Ongoing Massachusetts Healthcare Reform Legislation
03/08/2007
In our ongoing effort to keep you informed with the Massachusetts Health Care Reform legislation, the following is a brief summary and status of the key provisions contained in the new Massachusetts law.
Dependent Eligibility
In January 2007 the Massachusetts Health Care Reform Law contained a provision extending dependent eligibility for two years beyond the loss of dependent status under I.R.S. standards or up to age 26, which ever occurs first. Your employees with dependents, whose coverage ended due to aging off the plan, will want to consider the financial impact of adding their dependent back on their family plan. According to I.R.S. guidelines this additional extension in coverage for a non-I.R.S. dependent should be reported as imputed income for the employee at year end.
Non-Discrimination Requirement
This provision in the law requires health insurance carriers to provide group health benefit contracts only to employers who contribute equal contribution to all full-time employees. Group contracts are not permitted between insurance carriers and employers who discriminate between higher and lower paid employees. The Non-Discrimination Requirement is delayed until July 2007.
Health Insurance Responsibility Disclosure (HIRD)
Additionally, the provision of the law requiring all employers to complete an annual Health Insurance Responsibility Disclosure form, which will be used to administer and enforce the Individual Insurance mandate, the Employer Fair Share contribution and the Free Rider Assessment, is delayed until July 2007. It is our understanding however that employers should use the Employee HIRD waiver of coverage form for all newly eligible employees declining coverage or for employees waiving coverage at open enrollments during 2007. The Employee HIRD Form is available in both PDF format or as a Word Document .
Employer Surcharge for State Funded Health Cost or (a.k.a. the Free Rider Surcharge)
All employers with10 or more employees are required to establish a Section 125, premium pre-tax payroll deduction plan for health insurance premiums. This requirement applies for all employees even those not eligible to participate in your company sponsored medical plan. If your company does not currently have a Section 125 pre-tax payroll deduction plan in place, please contact your Yozell Account Manager for specific details.
This past weekend Governor Patrick, leadership of the Commonwealth Connector and the health insurance carriers in the state reached agreement on the plan design and age based rates for the new health insurance products available to uninsured individuals via Commonwealth Choice. Please see the attached article.
Ongoing discussions between the Division of Insurance and the health insurance carriers continue regarding the cost and plan designs for the Young Adult Plans which will be marketed to the 19-26 year old consumers this July.
If you or your employees have questions about the new Health Care Law, please feel free to contact us . As we learn more information about this legislation we will keep all our clients informed.
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