Cory Jorbin, Esq.

That time of the year is nearly upon us — Open Enrollment 2018. With the influx of state and federal government regulations, it’s becoming tougher to stay on top of all the changes to ACA and additional healthcare laws, with employer-related responsibilities becoming more and more complex.

Now is the time to prepare for the upcoming open enrollment period, and make sure your organization is mitigating risks and avoiding costly fines. Here are some of the most common themes for this year’s open enrollment period that every employer should take into account:

1. Affordability of contributions

The ACA’s affordability contribution has posed one of the main challenges during open enrollment since the original percentage of 9.5% was established in 2014. Employer-sponsored coverage is considered “affordable” if and only if an employee’s contribution does not exceed 9.56%. Since it took effect, the rate has continued to rise at a gradual pace , but for 2018, the affordability percentage has been revised down from 9.69% to 9.56%. For employers who may have been used to the previous percentage, and may have been passing rates on to employees, some changes may need to be made within their current structure.

2. Opportunity to enroll

It’s critical that communication be clear to employees about their opportunity to enroll. This will cover the bases for providing coverage to all those who qualify. To ensure that these communications are clear and straightforward, make sure your enrollment opportunities are accessible to all, and distributed on platforms that employees will engage with and understand.

3. Possibility of opt-out payments

Some companies are choosing to offer opt-out payments to employees who choose to decline medical coverage (e.g., those who are included under their spouses’ plans). Employers offer this as a “benefit” to people who would rather receive a payment than opt in for coverage. Unless the limited exception applies, this may impact plan affordability.

4. Waiver forms

From a compliance perspective, it could be beneficial to issue waiver forms to employees who choose to opt out of healthcare coverage. Although waiver forms are not required by law, documentation to demonstrate an employee’s choice to waive coverage is recommended.

5. Grandfathered health plans

While there aren’t many grandfathered health plans left since the ACA came into existence in 2010, it’s important for grandfathered plans to notify participants that their plans still retain this status. Before you send these notices out, be sure that this status is still accurate, because small contribution changes can result in the loss of the grandfathered status.

6. Summary of Benefits and Coverage

Every plan administrator is required to provide a Summary of Benefits and Coverage (SBC) to employees at the time of enrollment or re-enrollment. For plans beginning open enrollment after 4/1/17, the new template must be used. Overall, the changes are designed to improve readability for consumers. The new templates include more information about cost sharing, such as enhanced language to explain deductibles and a requirement that plans address individual and overall out-of-pocket limits in the SBC. These improvements reflect input from consumer groups, the National Association of Insurance Commissioners, and other stakeholders.

7. Notice distribution

As the previous points demonstrate, there are many notices that have to be distributed before and during open enrollment. Given the number of such notices, it can make the process confusing for employees. Thus, it is crucial that employers find effective ways to communicate these notices, ensuring compliance in turn.

While it may be easier and less expensive to issue electronic notices to employees, it is important to be aware of the related rules. The general rule for disclosure of ERISA documents is that they must be furnished in a manner reasonably calculated to ensure actual receipt of the document by the intended recipient. Below is an outline of what to consider when sending the required notices:

With notices for which no consent is needed, ensure that:

a. The participant has the ability to access documents furnished in electronic form at any location where the participant is reasonably expected to perform his or her duties as an employee; and

b. Accessing the electronic information system is an integral part of the participant’s duties as an employee.

With notices for which consent is needed, ensure that:

a. The intended recipient has affirmatively consented to receive the documents electronically and has not withdrawn the consent;

b. For documents to be furnished using the internet, the intended recipient has affirmatively consented, or confirmed consent, electronically and in a manner that reasonably demonstrates the individual’s ability to access information in the electronic form that will be used and has provided an address for the receipt of such information; and

c. Prior to consent, the target individual receives a clear and conspicuous statement explaining the following:

The types of documents to which the consent applies; That consent can be withdrawn at any time without charge; The procedures for withdrawing consent and for updating the address for receipt of electronic documents; and The right to a paper version of an electronically furnished document, and whether there will be a charge for the paper version. Despite the attempts at instituting other healthcare plans, the ACA remains the law of the land, and thus it is important to understand and comply with its regulations. Ensuring compliance is key for ensuring the future success of your business.

If you have any questions about maintaining compliance during Open Enrollment 2018, or to learn how HUB can help, please contact me at cory.jorbin@hubinternational.com.

Cory Jorbin, Esq.

Greater Phoenix Area 2K followers 500+ connections

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Experience

HUB International

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Education

Cleveland State University - Cleveland-Marshall College of Law

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