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Alden Bianchi is the Practice Group Leader of the firm’s Employee Benefits & Executive Compensation Practice. He advises corporate, not-for-profit, governmental, and individual clients on a broad range of executive compensation and employee benefits issues, including qualified and nonqualified retirement plans, stock and stock-based compensation arrangements, ERISA fiduciary and prohibited transaction issues, benefit-related aspects of mergers and acquisitions, and health and welfare plans.

In a series of recent posts (available here and here), we discussed the expanded Massachusetts Employer Medical Assistance Contribution (EMAC) requirements, including the adoption of a new EMAC supplemental contribution. Among other things, we explained that the EMAC rules operate in a manner that is fundamentally different from the now repealed “fair share employer contribution” requirement under the 2006 Massachusetts health care reform law. Under that law, employers were obligated to (among other things) obtain signed forms—referred to as Health Insurance Responsibility Disclosure (or “HIRD”) forms. While the HIRD form requirements were repealed effective July 1, 2013, there is now a new HIRD form requirement with which employers will need to contend.

Continue Reading Revenge of the HIRDs—The New Massachusetts Employer Healthcare Coverage Form

The Massachusetts Department of Unemployment Assistance (DUA) has begun assessing Employer Medical Assistance Contribution (EMAC) supplemental payments for the first quarter. This post proposes a grounds for appealing DUA determinations that would serve employers well: employers that offer affordable, major medical coverage to their employees should not be assessed an EMAC supplement for any full-time employee who has coverage under ConnectorCare. The Affordable Care Act (ACA) makes these employees ineligible for subsidized coverage.

Continue Reading Appealing Massachusetts Employer Medical Assistance Contribution (EMAC) Supplement Determinations Based on ConnectorCare Coverage

What’s a financial advisor to do? On March 15, 2018, the Fifth Circuit Court of Appeals in Chamber of Commerce of the U.S. v. U.S. Dep’t. of Labor, No. 17-10238, 2018 U.S. App. LEXIS 6472 (5th Cir. Mar. 15, 2018) vacated – thereby invalidating – a series of seven rules (which we collectively refer to in this post as the “fiduciary rule”) issued in April 2016 by the Department of Labor (DOL). The fiduciary rule vastly expanded the reach of the ERISA fiduciary standards that apply to individuals and entities providing investment advice. This post first explains the state of the law prior to the fiduciary rule; it then discusses the impact of the rule on the arguments that the Court grappled with; and it concludes by handicapping the options available to regulated financial advisors and institutions as they endeavor to respond.

Continue Reading Fifth Circuit Court of Appeals Invalidates the 2016 Final Department of Labor Fiduciary Rule and Related Prohibited Transaction Exemptions

In advance of issuing the Executive Order that culminated in the promulgation by the Department of Labor of proposed regulations expanding the availability of Association Health Plans, President Trump announced that one of the purposes of the order was to allow people to buy health insurance “across state lines.” This post examines the consequences of, the obstacles to, and the inevitable clashes occasioned by, the interstate insurance sales of group health insurance.

Continue Reading Association Health Plans and the Sale of Group Health Insurance “Across State Lines”

Recently proposed Department of Labor (Department) regulations governing Association Health Plans (AHPs) would, if made final, permit small employers to be regulated under more favorable, large group rules. The proposed regulations modify the rules governing fully-insured AHPs; they do not change the way that self-funded AHPs are regulated. But in the preamble to the proposal, the Department invites comments on whether the standards that govern fully-insured AHPs should be extended to self-funded AHPs. Such an extension would be a step into unchartered regulatory territory—which is the topic of this post.

Continue Reading Association Health Plans: Self-Funded vs. Fully-Insured

In last week’s post we explained the changes made by a newly proposed Department of Labor regulation, the purpose of which is make it easier for small employers to band together to form “association health plans” (“AHPs”). In that post, we promised to examine the impact of the proposed regulation on the small group and individual health insurance markets, which we will do in this post.

Continue Reading The Department of Labor’s Proposed Association Health Plan Regulation: Who Wins, Who Loses?

Massachusetts employers with 6 or more employees will soon be required to prepare and file a new health care reporting form referred to as the “healthcare coverage form.” While reminiscent of the now repealed “Health Insurance Responsibility Disclosure” or “HIRD” form requirement, the new form differs significantly. This post explains this new reporting rule.

Continue Reading Massachusetts to (Again) Require Health Care Reporting by Employers

On January 3, 2018, the Department of Labor issued proposed regulations that will make it easier for small employers to band together to form “association health plans” (“AHPs”), thereby providing access to more liberal underwriting and other rules governing large groups. This post provides context for, and summarizes the changes made by, these proposed regulations.

Continue Reading The Department of Labor’s Newly Issued Association Health Plan Proposed Regulations Include Welcome Changes for Employers But Would Present State Regulatory Challenges

After a long delay, the IRS has begun enforcing the Affordable Care Act’s rules governing shared employer responsibility  (a/k/a the “employer mandate”). This mandate imposes “assessable payments” on Applicable Large Employers (i.e. those with 50 or more full-time and full-time equivalent employees in the prior calendar year) that either fail to offer coverage, or offer unaffordable or insufficiently robust coverage, and where at least one employee qualifies for subsidized coverage from an ACA exchange/marketplace. Demand letters have been issued for 2015 to a number of employers, and in many instances, the assessable payment amounts are substantial. But as Alden Bianchi and Christopher Condeluci argue in Why the IRS May Be Unable to Assess ACA Employer Shared Responsibility Penalties for 2015, a recently published article by Bloomberg/BNA, the IRS may be on shaky ground as it endeavors to assessable payments for 2015, due to the Department of Health and Human Services’ failure to provide notices required by the statute. To read the full article, please click here.

As we reported in a previous post, Massachusetts Governor Charlie Baker in August 2017 signed into law H. 3822, “An Act Further Regulating Employer Contributions to Health Care” (the “Act”). Among other things, the law increases the Employer Medical Assistance Contribution (“EMAC”) and also imposes a tax penalty—or “EMAC supplement”—on Massachusetts employers with more than five employees. The supplement is 5% of a covered employee’s unemployment insurance taxable wages up to the $15,000 per year (i.e., a cap of $750 per covered employee) for each nondisabled employee who receives health insurance coverage through the Massachusetts Division of Medical Assistance (i.e., MassHealth) or subsidized insurance through the Massachusetts Health Insurance Connector Authority (i.e., ConnectorCare).

The EMAC supplement take effect as of January 1, 2018. The Massachusetts Division of Unemployment Assistance (DUA) previously issued a draft regulation, which we discussed in our post of November 20, 2017. The DUA has now issued a final regulation, which is the subject of this post.

Continue Reading Massachusetts Division of Unemployment Assistance Issues Final Regulations Implementing the EMAC Supplemental