Massachusetts now joins California, New York and Washington, D.C. as the only states to have both a $15 minimum wage and mandatory paid family and medical leave. It also eliminates some mandatory overtime rules, and gradually phases in over 5 years. If you are a Massachusetts-based employer or have employees there, this is a must read. Click here.
Great article in Fox Business about how these plans work and why they are popular. on the plus side, they are a lot less expensive. on the negative side- they are not insurance and there is no guarantee of payment. For the full article, click here.
EmblemHealth’s Tristate Network for Small Groups: Available to Quote Now
EmblemHealth has expanded our Prime network for small groups (1-100 employees) to include both the QualCare network in New Jersey and ConnectiCare’s network in Connecticut. The expanded Prime network will be effective for these groups July 1, 2018.
From Empire Blue Cross: “We are actively negotiating a renewal deal but we have reached a point where we are proceeding with the activities to terminate our contract effective 5/1/18. The 60 day cooling off period ends 7/1/18 , on 5/15/18 notification letters were mailed to our members. As always we are continuing our dialogue with the facility in the hopes of reaching a mutually acceptable agreement.”
Therefore as of 7/1, at the end of the cooling off period, if no deal has been reached, South Nassau will be out of the network.
At least two states (Massachusetts and New York) are threatening to sue the Trump administration over this new rule…. In several states, group health insurance laws will need to be revised to permit individuals and small groups to participate in AHPs if they are not otherwise members of pre-existing tax-qualified bona fide associations…. Many states do not permit the inclusion of sole proprietors and individuals in group insurance arrangements.
This may shape up as a battle between Federal and State rights, Liberals and Conservatives. In any event, no state to our knowledge has yet to approve any association health plans.
From Crains: “The state Department of Financial Services said Tuesday that the Trump administration’s final rule expanding the role of association health plans won’t preempt its authority to regulate health insurance. ” DFS Superintendent Maria Vullo said in a statement. “As always, DFS will enforce New York law and regulation to ensure consumers continue to enjoy the state’s robust health care consumer protections.” State officials and insurance experts have expressed concern that the expansion of association health plans will attract healthier customers seeking cheaper, less comprehensive coverage. That would leave behind a sicker pool of people seeking coverage in the state’s small-business and individual markets, which would lead to insurers’ raising prices for all customers.
A wave of breakthrough drugs is transforming the medical world, offering hope for people with deadly diseases despite their dizzying price tags.
But what if it turns out that some of these expensive new drugs don’t work that well?
That’s the quandary over Orkambi, a drug that was approved in 2015 for cystic fibrosis and was only the second ever to address the underlying cause of the genetic disease. Orkambi, which is sold by Vertex Pharmaceuticals, costs $272,000 a year, but has been shown to only modestly help patients.
Now, in a case that is being closely watched around the country, New York state health officials have said Orkambi is not worth its price, and are demanding that Vertex give a steeper discount to the state’s Medicaid program. The case is the first test of a new law aimed at reining in skyrocketing drug costs in New York’s Medicaid program.
Exclusions for many certain high-cost brand drugs that are no more effective than medications already available are among the latest updates to BlueCross BlueShield of South Carolina’s drug formulary, with most of the changes taking effect July 1, 2018.
We work with an independent panel of BlueCross network physicians and pharmacists, the Pharmacy and Therapeutics Committee, to develop and maintain our drug lists and policies. Clinical decisions are based on drugs’ efficacy, safety and value, with the goal of providing the greatest clinical effectiveness for the lowest cost.
The particular brand-name drugs affected by this update are usually launched a couple of years after a new brand-name drug is introduced. “Structurally, they are very similar to drugs already on the market,” said Joshua Arrington, who is pharmacy sales director for BlueCross as well as a licensed pharmacist.
The newer versions aim to capture their own share of the market as manufacturers promote them as providing additional value. But because they are so similar to the original drugs, they offer no clinical benefit to patients — and after initial discounts wear off, they don’t offer additional cost savings, either.
The new Update Bulletin from our Pharmacy Management department includes an A-to-Z (Aczone to Zofran) list of drugs that will be excluded as of July 1, as well as alternative medications that are covered. Arrington mentioned some examples of the savings involved:
Doryx averages $1,000 per prescription. Its generic alternative doxycycline is $18.
Amrix averages $1,000 per prescription. Its generic alternative cyclobenzaprine is $10.
Gralise averages $660 per prescription. Its generic alternative gabapentin is $15.
Please note that the Pharmacy Management bulletin also includes other drug formulary updates that have taken effect or will take effect soon. They apply to specialty drugs, topical corticosteroids, and some requirements for prior authorization, step therapy and quantity limits.
The media has grasped onto recent Trump administration statements as being aimed at pre-existing conditions. “At issue is Attorney General Jeff Sessions’ recent decision that the Justice Department will no longer defend key parts of the Obama-era Affordable Care Act in court. That includes the law’s unpopular requirement to carry health insurance, but also widely supported provisions that protect people with pre-existing medical conditions and limit what insurers can charge older, sicker customers.”
The truth here is that it is unlikely that anyone would want to go back to being stuck in a job because of medical coverage. The truth here is that the law has many interlocking parts, so allowing one piece to be abolished may have other consequences (Kind of lick all decisions we make as humans!).
It appears that the administration is refusing to defend parts of the law related to mandated employer coverages. While large employers would have no problem, it could affect employers with less than 50 employees IF such a change was ever made. IF such a change was made – the courts threw out a section that affected it, it would be a simple thing for Congress to fix it. Based on track record on other simple issues, however, this writer IMHO doubts they could get over their partisan paralysis and get much of anything done.
From Employee Benefit Advisor 6/14/18. For full story, click here:
The Family and Medical Leave Act already requires covered employers to allow eligible employees to take up to 12 weeks of unpaid leave. In an effort to encourage employers to offer paid leave, the recent Tax Cuts and Jobs Act of 2018 sweetened the deal by promising a tax credit to employers, starting in 2018, on the wages that they pay to eligible employees during family and medical leave. However, there are certain restrictions in the law which minimizes its benefit to employers.
The types of leave which qualify for the tax credit are taken from the FMLA include:
· Birth of the employee’s child
· Placement of a child with the employee for adoption or foster care
· Care of a spouse, child, or parent with a serious health condition
· A serious health condition which prevents the employee from performing the functions of their position
· A spouse, child, or parent on covered, active duty in the Armed Forces
· Care for a service member who is the employee’s spouse, child, or next-of-kin
The paid leave, for tax credit purposes, must be due to taking an FMLA leave. In other words, pay during the leave due to vacation, personal leave, or a medical leave is not considered for credit purposes.
If an employer provides a self-funded short-term disability benefit, for example, that wage replacement is disregarded. Similarly, any paid leave required under state or local law is disregarded for purposes of the federal tax credit.
Only paid leave amounts solely due to the taking of an FMLA leave will qualify. An example of paid leave eligible for the credit would be paid parental leave in the event of a new child — as long as the paid leave wasn’t paid due to the new mom’s disability or mandated under state or local law.
How an employer qualifies for the tax credit
The following requirements must be satisfied to claim the credit:
· The employer must have a written policy, allowing for at least two weeks of annual paid family and medical leave for full-time employees, or a prorated amount for part-time employees
· The employee must have been employed by the business for at least one year
· The employer must pay at least 50% of an employee’s normal wages while the employee is on leave
· For the prior year, the employee must not have earned more than 60% of the dollar threshold for being considered a highly compensated employee for 401(k) purposes.
Even employers not subject to FMLA may still qualify for the tax credit. In order to do so, these employers must provide paid family and medical leave in compliance with a written policy which includes assurances that the employer will not interfere with an employee’s right to claim paid leave under the policy or discriminate against an employee in connection with the employer’s paid leave policy.
How the tax credit works
The tax credit is calculated as a percentage of the wages paid to an employee while on family or medical leave. If the criteria are met, the employer may claim 12.5% of those wages paid as a federal tax credit for up to 12 weeks of paid leave per year.
Additionally, for every percentage-point increase in pay rate over 50% of the employee’s normal wages, the tax credit increases by 0.25%, with a maximum credit of 25% of wages paid during the leave.
Take a simplified example: Say an employee normally earns a wage of $1,000/week and the employer pays the employee $600/week for four weeks while on leave to care for a spouse with a serious health condition: 60% of normal wages would yield a 15% tax credit on those wages, which is a $360 credit for $2,400 in wages.
It is worth noting that employers must reduce their deduction for wages by the amount of the credit. Plus, any wages that are used in calculating another business tax credit cannot be used when calculating this credit.
Employers who already provide paid FMLA leave for their employees, or have already been considering it, may take advantage of this tax benefit with little added difficulty. On the other hand, employers may find the incentive to be too small to offset the expense of paid leave.
In any case, the provision is set to expire at the end of 2019. Unless Congress extends it, employers will only be able to take advantage of this benefit for two years.
The IRS has said that it will likely give more specific guidance on how the credit will work in the near future.
Governor Phil Murphy has signed into law The New Jersey Health Insurance Market Preservation Act (the “Act”) making it the second state, after Massachusetts, requiring resident individuals to maintain health insurance coverage or face an individual shared responsibility payment.
This law comes on the heels of The Tax Cuts and Jobs Act, signed by President Trump on December 22, 2017, which repealed the individual shared responsibility payment enacted under the Affordable Care Act (or commonly referred to as Obamacare).
The individual shared responsibility, under the Affordable Care Act, requires individuals to maintain minimum essential health coverage or face an individual shared responsibility payment. The Tax Cuts and Jobs Act repealed, or eliminated, the individual shared responsibility payment effective January 1, 2019. In an effort to help to control recent premium price increases, Governor Murphy signed the Act into law May 31st
The State’s shared responsibility payment is based on the Affordable Care Act calculation which, for 2017, was the greater of 2.5% of a taxpayer’s income over the applicable filing threshold or $695 ($347.50 for those under 18 years of age). The maximum shared responsibility payment for a family for 2017 was $2,085. The shared responsibility payment increases annually but cannot be more than average cost of a bronze level plan on the New Jersey health insurance marketplace.
It is important to note that there exists a religious and hardship exception to the shared responsibility payment.
Reeve Conover is a Registered Representative. Securities offered through Cambridge Investment Research, Inc., a Broker/dealer member FINRA/SPIC.
Cambridge and Conover Consulting are not affiliated.
Licensed in SC, NC, NY, CT, NJ, and CA. FINRA.org - SIPC - Brokercheck