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  • The CLASS Act: Facts and Fallacies About Long Term Care Insurance

    There has been a great deal of information – and some false information – circulating about the long term care insurance portion of Healthcare Reform.

    The Community Living Assistance Services and Supports Act (CLASS Act) is Title VIII of the Affordable Care Act.  The law specifies that it is “a national voluntary insurance program,” the key word being “voluntary.” Although the law requires employers to enroll workers automatically, workers may choose to waive coverage “at any time.”

    There was a chain email being passed around earlier this year with false information claiming that everyone will be subject to a new tax of $150 to $250 per month to pay for this new coverage.  This is not true.  Here is a quick look at what is true. . . and what is not.

    Facts about the CLASS Act:

    • It is a national, voluntary insurance program.
    • Anyone who is over age 18 and active at work is eligible to enroll in the plan.
    • The plan provides a modest cash benefit of at least $50 per day to help pay the cost of assistance with daily living activities such as bathing, dressing, eating, etc.
    • There is a five year waiting period before benefits can be paid.
    • Even though the provisions are effective January 1, 2011, the Secretary of Health and Human Services (HHS) must develop the plan an implement it by October 1, 2012.  Until the plan details are made available, most will not enroll until 2012 or 2013.

    What the CLASS Act does not include:

    • There is no tax to fund coverage. It will be funded only by the premiums paid by participants, which can be increased at any time to keep the plan solvent.
    • It does not provide disability insurance or any income replacement – it covers only care for help with basic daily living activities.
    • It does not provide a benefit amount sufficient to cover the high expense of long term care.

    Obviously, this new insurance coverage is only meant to cover the very basic necessities of long term care.  Similar to Social Security benefits for retirement income, it’s not meant to be a total replacement for your own savings or other long term care insurance products available.  It’s also not clear how exactly premiums will be calculated, so it remains to be seen whether the premiums are worth the $50 daily benefit.

    Updated: The Class Act was repealed on January 1, 2013

    Electronic Signing and Storage of I-9s

    All U.S. employers, regardless of size, are required to complete Form I-9 for each employee who began work after 1986.  The employee completes the top section of the form, and the employer, after viewing the employee’s documentation showing their eligibility to work, completes the bottom section of the form.  Civil monetary penalties are imposed for failure to complete an I-9.  Completed Form I-9’s must be retained for three years after the hire date or one year after the termination date, whichever is later.

    The Department of Homeland Security has mandated these rules:

    • Employers must complete a Form I-9 within three business (not calendar) days
    • Employers may use paper, electronic systems, or a combination of both
    • Employers may change electronic storage systems as long as the systems meet the performance requirements of the regulations
    • Employers need not retain audit trails of each time a Form I-9 is electronically viewed, but only when the Form I-9 is created, completed, updated, modified, altered, or corrected
    • Employers may provide or transmit a confirmation of a Form I-9 transaction, but are not required to do so unless the employee requests a copy.

    Health Care Reform: Dependent Coverage to Age 26

    One of the changes of The Affordable Care Act is extending coverage for dependent children.  Previously, children were normally covered until age 19 or age 24 if they are a full-time student. For plan years beginning September 23, 2010, health plans must cover dependent children up to age 26, regardless of their student status, marital status, whether they live with their parents, or are claimed as a dependent on their parents’ tax return, as long as the dependent is not eligible to enroll in other employer-provided coverage.  After January 1, 2014, dependent coverage up to age 26 will be required, even if the child is eligible to enroll in other employer-provided coverage.

    State Rules Could Be More Generous
    Keep in mind that some states have regulations that define the maximum dependent child eligibility age, before the Affordable Care Act was passed.  Some states have age limits higher than age 26, but may reduce them when the federal law goes into effect on September 23rd.  The state definition of dependent could be different than the definition under the Affordable Care Act.  Check with your State Department of Insurance to see how the Affordable Care Act will affect the dependent rules in your state.

    Tax Benefits
    As with other healthcare premiums, the employer share of this extended dependent care premium is excluded from the employee’s taxable income.  If the employer has a cafeteria plan in place, the employee’s share of the premium is also excluded from taxable income.

    If an employer extends dependent coverage beyond the child’s 26th birthday, the value of the coverage is excluded from the employee’s income for the entire taxable year in which the child turned 26.  So if the child turns 26 early in the year, and stays on the plan for the rest of the year, none of the premium would be taxable that year.

    Insurance Carriers Taking Action Now
    Many health insurance carriers have made the decision to voluntarily cover these dependents sooner than required, in order to spare the administrative burden of dis-enrolling those dependents who would have lost coverage when they graduated from school this past May, and re-enrolling them after their plan year renews after this September 23rd.  Check with your health insurance carrier to see if they have already extended dependent coverage – chances are they have.  If early coverage is not an option, the dis-enrolled child will have the opportunity to re-enroll during a special enrollment period.

    Unemployment Benefits Restored and Extended

    On July 22, 2010, President Obama signed into law the Unemployment Compensation Extension Act of 2010.  This will reinstate long term unemployment benefits to over 2.5 million unemployed workers through November 2010.  Unemployed workers will need to reapply for benefits through their state unemployment offices, and the benefits will be reinstated retroactively back to June 2nd, when the benefits originally expired.

    COBRA subsidy benefits were not extended as part of this law. Workers who lose their jobs after May 31, 2010 are not eligible for the subsidy.

    Congress has been at a “stalemate” for the past two months on this issue, debating how to pay for this unemployment benefit extension.  The Senate finally voted to extend benefits on July 21, the House quickly voted to approve the measure on July 22, followed by the President.  See the full SHRM article.

    Health Care Reform: Lifetime and Annual Limits Rules

    Interim final regulations have been issued by the Department of Health and Human Services (HHS), Department of Labor, and Treasury for annual and lifetime limits within group health insurance plans.

    Lifetime Limits
    Under the Affordable Care Act, a plan may not impose a lifetime dollar limit on essential benefits provided to an individual.  This requirement is effective for plan years beginning after September 23, 2010, so for plans with calendar year renewals, it would be effective January 1, 2011.  This requirement applies to both grandfathered and non-grandfathered plans.

    According to the Act, essential health benefits include, at a minimum, items and services in the following categories: ambulatory patient services; emergency services; hospitalization, maternity and newborn care; mental health and substance use disorder services, including behavioral health treatment; prescription drugs; rehabilitative services and devices; laboratory services; preventive and wellness services and chronic disease management; and pediatric services, including oral and vision care. Interestingly, the regulations provide no further guidance on the definition of “essential health benefits” except to say that, until HHS issues such guidance, the regulatory agencies will take into account good-faith efforts to comply with the “guidelines” set forth in the Act.

    A group health plan may still impose lifetime limits on non-essential health benefits. Thus, the key will be for the health plan to determine which benefits are “essential.”

    Special Enrollment Notice
    For those who have already reached their lifetime limit on essential benefits, the health plan will need to provide them a notice to let them know that the lifetime limit no longer applies, and (assuming they are still eligible) they have a 30 day special enrollment period to re-enroll in the plan.  This notice must be provided no later than the first day of the plan year beginning on or after September 23, 2010.  The DOL has issued model language for this notice.

    Annual Limits
    Prior to January 1, 2014, both grandfathered and non-grandfathered plans may impose a “restricted” annual limit on the dollar limit of essential benefits provided to an individual.  The annual limit is restricted in that it provides a three year phase-out.  The annual limit may not be less than:

    • $750,000 for any plan year beginning from September 23, 2010 to September 22, 2011
    • $1.25 million for any plan year beginning from September 23, 2011 to September 22, 2012
    • $2 million for any plan year beginning from September 23, 2012 to December 31, 2013

    Health Care Reform: What Is a Grandfathered Plan?

    When the Affordable Care Act (the Act) was passed on March 23, 2010, various health care coverage rules were imposed on health plans.  Some of these rules do not apply to health plans that were in effect as of March 23, 2010.  These plans are referred to as “grandfathered.”

    Recently, the three agencies charged with administering the Act (HHS, DOL, and Treasury) have issued clarification as to what exactly a grandfathered plan is, and the various changes made by health plans that would lose their grandfathered status.

    Grandfathered plan protection

    If a plan is grandfathered, the plan will still need to comply with many of the Act’s mandates.  However, grandfathered plans are exempt from the following mandates:

    • Required coverage for in-network emergency services;
    • Required first-dollar coverage for certain in-network preventive services
    • A prohibition on restricting the designation of primary care providers or requiring referrals for OB/GYN services;
    • Required coverage of routine expenses for participation in clinical trials;
    • Enhanced claim appeal procedures, including implementation of an external appeals process;
    • A prohibition on discriminating in favor of highly compensated individuals (i.e., applying the same nondiscrimination rules to both insured and self-funded plans).

    Keeping grandfathered status

    In order for a plan to retain its grandfathered status, it must not make any significant coverage or cost sharing changes to the plan.  Here are the changes that grandfathered plans would be prohibited from making, or else they would lose grandfathered status:

    • Cannot significantly cut or reduce benefits.
    • Cannot raise co-insurance charges.
    • Cannot significantly raise co-payment charges.
    • Cannot significantly raise deductibles.
    • Cannot significantly lower employer contributions.
    • Cannot add or tighten an annual limit on what the insurer pays.
    • Cannot change insurance companies, however self funded plans may change Third Party Administrators. [As of 11/15/10, HHS has removed this requirement. Plans can change insurance companies and remain grandfathered if the remaining items stay the same.]

    Grandfathered health plans pros and cons

    Employers will need to consider whether the advantages of keeping grandfathered status protection outweighs the cost sharing flexibility associated with non-grandfathered plans.  There are many unknowns at this point how the insurance exchanges beginning in 2014 will affect group health plans, but the HHS estimates that only about 55% of large employers and 34% of small employers will remain grandfathered by 2013.

    For more information about grandfathered plans, see www.Heathcare.gov

    Grandfathering FAQs on the HHS website

    Don’t spend time worrying about payroll deductions, when you could be focusing on revenue-generating tasks. Use Patriot Software’s Payroll Services to calculate, file, and remit your payroll taxes for you. Try it free (and stress free) for 30 days!

    Health Care Reform Update: Preventive Care Rules Clarified

    New regulations were issued on July 14, 2010, by The Department of Health and Human Services (HHS), the Department of Labor, and the Treasury regarding preventive care coverage requirements.  The HHS estimates that Americans currently use preventive services at about half of the recommended rate, due to the cost of these services.  According to the HHS, the intention of these regulations is to make preventive care more affordable, so that chronic diseases, which are often preventable, can be detected and treated or prevented early, thereby reducing healthcare costs and promoting health and wellness.

    Health plans that are not “grandfathered plan” will be required to include preventive care services beginning with plan years renewing after September 23, 2010, which would be January 1, 2011 for plans that renew each calendar year.  Grandfathered plans, which are plans that have not made certain substantial changes to plan design or costs will not have to meet this preventive care requirement.

    The covered preventive services would be available at no cost to the employee.  In other words, these services are not subject to a deductible, co-pay, or co-insurance, and would be covered 100% by the health plan, as long as they received services from an in-network provider.  Plans are still allowed to share the cost of preventive services provided by an out-of-network provider.

    Included in the preventive services are:

    • Screenings for diseases such as cancer, diabetes, high cholesterol, and high blood pressure
    • Vaccines for both children and adults
    • Pediatric care
    • Prevention for women including pregnancy related screenings and mammograms.

    For further information about the new preventive care rules, please visit www.healthcare.gov

    Ohio Mandating Electronic Child Support Payments

    The State of Ohio has passed legislation that requires employers with at least 50 employees to remit their payments electronically.  Prior to the legislation, large employers had the option of sending paper checks to the Ohio Child Support Payment Central processing center in Columbus.

    Ohio still encourages employers with less than 50 employees to also make child support payments electronically.  Electronic payments are more efficient and less costly for both employers and the State of Ohio.

    Employers have two options for remitting child support payments electronically:

    1) Online debit through www.ExpertPay.com
    This is a secure site that is free for employers to use.  Once an employer has registered as a user, they can initiate child support payments directly on this website.  The site offers reporting for previous payments.

    2) Electronic Funds Transfer
    You can send a special NACHA ACH credit file to your bank that contains details about the support payment, including employee and case information.  Check with your online payroll provider to see if this option is available.

    If you are on Ohio employer with at least 50 employees, and are currently remitting child support payments with a paper check, you will need to determine which of the two electronic methods will work best for your company.

    Earned Income Credit – What Is It and How Does It Work?

    NOTE: Effective January 1, 2011 the option for advanced EIC payments has been eliminated. Employers are not longer able to advance a portion of the credit with each paycheck.

    Earned Income Credit (EIC) can be referred to several ways, such as Earned Income Tax Credit (EITC) or Advanced Earned Income Credit (AEIC).

    What is EIC?
    EIC is a tax credit for certain individuals who don’t earn a high income and qualify for EIC.  They would receive the tax credit when they file their personal tax return.

    Annual EEO Reporting: Are You Ready?

    Private employers with over 100 employees or federal contractors with at least 50 employees are required each year to file the EEO-1 Report with the EEOC. Employers will report the demographic make-up of their workforce, which includes gender, ethnicity by job class. The annual reporting period starts every July, and employers must file their report no later than September 30th.

    If you are required to file, now is the time to make sure you have all of your employees properly classified by gender, ethnicity, and job class. It is recommended that employees self-identify their race/ethnicity, and can be part of the employee’s new hire paperwork. If this is not possible, employers are permitted to classify their employees’ race based on “visual observation,” but only if the employee’s answer is not available.

    The Race/Ethnicity categories are as follows:

    • Hispanic or Latino – A person of Cuban, Mexican, Puerto Rican, South or Central American, or other Spanish culture or origin regardless of race.
    • White (Not Hispanic or Latino) – A person having origins in any of the original peoples of Europe, the Middle East, or North Africa.
    • Black or African American (Not Hispanic or Latino) – A person having origins in any of the black racial groups of Africa.
    • Native Hawaiian or Other Pacific Islander (Not Hispanic or Latino) – A person having origins in any of the peoples of Hawaii, Guam, Samoa, or other Pacific Islands.
    • Asian (Not Hispanic or Latino) – A person having origins in any of the original peoples of the Far East, Southeast Asia, or the Indian Subcontinent, including, for example, Cambodia, China, India, Japan, Korea, Malaysia, Pakistan, the Philippine Islands, Thailand, and Vietnam.
    • American Indian or Alaska Native (Not Hispanic or Latino) – A person having origins in any of the original peoples of North and South America (including Central America), and who maintain tribal affiliation or community attachment.
    • Two or More Races (Not Hispanic or Latino) – All persons who identify with more than one of the above five races.
    • Officials and Managers
    • Professionals
    • Technicians
    • Sales Workers
    • Administrative Support Workers
    • Craft Workers
    • Operatives
    • Laborers and Helpers
    • Service Workers

    What You Will Need To File
    If you have never filed an EEO-1 before, and are required to file, you will need to obtain a company Login ID and password to the EEOC’s website so that you can enter your demographic information and file online. You can email the Joint Reporting Committee to get set up.

    For each worksite location at your company, you will need to report the number of male and female employees within each race and job category that were employed during any payroll period between July and September. Below is a sample grid layout similar to the data entry page on the EEOC website.

    EEO Data Sample resized 600

    For more information about the EEO-1 filing process, visit the EEO-1 Survey Website.

    The CLASS Act: Facts and Fallacies About Long Term Care Insurance

    There has been a great deal of information – and some false information – circulating about the long term care insurance portion of Healthcare Reform.

    The Community Living Assistance Services and Supports Act (CLASS Act) is Title VIII of the Affordable Care Act.  The law specifies that it is “a national voluntary insurance program,” the key word being “voluntary.” Although the law requires employers to enroll workers automatically, workers may choose to waive coverage “at any time.”

    There was a chain email being passed around earlier this year with false information claiming that everyone will be subject to a new tax of $150 to $250 per month to pay for this new coverage.  This is not true.  Here is a quick look at what is true. . . and what is not.

    Facts about the CLASS Act:

    • It is a national, voluntary insurance program.
    • Anyone who is over age 18 and active at work is eligible to enroll in the plan.
    • The plan provides a modest cash benefit of at least $50 per day to help pay the cost of assistance with daily living activities such as bathing, dressing, eating, etc.
    • There is a five year waiting period before benefits can be paid.
    • Even though the provisions are effective January 1, 2011, the Secretary of Health and Human Services (HHS) must develop the plan an implement it by October 1, 2012.  Until the plan details are made available, most will not enroll until 2012 or 2013.

    What the CLASS Act does not include:

    • There is no tax to fund coverage. It will be funded only by the premiums paid by participants, which can be increased at any time to keep the plan solvent.
    • It does not provide disability insurance or any income replacement – it covers only care for help with basic daily living activities.
    • It does not provide a benefit amount sufficient to cover the high expense of long term care.

    Obviously, this new insurance coverage is only meant to cover the very basic necessities of long term care.  Similar to Social Security benefits for retirement income, it’s not meant to be a total replacement for your own savings or other long term care insurance products available.  It’s also not clear how exactly premiums will be calculated, so it remains to be seen whether the premiums are worth the $50 daily benefit.

    Updated: The Class Act was repealed on January 1, 2013

    Electronic Signing and Storage of I-9s

    All U.S. employers, regardless of size, are required to complete Form I-9 for each employee who began work after 1986.  The employee completes the top section of the form, and the employer, after viewing the employee’s documentation showing their eligibility to work, completes the bottom section of the form.  Civil monetary penalties are imposed for failure to complete an I-9.  Completed Form I-9’s must be retained for three years after the hire date or one year after the termination date, whichever is later.

    The Department of Homeland Security has mandated these rules:

    • Employers must complete a Form I-9 within three business (not calendar) days
    • Employers may use paper, electronic systems, or a combination of both
    • Employers may change electronic storage systems as long as the systems meet the performance requirements of the regulations
    • Employers need not retain audit trails of each time a Form I-9 is electronically viewed, but only when the Form I-9 is created, completed, updated, modified, altered, or corrected
    • Employers may provide or transmit a confirmation of a Form I-9 transaction, but are not required to do so unless the employee requests a copy.

    Health Care Reform: Dependent Coverage to Age 26

    One of the changes of The Affordable Care Act is extending coverage for dependent children.  Previously, children were normally covered until age 19 or age 24 if they are a full-time student. For plan years beginning September 23, 2010, health plans must cover dependent children up to age 26, regardless of their student status, marital status, whether they live with their parents, or are claimed as a dependent on their parents’ tax return, as long as the dependent is not eligible to enroll in other employer-provided coverage.  After January 1, 2014, dependent coverage up to age 26 will be required, even if the child is eligible to enroll in other employer-provided coverage.

    State Rules Could Be More Generous
    Keep in mind that some states have regulations that define the maximum dependent child eligibility age, before the Affordable Care Act was passed.  Some states have age limits higher than age 26, but may reduce them when the federal law goes into effect on September 23rd.  The state definition of dependent could be different than the definition under the Affordable Care Act.  Check with your State Department of Insurance to see how the Affordable Care Act will affect the dependent rules in your state.

    Tax Benefits
    As with other healthcare premiums, the employer share of this extended dependent care premium is excluded from the employee’s taxable income.  If the employer has a cafeteria plan in place, the employee’s share of the premium is also excluded from taxable income.

    If an employer extends dependent coverage beyond the child’s 26th birthday, the value of the coverage is excluded from the employee’s income for the entire taxable year in which the child turned 26.  So if the child turns 26 early in the year, and stays on the plan for the rest of the year, none of the premium would be taxable that year.

    Insurance Carriers Taking Action Now
    Many health insurance carriers have made the decision to voluntarily cover these dependents sooner than required, in order to spare the administrative burden of dis-enrolling those dependents who would have lost coverage when they graduated from school this past May, and re-enrolling them after their plan year renews after this September 23rd.  Check with your health insurance carrier to see if they have already extended dependent coverage – chances are they have.  If early coverage is not an option, the dis-enrolled child will have the opportunity to re-enroll during a special enrollment period.

    Unemployment Benefits Restored and Extended

    On July 22, 2010, President Obama signed into law the Unemployment Compensation Extension Act of 2010.  This will reinstate long term unemployment benefits to over 2.5 million unemployed workers through November 2010.  Unemployed workers will need to reapply for benefits through their state unemployment offices, and the benefits will be reinstated retroactively back to June 2nd, when the benefits originally expired.

    COBRA subsidy benefits were not extended as part of this law. Workers who lose their jobs after May 31, 2010 are not eligible for the subsidy.

    Congress has been at a “stalemate” for the past two months on this issue, debating how to pay for this unemployment benefit extension.  The Senate finally voted to extend benefits on July 21, the House quickly voted to approve the measure on July 22, followed by the President.  See the full SHRM article.

    Health Care Reform: Lifetime and Annual Limits Rules

    Interim final regulations have been issued by the Department of Health and Human Services (HHS), Department of Labor, and Treasury for annual and lifetime limits within group health insurance plans.

    Lifetime Limits
    Under the Affordable Care Act, a plan may not impose a lifetime dollar limit on essential benefits provided to an individual.  This requirement is effective for plan years beginning after September 23, 2010, so for plans with calendar year renewals, it would be effective January 1, 2011.  This requirement applies to both grandfathered and non-grandfathered plans.

    According to the Act, essential health benefits include, at a minimum, items and services in the following categories: ambulatory patient services; emergency services; hospitalization, maternity and newborn care; mental health and substance use disorder services, including behavioral health treatment; prescription drugs; rehabilitative services and devices; laboratory services; preventive and wellness services and chronic disease management; and pediatric services, including oral and vision care. Interestingly, the regulations provide no further guidance on the definition of “essential health benefits” except to say that, until HHS issues such guidance, the regulatory agencies will take into account good-faith efforts to comply with the “guidelines” set forth in the Act.

    A group health plan may still impose lifetime limits on non-essential health benefits. Thus, the key will be for the health plan to determine which benefits are “essential.”

    Special Enrollment Notice
    For those who have already reached their lifetime limit on essential benefits, the health plan will need to provide them a notice to let them know that the lifetime limit no longer applies, and (assuming they are still eligible) they have a 30 day special enrollment period to re-enroll in the plan.  This notice must be provided no later than the first day of the plan year beginning on or after September 23, 2010.  The DOL has issued model language for this notice.

    Annual Limits
    Prior to January 1, 2014, both grandfathered and non-grandfathered plans may impose a “restricted” annual limit on the dollar limit of essential benefits provided to an individual.  The annual limit is restricted in that it provides a three year phase-out.  The annual limit may not be less than:

    • $750,000 for any plan year beginning from September 23, 2010 to September 22, 2011
    • $1.25 million for any plan year beginning from September 23, 2011 to September 22, 2012
    • $2 million for any plan year beginning from September 23, 2012 to December 31, 2013

    Health Care Reform: What Is a Grandfathered Plan?

    When the Affordable Care Act (the Act) was passed on March 23, 2010, various health care coverage rules were imposed on health plans.  Some of these rules do not apply to health plans that were in effect as of March 23, 2010.  These plans are referred to as “grandfathered.”

    Recently, the three agencies charged with administering the Act (HHS, DOL, and Treasury) have issued clarification as to what exactly a grandfathered plan is, and the various changes made by health plans that would lose their grandfathered status.

    Grandfathered plan protection

    If a plan is grandfathered, the plan will still need to comply with many of the Act’s mandates.  However, grandfathered plans are exempt from the following mandates:

    • Required coverage for in-network emergency services;
    • Required first-dollar coverage for certain in-network preventive services
    • A prohibition on restricting the designation of primary care providers or requiring referrals for OB/GYN services;
    • Required coverage of routine expenses for participation in clinical trials;
    • Enhanced claim appeal procedures, including implementation of an external appeals process;
    • A prohibition on discriminating in favor of highly compensated individuals (i.e., applying the same nondiscrimination rules to both insured and self-funded plans).

    Keeping grandfathered status

    In order for a plan to retain its grandfathered status, it must not make any significant coverage or cost sharing changes to the plan.  Here are the changes that grandfathered plans would be prohibited from making, or else they would lose grandfathered status:

    • Cannot significantly cut or reduce benefits.
    • Cannot raise co-insurance charges.
    • Cannot significantly raise co-payment charges.
    • Cannot significantly raise deductibles.
    • Cannot significantly lower employer contributions.
    • Cannot add or tighten an annual limit on what the insurer pays.
    • Cannot change insurance companies, however self funded plans may change Third Party Administrators. [As of 11/15/10, HHS has removed this requirement. Plans can change insurance companies and remain grandfathered if the remaining items stay the same.]

    Grandfathered health plans pros and cons

    Employers will need to consider whether the advantages of keeping grandfathered status protection outweighs the cost sharing flexibility associated with non-grandfathered plans.  There are many unknowns at this point how the insurance exchanges beginning in 2014 will affect group health plans, but the HHS estimates that only about 55% of large employers and 34% of small employers will remain grandfathered by 2013.

    For more information about grandfathered plans, see www.Heathcare.gov

    Grandfathering FAQs on the HHS website

    Don’t spend time worrying about payroll deductions, when you could be focusing on revenue-generating tasks. Use Patriot Software’s Payroll Services to calculate, file, and remit your payroll taxes for you. Try it free (and stress free) for 30 days!

    Health Care Reform Update: Preventive Care Rules Clarified

    New regulations were issued on July 14, 2010, by The Department of Health and Human Services (HHS), the Department of Labor, and the Treasury regarding preventive care coverage requirements.  The HHS estimates that Americans currently use preventive services at about half of the recommended rate, due to the cost of these services.  According to the HHS, the intention of these regulations is to make preventive care more affordable, so that chronic diseases, which are often preventable, can be detected and treated or prevented early, thereby reducing healthcare costs and promoting health and wellness.

    Health plans that are not “grandfathered plan” will be required to include preventive care services beginning with plan years renewing after September 23, 2010, which would be January 1, 2011 for plans that renew each calendar year.  Grandfathered plans, which are plans that have not made certain substantial changes to plan design or costs will not have to meet this preventive care requirement.

    The covered preventive services would be available at no cost to the employee.  In other words, these services are not subject to a deductible, co-pay, or co-insurance, and would be covered 100% by the health plan, as long as they received services from an in-network provider.  Plans are still allowed to share the cost of preventive services provided by an out-of-network provider.

    Included in the preventive services are:

    • Screenings for diseases such as cancer, diabetes, high cholesterol, and high blood pressure
    • Vaccines for both children and adults
    • Pediatric care
    • Prevention for women including pregnancy related screenings and mammograms.

    For further information about the new preventive care rules, please visit www.healthcare.gov

    Ohio Mandating Electronic Child Support Payments

    The State of Ohio has passed legislation that requires employers with at least 50 employees to remit their payments electronically.  Prior to the legislation, large employers had the option of sending paper checks to the Ohio Child Support Payment Central processing center in Columbus.

    Ohio still encourages employers with less than 50 employees to also make child support payments electronically.  Electronic payments are more efficient and less costly for both employers and the State of Ohio.

    Employers have two options for remitting child support payments electronically:

    1) Online debit through www.ExpertPay.com
    This is a secure site that is free for employers to use.  Once an employer has registered as a user, they can initiate child support payments directly on this website.  The site offers reporting for previous payments.

    2) Electronic Funds Transfer
    You can send a special NACHA ACH credit file to your bank that contains details about the support payment, including employee and case information.  Check with your online payroll provider to see if this option is available.

    If you are on Ohio employer with at least 50 employees, and are currently remitting child support payments with a paper check, you will need to determine which of the two electronic methods will work best for your company.

    Earned Income Credit – What Is It and How Does It Work?

    NOTE: Effective January 1, 2011 the option for advanced EIC payments has been eliminated. Employers are not longer able to advance a portion of the credit with each paycheck.

    Earned Income Credit (EIC) can be referred to several ways, such as Earned Income Tax Credit (EITC) or Advanced Earned Income Credit (AEIC).

    What is EIC?
    EIC is a tax credit for certain individuals who don’t earn a high income and qualify for EIC.  They would receive the tax credit when they file their personal tax return.

    Annual EEO Reporting: Are You Ready?

    Private employers with over 100 employees or federal contractors with at least 50 employees are required each year to file the EEO-1 Report with the EEOC. Employers will report the demographic make-up of their workforce, which includes gender, ethnicity by job class. The annual reporting period starts every July, and employers must file their report no later than September 30th.

    If you are required to file, now is the time to make sure you have all of your employees properly classified by gender, ethnicity, and job class. It is recommended that employees self-identify their race/ethnicity, and can be part of the employee’s new hire paperwork. If this is not possible, employers are permitted to classify their employees’ race based on “visual observation,” but only if the employee’s answer is not available.

    The Race/Ethnicity categories are as follows:

    • Hispanic or Latino – A person of Cuban, Mexican, Puerto Rican, South or Central American, or other Spanish culture or origin regardless of race.
    • White (Not Hispanic or Latino) – A person having origins in any of the original peoples of Europe, the Middle East, or North Africa.
    • Black or African American (Not Hispanic or Latino) – A person having origins in any of the black racial groups of Africa.
    • Native Hawaiian or Other Pacific Islander (Not Hispanic or Latino) – A person having origins in any of the peoples of Hawaii, Guam, Samoa, or other Pacific Islands.
    • Asian (Not Hispanic or Latino) – A person having origins in any of the original peoples of the Far East, Southeast Asia, or the Indian Subcontinent, including, for example, Cambodia, China, India, Japan, Korea, Malaysia, Pakistan, the Philippine Islands, Thailand, and Vietnam.
    • American Indian or Alaska Native (Not Hispanic or Latino) – A person having origins in any of the original peoples of North and South America (including Central America), and who maintain tribal affiliation or community attachment.
    • Two or More Races (Not Hispanic or Latino) – All persons who identify with more than one of the above five races.
    • Officials and Managers
    • Professionals
    • Technicians
    • Sales Workers
    • Administrative Support Workers
    • Craft Workers
    • Operatives
    • Laborers and Helpers
    • Service Workers

    What You Will Need To File
    If you have never filed an EEO-1 before, and are required to file, you will need to obtain a company Login ID and password to the EEOC’s website so that you can enter your demographic information and file online. You can email the Joint Reporting Committee to get set up.

    For each worksite location at your company, you will need to report the number of male and female employees within each race and job category that were employed during any payroll period between July and September. Below is a sample grid layout similar to the data entry page on the EEOC website.

    EEO Data Sample resized 600

    For more information about the EEO-1 filing process, visit the EEO-1 Survey Website.