🗓️ November Updates
Keeping HR pros up to date with important compliance updates and human resource articles.
Prescription Drug Reporting Due by December 27, 2022
A new transparency provision, enacted as part of the 2021 Consolidated Appropriations Act, requires employer-sponsored health plans and health insurance issuers to annually report information about prescription drugs and healthcare spending to the federal government. This reporting process is referred to as the “prescription drug data collection”. The first RxDC report is due by December 27, 2022, and covers data for the 2020 and 2021 reference years. Going forward, the annual deadline is June 1 of the calendar year immediately following the reference year. This means that the second RxDC report is due June 1, 2023, and will cover data for 2022.
Employers should reach out to their issuers, TPAs or PBMs, as applicable, to confirm that they will submit the RxDC reports for their health plans. Employers should also update their written agreements with these third parties to reflect this reporting responsibility. In addition, employers with self-funded plans should monitor their TPAs or PBMs compliance with the RxDC reporting. Unlike fully insured plans, the legal responsibility for RxDC reporting stays with a self-insured plan even if its TPA or PBM agrees to provide the report on its behalf.
PCORI Fee Amount Adjusted for 2023
The IRS issued a Notice to increase the Patient-Centered Outcomes Research Institute (PCORI) fee amount for plans ending on or after October 1, 2022, and before October 1, 2023. The updated PCORI fee amount is $3.00 multiplied by the average number of lives covered under the plan. For plan years that ended on or after October 1, 2021, and before October 1, 2022, the PCORI fee amount is $2.79 multiplied by the average number of lives covered under the plan.
The PCORI fee was created by the ACA and first applied for plan or policy years ending after September 30, 2012. The fee is imposed on health insurance issuers and self-insured plan sponsors to fund comparative effectiveness research. PCORI fees are reported and paid annually on IRS Form 720. These fees are due each year by July 31 of the year following the last day of the plan year. For plan years ending in 2022, the PCORI fee is due by July 31, 2023. Employers with self-insured health plans should have reported and paid PCORI fees for 2021 by August 1, 2022.
EEOC Releases Updated ‘Know Your Rights’ Poster
The EEOC has released an updated poster that employers with more than 15 workers are required to display. The new poster, released on October 19, 2022, summarizes laws that protect workers from discrimination and retaliation. The key changes in the updated poster include:
- Uses straightforward language and formatting
- Notes that harassment is a prohibited form of discrimination
- Clarifies that sex discrimination includes discrimination based on pregnancy and related conditions, sexual orientation, or gender identity
- Adds a QR code for fast digital access to the “how to file a charge” webpage
- Provides information about equal pay discrimination for federal contractors
For more information about downloading and displaying the updated poster for on-site and remote workers, visit the EEOC’s website.
Respect for Marriage Act Would Protect Same-Sex Couples’ Company Benefits
IRS Significantly Increases Many Benefit Plan Limits for 2023
The IRS responded to rising inflation with its recent announcement regarding the limitations applicable to retirement and other benefit plans for 2023. Many limits will have significant increases compared to previous years, with some limits increasing by more than 10% compared to 2022. These increases could result in substantial additional savings opportunities for participants.
This Compliance Overview includes a chart of the inflation-adjusted limits for 2023.
Affordable Care Act: 2023 Compliance Checklist
The ACA made a number of significant reforms to group health plan coverage when it was enacted in 2010. Since then, changes have been made to various ACA requirements that employers should be aware of. These changes include annual cost-of-living increases to certain ACA dollar limits, extensions to ACA reporting deadlines and updates to preventative care coverage guidelines.
Changes to some ACA requirements will take effect in 2023 for employers sponsoring group health plans. To prepare for 2023, employers should review these requirements and develop a compliance strategy. Employers should ensure that their plan documents, including the summary of benefits and coverage (SBC), are updated to reflect any new plan limits and that up-to-date information is communicated to employees at open enrollment meetings.
The following plan design requirements have changed for 2023:
- Limits on cost sharing for essential health benefits
- Health FSA contribution limits
- Coverage affordability percentages under the employer-shared responsibility rules
- Dollar amounts for calculating employer-shared responsibility penalties
The following deadlines apply for reporting under Sections 6055 and 6056:
- Feb. 28, 2023: Paper IRS returns for 2022 are due by this date
- March 2, 2023: Individual statements for 2022 must be furnished by this date
- March 31, 2023: Electronic IRS returns for 2022 must be filed by this date