By Employee Benefit Research Group
More healthcare-related regulatory news for plan sponsors, including links to detailed information.
IRS publishes final test packages for electronic filers of ACA information returns
The Internal Revenue Service (IRS) has published Publications 5164 and 5165, final test packages for electronic filers of information returns for the Patient Protection and Affordable Care Act (ACA).
• Publication 5164, Test Package for Electronic Filers of Affordable Care Act (ACA) Information Returns (AIR), contains general and program-specific testing information for use with ACA Assurance Testing System (AATS). AATS refers to both the process and the system used to test software and electronic transmissions prior to accepting software developers, transmitters, and issuers into the AIR system. Software developers are required annually to pass predefined AATS submissions and test scenarios for the forms that they will support. Transmitters and issuers are required to pass communication tests for the forms they will file.
• Publication 5165, Guide for Electronically Filing Affordable Care Act (ACA) Information Returns (AIR) for Software Developers and Transmitters (Processing Year [PY] 2015), outlines the communication procedures, transmission formats, business rules, and validation procedures for returns transmitted electronically through the AIR system. To develop software for use with the AIR system, software developers, transmitters, and issuers should use the guidelines provided in this publication along with the eXtensible Markup Language (XML) schemas published on IRS.gov. The procedures in this publication should be used when the following information returns are transmitted electronically:
o Form 1094-B, Transmittal of Health Coverage Information Returns
o Form 1095-B, Health Coverage
o Form 1094-C, Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Returns
o Form 1095-C, Employer-Provided Health Insurance Offer and Coverage
Note: This publication does not contain information or procedures for filing Forms 1095-A. The transmittal forms 1094-B and 1094-C provide information about the issuer of the ACA information returns and the forms 1095-B and 1095-C provide information about the covered individuals.
IRS releases draft publication
The IRS has released a draft of publication 5223, “General rules and specifications for ACA substitute Forms 1095-A, 1094-B, 1095-B, 1094-C and 1095-C.” The publication states:
“If you do not use the official IRS form to furnish statements to recipients, you must furnish an acceptable substitute statement. Information presented in substitute statements should be in a point size large enough to be easily read by recipients. To be acceptable, your substitute statement must comply with the rules in this Part. Generally, information returns may be furnished electronically with the consent of the recipient.”
To read the entire draft publication, click here.
CMS’s RDS program announcement: Authorized representative verification requirement removed
Previously, in order to receive a retiree drug subsidy (RDS) payment, plan sponsors were required to submit an authorized representative verification form to the Centers for Medicare and Medicaid Services (CMS) to verify that the authorized representative listed on the application has the legal authority to bind the plan sponsor to the terms of the plan sponsor agreement.
Effective immediately, CMS has removed this requirement. New or existing authorized representatives that are assigned to an application are no longer required to be verified in order for a plan sponsor to receive payment.
If you have questions or need additional information, contact CMS’ RDS Center.
IRS issues health tip regarding the ACA and aggregated companies
The IRS has issued Health Tip 2015-50, discussing how the ACA affects aggregated companies. According to the IRS, the ACA applies an approach to common ownership that also applies for other tax and employee benefit purposes. This longstanding rule generally treats companies that have a common owner or similar relationship as a single employer. These are aggregated companies. The law combines these companies to determine whether they employ at least 50 full-time employees including full-time equivalents.
If the combined employee total meets the threshold, then each separate company is an applicable large employer. Each company—even those that do not individually meet the threshold—is subject to the employer shared responsibility provisions.
These rules for combining related employers do not determine whether a particular company owes an employer shared responsibility payment or the amount of any payment. The IRS will determine payments separately for each company
For more information, click here.