EMPLOYEE BENEFITS
“ Failing to offer coverage that meets these requirements could result in significant penalties for your business .”
Both covered entities and business associates may be selected for a HIPAA audit .
THE GOAL OF THIS PROGRAM IS TO IMPROVE COMPLIANCE .
However , if an audit reveals a serious compliance matter , the HHS may initiate a compliance review to further investigate the issue .
Entities selected for an audit will have ten business days to draft a response . Communications from the OCR will be sent via email . Make sure to check your spam folder for emails from OSOCRAudits @ hhs . gov to make sure these important emails are not missed .
To prepare for a potential audit , employers should self-audit their compliance with HIPAA rules using the OCR ’ s audit protocol . The OCR ’ s audit protocol is organized around modules , each representing separate elements of privacy , security , and breach notifications . The protocol pinpoints nearly 180 areas for possible audit inquiry .
In addition , HIPAA ’ s Security Risk Assessment ( SRA ) Tool can be used to perform and document an organization ’ s security risk analysis . The SRA tool can be downloaded at www . healthit . gov / providers-professionals / security-riskassessment-tool .
Even if your organization is not selected for a Phase 2 audit , it is important to self-audit your business to ensure compliance since the OCR will likely continue its enforcement efforts after Phase 2 audits are completed .
ACA ’ S AFFORDABILITY CONTRIBUTION PERCENTAGE INCREASED FOR 2017 On April 12 , 2016 , the Internal Revenue Service ( IRS ) released new guidance on the percentages used to determine what is considered “ affordable ” health coverage .
Under the Affordable Care Act ( ACA ), the affordability of an employer ’ s plan may be assessed for an employer shared responsibility payment , the individual mandate , and the premium tax credit . The affordability test varies for each provision .
For plan years beginning in 2017 , employer-sponsored coverage will only be considered affordable if the employee ’ s required contribution for self-only service coverage does not exceed the following :
• 9.69 percent under the premium tax credit eligibility rules ( up from 9.66 percent in 2016 ). The shared responsibility rules , or play-orpay rules , require applicable large employers ( those that employ fifty or more full-time employees or fulltime equivalents ) to offer coverage that does not exceed 9.69 percent of an employee ’ s household income for the year . If employees ’ required contributions exceed 9.69 percent , those employees could be eligible for a premium tax credit through the health insurance marketplace , which could result in penalties for employers .
• 8.16 percent under an exemption from the individual mandate ( up from 8.13 percent in 2016 ). Individuals that lack access to affordable minimum value coverage are exempt from the individual mandate .
Failing to offer coverage that meets these requirements could result in significant penalties for your business .
Please note that these percentages only apply to individual coverage and do not include additional costs for family coverage .
If your company offers various health coverage options , the affordability test applies to the lowest-cost option that also meets the minimum value requirement established by the ACA .
THESE NEW REQUIREMENTS ARE EFFECTIVE FOR TAXABLE YEARS AND PLAN YEARS BEGINNING AFTER DECEMBER 31 , 2016 .
For more information on these requirements , contact Spectrum Insurance Group today . +
BY : CLARK THEILIG BENEFITS SPECIALIST , PARTNER , SPECTRUM INSURANCE GROUP
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