The Washington Report
October 9, 2019
President Trump Signs Executive Order Promoting Private Medicare Coverage
On October 3, 2019, President Trump signed an Executive Order promoting private Medicare Advantage plans as an alternative to the Medicare for All bill currently pending in Congress. Among other provisions, the Executive Order states that within one year the Secretary of Health and Human Services will propose a variety of regulations that will offer more diverse and affordable plan choices, improve access to providers and plans, instill reforms to the Medicare program enabling providers to spend more time with patients, encourage innovation, and provide better quality care and cost data.
The Executive Order is available here.
IRS Publishes Revenue Procedure on Remedial Amendment Periods for Correcting Form Defects in 403(b) Plans
On September 30, 2019, the Internal Revenue Service (IRS) released Revenue Procedure 2019-39, which establishes a system of recurring remedial amendment periods for correcting form defects in a Section 403(b) plan (both for Section 403(b) individually designed plans and Section 403(b) pre-approved plans) first occurring after March 31, 2020 (the ending date for the initial remedial amendment period under Revenue Procedure 2013-22, 2013-18 I.R.B. 985). It also provides a limited extension of the initial remedial amendment period for certain form defects. Further, as contemplated by Section 16.01 of Revenue Procedure 2013-22, this Revenue Procedure establishes a system of Section 403(b) pre-approved plan cycles under which a Section 403(b) pre-approved plan sponsor may submit a proposed Section 403(b) pre-approved plan for review and approval by the IRS, which, once approved, may be made available for adoption by eligible employers. This Revenue Procedure also provides deadlines for the adoption of plan amendments for Section 403(b) individually designed plans and Section 403(b) pre-approved plans.
IRS Revenue Procedure 2019-39 is available here.
IRS Proposes Individual Coverage HRA Regulations on ACA Employer Mandate
The Treasury Department and the Internal Revenue Service (IRS) have proposed regulations clarifying the application of the Employer Shared Responsibility (ESR) mandate and nondiscrimination rules to individual coverage health reimbursement arrangements (IC-HRAs) and to provide related safe harbors easing the administrative burdens of ESR and income tax compliance under the nondiscrimination rules. These regulations build upon the principles offered in last year’s IRS Notice 2018-88, which finalized regulations on how employers could use IC-HRAs to subsidize employees’ purchase of individual health insurance policies without violating the Affordable Care Act (ACA), ERISA, or the Internal Revenue Code.
The Aon bulletin is available here.
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