Time & Attendance
By Staff Report
Apr. 21, 2011
Employers that will lose a tax break for offering prescription drug coverage to Medicare-eligible retirees are considering a variety of design changes, according to a survey released April 21.
Under a provision in the health care reform law, employers with prescription drug plans provided to Medicare-eligible retirees in 2013 no longer will be able to receive a tax deduction equal to the amount of the tax-free federal subsidy they receive for prescription drug expenses.
Under a 2003 law that added a prescription drug benefit to the Medicare program, employers that have provided coverage at least equal to Medicare Part D receive a tax-free subsidy equal to 28 percent of medication costs within a certain range incurred by Medicare-eligible retirees.
In a survey of 344 employers, Lincolnshire, Illinois-based Aon Hewitt Inc. found that 75 percent now receive the prescription drug subsidy. Of those receiving the subsidy, 73 percent will alter their retiree drug benefits strategy as a result of the elimination of the tax break.
Among designs favored by employers that are considering changes are directly contracting with a Medicare Part D prescription drug plan, which 34 percent of respondents are considering.
Thirty percent of employers are considering a defined contribution approach in which retirees would receive a fixed contribution and use it to buy drug coverage in the individual Medicare market and 9 percent anticipate eliminating coverage.
Come see what we’re building in the world of predictive employee scheduling, superior labor insights and next-gen employee apps. We’re on a mission to automate workforce management for hourly employees and bring productivity, optimization and engagement to the frontline.
BenefitsWhat is Earned Wage Access (EWA)? A Few Considerations
Summary Earned wage access (EWA) programs are an increasingly popular way for employees to access their...
benefits, earned wage access products, payroll, time and attendance
BenefitsEEOC says that employers legally can offer incentives to employees to get vaccinated in almost all instances
If you’re an employer looking to get as many of your employees vaccinated as possible, you can rest eas...
ADA, CDC, COVID-19, EEOC, GINA, pandemic, vaccinated
BenefitsFixing some common misconceptions about HIPAA
Ever since the CDC amended its COVID-19 guidance to say that the fully vaccinated no longer need to wea...
COVID-19, health care, HIPAA, human resources, wellness