Healthcare Reform 2014: Managing Employee Data and Benefits

By David Dawley and Jessica Lollino, Abshier House

The advent of the Affordable Care Act (ACA) may affect how employee benefits are administered. To help you prepare your small business for the changes, the American Small Business Association (ASBA) provides excellent guidance on benefits administration and managing employee. Following are some of the major changes in store:

  • Employee Coverage Data: New requirements for how employee data is handled will take effect in 2015. This change will be linked to the Employer Shared Responsibility Rules, which apply to those businesses with more than 50 full-time employees. These larger businesses will be required to report all employees’ coverage, what health plan they are covered under, and how much that coverage is costing.

    Those businesses with less than 50 full-time employees, which accounts for 98% of the companies in the country, will not be subject to this requirement.

  • Contributions to Flexible Spending Accounts (FSAs): Employees are now capped on what they may contribute to a flexible spending account. This account is where employees may elect to have a portion of their paycheck put away for a rainy day. The cap to this account is at $2,500 specifically to prevent overspending on medical provision by the employee. This cap does not apply to what the employer may contribute.

  • 90-day waiting period limit: According to the ASBA, as of January 1, 2014, those eligible for healthcare coverage will not have to wait more than 90 days to receive it. Employers are responsible for the application and the enforcement of this 90-day rule.

  • No denial for pre-existing conditions: This may be one of the most talked-about provisions of the new healthcare act. Employer health plans cannot deny a person coverage based on a pre-existing condition. For example, if employee data shows that employee to be diabetic, he cannot be denied insurance coverage based on this fact. This applies to all conditions for which a patient may have been denied coverage in the past.

    While this applies mainly to the insurance company themselves, it deserves mention under employee data management.

  • New wellness programs in the workplace: The Affordable Care Act also expands on rewards provided to employers who offer preventative, or “wellness” programs in the workplace. While previously these rewards may have been focused on those who needed to get healthy, a larger focus is being placed on staying health, increasing insurance benefits from 20-30% (and as much as 50% for tobacco cessation) for those who choose to utilize an employee wellness program.

To prevent unfair practices, the United States Department of Labor has announced new rule changes that will be in effect, such as:

  • Notice of alternative means to receive an award must be given.

  • It must be obvious that a program is designed to promote health and that program must be reasonably accessible by the employees.

  • Programs must be designed so that all those with the same issue can participate. A person in a wheelchair should have equal access to heart health endeavors, for example.