The U.S. Department of Labor has issued a new model notice that employers can use in complying with the Children’s Health Insurance Program Reauthorization Act of 2009 (CHIPRA).

• If an employer’s group health plan covers residents in a state that provides a premium subsidy, the employer must send an annual notice about the available assistance to all employees residing in that state (the Employer CHIP Notice).
  
• The first Employer CHIP Notice must be sent by the first day of the first plan year beginning after February 4, 2010, or May 1, 2010, whichever is later. For employers with calendar year plans, the notice must be sent by January 1, 2011.
  
• Employers that fail to send the required notices may be subject to penalties of $100 per day.

PA Act 4 expands insurance coverage for children of insured parents under certain conditions. Adults up to age 30, can remain covered by their parent’s health insurance if they are:

• Unmarried
  
• Have no dependants
  
• Are residents of the Commonwealth
  
• Or enrolled as a full time student at an institute of higher education
  
• Are not provided private insurance coverage or enrolled in or eligible for government benefits.

Act 4 was signed into law on June 10, 2009 health contracts are impacted upon their issuance renewal date. Employers have the freedom to choose whether they would like to elect Act 4 benefits.

A Health Reimbursement Arrangement (HRA) is an employer-funded account that is designed to reimburse employees for qualified medical expenses that are paid for out-of-pocket. There are no annual contribution limits on HRAs; however, the employer usually sets the contribution below the annual deductible. HRAs are often designed to operate with a high deductible health plan (HDHP)), thereby reducing premium costs while encouraging employees to spend wisely.

A Health Savings Account (HSA) is a special account owned by an individual used to pay for current and future medical expenses. HSAs are used in conjunction with a High Deductible Health Plan (HDHP).

• Insurance that does not cover first dollar medical expenses (except for preventative care.)
• Can be an HMO, PPO, or indemnity plan, as long as it meets the requirements.

High Deductible Health Plan
Health Insurance plan with minimum deductible for 2009 of:

• $1,150 (self coverage only) ($1,200 for 2010)
  
• $2,300 (family coverage) $2,400 (for 2010)
  
• These amounts are indexed annually for inflation.

Annual out-of-pocket (including deductible and co-pays) cannot exceed:

• $5,800 (individual) for 2009 ($5,950 for 2010)
  
• $11,660 (family coverage) for 2009 ($11,900 for 2010)
  
• These amounts are indexed annually for inflation

Generally, employer-paid (non-contributory) group disability plans are paid on a pre-tax basis, and consequently, any disability benefit received by an employee is considered taxable income. However (under IRS Revenue Ruling 2004-55) employers have the option to structure their non-contributory disability plans so that employees can choose to have employer-paid group plan premium paid on an after-tax basis (the premium is included in the employee's W2). If the employee properly elects to have the cost of coverage included in current income and subsequently becomes disabled during the same plan year for which the election is in effect, then the disability benefit is not considered taxable income.

The plan must be amended to provide this option and the insurance company may charge a slightly higher premium if this option is elected.