May 15, 2024
Employer Compliance Tips
- Advance Explanation of Benefits (EOB)
- IRS Priority Guidance Plan (ACA Rules and Reporting)
- IRS Request for Comment - ACA Employer Reporting 1094/1095C Forms
Advance Explanation of Benefits (EOB)
One of the transparency requirements set forth in the Consolidated Appropriations Act of 2021 requires providers and group health plans to coordinate to provide a good faith estimate of the expected charges in advance of an individual receiving treatment or services.
These provisions were originally scheduled to go into effect for plan years beginning on or after January 1, 2022, however, the agencies received feedback from the industry about the challenges of developing the technical infrastructure necessary for medical providers to transmit the necessary information to plans and carriers. The agencies released a Request for Information (as proposed regulations) in an effort to better determine and establish appropriate data transfer standards, among other things.
Then just recently, the agencies released a summary providing a progress report of sorts. The summary indicates that because the advance explanation of benefits (EOB) will “require players and providers to exchange health data in a way that has not been done before, technology will need to adapt to ensure that providers and payers can comply.” The current recommendation is to develop a single data exchange standard that could be used for this purpose, which will take time. The summary suggests the agencies are continuing in these efforts, which are seen to plan a critical role in price transparency and patient protections, but the actual requirements will not be going into effect for group heath plans any time soon.
Summary of the progress toward the implementation of the Advance EOB
IRS Priority Guidance Plan
While the IRS responsibilities are widespread the agency often focuses more on retirement plans.
However, the most recent priorities guidance plan suggests a continued focus on §4980H assessments and collections.
Therefore, applicable large employers (ALEs with 50 or more FTEs) should ensure that minimum value and affordable coverage is being offered to full-time employees and reported accurately using Form 1094-C and Form 1095-C.
A guide to assist with coverage requirements and Employer reporting requirements.
IRS Request for Comment – ACA Employer Reporting (Form 1094-C & Form 1095-C)
The IRS is looking for feedback on the ACA employer reporting process, specifically the reporting on offers of coverage to full-time employees that is required of applicable large employers (50 or more FTEs).
The IRS is asking for comments regarding:
- Whether the collection of information is necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility;
- The accuracy of the agency’s estimate of the burden of the collection of information;
- Ways to enhance the quality, utility, and clarity of the information to be collected;
- Ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or other forms of information technology; and
- Estimates of capital or start-up costs and costs of operation, maintenance, and purchase of services to provide information.
It is possible that this feedback could lead to changes (hopefully simplification) of the ACA Employer Mandated Annual reporting requirements and processes.
The IRS notice requesting comments
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