Cafeteria Plans Add To Employer Benefit Options

Benefits continue to play a huge role for employees when looking for a job. According to MetLife’s 13th annual U.S. Employee Benefit Trends Study 9, companies that offer 11 or more benefit options appeal most strongly to top performers. So what can employers offer other than just your standard health, dental, or vision plans? Take a look at the BASE® 125 Cafeteria Plan


The BASE® 125 Cafeteria Plan allows employers to provide additional benefit options to employees and save money. Employers that sponsor a BASE® 125 Cafeteria Plan can allow employees who are paying medical expenses, insurance premiums or dependent care expenses to do so on a pre-tax basis. A cafeteria plan can create sizable savings for both the employer and employee.


The IRS has made some revisions to the Flexible Spending Account (FSA) portion of the Cafeteria Plan in the past few years, and statistics show that employers and employees are embracing the new changes. From carry over limits to the maximums that employees can elect, employers are amending their FSA plans to take advantage of the added flexibility.


With out-of-pocket health care costs up 11% last year, employers are continuing to look for ways to help employees lessen the financial burden. Along with the Cafeteria Plan, BASE® has strategies for small business and self-employed to do just that. Keep in mind that BASE® remains committed to keeping all of their plans in compliance with ACA, IRS, DOL, and ERISA guidelines.


If you are interested in more information on how BASE® can help your small business and to receive a free benefit analysis, call BASE® today at 1-800-309-8012.


Tom Stiles
BASE® - Digital Marketing Assistant

Notice 2015-17 Deadline Looming

Now that the ACA open enrollment period is coming to a close and tax season has come and gone, it is time for small business owners to turn their attention to the looming June 30, 2015 deadline that came out of Notice 2015-17.  Any small business owner that does not conform to the guidelines outlined regarding health coverage reimbursement arrangements and employer payment plans have been given a second chance to comply with market reforms without incurring penalties.

 

Small business owner’s time for making this transition is running out, as the guidance delayed the $100 per-day per-employee penalty for failure to comply until June 30, 2015.  A few highlights to take away from Notice 2015-17 are:


 No penalties for noncompliant employer payment plans through June 30, 2015.

-  Reaffirms that arrangements with one participant are exempt from the market reforms.

2% or greater S-Corporation Shareholders are exempt from the market reforms for 2015. However, their regular employees are not.

Shareholders of S or C Corporations who are covered under the same individual insurance coverage count as one participant for the market reforms.

Medicare Part B and D premiums can be reimbursed under an arrangement as long as the employer sponsors a group insurance plan for its other employees.

Reaffirms that after tax arrangements which are contingent on the purchase of insurance are not permissible.

 

It is important for small business owners to conform to these reforms.  If you have any questions regarding IRS Notice 2015-17 and what it really means for you, please call 1-888-386-9680. 

Anne Case
BASE® - Director of Marketing & Communications

Quick Facts About the HRA vs. HSA

While BASE® does not administer HSA's, Business Partners are frequently asking us about the differences between the two employee benefit plans. Following are some of the main things to remember when advising employers with multiple employees:

 - If an employer is going to reimburse an employee’s medical expenses through an HRA, it will make the employee ineligible for contributions to their HSA.
 - If an employer is going to reimburse an employee’s medical expenses and wants to allow employees to be eligible for contributions to their HSA, employers have the option to expand their benefit options with an FSA.
 - If an employer really wants to have an HRA and HSA, BASE® would recommend a post deductible HRA.
 - If the individual is enrolled in Medicare they are no longer HSA eligible.
 - If a spouse has an FSA through an employer, their spouse is ineligible to contribute to the HSA account –even if they have a qualifying HDHP.

There are conditions that must be met in order for employees to be eligible. Remember that any employer contribution to an HSA is immediately owned by the employee. When employers contribute to an HSA they lose control over that income immediately. The cost effective way to help employees and keep control over their bottom line is the Integrated HRA. Call 1-888-386-9680 to discuss HRA’s vs. HSA's in more detail.

See Notice 2004-45 and Notice 2008-59 Q-3 and Q-4 for more technical information.

Anne Case
BASE® - Director of Marketing & Communications