Wolf, Rogers, Dickey & Co.

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Health Care Planning for 2010 & 2011

Health Care Laws and Employers — Planning for 2010 and 2011




Health Care Planning for 2010 & 2011
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Employers and health plan administrators need to understand and respond to changes in the tax Code, ERISA and other laws made by health care legislation that has an immediate and significant impact. You may think that your organization has several years before the acts take effect. However, certain provisions became effective on enactment. Also, some tax-planning opportunities and requirements become effective in 2010 or 2011. Below is a short description of the key provisions of the health care acts (P.L. 111-148 and P.L. 111-152) that impact employers and health plans and generally are effective in 2010 or 2011. Note that some effective dates apply to plan years or taxable years.


Effective 2010:



  • Credit for small employers (no more than 25 employees) for health insurance expenses.

Effective March 23, 2010:



  • Employers with more than 200 full-time employees and that have one or more health plans must automatically enroll new full-time employees in one of the offered plans. Notice and opportunity to opt out must be provided. Note: This effective date is not clear. The provision may not be effective until guidance is issued.
  • The Fair Labor Standards Act is amended to protect whistleblowers and other employees receiving health care subsidies.


Effective March 30, 2010:



  • Self-employed individuals may deduct health insurance premiums paid on behalf of children under age 27
  • Dependent coverage is extended to a child of a member of a voluntary employees' beneficiary association (commonly referred to as a VEBA) who is less than age 27 as of the end of the calendar year.
  • Qualified retirement plans may pay health benefits for a retiree's child under age 27.


Effective June 20, 2010:



  • Employer health plans providing coverage to early retirees have access to reinsurance. Program terminates January 1, 2014.


Effective September 23, 2010:



  • Insurers and group health plans that offer dependent coverage are required to allow uninsured children to remain on their parents' health insurance through age 25.
  • Small and large group market plans are prohibited from imposing lifetime limits on coverage.
  • Plans must provide coverage, without cost-sharing, for preventive services and immunizations.
  • Insurance companies are prohibited from rescinding coverage, except in cases of fraud or intentional misrepresentation of material fact.
  • No discrimination based on the wages of employees.
  • All health insurance plans are prohibited from excluding children under age 19 on the basis of a pre-existing condition.


Effective 2011: