ERIC News Release
For Immediate Release: September 6, 2011
Washington, D.C. -- The ERISA Industry Committee (ERIC) today urged the Department of Treasury and Internal Revenue Service to not impose unnecessary administrative burdens or costs on employers when implementing the comparative effectiveness fee under the Patient Protection and Affordable Care Act (ACA).
ERIC's comments are in response to a June 2011 request for comments (IRS Notice 2011-35) regarding the implementation of the fee imposed on sponsors of self-insured health plans under the ACA to fund comparative clinical effectiveness research relating to patient-centered outcomes.
ERIC offers several recommendations on the methods and requirements for calculating the new fee, including that it should be easy and inexpensive to administer, and should not require employers to establish costly systems to determine the actual average number of lives covered under an applicable self-insured health plan.
"The fee and the associated administrative costs are real and immediate, and apply at a time when ERIC's members are struggling to cope with a mounting roster of expensive health mandates, as well as increasing health care costs," ERIC President Mark Ugoretz warns.
ERIC urges the agencies to adopt rules so that the fee is administered in a way that avoids duplication and does not require an employer to pay the fee more than once with respect to the same covered individual. "ERIC believes that this approach is consistent with the intent of the provision imposing the fee," the letter says.
To that end, ERIC recommends that employers be permitted to treat all accident and health benefits sponsored by an employer as one applicable self-insured plan for purposes of the fee. "If employers are not permitted to aggregate plans, an employer might be required to pay a higher fee merely because it has structured its accident and health coverage as separate plans for unrelated business reasons," ERIC contends.
ERIC also recommends that the agencies provide employers at least two safe harbor methods for determining the average number of covered lives that contain simplifying assumptions for determining the number of participants and dependents enrolled in self-insured plans, including one method based on the number of participants shown on the Form 5500 annual report filed for a plan. The second safe harbor would permit an employer to count employees each month and then average the monthly totals over the course of a year. ERIC also recommends simplifying assumptions for counting the number of beneficiaries, a number often not tracked by employers.
A link to ERIC's comment letter is below.
For more information:
The ERISA Industry Committee
1400 L Street, NW, Suite 350
Washington, DC 20005
Phone: (202) 789-1400
Fax: (202) 789-1120