Disruption Resulting from COVID-19
March 31, 2020
On March 19, 2020, Department of Banking and Insurance Commissioner Caride issued Bulletin No. 20-04, encouraging insurers to take into consideration the difficulties residents have endured and will continue to endure until the spread of COVID-19 is controlled. Specifically, the bulletin encourages insurers to relax due dates for premium payments, extend grace periods, waive late fees and penalties, allow forbearances and payment plans, and to essentially work with policyholders to make sure insurance policies don’t lapse. As a result, employer plan sponsors that are facing economic hardship can discuss their options with insurers.
Bulletin No. 20-04 »
Insurance Commissioner Requires Coronavirus Testing Without Cost Sharing
March 17, 2020
On March 10, 2020, Department of Banking and Insurance Commissioner Caride issued Bulletin No. 20-03, requiring insurers to waive all cost-sharing payments for the screening and testing for COVID-19. Insurers must also provide coverage for out-of-network testing in the same manner as it is provided in-network. Additionally, when a COVID-19 vaccine is formulated, insurers are encouraged to offer that vaccine without cost sharing. Employers can notify plan participants who may need to receive testing that the testing will be provided without cost sharing.
Bulletin No. 20-03 »
Additional 1095-C Filing Guidance for Employers with Employees Who Reside in NJ
February 19, 2020
In connection with NJ’s individual mandate (which took effect in 2019), employers with employees who reside in NJ must file (or coordinate filing with their carrier) IRS Form 1095-C (or 1095-B, in some instances) with NJ. We have covered the filing requirements previously in the January 22, 2020, edition of Compliance Corner. NJ previously announced that employers must file electronically using the NJ Division of Revenue and Enterprise Services’ MFT SecureTransport service. This has caused angst among employers, since many employers may have only a handful of NJ-residing employees for whom they must report, and many employers may not be able to meet the appropriate formatting and technical requirements to file through the NJ SecureTransport service.
The additional guidance clarifies that there is a new manual process for employers that had fewer than 50 employees living in NJ during 2019. Under the manual process, the employer essentially keys in the Form 1095-C information for each NJ resident. The manual process, which uses the “Fillable Form NJ-1095” is outlined under the “Transmitting 1095 Returns” section at the below link. In addition to considering the new manual process, employers should reach out to their payroll provider or their IRS 1095-C filing vendor to see if the provider/vendor can assist with the NJ filings. While most provider/vendor contracts likely don’t address new state filings such as the NJ filing, it’s possible the provider/vendor would agree to add those services to the contract.
NFP Benefits Compliance will continue to monitor the NJ filing requirement issue, and report future developments here in Compliance Corner.
Updated Guidance for Employer Health Coverage Filings
January 22, 2020
On December 13, 2019, the state of New Jersey published updated guidance relating to the New Jersey shared responsibility requirement (the requirement for New Jersey residents to carry minimum essential health insurance coverage or pay a tax penalty — a state individual mandate). Beginning in 2019, the New Jersey Health Insurance Market Preservation Act (HIMPA) requires third-party reporting to verify health coverage information supplied by individual payers of New Jersey’s income tax. Under HIMPA, employers and all other providers of MEC must file information with the Division of Taxation on or before March 31, 2020. Importantly, the state has no plans to offer filing extensions.
The updated guidance states that out-of-state employers who employ New Jersey residents have the same filing requirements as in-state businesses. The guidance includes important information on what forms are required and from whom. Specifically, employers must file the following:
- Small fully insured employers are not required to file anything with NJ (the carrier will send 1095-B)
- Small self-insured employers will file Forms 1095-B with NJ
- Large fully insured employers will file Forms 1095-C with NJ
- Large self-insured employers will file Forms 1095-C with NJ
Employers are required to submit forms electronically — there is no paper filing option available. Employers will need to file electronically to the state using the Division of Revenue and Enterprise Services’ MFT SecureTransport service. The guidance includes instructions on how to register for an account and use the service.
Employers with employees in New Jersey should review the updated guidance and determine their filing obligations. Employers should file by March 31, 2020.
Updated Guidance »
Updates to Family Leave Act Law Took Effect Recently
September 04, 2019
Recently, New Jersey made some changes to the Family Leave Act (FLA) law. Beginning June 30, 2019, New Jersey FLA applies to all employers with 30 or more employees anywhere worldwide (previously it was 50 or more employees). The change was a result of a law passed previously this year (HB 3975, described in the March 9, 2019, edition of Compliance Corner). New Jersey also recently updated its fact sheet and FAQ, both of which reflect the applicability change from 50 to 30 employees.
Fact Sheet »
Extended Transition for Grandmothered Plans
May 29, 2019
On May 10, 2019, the New Jersey Department of Banking and Insurance published Bulletin 19-05. The purpose of the bulletin is to advise carriers of the department’s intent to continue to permit the renewal of coverage pursuant to the CCIIO’s latest transitional policy extension for non-grandfathered non-ACA-compliant plans (called “grandmothered plans”) in the individual and small group markets. As background, on March 25, 2019, CCIIO provided guidance for a transition policy extension that allows insurers the option to renew grandmothered plans as long as the state allows it. Such transition policies are not required to be in compliance with certain ACA mandates including community rating, coverage of essential health benefits, prohibition on pre-existing condition exclusions, and the annual out-of-pocket maximum limit.
According to the bulletin, NJ-issued policies may continue to be renewed on or before October 1, 2020, provided the policy will terminate by December 31, 2020. Insurers may renew early or issue coverage for periods less than one year if a policy terminates prior to December 31, 2020, and (in the case of a small group) if the employer wants coverage through the end of the calendar year. Employers with grandmothered plans should check with their adviser and carrier to determine if the carrier will continue to offer the plan via the extension.
Bulletin 19-05 »
Updated Employer Guidance For Individual Mandate
April 16, 2019
NJ recently updated their guidance on the employer filing requirements related to the state’s individual health insurance mandate. As discussed in the January 23, 2019, edition of Compliance Corner, NJ residents are required to maintain health insurance as of January 1, 2019. The law requires that employers provide third-party reporting to verify the coverage information initially provided by individual taxpayers.
This third-party verification requires employers to provide NJ taxpayers and the state with the same 1094 and 1095 health-care coverage information sent to the IRS. The employer filing requirements vary depending upon whether the employer is fully-insured, self-insured or a participating employer in a multi-employer plan. The size of the company also impacts the reporting requirements. Generally though, employers that filed Form 1094-C/Form 1095-C federally in 2018, may use those forms for purposes of NJ reporting. Similarly, filers of Form 1094-B/Form 1095-B should use those forms. Out of state employers that withhold and remit NJ gross income tax for residents have the same filing requirements.
Employers must verify health coverage through the same electronic system used for filing W-2 forms. The guidance clarifies that should the federal government discontinue or substantially alter Forms 1094-B, 1094-C, 1095-B, or 1095-C, NJ will issue similar forms to continue the third-party verification requirements.
The deadline for employers to file 2019 coverage verification information is February 15, 2020.
NJ Health Insurance Mandate Website »
Pre-Tax Transportation Benefits
April 02, 2019
On March 1, 2019, Gov. Murphy signed S1567 into law, requiring employers with more than twenty employees to offer pre-tax transportation fringe benefits to their employees who are not otherwise covered by a collective bargaining agreement.
Under the bill, an employee may set aside a certain portion of pre-taxed wages to be made available for specified transportation services and this will also reduce the employee’s federal taxable income. This pre-tax fringe transportation benefit includes services such as transit passes, commuter highway vehicle travel, and costs of parking at park-and-ride lots. This bill does not apply to employees of the federal government who are eligible for a transit benefit equal to or greater than the pre-tax transportation fringe benefit required by the state.
Please note that this law does not require employers to offer a qualified parking or bicycle benefit, but employers are permitted to do so.
The Commissioner of Labor and Workforce Development will enforce this new measure and is authorized to issue citations to employers that do not offer this pre-tax transportation fringe benefit. Employers that do not comply will be liable for a civil penalty of not less than $100 and not more than $250 for the first violation.
The NJ DOL intends to adopt rules and regulations to address the administration of and enforcement of this pre-tax benefit. The Act takes effect immediately, but shall remain inoperative for 365 days following the date of enactment (March 1, 2020) or upon the effective date of rules and regulations adopted.
Governor’s Statement »
Family Leave Act Expanded
March 05, 2019
On Feb. 19, 2019, Gov. Murphy signed assembly bill No. 3975, expanding family leave under the New Jersey Family Leave Act (NJFLA), making corresponding changes under the NJ Family Leave Insurance (NJ FLI), the NJ Temporary Disability Benefits Law (NJTDBL), the NJ Temporary Disability Insurance (TDI), and also adding eligibility of family leave to the NJ Security and Financial Empowerment Act (SAFE).
Effective June 30, 2019, the NJFLA will require employers with at least thirty employees to provide up to twelve weeks of unpaid family leave in a 24-month period for the birth or adoption of a child or to care for a family member with a serious health condition. Previously, the NJFLA applied only to employers with 50 or more employees and allowed qualifying employees to take up to six weeks of leave in a 12-month period.
The bill also increased the amount of weekly benefits for family leave insurance and pregnancy leave to 85 percent of the claimant’s average weekly wage (an increase from 66 percent) up to a maximum of $860 per week (or 70 percent of the NJ’s average weekly wage). This increased benefit is paid exclusively through increases in payroll taxes and will not increase the employer contribution rates.
Certain provisions take effect immediately, including a change to the definition of “child” to allow a parent of a foster child to take unpaid and paid family leave, as well as an employee who becomes a parent pursuant to a surrogacy or a valid written gestational carrier agreement. It also expands the definition of “family member” to include parent-in-law, sibling, grandparent, domestic partner, or any other blood relative, and “any other individual that the employee shows to have a close association with the employee which is the equivalent of a family relationship.”
The NJ SAFE law provides qualifying employees with up to 20 days of unpaid leave in a 12-month period and was amended to allow employees to take paid family temporary disability leave in the event that they become victims of domestic or sexual violence and need medical care, counseling or to attend court or other legal proceedings. An employee may also use this leave to assist a family member who is a victim of domestic or sexual violence.
The bill also makes significant changes to permitted intermittent leave, provides anti-retaliation measures to ensure employers do not discriminate or retaliate against employees that take advantage of the benefits, and updates the employer notice requirement to require an NJ FLI notice be placed at all worksites.
Employers with employees in NJ should review this bill to ensure that their employee handbook and policies reflect the changes required by the law as well as to ensure they are compliant with the notice and posting requirements. They must also confirm that the changes to the payroll tax deductions are properly implemented.
HB 3975 »
Updated NJ Health Insurance Mandate Information
January 23, 2019
Beginning Jan. 1, 2019, NJ requires its residents to maintain health insurance throughout 2019 and beyond (unless an exemption applies). NJ recently updated its website to detail the requirement of employers to verify the information provided by individual taxpayers.
As background, Gov. Murphy signed the Health Insurance Market Preservation Act on May 30, 2018, requiring every NJ resident to have health coverage or pay a penalty (shared responsibility payment). This state mandate mirrors the former federal individual mandate imposed by the ACA and intends to require NJ residents to purchase health care so that the NJ health insurance market will remain stable and provide more affordable rates of coverage. We initially discussed the individual mandate shortly after it became law in Compliance Corner.
Beginning in 2020, the NJ legislature will require employers with at least 50 employees to provide Form 1094-C, “Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Returns,” and Form 1095-C, “Employer-Provided Health Insurance Offer and Coverage,” that they currently provide to taxpayers and the IRS to the NJ Div. of Taxation. Copies of the forms must be submitted on or before Feb. 15 following the close of each calendar year. This NJ reporting requirement mirrors the current ACA reporting requirements, but if the federal government discontinues the use of Forms 1094-C or Forms 1095-B and 1095-C at some point in the future, then NJ will deploy similar forms for the ongoing filing requirement.
Similar to the federal requirement, NJ does not require dependent information, including adult children who are covered by their parents’ plans. However, it is recommended that employers advise employees to provide a copy of any Form 1095-B or 1095-C containing coverage information to their children residing in NJ.
NJ employers should review the NJ website for the reporting requirements and make note of the Feb. 15 deadline to provide the Forms 1094-C and 1095-C starting in 2020. Please also note that this reporting requirement also applies to out-of-state employers that withhold and remit NJ gross income tax for NJ residents.
For more information, employers can visit the NJ Health Insurance Mandate website.
The NJ Health Insurance Market Preservation Act »