Monthly Archives: November 2016

How a broker can help with an individual health insurance plan

As of spring 2016, more than 11 million people had enrolled in individual health insurance through the Affordable Care Act (ACA) Marketplace, and similar numbers are expected in 2017. With numbers that high, some of these people are bound to feel confused, overwhelmed, and frustrated when shopping for health coverage. The good news is you don’t have to do it alone. Many people don’t realize there are free resources available to them.

Selecting an Individual Health Insurance Plan

Choosing an individual health insurance policy can be a complicated journey. Multiple factors go into the price of a plan—including the size of the provider network, how much the insurance company will cover, and the deductible amount. In an effort to simplify the process, the ACA divided their policies into four different tiers.

The lowest tier (Bronze) comes with the lowest premiums, but the highest out-of-pocket expense share at 40 percent. Silver is the next step up, then Gold. The highest tier is Platinum, which has the highest premiums, but enrollees can expect to pay only 10 percent of the cost of medical care.

Each family’s needs are different, but generally speaking, people who expect to seek little medical attention would be suited for the Bronze tier. If you are treating a chronic illness or require multiple prescriptions, a higher tier may be more suited to you. In addition, if network size is important to you, you may want to look into a PPO plan as opposed to an HMO.

What Does a Broker Do?

Brokers are there to help you make a more informed decision—usually at no charge to you. They can get individual health insurance quotes, compare plans, and help you understand what your options are. They should be able to answer most of your questions, and if not, they’ll have access to people who can.

There are multiple ways to find a broker. If you go to and look for individual health insurance quotes, brokers may call you to offer their assistance. You are welcome to use their services by phone or email—and no, you will not be charged.

Another way to find a healthcare broker is to call a company like Stride Health. They provide many free resources on their website, which means you can do some research ahead of time and ask more informed questions over the phone.

Word to the Wise

You may be wondering, if brokers provide free services, how do they get paid? Brokers are often paid a commission by the insurance company when they sign someone up for a policy. This means that companies offering better incentives to brokers may end up with more enrollees—and the individual health insurance option they recommend may take into account more than just the best option for you and your family.

As always, it is best to do your research and make sure that you understand all of the parameters of your plan before signing up for the year. Don’t be afraid to ask plenty of questions, including “Why are you recommending this plan for my family?

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ACA Individual Statement(1095) extended date!

IRS Extends ACA Individual Statement Deadline (Form 1095) from January 31 to March 2

November 20, 2016

In Notice 2016-70, IRS extends the 2017 deadline from January 31 to March 2 for employers and insurers to furnish individual statements on 2016 health coverage and full-time employee status (Forms 1095-B and 1095-C). The notice also extends 2015 good-faith penalty relief to 2016 for incorrect or incomplete reports due in 2017.

In the Notice, the IRS did not extend the due date for filing the forms with the IRS  February 28 (if filing by paper) or March 31 (if filing electronically).

Please remember that  filers can take advantage of an automatic 30-day extension of the IRS filing deadline  by submitting Form 8809 before the relevant due date.

Lastly, IRS extended the good-faith relief in Notice 2016-70 that applied to in 2015 to 2016. This relief applies to missing and inaccurate taxpayer identification numbers and dates of birth, as well as other information required on the return or statement. To show good faith efforts to qualify for this relief, filers must meet applicable deadlines. However, IRS recognizes that late filers may still be able avoid penalties by showing reasonable cause for missing the due dates.

For a copy of Notice, please click on the link below: 

More information available from:

Eric Walters

CELL: 602-616-1660


Email: OR



ACA/Obamacare- Q & A.

  • Question: What if a consumer files his or her tax return without Form 8962?
    Answer: Tax filers must file their tax return with the IRS Form 8962 to reconcile advance payments of the premium tax credit (APTC).



    Question: Does a consumer’s eligibility for Medicaid, in addition to actually being enrolled in Medicaid, disqualify a consumer from receiving advance payments of the premium tax credit (APTC)?
    Answer: Consumers who are determined eligible for or are enrolled in coverage through Medicaid or CHIP that qualifies as minimum essential coverage (MEC) are ineligible for APTC for themselves, and for income-based cost-sharing reductions (CSRs) to help pay for the cost of their Marketplace coverage.


    Question: Is loss of advance payments of the premium tax credit (APTC) or income-based cost-sharing reductions (CSR) a qualifying event for a special enrollment period (SEP) for consumers to change their Marketplace plan?
    Answer: A consumer may qualify for a Special Enrollment Period if he or she (or anyone in his or her household):
    – Is enrolled in Marketplace coverage and report a change that makes him or her: Newly eligible for help paying for coverage; Ineligible for help paying for coverage; Eligible for a different amount of help paying for out-of-pocket costs, like copayments.
    – Become newly eligible for Marketplace coverage because he or she has become a U.S. citizen, U.S. national, or lawfully present individual.
    – Become newly eligible for Marketplace coverage after being released from incarceration (detention, jail, or prison).
    – Gain or maintain status as a member of a federally recognized tribe or Alaska Native Claim Settlement Act (ANCSA) Corporation shareholders (he or she can change plans once per month).
    – Become newly eligible for help paying for Marketplace coverage because he or she had a change in household income or moved to a different state and he or she was previously both of these: Ineligible for Medicaid coverage because he or she lived in a state that hasn’t expanded Medicaid; Ineligible for help paying for coverage because his or her household income was below 100% of the Federal Poverty Level (FPL).


    Question: How would a consumer become enrolled in both Medicaid/Children’s Health Insurance Program (CHIP) and a Marketplace plan with advance payments of the premium tax credit (APTC) or income-based cost sharing reductions (CSR)?
    Answer: A consumer may experience a life change (e.g., drop in income) making him or her eligible for Medicaid or CHIP, but he or she may fail to end Marketplace coverage with APTC/CSRs after being determined eligible for Medicaid or CHIP. Similarly, consumers who are enrolled in Marketplace coverage with APTC/CSRs may apply for Medicaid or CHIP directly with the state agency and be determined eligible, but fail to end Marketplace coverage with APTC/CSRs. While the Marketplace reinforces in many places the importance of reporting changes directly to the Marketplace and ending Marketplace coverage with APTC/CSRs after being determined eligible for or enrolling in other minimum essential coverage, this notice is a reminder to these consumers who may not have been aware that they need to end their Marketplace coverage with APTC/CSRs after being determined eligible for Medicaid or CHIP.


    Question: Will the process for termination of advance payments of the premium tax credit (APTC) or income-based cost sharing reductions (CSR) be the same for consumers who are enrolled in Medicare?
    Answer: This noticing effort is the first step the Federally-facilitated Marketplace (FFM) is taking to make sure consumers take action to end their Marketplace coverage with APTC because they are receiving Minimum Essential Coverage (MEC) Medicare. The FFM does expect to turn off APTC/CSR for consumers who are found to be dually-enrolled in a Marketplace plan with financial assistance and Medicare once it is operationally feasible.



    Question: If consumers have recently amended their federal income tax returns, how long do they need to wait in to reapply for Marketplace coverage?
    Answer: The Internal Revenue Service (IRS) takes 3-10 weeks to process a tax return based on how it is filed. Consumers should update their application, or reapply for coverage, during the Open Enrollment Period which begins November 1, 2016. After tax filers have filed their tax return, they can attest on the application to having filed their taxes for all past years that they received advance payments of the premium tax credit (APTC). Consumers should update their application and select a plan by Dec 15, 2016 to have coverage effective Jan 1, 2017.


    Question: If a consumer received a final Medicaid/Children’s Health Insurance Program (CHIP) Periodic Data Matching (Medicaid/CHIP PDM) notice, but is not enrolled in Medicaid or CHIP, can he or she appeal the Marketplace’s decision to end advance payments of the premium tax credit (APTC) and income-based cost-sharing reductions (CSRs)?
    Answer: A consumer can appeal the Marketplace’s decision about his or her eligibility for health coverage, including eligibility for APTC and CSRs, within 90 days from the date of the notice. A consumer may appoint an Authorized Representative to help with his or her appeal, or may participate on his or her own. If a consumer requests an appeal, he or she may be able to maintain eligibility for coverage while the appeal is pending. Note that the outcome of an appeal could change the eligibility of other household members on the consumer’s Marketplace account, even if they do not ask for an appeal. Information regarding a consumer’s right to appeal and instructions on how to do so are included in the final notice.


    Question: When were failure to reconcile (FTR) notices sent to consumers?
    Answer: FTR warning notices were sent in May 2016 letting affected consumers and members of their households know they were at risk of losing advance payments of the premium tax credit (APTC) because Internal Revenue Service (IRS) records indicated they did not have a 2014 federal income tax return on file.


    Question: Does simply filing a 2014 federal income tax return automatically count as reconciling advance payments of the premium tax credit (APTC)?
    Answer: Tax filers must file their tax return with the Internal Revenue Service (IRS) Form 8962 to reconcile APTC.

    Have questions?

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Tax Credit or Cost Sharing Reductions- 2016? Check this!

On Exchange healthplan?- did you get Premium Tax Credit and cost sharing reduction payments in 2016?

CMS is re-determining subsidy eligibility for all on-exchange members again this year.

The Marketplace will use the newest income data available to re-determine advance payments of the premium tax credit (APTC) and cost-sharing reductions (CSR). This applies to enrollees who do not return to the Marketplace to update their application information and select a plan by December 15, 2016.

Also in October, CMS will send a Marketplace Open Enrollment Notice (MOEN) to all on-Exchange members.

This notice will contain certain basic information, including: a description of the annual redetermination and renewal process; the requirement to report changes affecting eligibility and the ways for reporting such changes; and the last day members can choose a plan for coverage starting January 1. For enrollees who authorized the Marketplace to request updated tax return information for use in the annual redetermination process and who are receiving APTC or income-based CSRs, this notice will have information on the process the FFM will use to establish APTC and CSR eligibility for 2017 for enrollees who do not actively reenroll.

Again this year, consumers who received subsidies in 2016 but did not file a 2015 federal tax return with Form 8962 to reconcile their APTC will be placed into a federal tax return (FTR) group. This could result in a loss of APTC and CSR eligibility. These consumers will receive a special version of the MOEN from CMS in October indicating that they are at risk for losing APTC in 2017. During Open Enrollment, this group will need to actively renew and include their latest income information or their APTC will be set to $0 for 2017.

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Large employers-<50- ACA reporting data?

In an article published this week, The National Law Review clearly and starkly describes how employers must ensure accuracy and completeness of ACA reporting data in order to avoid billions of dollars in fines. There will be no “good faith” efforts considered for the 2016 reporting year. The message is clear: Penalties and fines will be levied on organizations that fail to carefully attend to the detailed steps, and those fines will be significant.

This no-nonsense checklist explains ten important factors employers should consider in preparation for 2016 ACA reporting (filed in 2017). We recommend that employers with over 50 full-time employees should take the time to read the entire article and prepare their organization in order to mitigate risk.  We have consultants who can provide this level of service for all our clients.

  1. Understand The Big Data Environment. The IRS is using big data analytics to find contradictions within data across multiple forms – contradictions that will lead to audits and fines.
    “…the government projects employer mandate penalties of $228 billion. Thus, there is clear anticipation that revenue will be generated and violations will be ascertained through the information reporting filings.”
  2. Ensure Proper Worker Classifications. This covers more than just identifying full-time versus part-time. For the 2016 reporting year the eligibility threshold has gone from 70% to 95%, placing an additional burden on employers. Relationships with staffing firms and other alternative arrangements further complicate the process of properly classifying employees.
  3. Monitor changes in the applicable guidance. The IRS released draft forms and instructions for filing that included a number of significant changes to codes, some of which could lead to penalties for the employer. There are also proposed regulations regarding how coverage opt-outs should be handled when determining affordability, and how to handle reporting on employees potentially covered by multiple plans offering minimum essential coverage. Familiarity with these changes is vital, but because these are still draft guidelines and proposed regulations, employers will need to be vigilant in staying up-to-date on the information.
  4. Ensure Accurate Names and Social Security Numbers. The article outlines a number of steps that employers should take to ensure that the employee and dependent data is captured accurately and completely. However, it’s not enough to just take the steps outlined – employers will need to systematically track and record steps taken, responses received, and changes made to employee data.
  5. Corrected Returns. The author notes that while employers may be getting ready for 2017 filings, many are still addressing the corrections process for the 2015 forms: “Correcting errors is part of the good faith effort to file accurate and complete information returns.” For those who may have struggled with the 2015 reporting process, showing “good faith” means continuing to try to provide as much accurate information as possible.
  6. Record Retention. An extensive list of employee documentation is outlined in the article, and it’s recommended that employers gather all of this data to provide proof for audits or other issues. Employers should also have a documented process in place for gathering, tracking, and recording the data.
  7. Marketplace Notice and IRS Penalty Notice. For Marketplace Notices issued regarding employees who received a subsidy, “It is especially important for large employers to check records to determine if this employee was offered qualifying coverage, that the employee was properly classified and then to determine if it is necessary to challenge…because this could be a trigger for later receipt of an IRS penalty notice.” The article goes on to explain that employers should prepare to clarify their position and should have an approach for reviewing and responding to subsidy notices.
  8. Corporate Transactions. In terms of mergers and acquisitions, not only should the acquiring organization be aware of the method of reporting used by the organization being acquired, it’s also important to review that reporting to determine if there was inaccurate or incomplete information. Potential penalties could even be factored into purchase prices. “A best practice is to perform a 1095-C and 1094-C audit during the due diligence process.”
  9. Fiduciary Responsibility and Governance. Since health and welfare plans are subject to ERISA, care should be taken to ensure that they are in compliance. Employers are urged to enact enhanced fiduciary governance procedures.
  10. Establish an ACA Information Reporting Team. As the author notes, “ACA compliance has many facets, and information reporting is a complex requirement.” Data collection and integrity, quality control, data privacy, and accuracy auditing are all items that this team should handle to determine the cause of the errors and address them. Without this level of attentiveness, fines are an inescapable outcome.

What to do?

Partnering with an ACA expert ( we have the names for you) will relieve this pressure on your organization providing turnkey support including:

  • An ACA-certified partner who will manage your program and provide regular communication
  • Meticulous data collection, analysis and tracking
  • Proactive monitoring and alerts regarding updates and changes in the guidelines
  • Remediation to ensure your organization achieves ACA compliance success
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FSA 2017 Contributions- inflation adjustments!

On Tuesday, Oct. 26, 2016, the Internal Revenue Service (IRS) announced 2017 inflation adjustments for several tax provisions, including flexible spending accounts (FSA) and transportation services.

New limits are provided for plan years beginning on or after Jan. 1, 2017. Employers should ensure their FSA plan document accurately reflects their plans allowable annual election. 

Contribution Limits for FSAs
For 2016 For 2017 Change
Healthcare FSA(full and limited purpose) $2,550 $2,600* +$50
Dependent Care FSA $5,000 $5,000* No change
Transportation (parking and transit) $255/month $255/month No change


*This is the maximum annual election allowed by the IRS. An employer may choose to limit their plan to an amount less than the IRS maximum.


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Remember the Individual Mandate? Obamacare health insurance?

The Individual Mandate and the Affordable Care Act

What is the Obamacare Individual Mandate?

Under the Affordable Care Act’s Individual Mandate, most Americans are required to have health insurance, or pay a tax penalty if they don’t. This Obamacare rule is called the “Individual Mandate” or “Individual Shared Responsibility Fee” and started in 2014.

Coverage can include job-based health insurance, individual health insurance, or insurance through a government program such as Medicaid or Medicare.

Is there a penalty for not having health insurance?

Yes. The penalty for not having “minimum essential coverage” is either a flat fee or a percentage of household income, whichever is greater.

As the chart shows below, the penalty increases each year.


Year: Pay the Greater of: Flat Fee        OR                           Percentage of Income


        $695 per adult,$347.50                       OR                 2.5% of family income

per child, up to $2,085                                                minus federal tax filing

per family.                                                                    threshold

2017                                                    OR                   Adjusted Annually

Adjusted Annually




Individual Mandate Tax Penalty – Example

Beth is single and earns an annual income of $40,000/year. Beth went uninsured in 2015. At tax time, Beth is required to pay an Individual Shared Responsibility Fee.

Beth will pay either 2% of income (minus the federal tax filing threshold) or $325, whichever is greater.

Beth’s annual income ($40,000) minus the federal tax filing threshold ($10,150) is $29,850. Two percent (2%) of $29,850 is $597.

Since this amount is greater than $325, Beth will pay a $597 tax penalty.

How can I avoid the tax penalty?

You may not have to pay the Individual Mandate tax penalty if you are uninsured, and:

Are required to pay more than 8% of your household income for the lowest cost bronze plan.
Are not a U.S. citizen, a U.S. national, or a resident alien lawfully present in the U.S.
Had one gap in coverage for less than three consecutive months during the year.
Won’t file a tax return because your income is below the tax filing threshold. In 2013, the tax filing threshold was $10,000 for individuals and $20,000 for a couple.
Are unable to qualify for Medicaid because your state has chosen not to expand the program.
Participate in a health care sharing ministry or are a member of a recognized religious sect with objections to health insurance.
Are a member of a federally recognized Indian tribe.
Are incarcerated.
Qualify for a hardship exemption

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