- if the employer makes contributions because a court has ordered it to do so, the employer must make the reimbursements itself and not by providing funds to the city;
- employers that impose surcharges on customers to provide funds they can use to cover the reimbursements must use the full amount collected through the surcharges for that purpose;
- employers must provide written account summaries to employees 15 days after a quarterly contribution is made;
- employers must provide written notice about account balances to employees who leave their jobs within three days of termination;
- employers must allow reimbursements up to 90 days after employment ends; and
- employers must post notifications from the city about the law.
After reviewing the rate, independent experts determined the choice of assumptions the company based its rate increase on reflected national data rather than reliable and available state data. These assumptions resulted in an unreasonably high premium in relation to the benefits provided..“We have called on this insurer to immediately rescind the rate, issue refunds to consumers or publicly explain their refusal to do so,” said Steve Larsen, director of the HHS Center for Consumer Information and Insurance Oversight. Learn more about rate reviews. Rate review does not apply to grandfathered plans, and the acceptable rate of inflation will be allowed to vary from state to state. Starting September 2011, health insurance companies must inform individual or small group policyholders of premium increases of 10 percent or more. The same ACA provisions require insurers to give small businesses a written explanation of the increase and the factors contributing to it, the HHS official for consumer information and insurance oversight says here. The Indiana-based financial services company has 10 days to change its rate or post an explanation on its website.
- Health FSAs are not always subject to COBRA. Generally, an overspent health FSA is not subject to COBRA. Health FSA COBRA coverage only lasts through the end of the current plan year.
- Health FSAs can cover adult children. Because of the Patient Protection and Affordable Care Act (PPACA), participants can cover their adult children on a health FSA until the year in which the children turn age 27.
- You can save on orthodontia. Typically, an orthodontist provides a discount if payment is up front, instead of month to month. Health FSAs may now reimburse orthodontia expenses when paid, instead of when they are incurred.
- Dependent care expenses are a no-brainer. Dependent care expenses are usually a fixed cost that easily exceeds the $5,000 FSA limit in a year, even for just one child. Tax-free reimbursement makes a lot of sense.
- Debit cards make it even easier. Debit card auto-substantiation rates are usually over 90 percent, virtually eliminating the hassle of keeping receipts and waiting for reimbursement.
- Insurance product choices for a given ZIP code, sorted by out-of-pocket limits, average cost per enrollee, monthly premiums, etc.
- A summary of cost and coverage for small group products that shows the available deductibles, range of copay options, included and excluded benefits, and benefits available for purchase at additional cost.
- A filter that lets you selection products based on whether the plans are health savings account eligible, have prescription drug, mental health, or maternity coverage, or allow for domestic partner or same sex coverage.
Required minimum distributions (RMDs) generally are amounts that must be distributed from a participant’s plan account beginning in the later of the year that the participant reaches age 70½ or retires. The Worker, Retiree, and Employer Recovery Act of 2008 (WRERA) permitted plans to suspend RMDs for 2009 and allowed 2009 RMDs to be treated as eligible rollover distributions. DC plans must be amended by the last day of the 2011 plan year (for example, Dec. 31, 2011 for calendar year plans) to reflect whether the plan suspended 2009 RMDs and whether the plan treated 2009 RMDs as eligible rollover distributions. IRS Notice 2009-82 provides sample language for plan amendments related to 2009 RMDs.2) In-plan Roth conversions
The Small Business Jobs Act of 2010 (SBJA) permits plans to allow participants to convert tax-deferred contributions to Roth contributions within the plan. DC plans that permit in-plan Roth conversions must be amended by the last day of the plan year in which the amendment is effective or Dec. 31, 2011. See IRS Notice 2010-84 for more information.3) Discretionary amendments
Discretionary amendments to implement plan design changes made during the 2011 plan year generally must be adopted by the last day of the 2011 plan year (for example, Dec. 31, 2011 for calendar year plans). In addition, amendments to implement certain plan design changes for the 2012 plan year may need to be adopted by the end of the 2011 plan year, such as amendments to implement automatic enrollment or to reduce the amount of the employer’s matching or profit sharing contributions.Defined Benefit Plans An employer should keep in mind the following matters involving defined benefit (DB) plans. 4) Benefit restrictions based on plan funding
Final regulations under Code Section 436 were published in October 2009 and provide guidance on certain funding-based restrictions on benefit accruals and distributions for defined benefit plans. Amendments to implement the final regulations are required by the last day of the 2011 plan year (for example, Dec. 31, 2011 for calendar year plans). This deadline may be extended as the IRS has indicated its intent to issue a model plan amendment, which has not yet been published as of early November 2011. See Notice 2010-77 .5) Extended deadline for cash balance/hybrid plans
Both final and proposed regulations applicable to cash balance/hybrid plans were published in October 2010. The regulations include many requirements, such as three-year vesting schedules, protections against benefit reductions based on age and standards for setting interest credits at a rate not greater than the market of return. The deadline for amendments to implement the regulations had been the last day of the 2011 plan year. However, the IRS recently extended the deadline to the last day of the plan year before the plan year that the 2010 regulations are finalized and applicable to the plan. See Notices 2010-77 and 2011-85 for more information.6) Discretionary amendments
As with defined contribution plans, discretionary amendments to implement plan design changes made during the 2011 plan year and to implement certain changes for the 2012 plan year must be adopted by the last day of the 2011 plan year (for example, Dec. 31, 2011 for calendar year plans).Determination Letter Filings All individually designed qualified retirement plans should be submitted to the IRS for a determination on the plan’s qualified status following a fixed five-year filing cycle. Employers with an Employer Identification Number (EIN) that ends in “1” or “6” should plan to submit an on-cycle Cycle A determination letter application by Jan. 31, 2012. The IRS recently published revised forms and instructions that must be used for Cycle A filings. See Revenue Procedure 2011-6 for more information. Todd Solomon is contributing editor for the Employer’s Handbook: Complying With IRS Employee Benefits Rules.