Human Resources

The Washington Report

October 17, 2018


CMS Releases 2019 Medicare Parts A and B Premiums and Deductibles

On October 12, 2018, the Centers for Medicare and Medicaid Services (CMS) released the 2019 premiums, deductibles, and coinsurance amounts for the Medicare Part A and Part B programs. The standard monthly premium for Medicare Part B enrollees will be $135.50 for 2019, an increase of $1.50 from $134.00 in 2018. (According to the CMS, an estimated 2 million Medicare beneficiaries (about 3.5%) will pay less than the full Part B standard monthly premium amount in 2019 due to the statutory hold harmless provision, which limits certain beneficiaries’ increase in their Part B premium to be no greater than the increase in their Social Security benefits.) The annual deductible for all Medicare Part B beneficiaries is $185.00 in 2019, an increase of $2 from the annual deductible of $183.00 in 2018. Premiums and deductibles for Medicare Advantage and Medicare Prescription Drug plans are already finalized and are unaffected by this announcement.

The Medicare Part A inpatient hospital deductible that beneficiaries will pay when admitted to the hospital will be $1,364.00 in 2019, an increase of $24.00 from $1,340.00 in 2018. The Part A inpatient hospital deductible covers beneficiaries’ share of costs for the first 60 days of Medicare-covered inpatient hospital care in a benefit period. In 2019, beneficiaries must pay a coinsurance amount of $341.00 per day for the 61st through the 90th day of a hospitalization ($335.00 in 2018) in a benefit period and $682.00 per day for lifetime reserve days ($670.00 in 2018). For beneficiaries in skilled nursing facilities, the daily coinsurance for days 21 through 100 of extended care services in a benefit period will be $170.50 in 2019 ($167.50 in 2018).

The CMS Notice for 2019 Inpatient Hospital Deductible and Hospital and Extended Care Services Coinsurance Amounts is available here.

The CMS Notice for 2019 Part A Premiums for the Uninsured Aged and for Certain Disabled Individuals Who Have Exhausted Other Entitlement is available here.

The CMS Notice for 2019 Medicare Part B Monthly Actuarial Rates, Premium Rates, and Annual Deductible is available here.

The CMS news release is available here.


PBGC Announces 2019 Premium Rates for Single-Employer and Multiemployer Plans

On October 12, 2018, the Pension Benefit Guaranty Corporation (PBGC) announced the 2019 flat-rate premiums for single-employer and multiemployer plans. For the 2019 plan year, the per-participant flat-rate premium for single-employer plans is $80.00 (up from $74.00 in 2018) and $29.00 for multiemployer plans (up from $28.00 in 2018). For plan years beginning in 2019, the variable-rate premium (VRP) for single-employer plans is $43.00 per $1,000 of unfunded vested benefits, up from a 2018 rate of $38.00. For 2019, the VRP is capped at $541 times the number of participants (up from a 2018 cap of $523). Plans sponsored by small employers (generally fewer than 25 employees) may be subject to a lower cap.

For additional information on VRPs, current and historical data, and scheduled increases for years after 2019, please refer to the premium rate website.

The 2019 PBGC premium rates are available here.

Other HR/Employment

Social Security Administration Releases 2019 Indexed Figures; Announces 2.8% Benefit Increase

The Social Security Administration (SSA) released the Social Security 2019 indexed figures on October 11, 2018. The SSA announced that there will be a 2.8% Cost-of-Living Adjustment (COLA) for 2019. Some other changes that take effect in January of each year are based on the increase in average wages. Relevant figures are shown below.

COLA: Based on the increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers, Social Security and Supplemental Security Income beneficiaries will receive a 2.8% COLA for 2019. (The 2018 COLA was 2.0%.)

Wage Base: The 2019 Social Security wage base is $132,900. (The 2018 amount was $128,400.)

FICA/Medicare Tax Rate: The FICA tax rate remains at 7.65%: 6.20% for Social Security and 1.45% for Medicare combined.

Beginning in 2013, the Affordable Care Act increased the Medicare tax rate on wages by 0.9% (from 1.45% to 2.35%) for higher-income individuals. The payroll tax increase applies to wages over $200,000 for single tax filers and $250,000 for couples filing jointly ($125,000 for a married individual filing separately). The tax rates above do not include the 0.9%. The Internal Revenue Service has provided frequently asked questions on the Medicare tax increase, available here.

Maximum Monthly Benefit: For someone retiring at full retirement age in 2019, the maximum benefit is $2,861. (The 2018 amount was $2,788.)

Annual Earnings Test Limit: For individuals under full retirement age, the 2019 annual earnings test limit is $17,640. (The 2018 amount was $17,040.) For individuals attaining full retirement age in 2019, the annual earnings test limit for the months prior to attaining full retirement age is $46,920. (The 2018 amount was $45,360.) There is no annual earnings test for individuals who have attained full retirement age.

More information on the SSA COLA is available here.

A fact sheet on the SSA's 2019 Social Security changes is available here.

The October 11, 2018, news release is available here.

A more detailed Aon bulletin on the 2019 SSA indexed numbers is available here.

Fall 2018 Regulatory Agenda Released
On October 17, 2018, the Trump Administration released its Fall 2018 Unified Agenda of Regulatory and Deregulatory Actions, which provides an updated report on the actions federal departments and administrative agencies (e.g., the Department of Labor, Equal Employment Opportunity Commission, Department of the Treasury, Department of Health and Human Services, Pension Benefit Guaranty Corporation, etc.) plan to issue in the near and long term. The agendas include regulatory plans and priorities for 2018 and provide a framework of activity expected throughout next year. Included in this agenda are rules impacting overtime pay and joint employer liability for companies in staffing and franchise relationships. Departments and agencies may delay the release of regulations at any time, so it is important to note that projected timelines are estimates and may not be met by the date(s) indicated in the agendas.

The link to the Current Unified Agenda of Regulatory and Deregulatory Actions (i.e., updated Regulatory Agendas and Plans, searchable by department and agency) is available here.

Aon Publications

BOO! This Halloween, Make Sure Compliance Doesn’t Haunt Employers

With Halloween just a couple of weeks away, employers might be getting scared—and with good reason. Although Congress hasn’t enacted much in the way of health care legislation in 2018, several states and federal regulatory agencies have prepared a few health care “treats” with which to “trick” employers.

As we head toward the end of 2018, employers should have the following compliance items on their year-end “Fright Night” List to avoid Halloween scares:

  • States Are Replacing the Individual Mandate…With an Individual Mandate
  • Testing for Mental Health Parity
  • Do You Have Mail? The Internal Revenue Service Is Enforcing the Affordable Care Act Employer Mandate
  • Wellness Programs and the Vanishing Equal Employment Opportunity Commission Rules
  • Review Plan Designs for Compliance With Updated Limits
  • Facing a Paid Leave Juggernaut, Employers Should Take Family and Medical Leave Credit Where Credit Is Due
  • Are You Going to San Francisco? Make Sure You’re Paying Enough in Health Care Expenditures

The full text of this Aon bulletin can be found here.

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