Blue Cross and Blue Shield of Illinois

 

April 4, 2014

Legislative Update
Federal Government Releases Proposed, Final Rules on Marketplace, Reporting Requirements

The U.S. Department of Health and Human Services (HHS) recently released several proposed and final rules related to the Get Covered Illinois, the Official Health Marketplace of Illinois and the Basic Health Program under the Affordable Care Act (ACA). Also, the Internal Revenue Service (IRS) released final rules on reporting requirements related to minimum essential coverage and employer-sponsored coverage.

HHS released a proposed rule on the Marketplace and insurance market standards for 2015 and beyond. The proposed rule:

  • Sets forth standards related to product discontinuation and renewal, quality reporting, non-discrimination standards, minimum certification standards and responsibilities of Qualified Health Plan issuers operating in the individual exchanges and the Small Business Health Options Program (SHOP).
  • Adjusts parameters of ACA risk mitigation programs (risk adjustment, risk corridors and reinsurance, or 3Rs) to account for market uncertainty stemming from the administration's November 2013 transitional policy, as well as sets forth additional standards related to the 3Rs.
  • Updates various other aspects of ACA initiatives, including:
        •   Standards for consumer assistance programs;
        •   The opt-out provisions for self-funded, non-federal governmental plans and the individual market
            provisions under the Health Insurance Portability and Accountability Act of 1996; and
        •   Recognition of certain types of foreign group health coverage as minimum essential coverage.

The IRS released two final rules regarding how information on minimum essential coverage and employer-sponsored coverage should be reported to the government.

The final rule on Section 6055, which will assist the IRS in tracking minimum essential coverage to help enforce the individual mandate:

  • Provides two avenues for penalty relief.
  • Says the IRS will use Taxpayer Identification Numbers (TINs) to track whether individuals have coverage. A date of birth may be used in place of the TIN under certain conditions.
  • Applies to health insurance issuers, certain employers and government agencies that provide minimum essential coverage to their employees.

The final rule on Section 6056:

  • Applies to employers with 50 or more full-time employees.
  • Requires applicable employers to report information about health care coverage they offer to their full-time employees.
  • Allows self-insured employers to have a single, consolidated form to report to the IRS and employees under both sections 6055 and 6056.
  • Contains standards on ACA’s requirements on employer-furnished statements so that employees can determine, on an annual basis, whether they may claim a federal premium tax credit.

The 2015 Notice of Benefits and Payment Parameters final rule sets forth rules on payment parameters and oversight provisions, cost-sharing parameters and cost-sharing reductions and user fees for federally facilitated Marketplaces. It also provides standards for a variety of provisions, including privacy and security of personally identifiable information, the actuarial value calculator, the annual limitation in cost sharing for stand-alone dental plans and SHOP.

CMS also released a final rule on the Basic Health Program (BHP). The final rule sets forth a framework for BHP eligibility and enrollment, benefits, delivery of health care services, transfer of funds to participating states and federal oversight.

We are currently reviewing the proposed and final rules and will provide more information as it becomes available.

This communication is intended for informational purposes only. It is not intended to provide, does not constitute, and cannot be relied upon as legal, tax or compliance advice. The information contained in this communication is subject to change based on future regulation and guidance.

 
 


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A Division of Health Care Service Corporation, a Mutual Legal Reserve Company,
an Independent Licensee of the Blue Cross and Blue Shield Association.