Staffing Firm ACA Planning: "MVP Plans" No Longer Meet Minimum Coverage

SUMMARY:

Affordable Care Act Planning in the Staffing Industry

  • On Tuesday, November 4th, 2014 the IRS and HHS issued Notice 2014-69
  • The notice effects "MVP Plans" which NO LONGER meet the "minimum value" of coverage under the ACA
  • These "MVP Plans" will ONLY meet minimum value coverage in 2015 if you signed up or enrolled employees PRIOR to November 4, 2014 [more]
  • If you have any questions about this new notice, or would like to discuss your ACA Strategy, please request a free consultation.

FULL DETAIL:

IRS & HHS ANNOUNCEMENT:  On Tuesday, November 4th, 2014 the IRS and HHS issued Notice 2014-69 addressing employer sponsored plans that did not include certain physician and hospitalization benefits.  These so called "MVP Plans" had been adopted by the leading insurance brokers in the staffing industry as affordable options to avoid all potential penalties under the ACA.  The notice clarifies the position of the IRS and HHS on the adequacy of these types of plans and states very clearly that they are contrary to the concept of what should be considered "minimum value" under the ACA.

EXCEPTION:  The notice goes on to state that such plans will be considered as minimum value coverage in 2015 so long as an employer entered into a binding written commitment to adopt, or had begun enrolling employees before November 4th.  For those employers who had not yet entered into a binding written commitment, these plans can no longer be considered as offering minimum value.

EFFECT:  The effect of this notice is that employers who have waited to obtain coverage no longer have the ability to offer these MVP plans as they currently exist.  By removing certain hospitalization and physician benefits, the cost of total premium was typically around $200 per month.  This made these plans a very affordable and attractive option for employers looking to minimize their cost for protection against all potential ACA penalties.  Obviously, an inclusion of the required hospitalization and physician benefits to qualify a plan as providing "minimum value" are going to increase the cost of premium.

 

For more resources visit the ACA Planning in the Staffing Industry section of our website. There you can find FAQ's, webinars and whitepapers.

DISCLAIMER:  The information contained herein does not constitute legal or financial advice and should not be used as a substitute for the advice of legal counsel or a financial advisor.  Advance Payroll Funding, Ltd. makes no claims, promises or guarantees about the accuracy, completeness, or adequacy of said information.  Advance Payroll Funding, Ltd, its employees, agents, authorized representatives or stakeholders will not be liable or responsible to you for any claim, loss, injury, liability, or damages related to your use of said information.