Issue link: https://www.e-digitaleditions.com/i/177159
was imposed on certain indoor tanning services. • In June, early insurance reforms began. Temporary high-risk pools were created for uninsured adults with preexisting conditions. For plans that began in late September, there were prohibitions on lifetime and annual benefit spending limits, non-group plans were not allowed to cancel coverage, plans cover most preventive care, and dependents were allowed to remain on their parents' policies until age 26. 2011 and importers of • Manufacturers brand-name drugs began paying a $2.5 billion tax. • The prohibition of purchases of overthe-counter medications from consumer-driven accounts began. • The penalty for using Health Savings Accounts (HSAs) for non-qualified purchases doubled to 20 percent. 2012 would have been required • Businesses to send additional Form 1099s for every business-to-business transaction of $600 or more, but this provision was repealed in 2011. Previous Form 1099 reporting requirements still exist. • Manufacturers and importers of brand-name drugs tax rose to $2.8 billion. • Employers were required to provide a Summary of Benefits and Coverage (SBC) to employees during open enrollment season. Health insurance plans (in the case of fully insured products) and health insurance plan sponsors (in the case of self-insured products) designed the summaries, but employers were required to distribute the summaries to employees. 2013 must distribute a Notice • Employers of Exchange Coverage Options document to all employees by October 1, 2013. Employers must distribute the Notice of Coverage Options to employees hired after October 1, 2013, within 14 days of the time of hiring. The Notice of Coverage Options is a written notice describing an employer's health insurance offerings and/or exchange availability: • Informing the employee of the existence of an exchange, description of exchange services, and exchange contact information; and • Notifying the employee if the employer's plan is below 60 percent actuarial value. • Health Insurance Exchanges begin open enrollment on October 1, 2013. Qualified individuals and qualified businesses may begin selecting standardized private health insurance options. Coverage will not begin until January 1, 2014. • Medicare payroll tax on wages and self-employment income in excess of $200,000 ($250,000 joint) will increase by 0.9 percent. • Medicare investment tax imposes a new 3.8 percent tax on investment income for higher-income taxpayers. • Flexible Spending Accounts will be limited to a maximum of $2,500 annual contribution. • Employers will be required to report the cost of employee health benefits on W-2s for tax year 2012 (both employer and employee contribution). Until the IRS issues additional regulations, employers that file fewer than 250 Form W-2s may voluntarily report this information, but it will not be required until further regulations are issued. • The threshold at which medical expenses, as a percentage of income, are deductible increases to 10 percent from 7.5 percent. • An annual 2.3 percent excise tax on medical devices begins. 2014 must determine size, • Employers whether they will be considered "large" or "small," for the requirements of the employer mandate. Penalties will not occur until 2015, but a large employer is defined as an employer who employed an average of at least 50 full-time equivalent (FTE) employees on business days during the precontinued on page 26 September/October 2013 25