February 9, 2015
- IRS Releases Final Forms and Instructions for PPACA Information Reporting
- DOL Seeking Input on Updating Regulatory Process
IRS Releases Final Forms and Instructions for PPACA Information Reporting
The Internal Revenue Service (IRS) has finalized the forms and instructions to be used by applicable large employers and insurers for reporting information regarding health care coverage and “minimum essential coverage” as required under the Patient Protection and Affordable Care Act (PPACA).
The forms are to be used to fulfill the requirements specified in final regulations implementing the reporting of minimum essential coverage (MEC) under Section 6055 of the Internal Revenue Code) and the reporting of health insurance coverage under Section 6056 of the Internal Revenue Code. The requirements are effective for 2015, with the first required reporting due in 2016. These reporting requirements were delayed for 2014 under previously issued Notice 2013-45 transition relief (though the IRS encouraged voluntary reporting for coverage in 2014).
Code Section 6055 requires every health insurance issuer, sponsor of a self-insured health plan, government agency that administers government-sponsored health insurance programs and other entities that provide minimum essential coverage to file annual returns reporting certain information for each individual for whom minimum essential coverage is provided and to provide a copy of the return to the individual. Form 1095-B: Health Coverage is to be used to fulfill this requirement, while Form 1094-B is to be used for transmitting Form 1095-B.
The IRS has also finalized the instructions for filing Forms 1094-B and 1095-B.
An employer that sponsors an insured health plan will not report as a provider of health coverage under Section 6055; the health insurance carrier is responsible for reporting that coverage.
Code Section 6056 requires every applicable large employer (generally, an employer that employed on average at least 50 full-time employees or equivalents) to file a return with the IRS that reports the terms and conditions of the health care coverage provided to the employer's full-time employees during the year. Form 1095-C: Employer Provided Health Insurance Offer and Coverage is to be used to fulfill this requirement, while Form 1094-C is to be used for transmitting Form 1095-C. An applicable large employer that provides self-insured coverage is subject to the reporting requirements of both sections 6055 and sections 6056. As discussed in previous IRS Frequently Asked Questions (FAQs) on Information Reporting by Health Care Providers (Section 6055) (No. 27), such employers will combine section 6055 and 6056 reporting on Form 1095-C.
The IRS has also finalized the instructions for filing Forms 1094-C and 1095-C.
In a November 2014 letter to the IRS, the Council suggested numerous clarifications to the draft versions of these forms and their instructions, offering a range of recommendations to address the use of indicator codes, clarifying reporting of employees and non-employees, eliminating duplicative or unnecessary sections and providing additional instructions with regard to third-party reporting. Among the Council recommendations was a request that reporting information for non-employees (including retirees or COBRA beneficiaries be permitted on either the Form 1095-B or Form 1095-C. The final instructions for 1094-C and 1095-C confirm that reporting of non-employees is permitted using either form. The Council will be scheduling a member webinar to review the final instructions and forms in further detail.
For more information, contact Kathryn Wilber, senior counsel, health policy, at (202) 289-6700.
DOL Seeking Input on Updating Regulatory Process
Pursuant to the White House’s Executive Order 13563 (issued in 2011) and Executive Order 13610 (issued in 2012), in which President Obama directed his administrative agencies to improve the regulatory review process and review existing significant regulations to identify whether any regulations may be made more effective or less burdensome, the U.S. Department of Labor (DOL) is soliciting “ideas” on “how the Department can improve any of its significant regulations by modernizing, modifying, redesigning, streamlining, expanding, or repealing them.”
The comment request follows a previous March 24, 2011, RFI issued by the DOL for public input on reducing regulatory burden (see the March 30, 2011, Benefits Byte). At that time, the Council submitted written comments (see the April 8, 2011, Benefits Byte) addressing regulatory and procedural issues related to both employer-sponsored health care and retirement plans, including:
- Electronic delivery of required notices.
- Elimination of unnecessary or superfluous notices and disclosures.
- Serial changes in the regulatory landscape.
- Coordination of regulatory regimes.
- Balancing burdens against potential benefits.
The president’s executive orders specifically set forth a goal of creating a regulatory system that protects “public health, welfare, safety, and our environment while promoting economic growth, innovation, competitiveness, and job creation” while using “the best, most innovative, and least burdensome tools to achieve regulatory ends.” In the Council’s latest public policy strategic plan, A 2020 Vision, the Council recommended:
- Adopting a “presumption of good faith” standard allowing employers to use technology as it becomes available, rather than waiting for regulatory approval.
- Adopting a “least burdensome compliance” standard that fully incorporates technological capabilities in conjunction with all benefit plan regulations in its new strategic plan.
- Elimination of duplicative, contradictory or excessive regulations that impose administrative burdens with respect to plan sponsorship.
- Reducing or combining the number of retirement plan information disclosure requirements.
- Improving coordination of rules between Congress and administrative agencies – and across those agencies.
Comments in response to the solicitation must be received by February 25 through an Internet portal specifically created for this comment request. The solicitation includes a number of specific questions about the DOL’s regulatory approach and the general public will be able to “vote” on others’ ideas.
The Council welcomes your input as we consider submissions to DOL. To provide feedback on retirement regulatory policy, please contact Jan Jacobson, senior counsel, retirement policy. To provide feedback on health care regulatory policy – including promulgation of rules related to the Patient Protection and Affordable Care Act, contact Kathryn Wilber, senior counsel, health policy. Both can be reached at (202) 289-6700.