PCORI Fees Due to IRS No Later Than August 1, 2022

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Fees to fund the Patient-Centered Outcomes Research Institute (PCORI) are due to the IRS no later than August 1, 2022, from employers who sponsor certain self-insured health plans such as Level Funded and Health Reimbursement Arrangements (HRAs) that are not treated as excepted benefits.

How to Pay PCORI Fees
Employers that sponsor certain self-insured health plans (Level Funded) must report and pay the required PCORI fees via IRS Form 720 along with HRA plans, Quarterly Federal Excise Tax Return. Complete Part II, line 133. Employers should note “2nd Quarter” on the 720 form.

Click here to access the updated 720 form.

The fee applies to each Plan year that ends after October 1, 2012, and before October 1, 2029. “Plan year” refers to the plan year for your Level Funded Medical Plans or an HRA plan. Generally the plan year and the coverage period are the same. As an example, if your HRA benefit resets each January 1, your HRA plan year and your coverage period are generally a calendar year and end December 31.

Plan Year Ending Date Fee
October 1, 2020 – September 30, 2021 $2.66
October 1, 2021 – September 30, 2022 $2.79

There are three available methods that can be used to determine the average number of lives covered under a plan for the policy year. For an HRA plan it is acceptable to use the number of subscribers only. The most commonly used method for determining the fee for your Level Funded plan is the “Snapshot Method”.

  1. Actual Count Method: A plan sponsor may determine the average number of lives covered under a plan for a plan year by adding the totals of lives covered for each day of the play year and dividing that total by the total number of days in the plan year.
  2. Snapshot Method: A plan sponsor may determine the average number of lives covered under an applicable self-insured health plan for a plan year based on the total number of lives covered on one date (or more dates if an equal number of dates is used in each quarter) during the first, second or third month of each quarter, and dividing that total by the number of dates on which a count was made.
  3. Form 5500 Method: An eligible plan sponsor may determine the average number of lives covered under a plan for a plan year based on the number of participants reported on the Form 5500, Annual Return/Report of Employee Benefit Plan, or the Form 5500-SF, Short Form Annual Return/Report of Small Employee Benefit Plan.

Payments should be made payable to the U.S. Treasury and sent by August 1, 2022, to the address below:

Department of the Treasury
Internal Revenue Service
Ogden, UT 84201-0009

The following documents accompany this notice:

Tools to Assist you by Carrier:

All Savers®

All Savers posts the employer group’s membership information to the employer website. The employer group is required to complete and file the IRS Form 720. For general questions please contact All Savers Broker Services at 1-866-405-7174.

Humana Level Funded

Humana provides a snapshot report that shows the monthly membership employers will need when filing the PCORI. It is an employer report (instructions below). As a broker, the employer may grant you access if they want you to pull it for them.

Click here to review the instructions.

Aetna Funding Advantage

This link takes you to the Aetna Funding Advantage PCORI Fee Estimator Tool. This tool gives you guidance on calculating the PCORI fees for this group.

 

**Anthem OH SOCA MEWA, Anthem KY Chamber Advantage, Anthem IN Chamber Health Alliance, MMO COSE MEWA, Humana KY Chamber and UHC MEWA have built the PCORI fees into the premiums, therefore, you will not need to file and pay any additional fees.

Register: Join Cornerstone at the NWOAHU Products Fair in Toledo

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Visit Cornerstone’s booth at the upcoming NWOAHU Products Fair in the Toledo, Ohio, area. There are three CE courses pending with speakers from the Department of Labor, Cornerstone’s Geoff Beglen with an update on the 2022 individual market, and Chris Hartmann from NAHU’s Government Affairs team.

There will also be a special keynote speaker during a seated luncheon. OAHU/NWOAHU members are also eligible for CEs for attending in-person meetings.

Date: May 10, 2022

Time: 8:30 am to 2:00 pm

Location: Brandywine Country Club
6904 Salisbury Road
Maumee, OH 43537

Click here to register

Two-Hour CE Opportunity: Improving Quoting Techniques in the Dental Marketplace and Evaluating Network Size and Savings

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Join Cornerstone and Delta Dental for a two-hour CE opportunity* in Centerville.

The classes,”Improving Quoting Techniques in the Dental Marketplace” and “Evaluating Network Size and Savings,” will be presented by Jason Nickoloff from Delta Dental, and will provide an overview of common issues experienced in the agent community. These courses will offer explanations, examples, and solutions to the audience to make submitting dental quotes easier in the market.

*Ohio only

DATE: April 20, 2022

TIME: 2:00 to 4:00 pm

LOCATION: Yankee Trace

10000 Yankee Street • Centerville, OH 45458



The Pros and Cons of Alternative Funding for Small Groups

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The Affordable Care Act (ACA) and the continued high costs of group health insurance have led to “alternatives” to traditional fully insured small group health plans. Let’s examine the pros and cons of each approach available in today’s market.

Level Funding

Level funding uses a self-funding contract where the employer pays a fully insured premium equivalent. The employer’s liability is limited to this fully insured equivalent, however, they can receive a refund if the plan runs well.

Pros:

  1. Looks and acts like fully insured as offered by carriers.
  2. Employers can share in surplus after good claim years.
  3. No terminal liability when offered by traditional carriers.

Cons:

  1. Priced very similar to fully insured plans so savings potential is limited.
  2. Renewals tend to fluctuate a bit more than fully insured plans.
  3. Beware of “level funding” offered by third-party administrators. It is really self-funding.

Health Reimbursement Arrangement (HRA)

An HRA is an employer-funded plan that reimburses employees for medical expenses.

Pros:

  1. Allows employers to maintain a higher benefit level for their employees by taking some risk.
  2. Generally simple to administer and establish; some carriers have built in administration.
  3. Good for very small groups.

Cons:

  1. Carriers have adjusted their pricing on high deductible plans which has diluted the risk/reward equation a bit.
  2. Adds a layer of complexity and costs to plan administration and often introduces a third party.
  3. Not appropriate for administration of prescription drugs. Rx claims should always be run through the underlying carrier due to high costs and the point of sale nature of these claims.

Self-Funding

Self-funding offers the employer the opportunity to “pay as you go” for medical claims. The employer pays for fixed costs each month (administration and stop loss protection), but only pays for claims as they are incurred.

Pros:

  1. Allows for (and requires) greater involvement from the plan sponsor in the administration of the health plan—though this may also be a con.
  2. Maximum potential for savings and adoption of creative cost containment strategies.
  3. Flexibility to change stop loss carriers without disruption to employees.

Cons:

  1. Since carriers do not offer self-funding for small groups, access to top-tier provider networks can be a challenge.
  2. Risky for groups under 100 lives, very risky for groups under 50 lives, and not appropriate for groups under 20 lives.
  3. Stop loss pricing can fluctuate a great deal and is subject to exclusions for large ongoing claims (lasering).

 

We can help you to evaluate the various alternative to traditional funding that are available in the market and determine if any are a good fit for your clients. Contact your Cornerstone representative today to discuss your options.

IMPORTANT: Anthem Cornerstone Vision Open Enrollment

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Great news! As you know, Cornerstone has a multi-year rate hold for the Anthem Cornerstone Vision Plan with rates now expiring on March 31, 2024. Any group currently enrolled with the Anthem Cornerstone Vision Plan is approaching the open enrollment period. Enrollees added between March 15, 2022, and April 15, 2022, will become effective on the vision plan April 1, 2022.

Some important updates for this year’s open enrollment:

  • Members within your client group may have received new ID cards in late January. Anthem has selected a new vendor for ID cards and it is believed that some groups may have been a part of a pilot project.
  • Please be reminded that any adds, deletes, or changes for open enrollment will have an effective date of April 1, 2022.

Two ways to enroll employees into the vision plan:

  1. Online Employer Access is available. Please contact your broker advisor.
  2. Benefit administration changes may only be made on the Anthem Employer Portal. Please contact your broker advisor for more information to access.

Below is the updated summary of benefits, an additional flyer for online glasses and contact lenses, and more.

Should you have any additional questions, please contact your Broker Advisor. Thank you for supporting the Anthem Cornerstone Vision product!

Blue View Vision Summary of Benefits

Blue View Vision Glasses and Contacts

Blue View Vision Employer Paid Renewal Information

Blue View Vision Voluntary Renewal Information

Blue View Vision Enrollment Form

Blue View Vision New Group Rates

Why Employer Groups Really Need to Address Leave Policies

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Without a leave policy, employers can get into a difficult situation before they know it. It’s a little like trying to get toothpaste back in the tube—you can only fix it going forward. This is why we recommend all employers take the time to get an employee handbook together with a leave policy.

Here are some of the headaches and heartaches that can occur when an employer doesn’t have a policy in place

  • A valued employee suffers permanent disability with no source of income until approved for social security disability (SSDI). Did you know 70 percent of claims for Social Security disability income benefits are denied each year? Or that many people die before disability benefits can be reviewed in the courts?
  • An employee gets in a car accident and can’t work for six months and has no source of income.
  • An employee has a partial disability and can’t work full-time for a period of time. When do you remove them from the plan?
  • An employee visits a foreign country and is unable to return due to travel restrictions or being held against their will. How long do you cover them under your plan?
  • An employee goes on maternity leave but doesn’t return to work after leave. What happens if you didn’t collect premiums while they were on leave?

Without a clear leave policy that defines when benefits end or how benefits are paid during a leave, employers have the potential to become embroiled in some unpleasant situations. Some examples include: making a very hard decision to separate with an employee in what can be a terrible situation, creating a public relations backlash, inadvertently demoralizing their workforce, or being faced with a costly lawsuit.

Many expect their health insurers to set the rules, and while most carriers perform random audits of eligibility to ensure that covered employees match up with payroll, others take a more judicious view to allow employers the flexibility to comply with state and federal leave laws like Family Medical Leave or if the employer covers employees during a short or long-term disability. Their policies in this case don’t state that the group has to terminate an employee who has reduced hours or isn’t actively at work. While this allows the employer flexibility, it also requires the employer make the call for when to remove an employee from coverage when and if they no longer meet the criteria to be covered.

The best way to alleviate this is to have clear, documented leave policies in an employee manual to address a variety of scenarios.

Questions to consider with a leave policy

  • What is the employer’s paid-time-off policy? Do they offer a bank of sick time? How and when is that used?
  • Does the employer offer long-term disability or short-term disability coverage? When do the policy benefits kick in?
  • How will the employee pay their portion of the cost of health coverages? Will it be required during their leave or will the employer recover it from future paychecks when they return to work? What if they never return to work?
  • Is the business subject to Family Medical Leave? Do they have employees in states with state or local Family Medical Leave rules (like NY, CA)?
  • Does the employer have the ability to make modifications to jobs to permit an employee to work in a different capacity for a period of time? If not, what then?
  • What happens if an employee can’t work due to illness or disability for an extended time? What happens if the employee is no longer working full-time? When should an employer remove them from the medical plan and offer COBRA or, if applicable, state continuation of coverage?
  • Is the employer required to comply with ADA requirements? Would job modifications create a hardship for their business?
  • Could an employer’s generosity in keeping an employee on your plan hurt them in the long run? For example, they could meet their deductible and out-of-pocket on the plan in the first half of the year, get terminated from the plan, go on their spouse’s plan and have to meet another deductible and out-of-pocket amount. Or, they could miss out on an open enrollment period altogether such as for individual coverage although the loss of coverage would constitute a qualifying event, some options may not be available even mid-year.
  • When should employers have the discussion about options to continue coverage such as COBRA or state continuation of coverage? State continuation of coverage applies to groups under 20 in Ohio and Kentucky, but is not a concern in Michigan or Indiana.
  • An owner or partner will necessarily be treated differently since they are often beneficiaries of the revenues of the business regardless of their ability to work for the business; however, for family-owned and operated businesses, employers have to be careful of discriminating with leave policies, such as offering paid leave for one employee but not another especially those doing the same job. What impact would there be for the business if one or more of the key employees or owners is not able to work for a period of time? Unlike medical coverage, disability insurance can be classed in various ways to ensure owners, key employees, managers and/or employees are protected.
  • Professional practices such as lawyers, doctors, engineers, or architects as well as owners or sales people may continue to earn revenues that come in after a disability or leave has started. Many policies offset benefits by these payments. If an employer has this type of arrangement, they can look at options that don’t do this offset if available from the carrier.
  • If the business isn’t subject to Family Medical Leave, would they grant a leave of absence? Would they hold a person’s job for them to care for a family member during an extended illness? Under what circumstances?
  • We hope this article was helpful and gave you food for thought to help your clients and their employees. Please contact your Cornerstone Broker Advisor to discuss coverage options that could help and point to resources for addressing the employer leave policies.

1094/1095 Updates for Anthem SOCA MEWA and Chamber Advantage MEWA Clients

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Over the past few weeks, Cornerstone has included information regarding the 1094/1095 reporting requirements and carrier guidelines in the Monday Minute.

We were recently notified by Anthem about updates to the original set of 1094-B/1095-B forms loaded for both SOCA MEWA and Chamber Advantage MEWA plans. Updated forms were loaded onto the Anthem Employer Portal on February 9, 2022.

Any group that pulled and distributed these forms prior to February 9, will need to pull and re-distribute the corrected form to their employees.

Anthem will be mailing the 1094-B/1095-B forms to any groups that cancelled their SOCA MEWA benefit plan in 2021.

For groups who canceled their Anthem Chamber Advantage plan in 2021, please reach out to your Cornerstone Broker Advisor. We will work with the Anthem Account Manager to obtain those forms for your clients.

Below you will find an FAQ for both Anthem SOCA MEWA and Chamber Advantage MEWA addressing the 1094-B/1095-B filing requirements:

As a reminder, all Anthem SOCA MEWA groups are required to complete the Annual Rate and Census Reconciliation (ARC) report.  This information is needed in order for the SOCA Benefit Plan to complete the plan’s IRS 5500 filing.

MEWA.io will be emailing this request to your SOCA MEWA clients directly.

The collection period for this information will run from February 1, 2022 until March 11, 2022.

If you have questions on completing the Annual Rate and Census Reconciliation report please join us on February 17 for the Group Corner webinar to address these questions. If you did not receive the invite, please contact your Cornerstone Broker Advisor.

If you have any questions, please do not hesitate to contact your Cornerstone Broker Advisor.

Members Will Be Reimbursed for Most Over-the-Counter COVID-19 Diagnostic Tests

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A recent announcement from the federal government intends to increase access to COVID-19 testing. As of January 15, 2022, members can get reimbursed by their health plan without cost share for the costs of over-the-counter diagnostic COVID-19 tests until the end of the Coronavirus Public Health Emergency. Diagnostic tests are performed if members are experiencing COVID-19 symptoms or have been recently exposed. All of the medical carriers are required to participate and we have provided a piece below that gives some preliminary information from each carrier. As more details are released we will continue to update the grid. Please review the Q&A from each carrier to learn about items specific to that carrier in the reimbursement program.

Some cautionary points on the directive:

  1. Reimbursement will only apply to tests purchased after January 15, 2022, validated on your receipt submitted for reimbursement.
  2. Medicare, Medicaid members should contact their carriers as this program may not apply to their coverage.
  3. If OTC tests come in a package of 2, this will count as 2 of the 8 tests available per person for monthly reimbursement.
  4. No prescription is necessary to obtain testing supplies or to receive reimbursement.

Every home in the U.S. is eligible to order 4 free at-⁠home COVID-⁠19 tests. The tests are completely free. Orders will usually ship in 7-12 days. Click here to order your tests now so you have them when you need them.

Most Recent Carrier Guidance

Contact your Cornerstone representative with any questions.

Insurance Companies and Group Health Plans Now Required to Cover Costs of At-Home COVID-19 Tests

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The following information was originally posted by CMS.gov.

As part of its ongoing efforts across many channels to expand Americans’ access to free testing, the Biden-Harris Administration is requiring insurance companies and group health plans to cover the cost of over-the-counter, at-home COVID-19 tests, so people with private health coverage can get them for free starting January 15th. The new coverage requirement means that most consumers with private health coverage can go online or to a pharmacy or store, buy a test, and either get it paid for up front by their health plan, or get reimbursed for the cost by submitting a claim to their plan. This requirement incentivizes insurers to cover these costs up front and ensures individuals do not need an order from their health care provider to access these tests for free.

Beginning January 15, 2022, individuals with private health insurance coverage or covered by a group health plan who purchase an over-the-counter COVID-19 diagnostic test authorized, cleared, or approved by the U.S. Food and Drug Administration (FDA) will be able to have those test costs covered by their plan or insurance. Insurance companies and health plans are required to cover 8 free over-the-counter at-home tests per covered individual per month. That means a family of four, all on the same plan, would be able to get up to 32 of these tests covered by their health plan per month. There is no limit on the number of tests, including at-home tests, that are covered if ordered or administered by a health care provider following an individualized clinical assessment, including for those who may need them due to underlying medical conditions.

“Under President Biden’s leadership, we are requiring insurers and group health plans to make tests free for millions of Americans. This is all part of our overall strategy to ramp-up access to easy-to-use, at-home tests at no cost,” said HHS Secretary Xavier Becerra. “Since we took office, we have more than tripled the number of sites where people can get COVID-19 tests for free, and we’re also purchasing half a billion at-home, rapid tests to send for free to Americans who need them. By requiring private health plans to cover people’s at-home tests, we are further expanding Americans’ ability to get tests for free when they need them.”

Over-the-counter test purchases will be covered in the commercial market without the need for a health care provider’s order or individualized clinical assessment, and without any cost-sharing requirements such as deductibles, co-payments or coinsurance, prior authorization, or other medical management requirements.

As part of the requirement, the Administration is incentivizing insurers and group health plans to set up programs that allow people to get the over-the-counter tests directly through preferred pharmacies, retailers or other entities with no out-of-pocket costs. Insurers and plans would cover the costs upfront, eliminating the need for consumers to submit a claim for reimbursement. When plans and insurers make tests available for upfront coverage through preferred pharmacies or retailers, they are still required to reimburse tests purchased by consumers outside of that network, at a rate of up to $12 per individual test (or the cost of the test, if less than $12). For example, if an individual has a plan that offers direct coverage through their preferred pharmacy but that individual instead purchases tests through an online retailer, the plan is still required to reimburse them up to $12 per individual test. Consumers can find out more information from their plan about how their plan or insurer will cover over-the-counter tests.

“Testing is critically important to help reduce the spread of COVID-19, as well as to quickly diagnose COVID-19 so that it can be effectively treated. Today’s action further removes financial barriers and expands access to COVID-19 tests for millions of people,” said CMS Administrator Chiquita Brooks-LaSure.

State Medicaid and Children’s Health Insurance Program (CHIP) programs are currently required to cover FDA-authorized at-home COVID-19 tests without cost-sharing. In 2021, the Biden-Harris Administration issued guidance explaining that State Medicaid and Children’s Health Insurance Program (CHIP) programs must cover all types of FDA-authorized COVID-19 tests without cost sharing under CMS’s interpretation of the American Rescue Plan Act of 2019 (ARP). Medicare pays for COVID-19 diagnostic tests performed by a laboratory, such as PCR and antigen tests, with no beneficiary cost sharing when the test is ordered by a physician, non-physician practitioner, pharmacist, or other authorized health care professional. People enrolled in a Medicare Advantage plan should check with their plan to see if their plan offers coverage and payment for at-home over-the-counter COVID-19 tests.

This effort is in addition to a number of actions the Biden Administration is taking to expand access to testing for all Americans. The U.S. Department of Health and Human Services (HHS) is providing up to 50 million free, at-home tests to community health centers and Medicare-certified health clinics for distribution at no cost to patients and community members. The program is intended to ensure COVID-19 tests are made available to populations and settings in need of testing. HHS also has established more than 10,000 free community-based pharmacy testing sites around the country. To respond to the Omicron surge, HHS and FEMA are creating surge testing sites in states across the nation.

Contact your Cornerstone representative with any questions.

Direct and Indirect Compensation Transparency Requirements for Your Group Health Plans

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In response to the Consolidated Appropriations Act of 2021 (CAA) enacted by Congress in December 2020, brokers are now required to disclose compensation amounts if they reasonably expect to receive $1,000 or more in compensation, whether direct or indirect, for their services. This includes all revenue related to brokerage services and/or consulting services for all medical, dental, and vision group health plans of all sizes. These regulations are subject to change in the future upon release of further regulations, but this is the information we have thus far.

This law applies to contracts that are executed or renewed on or after December 27, 2021. This means, if you close your renewals by December 27, you will not have to disclose compensation for 2021. You would, instead, start disclosing compensation with February 1, 2022, groups.

This law also applies to individual market coverage (including student health insurance), however, the interim regulations have put the disclosure responsibility on the carriers.

The description of the compensation can be expressed in multiple ways in the fee disclosure. This means, because most commission scales from the carrier are on a per employee per month (PEPM) basis, you can disclose the PEPM, percentage of premium compensation, or you can choose to disclose the total annual compensation.

As a result of this law, brokers must provide a contract or consulting agreement that includes the following information:

  • A description of the services to be provided by the agent, including:
    • Enrollment
    • Renewal
    • Human Resources
    • Account management
    • Compliance
    • Consulting
  • A description of all direct and indirect compensation

So, What Now?

Cornerstone has provided disclosure and engagement letter templates for your benefit to ensure the communications with your clients are as seamless as possible.

Here are your next steps:

  1. Comprise a list of all your active groups for medical, dental, and vision sales, regardless of size.
  2. Gather your most recent commission statements. Medical and ancillary commissions for Anthem KY, Anthem IN and Humana can be found on the AGB broker commission portal. Statements for medical and ancillary lines from all other Cornerstone carrier partners have been provided to you directly by the carriers, including Aetna, Anthem OH, Humana, Medical Mutual of Ohio, and UnitedHealthcare.
  3. Select one of the two available disclosures and use the template letter to disclose compensation amounts for each
    1. Template broker compensation letter
    2. Disclosure option 1 (provided by NAHU and Cornerstone)
    3. Disclosure option 2
  4. Email the disclosure to each of your groups’ primary contacts.
  5. Repeat annually with each client or as compensations changes due to carrier moves throughout the year.

Please note on the disclosures that it is suggested that you obtain your client’s signature acknowledging receipt of this information. For January 1, 2022, renewals completed before December 27, it is recommended that you follow up with an email from your client to acknowledge the renewal is finalized. Contact your Cornerstone broker advisor with any questions you might have about this new law and the requirements.

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