GNYADA Insurance Brokerage Brief

BROKERAGE I N S U R A N C E

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BRIEF

Introducing GNYADA’s Brokerage Brief! We’re excited to launch our first edition of the GNYADA Brokerage Brief . This publication is devoted to addressing members’ insurance needs and informing them how the GNYADA Insurance Brokerage’s products can help. We hope that you’ll find it a valuable resource!

Dealers Choose GNYADA for Quality Insurance Products at Great Rates

Poor Workers’ Comp MODs Can Trigger Dealer Audits

If your dealership has a workers’ compensation experience modification rating (MOD) of more than 1.20 (and an annual payroll higher than $800,000), you may be contacted by the NYS Compensation Insurance Rating Board (CIRB) regarding workplace safety concerns. That MOD number is well above the normal safe rating for dealerships; therefore, receiving such notice from the State requires dealers to take immediate action. Dealerships have 30 days to arrange a consultation and evaluation by a certified Safety and Loss Consultant; they must tell the Department of Labor the name, address and certification number

Whether you want to insure five employees or your entire dealership, we can provide specialized insurance products and services for you. Our team of experts will show you how to choose the right plan and carrier for your business needs.

of the hired Consultant, in writing, within 10 days of setting up the evaluation. The Consultant’s completed report must be delivered within 75 days of the dealers’ receipt of the notice. Dealers must then send copies of the evaluation to both their insurance carrier and the DOL. These evaluations entail: • Reviews of safety procedures for employees • Assessments of the employer’s compliance with ICR59 requirements • Any hazard surveys the dealership must have done A list of certified consultants can be found on the DOL website at: www.labor.ny.gov/WSLPIP.html or by calling GNYADA at 718.746.8100. The penalty for noncompliance is a 5% surcharge on your workers’compensation premium. The surcharge goes up an additional 5% for each year not in compliance. Every employer is legally obligated to maintain a safe working environment for their employees, to minimize the number and severity of injuries. Proactive safety measures also contribute to reducing MOD ratings, which in turn, lowers Workers’ Comp premiums.

PRODUCTS: • Health insurance • Workers’compensation

• Dental plans • Vision plans • Long- and short-term disability • Life insurance • Voluntary group plans (employee pays 100%) • “Cafeteria”plans (allowing employees to set aside pretax earnings) • Long-term care plans • Medigap • Senior services – Medicare • Flexible spending accounts

GNYADA offers a very competitive Workers’ Compensation Program for GNYADA member dealerships. To arrange a complimentary review of your existing program or to discuss your dealership’s MOD rating, please call 718.746.8100 .

Call us at 718-746-8100 for assistance.

BROKERAGE BRIEF I N S U R A N C E President Obama Delays “Cadillac Tax” The Cadillac Tax is a 40% excise tax on high-cost employer sponsored health plans, which is part of the Affordable Care Act (ACA). President Obama has delayed implementation of this tax from 2018 to 2020. Based on the delay, the tax is still

The additional expenses associated with the Cadillac Tax can be reduced by: • Offering employees a high-deductible health plan (HDHP). These plans have lower premiums which can help employers avoid triggering the excise tax. • Making available a Health Savings Account, which can be funded by an employer or employee. • EstablishingaHealthReimbursementAccount,whichisfundedbytheemployer.

deductible for employers who will be subject to it. The purpose of the Cadillac Tax is:

• To help finance the broadening of health coverage under the ACA. • To reduce excess healthcare spending (by employees and employers). • To prevent employers from deducting high-cost health programs as a business expense. If the cost of insuring one of your employees is over $10,200, the dealership is subject to the Cadillac Tax. For families, the threshold is $27,500. Cost includes the amount paid by the employer and the employee. (Threshold amounts will increase over time, to keep up with inflation.)

Michael W. Conway , Executive Director of the GNYADA Insurance Brokerage, is available to discuss your current and future health insurance needs. To discuss any of the topics contained in this newsletter, schedule an in-person visit at your dealership, or inquire about and other insurance issues, Michael can be reached at 718.746.8100 or mconway@gnyada.com .

Medicare “Combo Plans” Can Benefit Both Employers and Employees

beyond the age of qualifying for Medicare, both them and you should be aware of this combo option. Naturally,there isnobroadbrushthatcoverseverypossiblescenarioandhealthcare need. For coverage advice, workers should be referred to a trusted professional, so they can analyze what the advantages would be under both options.

Employees who are eligible for Medicare can opt for health coverage that combines Medicare with a Medicare supplement, often called Medigap; this is a privately sold policy that helps cover copayments, coinsurance and deductibles. Not only do recipients see financial savings with this combination, they also get broader coverage. Employers likewise save money, as they’re spared the cost of insuring that employee through the company health plan. This is a win-win situation. Historically, the vast majority of people who worked past retirement age rarely opted out of their group coverage, in favor of Medicare. But the popularity of this new“combo”coverage is quickly changing the trend. In New York State, an employee 66 years of age pays the same premium as a 36-year-old employee, even though the older person has Medicare coverage paying a portion of medical/hospital claims. The ever-increasing health plan premiums, as well as significantly high deductibles, make this new form of coverage an attractive option. What should employers do? The potential benefit of this configuration of coverage depends on a few factors, including how many people you employ and whether Medicare or your company plan is the primary payer. If your dealership has employees working

Randy Frey, VP Senior Services, the FNA Group, contributed to this article.

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Oxford Exit Affects 2017 Health Insurance Renewals

Oxford Health Plans (NY) recently announced their decision to leave the commercial market. Impacted groups and members will be those enrolled in “small group OHP New York HMO” and “large group OHP New York POS” products, as of January 1, 2017. The withdrawal will not affect Oxford’s OHI platform, which includes PO, PPO, Metro and HSA plans. Affected groups and members will receive a notice form Oxford approximately 180 days prior to their 2017 coverage end-date. This means notices could be received any time between now and June of 2017, depending when that renewal-date is, and will outline any actions to be taken as well as other available coverage options. Individual employees obtaining their Oxford OHP coverage through the New York State Department of Health must enroll in a new plan to have coverage in 2017. The last day of coverage for these individuals is December 31, 2016. This would be considered a qualifying event which would permit an employee to sign up for their employers’health insurance plan, which will likely be their best coverage option, as opposed to waiting for open enrollment.

If your dealership is being affected by this Oxford change and you would like to look into alternative products from the GNYADA Insurance Brokerage, please call the Brokerage at 718.746.8100.

Health Savings Accounts Benefit Dealers and Employees

A Health Savings Account (HSA) allows individuals or families to save money for medical expenses and reduce their taxable income. If you enroll your employees in a high-deductible health insurance plan (HDHP), those employees qualify for an HSA. Increasing numbers of dealerships, both large and small, are offering HSAs because they bring the following benefits: • They are less expensive than tradition plans. Employees set aside pretax dollars for medical expenses, which reduces cost for both them and their employers. • Employees are more empowered and knowledgeable about their healthcare plan. They typically become more cost-aware in selecting medical treatment and healthcare providers, for example.

The IRS recently released updated guidelines on the maximum contributions for Health Savings Accounts (HSA) in 2017: • In 2017, individuals will be able to contribute $3,400 to a Health Savings Account, and families can contribute $6,750. • The minimum individual deductible for a HDHP is $1,300 and $2,600 for a family. (Most common deductibles are $5,000 for an individual and $10,000 for a family.) • The maximum out-of-pocket limit for an individual in a HDHP is $6,550 and $13,100 for a family.

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718.746.5900 / WWW.GNYADA.COM

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BROKERAGE BRIEF I NS U R ANC E

The 5 Most Common Penalties in the Affordable Care Act

The coverage requirements and reporting deadlines required by the Affordable Care Act (ACA) are constantly changing. The following summarization offers a refresher on the most common ACA fines that both employers and employees should be aware of.

Delivering forms late to employees Employers must provide employees, by January of each year, with Health Coverage Forms 1095-B (establishing that an individual has minimum essential health coverage and is therefore not liable for the individual shared responsibility payment) or 1095-C (establishing that an individual is employed by an Applicable Large Employer which is subject to the ACA’s employer shared responsibility provision) as applicable. If employers miss the deadline for fewer than 30 days, the penalty is $50 per form. After 30 days, the penalty raises to $250 per form. Form filing late to the IRS ACA Employer Reporting Forms are due by the end of February if filing by paper, and by the end of March if filing electronically. Employers who miss these deadlines will be penalized $250 per form.

Individual Mandate Penalty This penalty only affects employees, but it’s nevertheless wise for dealers to know the specifics, in case their staffs ask about it. When a person files their taxes, they must indicate if they have maintained minimum essential coverage all year. If they can afford health insurance but they choose not to pay for it, they must then pay the individual shared responsibility fee. If, after checking with the employer or the insurance carrier, the IRS determines that an individual was subject to the individual shared responsibility fee but failed to pay it, a penalty letter will be issued.

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Jim Rochel, Senior Sales Representative, Professional Group Plans, contributed to this article.

Failure to offer compliant coverage

‘A’ penalties If the employer fails to offer coverage that is compliant with the federal law, and an employee goes to the state or federal health insurance exchange to get a subsidy, the employer must pay a penalty of $2,160 for every full-timer they employ in excess of 30

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full-time employees. ‘B’ penalties

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If an employee goes to the exchange, gets a subsidy, and the insurance offered by the company was not affordable (or met minimum value), the employer is penalized $3,240 for each employee who got the subsidy from the exchange.

Is Your Dealership ACA Compliant? The GNYADA Insurance Brokerage can evaluate your current health plan, to help assure that it meets all requirements of the Affordable Care Act. Just call 718.746.8100 or email mconway@gnyada.com.

GNYADA’s Brokerage Brief is published by the GNYADA Insurance Brokerage, a division of GNYADA. We are located at 18-10 Whitestone Expressway, Whitestone, NY 11357.

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