Federal agencies released new pieces of guidance this past week on the implementation of health care reform provisions. The new guidance includes updated information from the Internal Revenue Service on the new small-business tax credit regarding employer contribution amounts, information released by the Department of Health and Human Services (HHS) on the employer reinsurance program for early retirees and state health information Web portals and preliminary guidance from the Centers for Medicare and Medicaid Services (CMS) on the Medicare coverage gap discount program.
The IRS guidance helps determine the amount of the new tax credit for eligible small employers that make “non-elective” contributions toward their employees’ health care premiums by establishing what the average small-group premium amount for 2010 will be for each state. The new credit is based on a percentage of the lesser of:
- the amount of “non-elective” contributions paid by the small employer or
- the amount of “non-elective” contributions the employer would have paid if an employee were enrolled in a plan with a premium equal to the average premium for the small-group market in the state where the insurance is provided.
HHS issued guidance in the form of an interim final rule on the Early Retiree Reinsurance Program, which becomes effective on June 1 and will reimburse qualified employers and other plan sponsors for up to 80% of claims costs between $15,000 and $90,000 incurred by employers in providing group health benefits to early retirees. The program also applies to claims filed by their spouses, surviving spouses and dependents. Reimbursements will be made on a first-come, first-served basis, and it is expected that the amount of eligible reimbursements will substantially exceed the program’s $5 billion in federal funding, so speed is of the essence for eligible employer plans with applications for this program.
Additionally, HHS released an interim final rule and request for comments adopting the categories of information that will be collected and displayed on its consumer Web portal as required under health care reform. The rule specifies that the portal, which must be available no later than July 1, will include information about tax credits for small businesses available under Tax Code Section 45R.
CMS also issued preliminary guidance for Medicare Part D plan sponsors regarding the Medicare Coverage Gap Discount Program. In closing the coverage gap, CMS has proposed making manufacturer discounts on coverage gap claims available to beneficiaries at the point of sale beginning in 2011.
