Unless you’ve been under a proverbial (or actual) rock for the last several months, you are probably aware that the health reform law has a really big tax that could hit employers for not offering (or not offering good enough) health coverage to their full-time employees and dependents, referred to as play or pay (or “shared responsibility”) rules. We’ve discussed the proposed regulations previously here. But starting with this post, we are going to cover these rules in digestible portions. This will help you see some of the finer points of the rules, without having to swallow the entire regulations in a single sitting. In this first post, we’ll cover how you determine full-time employees (so you know who has to be offered coverage effective January 1, 2014)in a Q&A format. It’s worth noting the rules discussed here technically apply to all ongoing employees (we’ll touch on new hires later). (more…)
We understand that an IRS official today confirmed that the IRS has identified 3,377 tax-exempt hospitals whose community benefit activities will be reviewed to determine if they are meeting the community benefit standard necessary for tax exemption. We understand that these reviews began as early as April 2011 following enactment of the Affordable Care Act and that the reviews will be conducted in several waves, with each hospital being looked at in one of three annual phases. The hospitals will not be notified by the IRS that they are being reviewed, and will not know when the reviews begin or end.
Notice 2011-52 describes regulatory provisions that Treasury and the IRS intend to propose regarding the community health needs assessment (CHNA) requirements applicable to charitable hospital organizations under the Patient Protection and Affordable Care Act of 2010. The notice describes how hospital organizations can document a CHNA in a written report, make the CHNA widely available to the public and adopt an implementation strategy to meet the health needs identified through the CHNA.
On March 15, 2011, the Medicare Payment Advisory Commission (the “Commission”) issued its annual Medicare Payment Policy report (the “Report”) to Congress. The focus of the Report is the Commission’s recommendations for annual rate adjustments under Medicare’s fee-for-service (“FFS”) payment systems. The report includes payment policy recommendations for ten payment systems: inpatient hospitals, outpatient hospitals, physician and other health professional services, ambulatory surgical centers, outpatient dialysis, skilled nursing facility services, home health services, inpatient rehabilitation facility services, long-term care hospitals, and hospice. The Commission concluded that payment adequacy indicators were positive for ambulatory surgical centers, outpatient dialysis services, inpatient rehabilitation facility services, long term care hospitals, and hospice. Click here for a copy of the entire Alert.
On February 2, 2011, the Centers for Medicare and Medicaid Services (“CMS”) issued final rules which dramatically change how providers and suppliers (including tax-exempt organizations) enroll with Medicare. The new regulations, intended to carry out various provisions of the Patient Protection and Affordable Care Act (“PPACA”), greatly expand the reach of the enrollment requirements which were first proposed by CMS on September 22, 2010, and signify CMS’ focus on preventing fraud and abuse before it begins. Click here for a copy of the entire Alert.
In IRS Announcement 2011-20, the IRS granted tax-exempt organizations that operate one or more hospital facilities (hospital organizations), and that would otherwise be required to file Form 990, Return of Organization Exempt From Income Tax, including Schedule H, Hospitals, for the 2010 tax year before August 15, 2011, an automatic three-month extension of time to file the Form 990 for 2010. In addition, this announcement directs these hospital organizations not to file the 2010 Form 990 before July 1, 2011.
On September 22, 2010, the Centers for Medicare and Medicaid Services (“CMS”) issued proposed rules that will dramatically change the enrollment process for Medicare providers and suppliers, including new enrollment following a change of ownership. The proposed rules are intended to carry out various provisions of the Patient Protection and Affordable Care Act (“PPACA”), particularly section 6401, which requires that HHS develop procedures to screen Medicare providers for risk of fraud and abuse. The rules represent a shift in CMS’ anti-fraud strategy from one that pays first and asks questions later to one designed to prevent fraud before it starts. These rules will impact many tax-exempt organizations, especially health care organizations. For more information regarding these proposed rules, please click here.
IRC § 501(r) was enacted during 2010 to tighten the requirements that hospitals must satisfy to maintain IRC § 501(c)(3) status. IRC § 501(r) also complements steps taken by the IRS in the last couple of years to increase hospital transparency and supplement the”community benefit” standard set out in IRS Rev. Rul. 69-545, including more detailed requirements for reporting charity care and community benefits in the redesigned annual federal information return form (Form 990, particularly Schedule H). Under IRC § 501(r) a hospital organization that wants to retain its IRC § 501(c)(3) status must: (1) at least every three years conduct a community health needs analysis and develop a plan to meet these needs; (2) adopt, implement, and widely publicize written financial assistance and emergency care policies that must cover specified topics; (3) limit charges to persons qualifying for financial assistance to amounts charged to persons with emergency insurance; and (4) not take extraordinary collection actions without first trying to find out whether the individual is eligible for financial assistance under its policy. (more…)