Q.- An employee is moving to work for us from Texas. His family members are not moving for a few months. He wants to know if he can wait to add his children to his coverage when they move. Will this be recognized as a permissible mid-year change event?
The U.S. Department of Labor encourages affirmative actions to employ covered veterans and to advance covered veterans in employment. Federal contractors and subcontractors with a contract in the amount of $150,000 or more with any department of the U.S. government must report on their affirmative action initiatives to employ veterans. Information must be provided by job category, hiring location, and new hire status.
An Applicable Large Employer (ALE) must provide affordable, minimum value coverage to its full-time employees and their dependents or be subject to a tax penalty. An ALE is an employer with 50 or more full-time employees in the prior year. Some employers may consider themselves “small employers,” but may actually be ALEs because they are part of a controlled group.
In a recent Opinion Letter, the Department of Labor found that an employee’s absence to attend a school meeting discussing his or her child’s individualized education program (IEP) was protected under the Family and Medical Leave Act.
Q.- I heard that it is possible to use a health FSA to purchase vitamins. Is this true?
The Medical Loss Ratio (MLR) provisions of the Affordable Care Act require insurers to spend at least a certain percentage of employees’ premium dollars on clinical care, instead of on administrative expenses such as executive salaries, overhead, marketing and profit. If an insurer does not spend enough on patient care to satisfy the MLR provisions, the insurer must make financial adjustments and provide rebates to customers. Health care reform sets the minimum MLR level at 85 percent for the large group market (policies covering over 50 employees) and 80 percent for the small group market. This means that administrative and other non-clinical costs can be no more than 15 or 20 percent of the insurer’s revenue. If an insurer fails to meet these standards, the insurer will be required to provide a rebate to customers.
ERISA requires administrators of health plans to give information about the plan’s operation to participants. One of the ERISA requirements is the distribution of a plan’s Summary Annual Report (SAR). A SAR is a summary of a plan’s financial information that is filed with the U.S. Department of Labor on Form 5500.
Q.- We just hired someone who has been out of work for a few weeks. She won’t be eligible for our health coverage until the first day of next month. She is concerned about a lapse of health coverage. I know the penalty for not having health coverage has been reduced to $0, but she is concerned. Is her concern legitimate?
The IRS has a website for helping help both individuals and employers with health care reform compliance.
The U.S. Department of Labor is considering changing its template Family and Medical Leave Act (FMLA) forms. While the DOL forms are not required, many employees use the template forms as a basis for requesting medical documentation and administering FMLA requests.
Q.- An employee cancelled dental coverage for his family in June when he was going through a divorce. We just received a copy of the divorce papers showing that the divorce was finalized last week (August 30th). We have to offer the ex-wife the opportunity to continue her medical coverage under COBRA, but can she also have dental coverage? That coverage stopped 2 months ago.
The Affordable Care Act requires applicable large employers (ALEs) to offer health coverage to full-time employees and their dependents. A “full-time employee” is defined as an employee who, in any month, works at least 30 hours per week. 130 hours of service in a calendar month is considered the equivalent of 30 hours per week.