ACA Reporting
ACA Compliance Lessons Learned From Recent Reporting Seasons
Common themes emerge when reflecting on recent ACA reporting seasons that can help employers reduce administrative burdens and improve accuracy.
COBRA
Question of the Week - COBRA and FSA Carryover
Q.: An employee terminated employment. He did not have a health FSA election for the plan year, but he did have a carryover balance from prior years. Should he be given a COBRA
Q.: An employee terminated employment. He did not have a health FSA election for the plan year, but he did have a carryover balance from prior years. Should he be given a COBRA election and if yes, what would the COBRA premium be?
A.: The answer may depend on the terms of the FSA plan. Some plans require an employee to make a salary reduction contribution in the plan year for a prior plan year’s balance to be available. Some plans allow the carryover to be accessible for only a set number of plan years. Some plans terminate access to a carryover upon an employee’s termination of employment. You should review the terms of the plan document.
Carryovers are not counted for purposes of determining the COBRA premium. The applicable premium must be based solely on the sum of the employee’s salary reduction election for the year and any nonelective employer contribution (if applicable). In this situation, if a COBRA election is provided, there would be no premium associated with continuing FSA coverage under COBRA.
Benefit Allocation Systems (BAS) provides online solutions for: Employee Benefits Enrollment; COBRA; Flexible Spending Accounts (FSAs); Health Reimbursement Accounts (HRAs); Leave of Absence Premium Billing (LOA); Affordable Care Act Record Keeping, Compliance & IRS Reporting (ACA); Group Insurance Premium Billing; Property & Casualty Premium Billing; and Payroll Integration.
MyEnroll360 integrates with major insurance carriers for enrollment eligibility management (e.g., Blue Cross, Blue Shield, Aetna, United Health Care, Kaiser, CIGNA and others), and with leading payroll platforms for enrollment deduction management (e.g., Workday, ADP, Paylocity, PayCor, UKG, and others).
This article is for informational purposes only and is not intended as legal, tax, or benefits advice. Readers should not rely on this information for taking (or not taking) any action relating to employment, compliance, or benefits. Always consult with a qualified professional before making decisions based on this content.
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