Scott Morrison Jr Health Policy Analyst California Department of Human Resources CalHR Introduction The ACA was enacted in March 2010 to ensure that all Americans have access to quality and affordable health care ID: 702281
Download Presentation The PPT/PDF document "Patient Protection and Affordable Care A..." is the property of its rightful owner. Permission is granted to download and print the materials on this web site for personal, non-commercial use only, and to display it on your personal computer provided you do not modify the materials and that you retain all copyright notices contained in the materials. By downloading content from our website, you accept the terms of this agreement.
Slide1
Patient Protection and Affordable Care Act (ACA)
Scott Morrison Jr.
Health Policy Analyst
California Department of Human Resources (CalHR)Slide2
Introduction
The ACA was enacted in March
2010 to ensure that all Americans have access to quality and affordable health care.
It includes many
employer-administered provisions
that
impact the State of California, such as:
Employer Notification Requirements
Employer Shared Responsibility Provisions
Annual Information Reporting to the
Internal Revenue Service (IRS)
and Employees
Affordable Care Act System (ACAS) and Compliance ReviewsSlide3
Employer Notification Requirements
Health Insurance Marketplace Coverage Options and Employee Health Coverage Notice
Provides information about the Health Insurance Marketplace and premium tax credits available to qualified individuals to help pay for their health coverage, for example if they are not offered affordable coverage from their employer, etc.
Identifies employees and dependents eligible for state-sponsored health coverage.
Notice must be issued to all new employees within 14 days of their hire, regardless of their health benefits eligibility. State may be subject to penalties for failure to provide notice timely.
CalHR PML #2013-030Slide4
Employer Notification Requirements
2
Summary of Benefits and Coverage
Notice
Notice provides links and contact information to the health plans available to eligible state employees to assist them in making informed decisions.
Notice
must be
provided to employees, those newly eligible for health benefits, no later than the first day the employee is eligible to enroll in coverage.
CalHR PML #2014-038Slide5
Employees
eligible for state-sponsored health
coverage include:
Permanent Full-Time;
Permanent
Part-Time
, if appointed half-time or more;
Permanent
Intermittent
, after working >480 hours in a Control Period;Limited-Term of more than 6 months, Full-Time; and,Limited-Term of more than 6 months; Part-time, only if appointed to time base of half-time or more.Note: Temporary and Limited-Term Intermittent employees are not eligible, regardless of their hours of work.
Health Benefits EligibilitySlide6
Dependents
eligible
for
state-sponsored health coverage include:
Employee’s spouse
or registered domestic partner;
Employee’s children
(including adopted, step, or registered domestic partner's children) up to age 26;
Disabled adult children of any age if they were enrolled prior to age 26; and, Children up to age 26 for whom the employee has assumed a parent-child relationship and is considered the primary care parent. Health Benefits Eligibility Slide7
The Checklist documents
the distribution
dates
of the
Health Insurance Marketplace
Coverage Options
and Health Coverage Notice
and Summary of Benefits of Coverage
Notice,
if applicable. The state may be subject to penalties for failure to provide these notices timely. CalHR PML #2014-038Affordable Care Act Notification ChecklistSlide8
Requires
the state to offer “affordable” health coverage that provides “minimum value” to at least 95%
of its federally defined
full-time employees (those
who average
130 or more
hours of service
per month), and their dependent children.
All
state departments and entities are considered one employer for purposes of the Employer Shared Responsibility provisions.Employer Shared Responsibility ProvisionsSlide9
“Affordable” and “Minimum Value” Coverage
Affordable Coverage
– Employee’s contribution for self-only coverage for the lowest cost plan available to employee,
does not
exceed 9.69 percent* (in 2017) of the employee’s monthly salary or the employee’s wages as reported on Form W-2, Box 1 for the calendar year, or the annual federal poverty level, divided by twelve for single-member household (for applicable calendar year).
Minimum Value
- If the plan covers at least 60% of total allowed costs of benefits provided under the plan.
*The affordability threshold is subject to annual inflation. Slide10
Annual Information Reporting
To demonstrate compliance with the Employer Shared Responsibility Provisions, the state must:
Provide an
annual
statement (Form
1095-C) to its full-time employees, by January
31 (March 2 for 2017),
with
information about
the health coverage offered, if any, the employee and their dependents for each month during the preceding calendar year.
File annual
reports with the IRS
, by March 31, with
information
about the
health coverage
offered, if any, to its full-time employees and
their
dependents for each month during the preceding calendar year. Slide11
The Affordable Care Act System (ACAS) Database
Database developed for departmental HR offices to track the various health benefit status data (e.g., offer of health coverage, accept, or declination) the state is required to report to the IRS and its full-time employees to demonstrate compliance under the ACA.
The ACAS database is the state’s system of record for reporting data to the IRS.
SCO Personnel Letters #14-021, #15-001, and #16-005
Where Does the Data for Reporting Come From?Slide12
Departments are responsible for accurate and timely entry of an employee’s health benefit status information in the ACAS database.
All relative health
benefit status
data for employees must
be entered in the ACAS database in the pay period in which they are effective.
The
integrity of the data captured in the ACAS is critical to the state’s ability to demonstrate compliance.
The Role of HRSlide13
Form 1095-C Slide14
ACAS Health Benefit Status Codes
Health Benefits Offered
1A- Health benefits
offered
to the employee, the employee's spouse and all eligible dependents
.
The
effective
date must reflect the first day of the month following the employee's qualifying appointment.1C- COBRA continuation health coverage was offered to an "active" employee (not permanently separated) due to a COBRA qualifying event. The effective date must reflect the first day of the month following the cancellation of employee's health coverage. Slide15
ACAS Health Benefit Status Codes2
Health
Benefits Not Offered
2A- Health benefits not offered to
employee
since the employee does not meet the
state’s health benefit eligibility
criteria
.
The effective date must reflect the date of the employee's appointment.2B- Health benefits not offered to a Permanent Intermittent employee since the employee must first qualify for health benefits during a qualifying Control Period. The effective date must reflect the date of the employee’s appointment or the first date following a control period where they did not meet the hour criteria.Slide16
Health Benefits Not Offered Continued…
2D-
Health benefits not offered to employee because employee is in a waiting period for new hires or newly eligible.
The effective date must reflect the date of the employee’s qualifying appointment
, or
the first date following a control
period
where they
did meet the criteria.ACAS Health Benefit Status Codes3Slide17
Health Benefits Offer Accepted
3A- Employee accepted the offer of coverage
within
60 days of his/her permitting event.
The effective date must reflect the first
day of the month
in which
the employee's health
coverage
was effective. 3B- Employee accepted the offer of coverage after 60 days of his/her permitting event. (Late enrollment - employee must first serve a 90-day HIPAA waiting period.) The effective date must reflect the first day of the month following the 90-day waiting period, in which the employee's health coverage was effective. ACAS Health Benefit Status Codes4 Slide18
Health Benefits Declined
4A- Employee declined health benefits for self, spouse and/or eligible dependents within 60 days of his/her permitting event
.
The effective date must reflect the same date as the
effective
date of the employee's 1A status code.
4B- Employee
failed to return his/her health benefit enrollment documents
within 60 days of his/her permitting event (an administrative decline is documented). The effective date must reflect the 61st calendar day after the permitting event date. ACAS Health Benefit Status Codes Slide19
Health Benefits Cancelled
5A- Health benefits administratively cancelled due to loss of eligibility
.
5B- Health benefits voluntarily cancelled by the employee.
5C-
Health benefits temporarily suspended
because
the employee is temporarily separated or placed on unpaid status
.
5D- Health benefits cancelled due to permanent separation, disability retirement, or lay-off. The effective date for all cancellation codes must reflect the last day of the month in which the employee's health coverage was effective. ACAS Health Benefit Status Codes5 Slide20
ACAS Home Page Slide21
Exercise 1
New
Permanent Full-Time
employee appointed
2/15/2015
Returns paperwork
to
enroll
in
health benefits immediatelySlide22
IMPORTANT: Be sure to key in a Health Coverage Notice Date with an effective date within 14-days of the employee’s hire date and a 2D code (employee is newly eligible for health benefits), effective the date of the employee’s hire date.
Exercise
1-
New Permanent Full-Time Employee Appointed
2/15/2015,
Returns Paperwork to Enroll in Health Benefits ImmediatelySlide23
2D –
Employee is newly eligible for health benefits.
Effective date should
reflect the employee’s
date of hire.
1A
– Health Benefits Offered
Effective date should reflect the first day of the month following
the event that makes the employee eligible for health benefits.
3A – Health Benefits AcceptedEffective date should reflect the first day of the month in which the employee’s health coverage was effective.
Exercise 1
(continued) -
New Permanent Full-Time Employee Appointed
2/15/2015,
Returns Paperwork to Enroll in Health Benefits ImmediatelySlide24
IRS Form 1095-C Reporting
Line
14
1E-
Minimum essential coverage providing minimum value
was offered
to
employee, their spouse, and dependent children.
1H-
No offer of coverage (employee was not offered state-sponsored health coverage). Line 15Dollar amount reflects the employee’s share of the lowest cost monthly premium for self-only coverage offered by the state (health premium minus the employee’s respective health contribution for self-only coverage). Slide25
Line 16
2A-
Employee was not employed on any day of the calendar month.
2B- Employee was not a full-time employee and not enrolled in state-sponsored health coverage during the month.
2C
-
Employee was enrolled in
state-sponsored health coverage during the month.
2D- Employee was in a “Limited Non-Assessment Period” for the month. 2F-2H- Employee was offered health coverage that met the law’s affordability standards. IRS Form 1095-C Reporting CodesSlide26
ACAS Action
Resulting IRS Code
2D – Employee
is newly eligible for health benefits (2/15/2015)
.
Line 14 -1H Employee was not offered
health coverage for the month.
Line 16 - 2D
Employee was in a waiting period.
1
A – Health Benefits Offered (3/1/15)
3A – Health Benefits Accepted
(3/1/15)
Line 14 - 1E Employee was offered health coverage for the month.
Line 16 - 2C Employee was enrolled in health coverage for the month.
1095-C Tie-in1Slide27
Exercise 2
New
Permanent Full-Time
employee appointed 2/15/2015
Declines health benefits
within 60
days
, and
enrolls
in Cash Option. Slide28
2D –
Employee is newly eligible for health benefits.
Effective date should
reflect the employee’s
date of hire.
1A
– Health Benefits Offered
Effective date should reflect the first day of the month following
the event that makes the employee eligible for health benefits.
4A – Health Benefits Declined Effective date should reflect the same date as the effective date of the employee’s 1A status code.
03/01/2015
03/01/2015
02/15/2015
02/15/2015
Exercise 2-
New
Permanent Full-Time Employee Appointed 2/15/2015, Declines Health Benefits within 60 Days, and Enrolls in Cash Option Slide29
1095-C Tie-in
ACAS Action
Resulting IRS Code
2D – Employee
is newly eligible for health
benefits. (2/15/15)
Line 14 - 1H Employee was not
offered health coverage for the month.
Line 16 - 2D
Employee is in a waiting period.
1
A – Health Benefits Offered
(3/1/15)
4A – Health Benefits Declined
(3/1/15)
Line 14 - 1E Employee was offered state-sponsored health coverage for the month.
Line 16 – 2H Health coverage offered to employee meets the ACA’s affordability standards. Slide30
Exercise 3
New
Permanent Intermittent
Employee (Appointed 12/31/2014) worked
900
hours during
January 2015 to June 2015 c
ontrol period
AND
enrolls in health coverage immediately upon becoming eligible.Slide31
2B –
Permanent Intermittent employee must work a qualifying number of hours in a Control Period to be eligible for health benefits.
Effective date should
reflect the employee’s
date of hire.
2D – Employee is newly eligible for
health benefits.
Effective
date should reflect the date the employee satisfies the 480-hour requirement within a qualifying Control Period.
1A – Health Benefits Offered Effective date should reflect the first day of the month following the event that makes the employee eligible.
3A – Health Benefits Accepted
Effective date should reflect the first day of the month
in which the employee’s health coverage was effective.
ACTIVE
Exercise
3 –
New Permanent Intermittent
Employee (Appointed 12/31/2014)
Worked 900
Hours
During January 2015 to June 2015 Control Period AND Enrolls In Health Coverage Immediately Upon Becoming
EligibleSlide32
1095-C Tie-in 2
ACAS
Action
Resulting IRS Code
2B – Permanent
/Intermittent Employee must work a qualifying number of hours in a Control Period. (12/31/14)
2D – Employee is newly eligible for health benefits. (7/1/15)
Line 14 – 1H
Employee was not offered health coverage for the month.
Line 16 – 2D Employee
was in a waiting period.
1A – Health Benefits Offered to
Employee during period of August 2015 to January 2016.
(8/1/15)
3A – Health Benefits Accepted. (8/1/15)
Line 14 - 1E Employee
was offered health coverage for the month.
Line 16
- 2C Employee was enrolled in health coverage for the month. Slide33
Exercise 4
The same Permanent
Intermittent
Employee
did not
work enough hours
during
the subsequent control period
of July 2015 to December 2015
AND loses eligibility for health coverage to continue.Slide34
Note: The same Permanent Intermittent Employee loses his/her health benefit eligibility during the period of February 2016 to July 2016 because he/she did not work enough hours during the July 2015 to December 2015 Control Period.
Department should key a
5A
(Health Benefits Administratively Cancelled), with a January 31, 2016, effective date (the last day of the month that the employee’s health coverage was effective), a
2B
(Health Benefits Not Offered to PI) with a January 1, 2016, effective date as the employee is no longer eligible for state-sponsored health
coverage, AND a
1C
(COBRA coverage was offered) with a February 1, 2016, effective date. 2016 02/01/2016 ACA 1C 04/04/2016 SCO ADMIN SEE PIMS
01/31/2016 ACA 5A 04/04/2016 SCO ADMIN SEE PIMS
01/01/2016 ACA 2B 04/04/2016 SCO ADMIN SEE PIMS
2015 08/01/2015 ACA 3A 04/04/2016 SCO ADMIN SEE PIMS
08/01/2015 ACA 1A 04/04/2016 SCO ADMIN SEE PIMS
07/01/2015 ACA 2D 04/04/2016 SCO ADMIN SEE PIMS
2014 12/31/2014 ACA 2B 04/04/2016 INITIAL LOAD SEE PIMS
ACTIVE
Exercise
4 –
Same Permanent
Intermittent Employee Did Not Work Enough Hours during Subsequent Control Period of July 2015 to December 2015 AND
Loses Eligibility for Health Coverage To
ContinueSlide35
Exercise 5
Permanent Full-Time
Employee cancels
his/her
health coverage effective 12/31/2015, and enrolls
in
Cash Option during Open Enrollment. Slide36
Employee has been enrolled in health benefits since 2/1/2015, and elects to cancel his/her coverage effective 12/31/2015. Department should key in the following ACAS status codes:
5B status code, Employee Voluntarily Cancels his/her Health Benefits, effective 12/31/2015;
1A status code, Employee Was Offered Health Benefits, effective 1/1/2016; and
4A status code, Employee Declines Health Benefits, effective 1/1/2016
01/01/2015
Exercise
5 –
Permanent Full-Time
Employee Cancels
his/her Health
Coverage Effective 12/31/2015,
and Enrolls in Cash Option
During Open EnrollmentSlide37
1095-C Tie-in3
ACAS Action
Resulting IRS Code
2D – Employee is newly eligible for health benefits (1/1/15)
Line 14 - 1H Employee
was not offered health coverage for the month.
Line 16 - 2D
Employee was in a waiting period.
1
A – Health Benefits Offered (2/1/15)
3A – Health Benefits Accepted (2/1/15)
Line 14 - 1E Employee was offered health coverage for the month.
Line 16 – 2C Employee was enrolled in health coverage for the month.
5B – Employee Voluntarily Cancels his/her Health
Coverage (12/31/15)
1A – Health Benefits Offered (1/1/16)
4A – Health Benefits Declined (1/1/16)
Line 14 – 1E Employee was offered health coverage
for the month.
Line 16 – 2F Indicates the health coverage offered to employee mee
ts the ACA’s affordability standards. Slide38
Exercise 6
Permanent Full-Time Employee cancels his/her enrollment in Cash Option effective 12/31/2015, and enrolls in in health coverage during Open
Enrollment.Slide39
Employee was enrolled in the Cash Option program and elects to enroll in health coverage during Open Enrollment. Department should key in the following ACAS status code, assuming the employee already had a 1A (offer of health coverage) and 4A (declined health coverage) status code keyed in ACAS:
3A status code, Employee Accepts the Offer of Health Coverage, effective 1/1/16
Exercise
6 –
Permanent Full-Time Employee
cancels his/her enrollment in Cash Option effective 12/31/2015, and enrolls in health coverage during
Open
EnrollmentSlide40
New Retired Annuitant was appointed on 10/1/2015, and is not eligible for health benefits.
Exercise 7Slide41
Exercise 7
–
New Retired Annuitant was appointed on 10/1/2015, and is not
eligible for health benefits.
2A status code, Employee not eligible for health benefits, effective 10/1/2015Slide42
Training
Departmental HR staff that have update or inquiry access to the ACAS are required to complete the two ACA training modules on CalHR’s website prior to obtaining access.
ACA Overview Video
ACA Database Training Module (Keying ACAS Transactions)
Departments are required to maintain a list of HR staff that have completed ACA training for audit by CalHR and the SCO.
CalHR PML #2014-038 and SCO Personnel Letter #14-021Slide43
Additional ACA-Related Resources Available to Departmental HR Staff:
CalHR
ACA Tool Kit
ACAS Emulator
-Sample Scenarios for ACAS Emulator
ACAS Database – Employee Benefit Transaction Worksheet
Annual Health Care Coverage Statements – Glossary of Commonly Used Terms and Frequently Asked Questions
SCO
ACAS User GuideScenario Based Job Aid Slide44
ACA Compliance Review
Monthly Departmental Compliance Review
The State Controller’s Office (SCO) has created several ACAS Exception Reports that departments can use to proactively monitor their ACA compliance.
ACAS Exception Reports are available via the SCO’s Personnel/Payroll Services Division’s ViewDirect database and are updated monthly.
Departments are expected to review their ACAS Exception Reports and take action to correct all errors identified within 30 days of receipt of the reports.
SCO Personnel Letters #15-009 and #15-013 and CalHR PML #2015-013Slide45
ACA Compliance Review1
CalHR Quarterly ACA Compliance Review
CalHR is responsible for providing oversight of departmental ACA compliance efforts to ensure accurate and timely entry of health benefit status information on employees in the ACAS.
CalHR will notice departments with transaction errors in the ACAS database that are over 90 days old, via the Quarterly ACA Compliance Review Notification document.
Departments are to correct outstanding transaction errors within 30 days of receipt of notification from CalHR, and certify corrections were made, utilizing the form provided.
CalHR PML #2015-013Slide46
ACA Compliance
Review
2
Self-Monitoring
The departmental monthly ACAS Exception Reports capture most, but not all, errors and discrepancies in the ACAS database.
Departments are encouraged to utilize existing reports available on MIRS (Management Information Retrieval System) to compare an employee’s employment history data with ACAS data. (e.g. Permanent Intermittents who work 480 hours or more in a control period)
Be proactive! Don’t wait for monthly/quarterly reports to drive the work.Slide47
ACA-Related Penalties
Employer Shared Responsibility Provisions
Failure
to
demonstrate compliance could
result in significant
penalties to the state
if at least one full-time employee receives a premium tax credit for purchasing individual coverage through Covered CA.
Penalty A
─$2,260 annual penalty (in 2017)
for each full-time employee if the state fails to offer health coverage to at least 95 percent of its full-time employees.
Penalty B
─ Even if the state offers health coverage to at least 95 percent of its full-time employees, a $
3,390
penalty (in
2017)
may apply if the health coverage was “unaffordable” or failed to provide “minimum value.”
*These Penalties are indexed annually for inflation. Slide48
ACA-Related Penalties
2
Information Reporting
Penalties
up to
$
520
for incorrect reporting:
Failure
to file a correct information return with the IRS is
$
260
.
Failure
to furnish a correct employee statement (1095-C) is
$
260
.Slide49
Other Information
Employer Notification Program
Detailed
Safe Harbor
Reports
HBD-12 and HBD-12A
Slide50
Contacts
CalHR
ACA.Policy@calhr.ca.gov
Elaine Smith
(916) 445-9801
Elaine.Smith@calhr.ca.gov
Scott Morrison
(916) 322-3657
Scott.Morrison@calhr.ca.gov
SCOACASupport@sco.ca.gov(916) 322-3770Slide51
Questions