Capitol Benefits Group News & Updates
Requirement to Post Machine-readable Files Begins July 1, 2022
Requirement not applicable to grandfathered plans, excepted benefits and account-based plans, such as HRAs, FSAs and HSAs
The Transparency in Coverage Final Rules (TiC Final Rules) require group health plans and health insurance issuers to disclose on a public website detailed pricing information in three separate machine-readable files (MRFs). Specifically, the following information must be disclosed:
First file: In-network provider negotiated rates for covered items and services (the "In-network Rate File");
Second file: Historical payments to and billed charges from out-of-network providers (the "Allowed Amount File"); and
Third file: In-network negotiated rates and historical net prices for covered prescription drugs (the "Prescription Drug File")-this particular MRF requirement is delayed until further notice.
The files must be publicly available and accessible free of charge without any restrictions. Employers should coordinate with their carriers and TPAs, and confirm whether written agreements addressing MRFs are in place, to ensure the files will be available by the applicable deadline.
Specific to fully insured health plans, the regulatory guidance specifically indicates that if the employer has something in writing from the carrier indicating that the carrier is posting the information, then the employer does not need to take further action.
Capitol Benefits Group is unaware of any insurer that isn’t carrying out these responsibilities for its fully-insured client base. That said—if you are a sponsor of a level-funded or self-funded plan and need more information as to how your Third Party Administrator might be supporting your compliance efforts, please feel free to reach out directly to your broker representative for more information.
PCORI Fees Due Aug. 1, 2022
The Fee is $2.79 per Covered Life for Plan Years Ending on or After Oct. 1, 2021, and Before Oct. 1, 2022
The Affordable Care Act (ACA) requires health insurance issuers and self-insured plan sponsors to pay Patient-Centered Outcomes Research Institute fees (PCORI fees). Issuers and plan sponsors are generally required to pay the PCORI fees annually by July 31 of each year. However, the PCORI fee payment for plan years ending in 2021 is due Aug. 1, 2022, since July 31, 2022, is a Sunday.
The fees are reported and paid annually using IRS Form 720 (Quarterly Federal Excise Tax Return). In general, the PCORI fees are assessed, collected and enforced like taxes. The PCORI fee applies separately to "specified health insurance policies" and "applicable self-insured health plans," and is based on the average number of lives covered under the plan or policy.
Using Part II, Number 133 of Form 720, issuers and plan sponsors are required to report the average number of lives covered under the plan separately for specified health insurance policies and applicable self-insured health plans. That number is then multiplied by the applicable rate for that tax year ($2.66 for plan years ending on or after Oct. 1, 2020, and before Oct. 1, 2021, or $2.79 for plan years ending on or after Oct. 1, 2021, and before Oct. 1, 2022). The fees for specified health insurance policies and applicable self-insured health plans are then combined to equal the total tax owed.
Reminder: Form 5500 Is Due by Aug. 1, 2022 for Calendar Year Plans for Large Plans
Employers May Extend Deadline By Filing IRS Form 5558
Employers with employee benefit plans that operate on a calendar year basis must file their annual reports (Forms 5500) for 2021 with the Department of Labor by Aug. 1, 2022. An employer may extend this deadline by two and one-half months (until Oct. 17 2022) by filing IRS Form 5558 by Aug. 1, 2022.
Typically, the Form 5500 is due by July 31st for calendar year plans, with an extension deadline of Oct. 15th, but if the filing due date falls on a Saturday, Sunday or federal holiday, it may be filed on the next business day.
An employer must file a Form 5500 for each separate employee benefit plan that it maintains, unless a filing exemption applies. Welfare benefit plans are exempt if they are unfunded or fully insured and have fewer than 100 plan participants.
Employers with calendar year plans that do not qualify for the filing exemption should work with their service providers to complete their Form 5500 and file it by Aug. 1, 2022. Employers that need extra time should file Form 5588 by Aug. 1, 2022.
IRS Raises Standard Mileage Rates for Second Half of 2022
Change Is a Result of Gas Price Increases
For the first time since 2011, the IRS has made a mid-year adjustment to the optional mileage rate used to calculate the deductible costs of operating an automobile for business and certain other purposes. The agency said the change is in recognition of recent gasoline price increases.
Rate Increase
In Announcement2022-13, released June 9, 2022, the IRS increased the standard mileage rate for the final six months of 2022, starting July 1. During that period, the standard mileage rate for business travel will be 62.5 cents per mile, up four cents from the rate effective at the start of the year.
The new rate for deductible medical or moving expenses (available for active-duty members of the military) will be 22 cents for the remainder of 2022, up four cents from the rate effective at the start of 2022.
The rate for charitable organizations is set by statute and will remain unchanged at 14 cents per mile.
Background
The optional business standard mileage rate is used to compute the deductible costs of operating an automobile for business use, in lieu of tracking actual costs. It is based on the fixed and variable costs of operating an automobile, such as fuel, depreciation and insurance. The rate is also used as a benchmark by the federal government and businesses to reimburse their employees for mileage.
Taxpayers always have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates.
DOL Issues Guidance on FMLA and Mental Health Conditions
Mental Health Conditions Can Be FMLA Serious Health Conditions
The Wage and Hour Division of the U.S. Department of Labor (DOL) has released new resources on workers' rights to leave for mental health conditions under the federal Family and Medical Leave Act (FMLA). In a press release, the DOL said it published the new guidance in recognition of Mental Health Awareness Month.
New DOL Fact Sheet and FAQs
The new guidance includes:
Frequently asked questions (FAQs) on the FMLA's mental health provisions
Mental Health as a Serious Health Condition
An eligible employee may take FMLA leave for their own serious health condition or to care for a spouse, child or parent because of their serious health condition.
The new resources make clear that mental health conditions are considered serious health conditions under the FMLA if they require inpatient care or continuing treatment by a health care provider, such as an overnight stay in a treatment center for addiction or continuing treatment by a clinical psychologist. Chronic conditions such as anxiety, depression, or dissociative disorders that cause occasional incapacitated periods and require treatment at least twice a year fall under the "continuing treatment" definition.
The FAQs provide additional examples of situations that qualify for FMLA leave, including treatment sessions for anorexia nervosa and caring for an adult child whose mental health condition is a disability under the Americans with Disabilities Act.
Webinar Archive
Employers often find it challenging to keep track of their obligations under the FMLA. Employers can avoid common problems by understanding the FMLA's leave requirements and implementing the correct administrative procedures.
During this webinar, we will provide a step-by-step overview of the FMLA's requirements to help employers stay in compliance with the law.
Watch Last Month’s Webinar HERE