Welfare Benefit Plan ERISA News
May 2011

 
IRS Delays W-2 Reporting for Most Employers
The IRS has postponed the requirement to report the cost of group health insurance on employees' W-2s until 2012. However, employers who filed fewer than 250 W-2s (about 98% of all employers) in the preceding year do not have to report the cost of coverage until further guidance is issued. Additionally, the IRS clarified how employers can calculate the cost of coverage. This is a reporting requirement only; it does not impact employees' taxable wages. See questions 3, 24, 25, 26, 27, and 31 in Notice 2011-28.
1099 and Voucher Provisions of PPACA Repealed
A provision requiring employers to offer vouchers to employees with household incomes up to 400% of the federal poverty level and whose premium contributions were between 8% and 9.8% of their household income has been repealed. Beginning in 2014, an employee would have been entitled buy coverage from a Health Care Exchange with a voucher of company money if his or her cost of group health insurance exceeded 8% of family income. However, that would have boosted employer costs, added administrative complexity, and required employers to find out spouses' incomes - breaking other privacy laws. Another provision in PPACA, the requirement to send a 1099 to any person or business that provided $600 in goods or services, has been repealed. Business Insurance "The law as drafted leaves a lot to be desired." lamented Assistant Secretary of Labor Phyllis Borzi. Source: Attorney Adam V. Russo.
Bypass Beach Bonanza
A $2 billion "health care city" encompassing a 2,000 bed hospital, medical university, and assisted-living facility is being constructed in the Cayman Islands to target American patients and insurance providers seeking deep cost reductions.

Insurance companies and self-insured employers may prefer to buy an air ticket and ask employees to go to the Cayman Islands, have their procedure and a two-week beach holiday, saving perhaps 50% of the cost. "The average cost for a heart bypass is $144,000 in the United States, five times higher than neighboring Mexico at $27,000. Costa Rica charges $25,000 and Colombia $14,800 for the same procedure," the Medical Tourist Assn. said. Founder Dr. Shetty, renown for being Mother Theresa's heart surgeon, estimates a heart bypass will cost less than $10,000 in the Cayman Islands.

An estimated 1.3 million Americans will seek medical care outside of the United States in 2011. The Cayman Islands have the advantage of being politically stable, English-speaking, beautiful, and close to Miami. Business Insurance
 
 
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© 2014 ERISA Pros, LLC, All rights reserved. Information on ERISA Pros' website, its newsletter, “News & Views,” and its blog, “ERISA Wonk,” is published as a general informational source. Information and articles are general in nature and are not intended to constitute legal or tax advice in any particular matter. Blog posts and comments reflect the personal views of their respective authors - not those of ERISA Pros. Transmission of this information does not create an attorney-client relationship. ERISA Pros, LLC is not a law firm and is not giving legal or tax advice. It does not warrant and is not responsible for errors or omissions in the content on its website or in its newsletters. ERISA is a complicated and confusing law. Summary Plan Descriptions (SPDs), Wrap Plan Documents, and Form 5500s require review and updating by qualified ERISA compliance professionals.

 

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