LEG REG REVIEW GPAHU Edition 2018, 1st Issue *** January 1, 2018

WHAT IS ON THE PENNSYLVANIA LEGISLATIVE CALENDAR FOR 2018?

Although the General Assembly will not return to active session until January 23, there are several bills of interest to the Health Insurance Community on the voting calendars of the House and Senate.

 

SENATE:

  • Prescription Drug Price Transparency, Senate Bill 637 (White-R-Indiana) is on second consideration. A bill needs to be on third consideration before finally being voted on – rules of the House and Senate.  Second consideration also presents the opportunity to be re-referred to another committee like Appropriations for a fiscal note or simply that the bill needs more work.
  • Senate Bill 1003 (White-R-Indiana) requires insurance companies to reimburse emergency medical services in situations where the individual did not go to a hospital – second consideration.

 

HOUSE

  • Municipal pension advisor changes will be made easier if House Bill 1142 (Briggs-D-Phila.) is passed.  It allows municipalities to dip into pension assets to pay for costs connected with issuing an RFP (Request for Proposals) and , according to Rep. Briggs, it addresses a problem with present law that locks “small municipal pension plans into their existing professional advisors even if they are unhappy with their advice or service.” – second consideration
  • Also on second consideration is a bill establishing a travel insurance limited line allowing unlicensed travel agency employees to sell travel insurance providing that someone with the limited lines license is on the premises.  House Bill 1576 (Pickett-R-Bradford) and DeLuca-D-Allegheny)
  • House Bill 1846 (Ellis-R-Butler) deals with privacy breach notifications including personally identifiable information governed by Gramm-Leach-Bliley Act and by HIPAA and requires that a breach be reported to the consumer and to the Attorney General within 45 days.  The Attorney General will have compliance authority although state agencies must report the breach to the PA Department of Administration – second consideration.  Provisions of this bill are in addition to existing Federal privacy breach notification laws.
  • On second consideration is House Bill 1286 (Mentzer-R-Lancaster) to require a study on medical malpractice punitive damages awards.

 

VOLATILE CHIP ISSUE RE-SURFACES

The issue that almost prevented the Children’s Health Insurance Program (CHIP) from being re-authorized has resurfaced with House Bill 1933 (Topper-R-Bedford) being on the House calendar..  HB 1933 would prohibit CHIP monies to be used for transgender surgery, transgender drugs or transgender counseling.  This would reverse a decision by the Wolf Administration to allow such CHIP benefits.

OTHER PA BILLS TO WATCH…

Abortion issue resurfaces… Governor Wolf vetoed a bill prohibiting abortions after the first 20 weeks.  Another piece of legislation, House Resolution 609 (Kulik-D-Allegheny), denounces the practice of selectively aborting fetuses with Down Syndrome.  It is on the House voting calendar.

 

Legislation is progressing that would permit both insurers and insurance brokers to offer rebates and inducements up to a value of $100.  Senate Bills 877 and 878 (White-R-Indiana) passed the Senate November 13 and were referred to the House Insurance Committee. House counterparts House Bills 1841 and 1842 (Tobash-R-Schuylkill) are also in the House Insurance Committee.

 

School benefit consolidation legislation (Senate Bill 420 sponsored by Senator Dave Argall (R-Schuylkill) would require that school districts join a consortium as a way to reduce health care costs.  It is markedly different from previous Argall legislation which would have forced school district health benefits into one state-run plan.  This may have been the result of fierce opposition by school business officers, school boards and the PA Association of Health Underwriters.  SB 420 does set a floor on benefits equal to the collectively bargained norm of a geographic region – something that may force benefits costs up for rural or impoverished school districts.  It was referred to the Senate Education Committee.

 

FEDERAL UPDATES

  • The IRS has extended Affordable Care Act mandatory Forms 1095-B and 1095-C deadlines from January 31, 2018, to March 2, 2018.  Details IRS Notice 2018-06: https://www.irs.gov/pub/irs-drop/n-18-06.pdf
  • The IRS is boosting fines for employers that fail  to file correct 1094 and 1095-C forms under the Affordable Care Act from $260 per return in 2017 to $270 in 2018.  (Source: NAHU Compliance Cornered Blog)  The IRS notice regarding penalties may be found on this link.  There is a great deal more contained in that notice not mentioned in the blog, some of which appears below: https://www.irs.gov/pub/irs-drop/rp-17-58.pdf
  • Cafeteria Plans: voluntary employee contributions to Flexible Spending Accounts is $2,650.
  • Eligible Long-Term Care Insurance Premiums: Under medical care, Part A, Form 1040, eligible premiums are:  age 40 or less, $420; age 41-49, $780; age 51-59, $1,560; 61-69, $4,160; and age more than 70, $5,200.  NOTE:  R. 1, the Tax Cuts and Jobs Act reduces the threshold to 7.5% of AGI instead of the 10% under the Affordable Care Act beginning in tax year 2017.
  • If you decide to review the entire Notice since there are other provisions of interest regarding high deductible health plans, qualified employer Health reimbursement Accounts, etc., there is a disclaimer that there may be other changes since October 19, 2017 (H.R. 1) which would warrant further research. The primary drafter of the IRS Notice was William Ruane, IRS Office of Associate Chief Counsel (Income Tax & Accounting). 202-317-4718

 

NEW TAX REFORM LAW

H.R. 1, the Tax Cuts and Jobs Act of 2017 signed into law by President Trump on December 22, 2017, contains a large number of changes to the Tax Code.  Following are several resource points:  The Journal of Accountancy December 20, 2017 has two articles, one of which looks at changes for individuals, and the other which examines non benefit tax changes for businesses.

https://www.journalofaccountancy.com/news/2017/dec/president-signs-tax-cuts-jobs-act-201718112.html

 

The Federation of Tax Administrators https://www.taxadmin.org/2017-tax-reform offers two resources.  First is the actual fine print of this tax legislation.  The second is a section by section summary authored by consulting firm KPMG.

Summary of the Conference Version by KPMG

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