091813 ppaca slide deck flinchbaugh
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Transcript of 091813 ppaca slide deck flinchbaugh
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SMITH ELLIOTT KEARNS & COMPANY, LLC WWW.SEK.COM
An overview of the administrative and tax requirements of the Law…
2010…2011…2012…2013…2014…2015…2016…2017…2018…
» The Patient Protection and Affordable Care Act
Joel A. Flinchbaugh, CPAMember of the FirmSmith Elliott Kearns & Company, [email protected]
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SMITH ELLIOTT KEARNS & COMPANY, LLC WWW.SEK.COM
2010
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SMITH ELLIOTT KEARNS & COMPANY, LLC WWW.SEK.COM
President Obama Signs law March 23, 2010
now what???
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SMITH ELLIOTT KEARNS & COMPANY, LLC WWW.SEK.COM
35% tax credit applicable for:• Businesses with less than 25 FTE employees & average wages less than $50,000.• Credit reduced as # of employees exceeds 10 and average wage exceeds $25K.
Small Business Health Insurance Credits Begin
Click icon to add picture 2010
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SMITH ELLIOTT KEARNS & COMPANY, LLC WWW.SEK.COM
Tax applicable for services rendered after July 1, 2010.
10% Excise Tax on Indoor Tanning Services
2010
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SMITH ELLIOTT KEARNS & COMPANY, LLC WWW.SEK.COM
2011
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SMITH ELLIOTT KEARNS & COMPANY, LLC WWW.SEK.COM
• Over the counter drugs NO LONGER qualify.
• Non-qualified distributions subject to 20% penalty vs. 10% under old law.
Modifications to qualified expenses from FSA’s, HSA’s, and HRA’s and increased penalties.
2011
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SMITH ELLIOTT KEARNS & COMPANY, LLC WWW.SEK.COM
Medical Loss Ratio Limits Begin • Small group and individual insurers-80%.• Large group-85%.• Excess premiums must be refunded.
2011
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SMITH ELLIOTT KEARNS & COMPANY, LLC WWW.SEK.COM
2012
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SMITH ELLIOTT KEARNS & COMPANY, LLC WWW.SEK.COM
Reporting of Health Insurance on W-2• Employers issuing more than 250 W-2’s required
to report health benefits on W-2• Still waiting for final regulations regarding
companies with less than 250• Not taxable – just information
2012
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SMITH ELLIOTT KEARNS & COMPANY, LLC WWW.SEK.COM
Summary of Benefits Required• Renewals on or after 9/23/12• Notice of change in benefits must be provided 60
days before change• Insurance company should be providing this
reporting for employers
2012
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SMITH ELLIOTT KEARNS & COMPANY, LLC WWW.SEK.COM
Employers Begin to Receive MLR rebates• Can be used to offset future premiums.• If employees contribute to premiums, they must
receive proportionate share of rebate.
2012
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SMITH ELLIOTT KEARNS & COMPANY, LLC WWW.SEK.COM
2013
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SMITH ELLIOTT KEARNS & COMPANY, LLC WWW.SEK.COM
Increased Medicare Tax (Hospital Insurance Tax)• .9% of wages in excess of…
• $200,000 if single.• $250,000 MFJ.
• Employers MUST withhold on wages paid in excess of $200,000 to individual.
2013
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SMITH ELLIOTT KEARNS & COMPANY, LLC WWW.SEK.COM
Unearned Income Medicare Contribution Surtax • 3.8% on lessor of:
• Net investment income or• Excess of modified AGI over $200/S, $250/MFJ.
• Investment income (interest, dividends, royalties, rents, sale of passive activity, passive activity).
2013
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Increased Threshold for Deducting Medical Expenses• Threshold raised to 10% of AGI.• If over 65 - 7.5% limit still applies through
December 31, 2017.
2013
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Flexible Spending Account Limits• Annual limit of $2,500 for contributions to
flexible spending accounts.• No impact on premium or dependent care.
2013
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SMITH ELLIOTT KEARNS & COMPANY, LLC WWW.SEK.COM
2.3% Excise Tax on Medical Device Manufacturers• Exemptions
• Eyeglasses.• Contacts.• Any device generally purchased by the public at
retail.
2013
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SMITH ELLIOTT KEARNS & COMPANY, LLC WWW.SEK.COM
Patient Centered Outcomes Research Institute Fee - PCOR• Assessed on medical plans – usually paid by
carrier.• Employer may be subject with any type of self
insurance.• $1 per covered life, increasing to $2 than indexed
with inflation.
2013
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Notice of Coverage- Due 10/1/13• Employers required to provide• Must include:
• Description of services offered on Exchange• Potential eligibility for premium credit• Info about impact of purchasing through
Exchange
2013
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SMITH ELLIOTT KEARNS & COMPANY, LLC WWW.SEK.COM
2014
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SMITH ELLIOTT KEARNS & COMPANY, LLC WWW.SEK.COM
Individual Mandate• Maintain “minimum essential coverage” or:
• 2014 - Penalty (Tax) greater of 1% of household income OR $95 per uninsured
• 2015 – Penalty (Tax) greater of 2% of household income or $325 per uninsured
• Penalty Cap of $2,250 per household• There are some exceptions to the penalty
2014
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SMITH ELLIOTT KEARNS & COMPANY, LLC WWW.SEK.COM
“Tax Credits” for Individuals Purchasing Through Exchange• A subsidy for purchasing insurance through the
Exchange. • For people with income above Medicaid limits,
but below 400% of federal poverty level.
2014
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SMITH ELLIOTT KEARNS & COMPANY, LLC WWW.SEK.COM
Expansion of small business Health Insurance Credit to a 50% credit for small businesses who purchase insurance through SHOP (Exchange).
Small Business Health Insurance Credits
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SMITH ELLIOTT KEARNS & COMPANY, LLC WWW.SEK.COM
2015
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Pay or Play Employer MandateEmployers with 50 or more FTE employees must either offer health insurance, or pay a penalty• $2,000/employee, but first 30 are not counted• Still subject to penalty even if coverage is offered,
but employee receives tax credit
2015
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2017
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States May Allow Larger Employers to buy on Exchange• Businesses with more than 100 employees may
be able to purchase insurance in the SHOP
2017
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SMITH ELLIOTT KEARNS & COMPANY, LLC WWW.SEK.COM
2018
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SMITH ELLIOTT KEARNS & COMPANY, LLC WWW.SEK.COM
Excise Tax on “Cadillac” Plans • 40% Excise tax on plans with costs exceeding:
• $10,700 for individuals• $27,500 for family
2018
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That was Easy!!!!
2018