employer would be liable for the fee covering participants in the HRA, while the insurer would be liable for the fee on the insured plan.In short, “there will be two fees to be paid,” said Rich Stover, a principal with Buck Consultants L.L.C. in Secaucus, N.J.The proposed regulations also give examples of methodologies that health plan sponsors could use to determine the number of participants in their health care plans for calculating the amount of the fee they would owe.
To view the full article click here
That fee—mandated by the health care reform law to fund research on medical outcomes—will be $1 per plan participant for the first plan year ending after Sept. 30, 2012, and $2 per participant in succeeding years. For plan years starting after Sept. 30, 2014, the fee would be indexed to reflect the percentage increase in national medical expenditures as published by the Department of Health and Human Services.The fee is to be paid annually by July 31 of the next plan year. Many questions have been raised about the fees and to which type of health plans they would apply. “This has been on employers' 2012 health care reform radar screen,” said Andy Anderson, a partner with Morgan, Lewis & Bockius L.L.P. in Chicago.
For example, the proposed regulations that the IRS issued Thursday make clear that the fee would be imposed on retiree-only health care plans, even though such plans are largely exempt from the health care reform law.In addition under the proposed rules, an employer with a health reimbursement arrangement linked to a self-funded high-deductible health care plan would be liable for the fee only for participants in its plan. It would not pay a second fee for participants in the HRA. On the other hand, the fee would be imposed on HRAs if the arrangement were linked to an insured health care plan. In that situation, the employer would be liable for the fee covering participants in the HRA, while the insurer would be liable for the fee on the insured plan.In short, “there will be two fees to be paid,” said Rich Stover, a principal with Buck Consultants L.L.C. in Secaucus, N.J.The proposed regulations also give examples of methodologies that health plan sponsors could use to determine the number of participants in their health care plans for calculating the amount of the fee they would owe.
To view the full article click here
Monday, April 2, 2012
Express Scripts Closes Medco Acquisition .
Expess Scripts Inc. said it completed its $29.1 billion acquisition of Medco Health Solutions Inc. after the Federal Trade Commission determined that the combination of the two largest pharmacy-benefits management companies in the U.S. wouldn't stunt competition in the sector.
The FTC in a majority vote of 3-1 decided that the deal wouldn't change dynamics in the PBM market, ending an eight-month investigation. In a statement the panel said its probe found a "competitive market for PBM services characterized by numerous, vigorous competitors who are expanding and winning business from traditional market leaders."
The probe also showed that Express Scripts and Medco "are not particularly close competitors, the market today is not conducive to coordinated interaction, and there is little risk of the merged company exercising monopoly power," the FTC said.
In a dissenting opinion, FTC Commissioner Julie Brill called the merger "a game changer" and stated, "I have reason to believe that this merger is, in fact, a merger to duopoly with few efficiencies in a market with high entry barriers--something no court has ever approved."
Ms. Brill called on the commission to conduct a retrospective study on the merger in three years' time.
To view the entire article click here.
The FTC in a majority vote of 3-1 decided that the deal wouldn't change dynamics in the PBM market, ending an eight-month investigation. In a statement the panel said its probe found a "competitive market for PBM services characterized by numerous, vigorous competitors who are expanding and winning business from traditional market leaders."
The probe also showed that Express Scripts and Medco "are not particularly close competitors, the market today is not conducive to coordinated interaction, and there is little risk of the merged company exercising monopoly power," the FTC said.
In a dissenting opinion, FTC Commissioner Julie Brill called the merger "a game changer" and stated, "I have reason to believe that this merger is, in fact, a merger to duopoly with few efficiencies in a market with high entry barriers--something no court has ever approved."
Ms. Brill called on the commission to conduct a retrospective study on the merger in three years' time.
To view the entire article click here.
Friday, March 30, 2012
Experts Agree: Healthcare Vote Stands or Falls with Kennedy's Vote
It is widely beleived that eight of the nine supreme court votes are virutally set in stone on the constititionality of the indivdual mandate required by healthcare reform. Four votes to uphold the law and four votes to strike it down.
The swing vote is to be cast by Justice Anothony M. Kennedy. Below is a link to an article that thoughtfully explains what makes this decision for Justice Kennedy a difficult one.
Click here for the New York Times article.
The swing vote is to be cast by Justice Anothony M. Kennedy. Below is a link to an article that thoughtfully explains what makes this decision for Justice Kennedy a difficult one.
Click here for the New York Times article.
Monday, March 26, 2012
Early Aruguments Indicate Supreme Court Will Rule This Year on Healthcare Reform
The U.S. Supreme Court opened its historic arguments on President Barack Obama’s health-care overhaul with several justices suggesting they are prepared to rule this year rather than wait for the law to take full effect.
Justices including Stephen Breyer and Ruth Bader Ginsburg today suggested they didn’t view an 1867 law as barring them from ruling immediately on the central question, the law’s requirement that Americans either get insurance or pay a penalty. The 1867 law blocks lawsuits over taxes that haven’t been imposed, and Ginsburg questioned whether health-care penalties would be taxes.
“This is not a revenue-raising measure,” Ginsburg said. “If it’s successful, nobody will pay the penalty and there will be no revenue to raise.”
The court is hearing three days of arguments on the 2010 law, Obama’s biggest legislative achievement. Its decision will determine the fate of a measure designed to extend insurance to about 32 million people and revamp an industry that accounts for 18 percent of the U.S. economy. The court probably will rule by late June, months before the November presidential election.
The six hours of planned debate is the most on a case in 44 years. The justices tomorrow will consider the main issue: whether the government had power to enact the health-care law under its constitutional authority to regulate interstate commerce.
To view the entire article click here
Justices including Stephen Breyer and Ruth Bader Ginsburg today suggested they didn’t view an 1867 law as barring them from ruling immediately on the central question, the law’s requirement that Americans either get insurance or pay a penalty. The 1867 law blocks lawsuits over taxes that haven’t been imposed, and Ginsburg questioned whether health-care penalties would be taxes.
“This is not a revenue-raising measure,” Ginsburg said. “If it’s successful, nobody will pay the penalty and there will be no revenue to raise.”
The court is hearing three days of arguments on the 2010 law, Obama’s biggest legislative achievement. Its decision will determine the fate of a measure designed to extend insurance to about 32 million people and revamp an industry that accounts for 18 percent of the U.S. economy. The court probably will rule by late June, months before the November presidential election.
The six hours of planned debate is the most on a case in 44 years. The justices tomorrow will consider the main issue: whether the government had power to enact the health-care law under its constitutional authority to regulate interstate commerce.
To view the entire article click here
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