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Play Time is Over: IRS Reveals Process for Assessing ACA Penalties

November 27, 2017

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The Affordable Care Act (ACA) introduced a “pay or play” scheme, effective January 1, 2015, in which Applicable Large Employers (ALEs) must offer affordable qualifying healthcare to their full-time employees (and their dependent children) or pay a penalty. Despite President Trump’s first Executive Order (discussed here) directing a rollback of the Affordable Care Act (ACA) and instructing the Secretary of Health and Human Services to minimize the “unwarranted economic and regulatory burden of the act,” the Internal Revenue Service (IRS) quietly updated its Questions and Answers on Employer Shared Responsibility Provisions Under the ACA to include the first official guidance detailing the process for enforcement of the penalty. Notably, this update coincided with an IRS announcement that penalties for the 2015 calendar year will be assessed late this year.

The ALE penalty process starts with Letter 226J, which the IRS will send to ALEs it believes owe a penalty based on

HIPAA Audits Are Coming (Again) – Are You Ready?

July 3, 2014

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The Office of Civil Rights (“OCR”) of the U.S. Department of Health and Human Services (“HHS”) is required to conduct periodic audits of compliance with the Privacy, Security and Breach Notification Rules under the Health Insurance Portability and Accountability Act (“HIPAA”).

In Phase I, which closed on December 31, 2012, OCR conducted 115 performance audits.  Now, OCR is preparing for Phase II.

To have a broad range of covered entities audited in Phase II, OCR is sending electronic pre-audit surveys to 550-800 eligible entities this summer. The pre-audit surveys are designed to ascertain the size, location, services and best contact information of the covered entities.

OCR is expected to select 350 covered entities for audit (232 health care providers, 109 health plans and 9 health care clearinghouses).  Audit notifications and request letters will be mailed to selected covered entities in the fall of 2015.

The Phase II audits will

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