Employers had to comply with many Patient Protection and Affordable Care Act (PPACA) provisions — including the young-adult coverage access provisions, the Summary of Benefits and Coverage (SBC) provisions, and the provisions phasing out annual and lifetime major medical benefits limits — even before Jan. 1, 2014.
More notice requirements crept in shortly before and during 2014.
In 2015, many employers will start to learn more than they’d like about many different PPACA coverage and reporting requirements, such as the PPACA employee counting and coverage reporting rules.
The federal agencies in charge of PPACA compliance — the U.S. Labor Department’s Employee Benefits Security Administration (EBSA), the Internal Revenue Service and the U.S. Department of Health and Human Services (HHS) — have talked mostly about warm and friendly efforts to help helpful and enthusiastic employers fulfill their PPACA compliance obligations.
The officials have also mentioned, in passing that they are getting ready to supplement employers’ enthusiastic compliance efforts by conducting audits.
Compliance analysts at ACAtrack.net, a PPACA compliance automation firm, have recently created a helpful slide deck discussing the EBSA PPACA audit program.
For highlights from the slide deck, read on.
1. EBSA has set up a Health Benefits Security Project team to handle PPACA enforcement.
Getting numbers is difficult, but EBSA said in 2010 that it was hiring about 670 new investigators to help with matters such as PPACA compliance audits. By now, hundreds of those new hires should be on board, trained, and ready to investigate.
EBSA also said it was setting up a Health Benefits Security Project (HBSP), and Labor Department officials have talked about a need for cash to fund the HBSP in congressional hearings.
The Labor Department has not posted much information about that the HBSP on the Web, but several Federal Bureau of Investigation (FBI) fraud arrest announcements have mentioned that the FBI got help from the HBSP.
See also: Agency highlights PPACA whistleblowing
2. EBSA can investigate any Employee Retirement Income Security Act (ERISA) plan, whether it’s fully insured or self-insured.
Employers may be able to use stop-loss arrangements to escape from some PPACA requirements, but, if EBSA believes a PPACA rule applies to an employer, self-funding will provide no protection.
If an employer must comply with ERISA, EBSA can investigate it.
3. One risk factor is getting filings in late.
Another risk factor is unhappy employees. ACATrack.net analysts say employee complaints led to 814 EBSA investigations of all kinds in 2012 alone.
4. Investigators may look closely at notices and plan documents — but also at gaps between what a plan has promised and what it delivers.
But notice provision violations are nothing to sneeze at. Simply getting an SBC notice out late could lead to an excise tax penalty of $110 per day per participant.
5. Employers and their benefits advisors should get to know EBSA’s PPACA self-compliance tool.
ACATrack.net analysts note that EBSA has provided a 29-page guide that employers and benefits advisors can use to make sure they are on the right track.
Employers should conduct period internal audits, maintain documents in date order, document procedures, and maintain written minutes for benefits-related meetings, analysts at the firm say.