Steps to check if your medical and employee benefit broker has an insurance license

  Below I will describe how to check if your insurance broker is licensed in CA. In every state the process is very similar. As a consumer it is not your responsibility to check the creditability of your insurance broker, however I would urge you do so that you do not end up with the wrong insurance policy in the future. Step One: For CA employers, search by license number. If you would prefer you can search by the insurance broker’s name. Step two: Once you find your insurance broker’s name it is important that you verify that their license is “Active.” If their license is “Active” at least you know that your broker is current with the state continuing education and should be familiar with all of the products they are recommending. Tip: If the insurance company that your broker is recommending is not on the list of “Insurance Company Appointments” then it is likely your broker is selling you an insurance policy for that company for the first time. However, if your insurance broker works for an insurance agency then it is likely that the insurance policy will be placed under the managing broker. If you ever want to confirm who your broker is on your insurance policy, call the broker and ask to see the Master Application for any group insurance benefits (medical, dental, vision, life and disability insurance). For individual insurance plans many times there is a broker attestation or broker details section that clearly identifies who was the writing broker or broker of record for your insurance policy. If you are ever unsatisfied with your current insurance broker and...

Common Summary Plan Description (SPD) Mistakes

Subject to ERISA (Employee Retirement Income Security Act) the SPD (Summary Plan Description) is one of the most important documents that participants under a health benefit plan must receive.  The Department of Labor has increased its company audits, and more often than not employers are failing to provide their employees an SPD. Some may consider the information distributed by their insurance carrier as sufficient evidence of coverage and benefits to satisfy their SPD distribution requirement.  Unfortunately, this is not the case, and the responsibility lies solely in the lap of the plans administrator (the employer that sponsors the group plan). Every employer that sponsors a group health plan must comply with this important ERISA requirement, or they run the risk of facing a hefty fine.  Penalties of up to $110/day per participant or beneficiary for failing to provide an SPD or plan document within 30 days of receiving a request.  The penalty accrues daily from the inception of the policy, not from the date of notification to furnish. It is considered a best practice to distribute the SPD to employees and maintain proper records that each beneficiary has in fact acknowledged receipt.  This can be accomplished by employing an online administration system that can track and organize specific notices, and ensure compliance under ERISA. To learn more about how we can assist your company reduce its risk of an audit, and eliminate the risk of arbitrary penalties -please contact us via telephone or...

ACA Reporting Requirements

Applicable Large Employers (ALEs) must report information to the IRS regarding the health care coverage offered to full-time employees and full-time equivalent employees (FT/FTE). Once you’ve collected all the necessary information from your workforce, you must complete the three documents required for ACA compliance: the 1094-C, 1095-C, and the Written Statement to each employee. Form 1094-C Employer Transmittal Accounts for each of the following, per 2015 calendar month: Full-time employees Total headcount Whether Minimum Essential Coverage was offered Whether an applicable 4980H “Safe Harbor” was used Deadline for documents to be mailed: February 29, 2016 Deadline for document to be transmitted digitally: March 21, 2016 Form 1095-C Employee Statement Accounts for each of the following, per 2015 calendar month: Proof of offer of coverage (with code) Employee’s share of the lowest cost monthly premium Whether an applicable 4980H “Safe Harbor” was used Deadline for documents to be mailed: February 29, 2016 Deadline for document to be transmitted digitally: March 21, 2016 Written Statement of Each Covered Employee The employer’s name, address, and contact information The information for the employee on the return being filed Deadline for Statement Sent to Employee: January 31,...

4 Things to Know About the Affordable Care Act

The ACA is designed to reduce healthcare costs, expand coverage for the uninsured, and increase quality of care for people. The ACA can be confusing, making it difficult for many businesses to comply with the law’s requirements. In 2016, almost all businesses will be required to comply. To avoid hefty fines, here are four things to know about the requirements so you can remain compliant and penalty free in 2016: Are you an Applicable Large Employer (ALE)? If so, your business is subject to ACA requirements! To be considered an ALE, your company has to have 50+ full-time employees and full-time equivalent employees (FT/FTE). Calculating your total number of employees is difficult. That’s because the ACA classifies “full time” employment as 30 hours a week of work or more. Make sure to include both full-time employees as well as those who work the equivalent of full-time hours. Your business must offer “affordable” health insurance of “minimum value” to your employees: “Affordable” Health Insurance is less than 9.5% of annual household income. You can calculate the 9.5% from employees’ W2 wages, hourly pay rate, or the Federal Poverty Level for an individual. “Minimum Value” means employer-sponsored health plans must be designed to pay at least 60% of the total cost of medical services. You need to submit three key documents to guarantee compliance. If you’re an ALE, collected all the necessary info from your workforce, and made the necessary calculations, then it’s time to complete the three documents required for ACA compliance: the 1094-C, 1095-C, and the Written Statement to each...

Blue Shield System Enhancements for Small Groups in CA

As part of Blue Shield’s commitment to improve the way they provide service to you, they are continuing to bring more customers onto our enhanced membership and claims system. Once the new system has been fully implemented, Blue Shield customers will be able to process and pay claims and enroll members faster and with greater efficiency. On June 1, Blue Shield is moving their small business clients with a July, August, and September 2014 renewal period onto the system. As of June 1, 2014, your clients will notice some changes. Changes for employers: Consolidated medical, dental, and vision* coverage billing with an improved format and a tear-off remittance slip. Customers will no longer receive separate bills for Dental HMO and/or vision* coverage they obtain through Blue Shield. New account number for billing purposes. New group contract number that replaces your current number. New subgroup billing number(s) that replaces your existing billing unit number(s). New employer service contact number. New payment mailing address. Access to our enhanced Employer Connection Plus online system for account management. Delayed June 2014 client bills. Please note: June 2014 Blue Shield bills will be mailed the last week of May, and they should receive them the first week in June. Our standard 30-day grace period for payment will extend from the date we actually produce their June bills. Clients’ June bill will be the first one generated by our newly enhanced system. The June bill will not reflect outstanding balances or adjustments from May, so please have them pay their May bill as usual. Our Producer Services team will work with you to resolve any open balances. For...

IRS – New Guidance Pertaining to FSAs & HRAs

On Friday, March 28, 2014, the IRS issued guidance regarding the FSA $500 Carryover and Health Savings Account (HSA) eligibility, in addition to guidance regarding FSA substantiation/correction of health care expenses. IRS Chief Counsel Memo No. 201413005 addresses Flexible Spending Account (FSA) carryovers and Health Savings Account (HSA) eligibility. IRS Chief Counsel Memo No. 201413006 addresses correction procedures for improper FSA payments. Regarding FSA carryovers, the IRS provided the following clarifications: 1. An individual in a medical FSA is not eligible for an HSA, even if the balance consists solely of carryover or grace period amount. 2. In regards to the carryover, this HSA ineligibility will continue for the entire plan year, even if the balance is exhausted earlier in the plan year. 3. In regards to the grace period, this HSA ineligibility will continue for the length of the grace period, even if the balance is exhausted before the end of the grace period. 4. As an alternative, a medical FSA can be designed to allow an individual to elect that the carryover amount be used as Limited FSA, so that the medical FSA is compatible with the HSA. The carryover amount cannot be transferred into any other non-Health FSA or another cafeteria plan benefit. 5. The medical FSA cannot be designed to allow an individual to elect to use the grace period and have it transfer into a Limited FSA unless the Limited FSA is established for all individuals. 6. A cafeteria plan may design the medical FSA so that any election for high-deductible health plan (HDHP) coverage, which makes an individual HSA eligible, can automatically force...