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HCR Update: New Tax Credit Fact Sheet, Updates on Essential Health Benefits, etc.

Feb 11, 2011

Health Care Reform Update

February 11, 2011

New fact sheet explains small employer tax credit

The small employer tax credit, which was added to the Internal Revenue Code by the health care reform law, is effective for taxable years beginning in 2010. We've developed a new fact sheet that provides more details about the tax credit, including:

·         Employer eligibility

·         Credit amount

·         Links to IRS information and resources, including the new Form 8941 and instructions

·         Information about the small business tax credit calculator on our health care reform website 

For more details about whether they qualify for the tax credit and how to claim the credit, customers should talk with their tax advisor due to the complexity associated with determining the amount of credit an employer is entitled to receive.  

Status update on essential health benefits

At the request of the U.S. Department of Health and Human Services (HHS), the Institute of Medicine is conducting a study that will make recommendations on the criteria and methods for determining and updating the essential health benefits package. The study is expected to be complete in September 2011. Once the institute study is complete, HHS will issue regulations defining essential health benefits.

We are implementing the changes necessary based on current guidance. Once we get further guidance from HHS, we may adjust some of the actions we have taken and guidance we have provided to our customers.  

For more details and talking points, refer to this fact sheet.

Fact sheet clarifies excluded plans and excepted benefits

Do you get a lot of questions about which plans are excluded from health care reform? Then check out our new fact sheet for answers.

The fact sheet clarifies which benefits are considered "excepted benefits." In general, the health care reform law does not apply to excepted benefits. Certain benefits are always treated as excepted benefits because they are not considered health coverage. Other benefits are treated as excepted benefits if they are offered separately or are not an integral part of the health plan. 

Template language for employers posted on reform website

The health care reform law requires health insurance issuers and sponsors to provide certain notices to employees, either as a separate notice or as part of other benefits materials. To help employers comply with these requirements, we've posted a template language library on our health care reform website  for employers and brokers.

 The library contains two types of language:

·         Required language mandated by health care reform regulations, including:

o        Grandfathered plan disclosure

o        Annual limit waiver

o        Dependent special enrollment right

o        Lifetime limit special enrollment right

·         Optional language employers can use to explain key reform-related topics such as these in a consumer-friendly way:

o        Meaning of "grandfathered"

o        No pre-ex waiting periods for children

o        Spending account changes

o        W-2 reporting

o        Exchanges  

Employers can copy and paste the language they need and then customize as necessary. As we continue to receive additional guidance from the U.S. Department of Health and Human Services, Department of Labor and Internal Revenue Service, we'll update the document as needed. 

Now you have a single, reliable resource for health care reform information.


This content is provided solely for informational purposes: it is not intended as and does not constitute legal advice. The information contained herein should not be relied upon or used as a substitute for consultation with legal, accounting, tax and/or other professional advisers.


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