Implementation issues for kentucky school districts
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Implementation Issues for Kentucky School Districts. Affordable Care Act. Presenters. Melissa Sullivan [email protected] 502-564-3930 extension 4415 Susan Barkley [email protected] 502-564-3930 extension 4437. Resources.

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Implementation issues for kentucky school districts

Implementation Issues for

Kentucky School Districts

Affordable Care Act


Presenters
Presenters

  • Melissa Sullivan

    [email protected]

    502-564-3930 extension 4415

  • Susan Barkley

    [email protected]

    502-564-3930 extension 4437


Resources
Resources

  • KDE website: Health and Life Insurance Benefits and Flexible Spending Accounts page

  • http://education.ky.gov/districts/FinRept/Pages/Health-and-Life-Insurance-Benefits-and-Flexible-Spending-Accounts.aspx

    • Implementation Guide

    • Timekeeping documentation

    • KEHP FAQs and Responsibility Chart


Disclaimer
Disclaimer

  • The Guide is only one of many resources

  • IRS continues to issue regulations on ACA

  • Information in the Guide could become inaccurate

  • Not comprehensive of all aspects of ACA

  • Consult legal counsel


Whose responsibility
Whose Responsibility?

  • Districts:

    • Eligibility and offers of coverage (Play or Pay)

    • Nondiscrimination

    • Marketplace Notice

    • Employer Reporting

  • KEHP:

    • Affordable coverage

    • Adequate coverage

    • Plan details and options






And we know many variable hour employees won’t work enough separate days at 8 hours a day to change their eligibility status – therefore we don’t need to track their actual time



What do we have to deal with
What do we have to deal with? as we expected

  • Establish policies relating to ACA

  • Track actual time for employees close to the eligibility break point and part-timers

  • Calculate eligibility for all variable hour employees

  • Document offers of coverage

  • Provide marketplace notice to new hires

  • Ensure nondiscrimination

  • Employer reporting to IRS



Expectations
Expectations as we expected

  • If employee is expected to work full-time must offer coverage at the time of hire

  • If it is unknown if the employee will have an average of 30 service hrs/week or 130 service hrs/month, use the measurement period


Action steps
Action Steps as we expected

Repeat Annually


Who are employees
Who are Employees? as we expected

An employee relationship exists when the employer has the right to control and direct the individual who performs the services and the details and means by which the result is accomplished.


Who are employees1
Who are employees? as we expected


Large employer
“Large” Employer as we expected

  • 2015 = 100 or more FT & FTEs

  • 2016 = 50 or more FT & FTEs

  • Most KY school districts are large


Hours of service
“Hours of Service” as we expected

  • Hours actually worked (or equivalency)

  • Hours paid or entitled to be paid

    • Vacation

    • Holiday

    • Sick leave

    • Disability

    • Jury duty

    • Military duty


Equivalency hours
Equivalency Hours as we expected


Employment breaks
Employment Breaks as we expected

  • Breaks at least 4 consecutive weeks in length

  • Cannot count zero hours worked

  • Exclude from average hours of service

    Examples: summer break, FMLA leave


Eligibility break point
Eligibility Break Point as we expected

  • Step 1 – calculate number of days excluding breaks of > 4 weeks

  • Step 2 – multiply 5.997 by the number of days from Step 1 and then divide by 8

    5.997 * 207 / 8 = 154 days


Do i need to track actual time
Do I need to track actual time? as we expected

  • To limit the number of employees tracking actual time worked:

    • Limit number of days/year

    • Limit number of days/week

    • Use equivalency of 8 hrs/day


Board action
Board Action as we expected

  • Measurement, administrative, and stability periods

  • Limitation of days worked

  • Track actual hours or use equivalency

  • Terminate subs that refuse

    assignments


Full time employees for aca
Full-time Employees for ACA as we expected

Employees who average

30 hours of service per week or

130 hours of service per month


Who is full time
Who is Full-time? as we expected

Average hours of service over measurement period

  • Max 12 months

  • Recommended:

    October 3, 2013 – October 2, 2014

  • Don’t forget to exclude breaks >4 weeks


Recommended measurement periods
Recommended Measurement Periods as we expected

Continually measuring


What about mid year hires
What About Mid-Year Hires? as we expected

  • InitialMeasurement Period

    • Begins the first day of the month after hired

    • Max 12 months

    • Transitions to standard measurement period


Initial measurement period
Initial Measurement Period as we expected

Note that the standard measurement period begins during the initial measurement period; both periods occur simultaneously


Offering coverage
Offering Coverage as we expected

  • ACA requires coverage for full-time employees and dependent children – not spouses

  • Coverage must begin Jan 1, 2015 for districts with 100 or more full time & FTEs

  • Coverage must begin Jan 1, 2016 for districts with 50 or more full time & FTEs

  • Offer must be made, employee can decline

  • Maintain documentation

  • Annual requirement


Offering coverage1
Offering Coverage as we expected

  • Full-time during Measurement Period = Coverage during Stability Period regardless of hours of service during Stability

  • NOT full-time during Measurement Period = NO coverage during Stability Period regardless of hours of service during Stability


Cobra
COBRA as we expected


Funding
Funding as we expected

  • State funds non-federal employee premiums

  • If health insurance appropriation is inadequate, unexpended SEEK funds may be used

  • Avoid a blanket policy to offer coverage to all employees


Penalty
Penalty as we expected

  • If no Substantial Compliance

    • For 2015 - 70% of full-time employees

    • Starting in 2016 - 95% or no more than 5 full-time employees

  • Penalty is

    • Number of full-time employees minus 30

    • Multiplied by $167 per month


Nondiscrimination
Nondiscrimination as we expected

  • Cannot provide more for highly compensated employees

  • Example: paying the superintendent’s employee premiums

  • Penalty is

    • Number of employees minus the superintendent

    • Multiplied by $100 per day until in compliance

  • Solution: tax the additional benefit


Employer reporting
Employer Reporting as we expected

  • Will be required

  • First report due March 2016 for 2015 plan year data

  • IRS guidance not finalized

  • More information forthcoming


Your good questions
Your Good Questions as we expected


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