FINALLY!

The Internal Revenue Service (IRS) finally announced the official 2022 Flexible Spending Account (FSA), commuter, and adoption limits. Here are the newly released contribution limits:

NEW CONTRIBUTION LIMITS

• 2022 Healthcare FSA/Limited Purpose FSA: $2,850
• 2022 FSA carryover: $570
• 2022 Dependent Care FSA: $5,000 (family); $2,500 (married filing separately)
• 2022 Commuter (parking and transit): $280 per month
• 2022 Adoption limit: $14,890

YOUR FLEXIBLE SPENDING ACCOUNTS
The 2022 healthcare FSA contribution limit is an increase of $100 from the 2021 healthcare FSA contribution limit ($2,750). The carryover limit is an increase of $20 from the 2021 limit ($550).

The 2022 Dependent Care FSA contribution limits decreased from $10,500 in 2021 for families and $5,250 for married taxpayers filing separately. The 2021 Dependent Care FSA limits came in response to the COVID-19 pandemic as a temporary relief to working parents. Both healthcare FSAs and Dependent Care FSAs are versatile healthcare savings vehicles that allow individuals to receive tax benefits when they spend funds on eligible expenses.

Overall, there are four general types of FSAs to know about:

1. Healthcare FSA: Can be used for eligible medical expenses, including deductibles, copays, and coinsurance.
2. Post-deductible FSA: Can be used for certain eligible medical expenses once a minimum deductible has been met. Can be used in conjunction with a Health Savings Account (HSA).
3. Limited-purpose FSA: Can be used to pay for eligible vision and dental expenses. Can be used in conjunction with an HSA.
4. Dependent Care FSA: Can be used to pay for eligible expenses related to tax dependents, including day care, preschool, elderly care, and other types of dependent care. This type of FSA can only be used if the dependent care is necessary for you or your spouse to work, look for work, or to attend school full time.

 WHAT TO KNOW ABOUT ROLLOVER FUNDS 
In general, FSA funds are a use-it-or-lose-it account. However, employers may offer employees one of two options:

1. Grace period: Allows for a maximum of an extra 2.5 months to use FSA funds for eligible expenses incurred in the following plan year.
2. Carryover: Allows accountholders to carry over a certain amount (for 2022, the limit is $570) that can be used in the following year.

Employers can offer one of these options but not both, and neither option is required. To learn more contact us for more information.

DETAILS ON COMMUTER LIMITS
For 2022, the commuter contribution limits have increased $10 more per month than the 2021 contribution limit ($270).

If this plan is offered by the Employer, a commuter account allows you to set aside pre-tax funds to pay for your commute to work. For 2022, if you were to use both transit and parking, you could set aside up to $6,720 annually. Assuming a 30% effective tax rate that means you could potentially reduce your tax liability by more than $2,000. 

ADOPTION ASSISTANCE EXCLUSION AND ADOPTION CREDIT
The IRS also increased the Adoption Assistance Exclusion or Adoption Credit amounts to $14,890, an increase of $490 from 2021 ($14,400).
Parents who either adopted or tried to adopt a child may seek to claim the adoption credit on their individual tax returns. If a taxpayer’s employer helped with adoption expenses through a qualified adoption assistance program, the taxpayer may qualify to exclude that amount from their individual taxes.
 

401(k) Contribution Limit Increased to $20,500

The Internal Revenue Service (IRS) has released Notice 2021-61, which contains cost-of-living adjustments for 2022 that affect amounts employees can contribute to 401(k) plans and individual retirement accounts (IRAs). The employee contribution limit for 401(k) plans in 2022 has increased to $20,500, up from $19,500 for 2021 and 2020.

Other key limit increases include the following:

The employee contribution limit for SIMPLE IRAs and SIMPLE 401(k) plans is increased to $14,000, up from $13,500.
The limits used to define a “highly compensated employee” and a “key employee” are increased to $135,000 (up from $130,000) and $200,000 (up from $185,000), respectively.

Key limits that remain unchanged include the employee contribution limit for IRAs (remaining at $6,000) and the catch-up contribution limit for employees aged 50 and over who participate in 401(k), 403(b), most 457 plans and the federal government’s Thrift Savings Plan (remaining at $6,500).

Starting Jan. 1, 2022, Washington state law protects you from surprise or balance billing if you receive emergency care at any medical facility or when you're treated at an in-network hospital or outpatient surgical facility by an out-of-network provider. 

What is surprise or balance billing
Surprise billing happens because some types of medical providers, including anesthesiologists, radiologists, pathologists, and labs may not be contracted with your health insurer even though they provide services at a hospital or facility that is in your health plan’s provider network. So, in addition to your expected out-of-pocket costs, you also get a bill for the difference between what your insurer has agreed to pay that provider and the amount the provider billed for their services. 

The new Balance Billing Protection Act prevents people from getting a surprise medical bill when they receive emergency care from any hospital or if they have a scheduled procedure an in-network facility and receive care from an out-of-network provider. In this case, if an insurer and provider cannot agree on a price for the covered services, they go to arbitration and cannot bill the consumer for the amount in dispute.
 

What to do if you get a surprise bill
If you get a surprise medical bill for a service you had before Jan. 1, 2022, contact the provider or facility and tell them your concerns. See if you can get them to lower your bill. After Jan. 1, 2022, you cannot be surprise billed for certain services. If you get a surprise bill, contact the provider or facility and tell them you believe you've been wrongly billed. You can also file a complaint with the Washington Office of the Insurance Commisioner and they will investigate on your behalf. 
 

The law applies to most, but not all health plans 
The Balance Billing Protection Act applies to all state-regulated health plans and state and school employee benefit plans. Self-funded group health plans are not regulated by the state and must notify the WAOIC if they want to opt-in to the law and offer the protections to their enrollees.  

There are a number of new laws coming out of the Biden Administration which may impact you.  Centers for Medicare & Medicaid Services (CMS) provided a fact sheet regarding new ACA subsidies, with a Q&A section to help individuals understand how to obtain the new subsidies. To delve further in by county, see the Assistant Secretary for Planning and Evaluation (ASPE) data sets which break down the uninsured numbers by household income, age, etc.  

Health and Human Services (HHS) provided a fact sheet regarding new ACA subsidies, along with a table which shows the number of uninsured who will now be eligible in each state.

For additional information, refer to HR360 .

Final Rule Removes Gender Identity, Termination of Pregnancy, and Notice and Tagline Provisions

On June 12, 2020, the U.S. Department of Health and Human Services (HHS) issued a final rule that revises the implementation of the Affordable Care Act’s Section 1557 nondiscrimination provisions on gender identity and language access. Specifically, the final rule:

• Removes gender identity and termination of pregnancy from being included as sex discrimination; and
• Eliminates the requirement that covered health programs and activities distribute nondiscrimination notices and tagline translation notices in at least 15 languages to patients and customers.

The final rule is scheduled to be published in the Federal Register on June 19, 2020, and will become effective 60 days after publishing. The final rule does not affect the substantive Section 1557 provisions related to nondiscrimination on the basis of disability, race, color, age, national origin or sex.

Employer Notice, Fact Sheets, Q&As Available on DOL Webpage
Guidance materials on the new Families First Coronavirus Response Act (FFCRA) are now available for employers from the U.S. Department of Labor (DOL). Links to the materials, which explain how the law will be implemented and include required notices, can be found on a DOL webpage dedicated to COVID-19. Employers should monitor the webpage to stay apprised of the latest DOL guidance on the law, as the page is updated frequently.
 
The following resources are currently available on the DOL COVID-19 webpage:
 
Fact Sheets
Families First Coronavirus Response Act: Employee Paid Leave Rights (PDF)
 

Questions and Answers
Families First Coronavirus Response Act: Questions and Answers
COVID-19 and the Fair Labor Standards Act: Questions and Answers
COVID-19 and the Family and Medical Leave Act: Questions and Answers

Posters
Employee Rights: Paid Sick Leave and Expanded Family and Medical Leave under The Families First Coronavirus Response Act (FFCRA)
Families First Coronavirus Response Act Notice - Frequently Asked Questions

Field Assistance Bulletin
Field Assistance Bulletin 2020-1: Temporary Non-Enforcement Period Applicable to the Families First Coronavirus Response Act (FFCRA)

Starting Jan. 1, 2020, Washington state law protects you from surprise or balance billing if you receive emergency care at any medical facility or when you're treated at an in-network hospital or outpatient surgical facility by an out-of-network provider. 

What is surprise or balance billing?
Surprise billing happens because some types of medical providers, including anesthesiologists, radiologists, pathologists, and labs may not be contracted with your health insurer even though they provide services at a hospital or facility that is in your health plan’s provider network. So, in addition to your expected out-of-pocket costs, you also get a bill for the difference between what your insurer has agreed to pay that provider and the amount the provider billed for their services. 

The new Balance Billing Protection Act prevents people from getting a surprise medical bill when they receive emergency care from any hospital or if they have a scheduled procedure an in-network facility and receive care from an out-of-network provider. In this case, if an insurer and provider cannot agree on a price for the covered services, they go to arbitration and cannot bill the consumer for the amount in dispute.

What to do if you get a surprise bill
If you get a surprise medical bill for a services you had before Jan. 1, 2020, contact the provider or facility and tell them your concerns. See if you can get them to lower your bill. After Jan. 1, 2020, you cannot be surprise billed for certain services. If you get a surprise bill, contact the provider or facility and tell them you believe you've been wrongly billed. You can also file a complaint with our office and we will investigate on your behalf. 

The law applies to most, but not all health plans 
The Balance Billing Protection Act applies to all state-regulated health plans and state and school employee benefit plans. Self-funded group health plans are not regulated by the state and must notify the state if they want to opt-in to the law and offer the protections to their enrollees.  

How much do you pay? 
If you receive a surprise medical bill, you're not responsible for paying it. Your insurer must pay the out-of-network provider and facility directly. You are only responsible for your in-network cost-sharing, including any copays, coinsurance and deductible. 

What health insurers must do 
Base your cost-sharing responsibility on what it would pay an in-network provider or in-network facility in your area and show the amount on your Explanation of Benefits (EOB). 
Count any amount you pay for emergency services or certain out-of-network services toward your deductible and out-of-pocket limit.
Tell you, via their websites or if you ask, which providers, hospitals and facilities are in their networks.
Provide notice to you (PDF, 143KB) detailing your rights under the balance billing protection act and letting you know when you can and cannot be balanced billed.

What medical providers and facilities must do
Tell you which provider networks they participate in on their website or if you ask.
Refund any amount you overpay within 30 business days.
Not ask you to limit or give up these rights.
Provide notice to you (PDF, 143KB) detailing your rights under the balance billing protection act to let you know when you can and cannot be balanced billed. 

New Form W-4 for 2020 Just Released

On December 5, 2019, the Internal Revenue Service released a final Form W-4 for use in 2020. Employees who have submitted Form W-4 in any year before 2020 are not required to submit a new form merely because of the redesign. Employers should continue to compute withholding based on the information from the employee’s most recently submitted Form W-4.

Employees complete the Form W-4 so that their employers can withhold the correct amount of federal tax from their paycheck. A significant change for the 2020 form is that it does not have withholding allowances because employees may no longer claim personal exemptions or dependency exemptions. Previously, the value of a withholding allowance was tied to the amount of the personal exemption.

The new form is divided into five steps and employees will provide information for the steps that apply to them (steps 2-4 may not). 

Step 1: Enter personal information (including marital status).
Step 2: Account for multiple jobs (employee), or whether the employee’s spouse works. This step is completed if the employee holds more than one job at a time or is married filing jointly and their spouse also works. The correct amount of withholding depends on income earned from all jobs.
Steps 3 and 4: Claim dependents and other adjustments (specifically, other income that is not from jobs, deductions, and extra withholding). Steps 3 – 4 are completed on Form W-4 for only one job, and these steps are left blank for the other jobs. Withholding is most accurate if an employee completes Steps 3 – 4(b) on the Form W-4 for the highest paying job.
Step 5: Employee signature and date.

Publication 15-T (still in draft form) assists employers in determining the amount of federal income tax to withhold from their employees’ wages.

Continue to read about the Form W-4, and see the 2020 version.

Lately, you may have heard about surprise medical billing in the local and national news.  I'm thrilled both Washington D.C. and Washington state are finally giving this issue the attention it deserves, because it is one of the most costly and troublesome issues I see for health insurance consumers.  For most of us, the only 'surprise' we want on our medical bill, is to hear either we don't owe anything after all or insurance decided to cover it.  But the reality is, surprise or 'balance' billing can happen when you're treated for an emergency, or have a scheduled procedure at an in-network hospital or surgery facility and are seen by an out-of-network provider.

A common concern we get at PNW Insurance Solutions, located in Mukilteo, WA is something along the lines of "I went to an in-network hospital, so why do I owe this HUGE amount still?" Well, this happens because some types of providers, including anesthesiologists, radiologists, pathologists, and labs may not be contracted with your insurance company even though they provide services at a hospital or facility that is in your health plan’s provider network. So, in addition to your expected out-of-pocket costs, you also get a bill for the difference between what your insurer has agreed to pay that provider and the amount the provider billed for their services.  This is commonly referred to as 'balance billing'.  

So, what is Washington state doing about this?  Quite a bit actually.  Beginning January 1, 2020, The new surprise billing law (www.leg.wa.gov) prevents people from getting a surprise medical bill when they receive emergency care from a hospital or get care at an in-network facility but are treated by an out-of-network provider. If an insurer and provider cannot agree on a price for the covered services, they can go to binding arbitration but they cannot bill the consumer for the amount in dispute. How great is that?!? 

This new law will provide transparency. Insurers, medical providers and facilities must give consumers a new notice detailing their rights and letting them know when they can and cannot be balance billed. Also, they must keep updated information about provider networks on their websites. At last, some long needed help!

This new law will provide dispute resolution. The amount an out-of-network provider will be paid by an insurer must be a 'commercially reasonable' amount, based on payments for the same or similar service in a similar geographic area. If an insurer and provider cannot reach an agreement, either one can request arbitration. Neither one can involve the consumer in the dispute. More protection for us!

There will be a new sheriff in town. If the commissioner's office sees that a provider is continuing to surprise bill consumers, it can refer the provider to the Department of Health for disciplinary action. Bam!

So what should you do before the law is enacted if this happens? If you get a surprise medical bill before the new law takes effect, you should contact the provider directly. Tell them you know the law is changing soon and ask them to reconsider the charges or request a reduced charge. Unfortunately, surprise billing could still occur in this time, but knowing your options could help you reduce your costs. Stand up for yourself!

If you have any questions, please contact Wendee Allen at PNW Insurance Solutions 425-314-0988.

As the weather heats up, the insurance carrier activity here in Washington state is heating up too.  The 2020 individual and small group requested rate increases were recently released.  There are decreases, increases, carriers exiting the state or certain counties, a few new players and more! 

Individual & Family Health Insurance

There are two new insurance companies entering the Washington market and many changes to county coverage with existing carriers.  Of note: 

• Bridgespan, Lifewise and Regence are adding King and Pierce counties
• Bridgespan also adding Clark county
• Lifewise adding 21 counties altogether
• Premera removing 7 counties including Snohomish & Pierce counties
• Coordinated Care adding Kitsap county
• Kaiser Permanente removing San Juan county
• Molina adding Snohomish county
• Two new carriers: PacificSource (3 counties) and Providence (6 counties)

Small Group Health Insurance

The requested small group rate increases for 2020 are in for several noteworty carriers:

• Aetna will continue to sell plans statewide and requested a 11.0% rate increase
• Kaiser Permanente requested a 4.4% increase and is pulling out of San Juan county 
• Premera Blue Cross requested a 5.6% increase and will offer plans statewide, except in Pierce county
• PacificSource is a new carrier to Washington offering plans statewide
• Regence Blue Shield - requested a 5.8% rate increase and will continue to sell plans in all current areas
• United Healthcare - will continue to sell plans statewide and requested a 9.0% rate increase
• Health Net has decided to discontinue selling small group plans altogether in Washington state

The requested changes from each insurance company have not been approved yet by Washington's Insurance Commissioner.  We did see changes happen last year and will provide updates as they become available. If you have any questions please contact Wendee Allen at (425) 314-0988. Have a great summer!