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New Affordable Care Act FAQ Re: Exchange Notices, Health Reimbursement Arrangements, Fixed Indemnity Insurance, and PCORI Fees

The U.S. Department of Labor issued FAQs Part XI that address a number of outstanding issues under the Affordable Care Act. According to the FAQs, the requirement to provide employees with notices regarding the availability of exchanges will not take effect on March 1, 2013, as originally scheduled, but rather will be effective in late summer or fall of 2013 in order to coordinate with the open enrollment period for the new healthcare exchanges. The FAQs also clarify that health reimbursement arrangements (HRAs) must only be available to employees who are covered by the employer?ÇÖs group health plan; otherwise such HRAs (other than HRAs for retirees) would fail the prohibition on lifetime and annual limits on essential health benefits. Generally, fixed indemnity health insurance is considered an excepted benefit that is not subject to the Affordable Care Act. The FAQs clarify that fixed indemnity insurance can only provide benefits on… Continue Reading

Treasury Issues Proposed Regulations Imposing Co-Liability for Employment Taxes on Some PEOs and Staffing Services

Under proposed regulations issued by the U.S. Department of the Treasury, when an employer enters into a ?Ç£service agreement?Ç¥ with a third party in which the third party pays the employee?ÇÖs wages and handles employment tax withholding, the third party generally becomes designated as an agent of the employer and is co-liable for the payment of employment taxes. To qualify as a ?Ç£service agreement,?Ç¥ the third party must (1) assert it is the employer or ?Ç£co-employer?Ç¥ of the employees, (2) pay the employees?ÇÖ wages for the services performed for the employer, and (3) collect; report; and pay; or assume liability for, any employment taxes with respect to those wages. A third party may assert that it is an employer or co-employer by (1) either separately or together with the employer, recruiting and hiring or assigning employees as permanent or temporary members of the employer?ÇÖs workforce, (2) hiring the employer?ÇÖs employees… Continue Reading

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