Tag Archives: IRS

Regulatory roundup

More healthcare-related regulatory news for plan sponsors, including links to detailed information.

2019 Medicare Part D benefit parameters published
The Centers for Medicare & Medicaid Services (CMS) released the Medicare Part D standard benefit parameters and the cost thresholds and limits for qualified retiree prescription drug plans for 2019.

For more information, click here.

CMS’ RDS Center now accepting Medicare Beneficiary Identifier (MBI) in retirees files
Effective as of April 1, 2018, the CMS’ Retiree Drug Subsidy Center is accepting Medicare Beneficiary Identifier (MBI) in retiree files. Plan Sponsors and Vendors should take note that the use of MBI is not mandatory within the RDS Program and that RDS will continue to accept SSN and/or HICN or RRB indefinitely. For information on the use of MBI in RDS retiree file formats please reference the following pages in the RDS User Guide:

• Retiree File Layouts
• Retiree Response File Layouts
• Weekly Notification File Layouts
• Covered Retiree List File Layout and Format
• RDS Reason Codes

For more information, contact CMS’ RDS Center.

Regulatory roundup

More healthcare-related regulatory news for plan sponsors, including links to detailed information.

ACA Information Returns Submission (AIR) guide updated
The Internal Revenue Service (IRS) has released its “ACA Information Returns (AIR) Submission Composition and Reference Guide.” The guide was updated as of March 16, 2018. The purpose of this document is to provide guidance to all types of external transmitters about composing and successfully transmitting compliant submissions to IRS.

To download the guide, click here.

RDS to start accepting Medicare Beneficiary Identifier files
The Retiree Drug Subsidy (RDS) Center of the Centers for Medicare and Medicaid Services (CMS) will begin accepting the Medicare Beneficiary Identifier (MBI) in retiree files in accordance with CMS’s new Medicare Card Project, beginning April 1, 2018. Healthcare plan sponsors should review the RDS program website’s “New Medicare Card Project” page for helpful guidance on this initiative and how it impacts the RDS program.

For more information, click here.

IRS revises HSA family contribution limit and other inflation-adjusted amounts

The Internal Revenue Service (IRS) published Revenue Procedure 2018-18 containing inflation-adjusted amounts revised due to the December 2017 enactment of the Tax Cuts and Jobs Act (P.L.115–97). The law revised the basis for certain tax adjustments from the Consumer Price Index for Urban Consumers (CPI-U) to the Chained CPI-U, effective in 2018. Thus, the new revenue procedure replaces figures previously announced for 2018 in Revenue Procedure 2017-37 (regarding health savings accounts [HSAs] and high-deductible health plans [HDHPs]) and Revenue Procedure 2017-58 (tax provisions, including those covering employer-provided benefits, that are subject to annual cost-of-living adjustments [COLAs]).

Revenue Procedure 2018-18 revises the following items (changed amounts are boldfaced):

HSAs/HDHPs: The maximum contribution limit to an HSA for family coverage under an HDHP is reduced by $50, while all other amounts remain the same. The HSA $1,000 annual “catch-up” contribution limit for individuals aged 55 or older was set by law for 2009 and later years and is not subject to inflation adjustments.

Amounts under Rev. Proc. 2017-37 2018 Updated Amounts under Rev. Proc. 2018-18
Benefit Self-Only Family Self-Only Family
HSA Maximum Annual Contribution $3,450 $6,900 $3,450 $6,850
HDHP Minimum Annual Deductible $1,350 $2,700 $1,350 $2,700
HDHP Maximum Annual Out-of-Pocket Expenses $6,650 $13,300 $6,650 $13,300

Archer Medical Savings Accounts: Some figures decrease for 2018.

Amounts under Rev. Proc. 2017-37 2018 Updated Amounts under Rev. Proc. 2018-18
Benefit Self-Only Family Self-Only Family
HDHP Annual Deductible Between $2,300 and $3,450 Between $4,600 and $6,850 Between $2,300 and $3,450 Between $4,550 and $6,850
Annual Out-of-Pocket Expenses $4,600 $8,400 $4,550 $8,400

Adoption Assistance Programs: All figures decrease for 2018.

Amounts under Rev. Proc. 2017-37 2018 Updated Amounts under Rev. Proc. 2018-18
Excludible amounts
For adoption of special
needs child
$13,840 $13,810
For other adoptions $13,840 $13,810
Phase-out Income Thresholds
Phase-out Begins $207,580 $207,140
Phase-out Ends $247,580 $247,140

Employee Health Insurance Expense for Small Employers: The amount decreases for 2018.

Amounts under Rev.
Proc. 2017-37
2018 Updated Amounts under Rev.
Proc. 2018-18
Small Employer Health Insurance Expense $26,700 $26,600

Employers that offer HSAs/HDHPs, Archer medical savings accounts, or adoption assistance to their employees, and/or employers that receive tax credits for health insurance premiums they pay for employees enrolled in qualified health plans under the Small Business Health Options Program (SHOP) should review their programs and consider modifying the amounts to comply with the updated figures. There are potential penalties and other tax consequences for noncompliance with the revised limits. For example, an employee contributing to an HSA for family coverage could be subject to additional taxes if he or she contributes at the outdated maximum amount. At this time, however, the IRS has not provided guidance on the steps necessary to make the midyear changes, so consulting with tax counsel or other expert advisers may be prudent. Employers also may have to modify administrative systems (e.g., to accommodate payroll withholding) and update communications materials to employees.

For further information about the IRS’s revised figures for 2018, please contact your Milliman consultant.

Regulatory roundup

More healthcare-related regulatory news for plan sponsors, including links to detailed information.

IRS releases final and temporary rule on health providers’ fee
The Internal Revenue Service (IRS) released final regulations that provide rules for the definition of a covered entity for purposes of the fee imposed by section 9010 of the Patient Protection and Affordable Care Act (ACA), as amended. The final regulations supersede and adopt the text of temporary regulations that provide rules for the definition of a covered entity. These regulations affect persons engaged in the business of providing health insurance for U.S. health risks.

To read the entire rule, click here.

Federal agencies propose rule on short-term, limited-duration insurance
The U.S. Departments of Treasury, Labor (DOL), and Health and Human Services (HHS) have released a proposed rule that would amend the definition of short-term, limited duration insurance for purposes of its exclusion from the definition of individual health insurance coverage.

The proposed rule would make it easier to obtain coverage through short-term health insurance plans by allowing insurers to sell policies that last under a year. The new rules stem from an executive order the president signed in October aimed at boosting competition, giving consumers more choices, and lowering premiums.

To learn more, click here.

How CBO and JCT analyze major proposals that would affect health insurance coverage
The Congressional Budget Office (CBO) and the staff of the Joint Committee on Taxation (JCT) released a report that estimates the budgetary effects of most types of major legislative proposals that would affect both spending and revenues using a process that involves many steps and many analysts. The report focuses on the process that the agencies use to analyze proposals affecting health insurance coverage for people under age 65, such as legislation that would make major changes to the ACA.

For more information, click here.

Regulatory roundup

More healthcare-related regulatory news for plan sponsors, including links to detailed information.

IRS publishes best practices for tax filings related to individual shared responsibility provision
The Internal Revenue Service (IRS) released a document offering best practices for practitioners to gather necessary information to use in preparing 2017 tax returns for their clients, including information that may be helpful to demonstrate compliance with health coverage requirements of the Patient Protection and Affordable Care Act (ACA). General requirements on filing a complete and accurate tax return continue to apply. Preparers are expected to resolve conflicting or contradictory statements from their clients during the return preparation process.

Under the individual shared responsibility provision of the ACA, all individuals are required to have qualifying healthcare coverage (called minimum essential coverage), qualify for an exemption, or make an individual shared responsibility payment (ISRP) with their federal income tax returns. An individual is responsible for himself or herself, his or her spouse (if filing a joint return), and any individuals who could be claimed as dependents (collectively, the tax household). Under the recently enacted Tax Cuts and Jobs Act, taxpayers must continue to report coverage, qualify for an exemption, or pay the individual shared responsibility payment for tax years 2017 and 2018.

For more information, click here.

Guidance on corrected, incorrect, or voided forms 1095-A
Individuals enrolled in health coverage through a healthcare marketplace must complete a Form 1095-A, Health Insurance Marketplace Statement, early in the year following the year of coverage. They should use the information on the form to claim the premium tax credit, to reconcile advance payments of the premium tax credit, or both, when filing their tax returns. Some taxpayers may receive a second Form 1095-A because the information on the initial form was incorrect or incomplete. The IRS has published information related to corrected or voided Forms 1095-A for tax years 2014 through 2017.

For more information, click here.

Regulatory roundup

More healthcare-related regulatory news for plan sponsors, including links to detailed information.

Guide for electronically filing ACA Information Returns for software developers and transmitters
The Internal Revenue Service (IRS) has published its Guide for Electronically Filing Affordable Care Act (ACA) Information Returns (AIR) for Software Developers and Transmitters (Processing Year [PY] 2018). The guide outlines the communication procedures, transmission formats, business rules, and validation procedures for information returns transmitted electronically through the AIR System.

For more information, click here.

Health insurance provider fee moratoriums released
The IRS has published questions and answers regarding the health insurance provider fees on its website. The posting offers perspective on several issues, including the following:

• Under the 2019 moratorium, is there a health insurance provider fee in 2019?
• Must Form 8963 be filed in the 2019 fee year?
• Do the 2017 or 2019 moratoriums affect the 2018 fee year?
• Does the 2019 moratorium apply to fee year 2019 or data year 2019?

For more information, click here.