HCR - What Should Be Done and Whats To Come
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    A Brief Slide Show on Health Care Reform.
Stacey L. LaFrance, PHR | Founder & President | Innovative HR Solutions Inc.
Innovative HR Solutions Is Proud To Be In
The Human Services Profession, We Believe
HR MAKES A DIFFERENCE and heres why:

HR puts the world to work. Consider the billions and billions of people who go to jobsevery day around the planet. Steady paychecks. Safe working conditions.Reasonable management policies and leadership behaviors. Fair prospects foradvancement. In many countries, unprecedented surges in standards of living.Whos behind that? HR.

HR builds communities. Communitiesare filled with employees, former employees and future employees. Through HR,companies partner with community leadership to foster stability, hope, growthand development for all their citizens and constituents. When there are jobspeople stay. When people stay there is a tight fabric of relationships,memories, dreams and willingness to invest and sacrifice for an even betterfuture.

HR saves lives. HRis on the front lines of all the personal battles faced by modern humanity.Depression. Addiction. Domestic violence. Illiteracy. Street crime. Divorce.Despair. Thanks to the many initiatives and support systems that HR has assumedover the last 20 years, employees have a chance to prevail over their personalnightmares and sources of shame and stress.

HR makes greatness happen.No matter what we do for a living, we all share a single calling, which is touse our talents to make the world a better, more hopeful place. But none of uscan fully manifest our potential all by ourselves. Even the most talented andsingular visionaries need the support of organizations to bring their genius tothe marketplace. We need each other. We come to our chosen organizations withour various gifts and talents and skills. And we look to HR to sort it all outfor us, plug us into the places where we can do our best work and together asa team we lean into the wheel and build a future for ourselves, our families,our communities, our world that matches our best dreams and values.

HR matters and we are honored to provide service to yourcompany or organization. Thank you.

-Stacey L. LaFrance, PHR

Health Care Reform:
NondiscriminationTesting for Insured Plans

 The BIG Change For plan years beginning on or after September 23, 2010,insured health plans will be subject to the nondiscrimination rules contained in the Internal Revenue CodeSection 105(h) prohibiting a group health plan from discriminating in favor ofhighly compensated employees as to eligibility to participate in a plan or tothe benefits provided under the plan. Please refer to the Attachment for a copyof the actual HCR provision. This new rule will not apply to grandfatheredplans until and at such time the plan loses its grandfathered status (e.g. dueto a change in plan design).
Past Practices Historically, a number of employers purchased a specialgroup health policy covering the employers executive staff only. The policyprovided benefits supplementing the underlying group health plan by coveringdeductibles, copays, and excess over plan limits, as well as qualifying benefitsnot available through the basic health (including dental and vision) plans. Nonhighly compensated employeestypically would be ineligible to participate in the plan. Since insured grouphealth plans were exempt from the discrimination testing rules applicable toselffunded plans, the policy could be limitedto executives without IRS scrutiny.
Other ImpactsThis new rule also may impact multistateemployers who have different benefit levels, eligibility rules, andcontribution requirements based on business location. For example, a companybased in Connecticut may have a rich health plan withno employee contributions for Connecticut employees and a plant in Californiawith a modest health plan and high employee contributions achieving parity withwhat California employers offer as benefits in the same industry. The nondiscrimination testing rules mayrequire a more uniform level of benefits and contributions for all employeesregardless of their business location.
The Tax Effect Insured group health plans must pass the tests describedbelow. If they do not, the actual benefits provided (claims paid) becomeordinary income to the employee. For example, in a discriminatory plan, theactual dollars paid out in connection with a hospital stay, dental surgeries,or even the purchase of prescription lenses for the employee or covered familymember would be income to the highly compensated employee in the year thebenefit amount is paid. The nonhighly compensated employees remain exempt from taxation ofbenefits paid out.