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Insights

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The IRS released the 2018 required contribution percentage for the “affordability” threshold under the Affordable Care Act (ACA). The percentage will decrease to 9.56% from 9.69% in 2017. As a reminder, under the ACA’s Employer Shared Responsibility provision – which is still applicable as of now -  “applicable large employers” (generally, those with 50+ employees) must offer an affordable, minimum value health plan to their full-time employees and child dependents or be subject to a §4980H penalty for each full-time employee who receives a subsidy to purchase health insurance through the Marketplace / Exchange.

View Summary of Information on Affordability

View Rev. Proc. 2017-36 

Update on ACA repeal:  Senators are busy reviewing the ACA repeal bill “Better Care Reconciliation Act of 2017” released this morning.  The bill will be scored by the Congressional Budget Office to estimate its impact on the budget and insurance premiums as well as the number of insured individuals. Senate Majority Leader Mitch McConnell plans to hold a vote next week and hopes to get the 50 votes needed to pass it.

The discussion draft of the bill, which is expected to change prior to the vote, appears similar to the American Health Care Act (AHCA) passed by the House of Representatives in May.

Similarities between the bills:

  • Eliminates the employer and individual mandate penalties beginning in 2016
  • Increases Health Savings Account (HSA) contributions and flexibility regarding other HSA provisions
  • Repeals several taxes, such as OTC medications reimbursed through an HSA or FSA, Medical Device Tax, Health Insurance Tax, Medicare Tax Increase, Net Investment Tax
  • Removes Health Flexible Spending Account (FSA) contribution limit
  • Delays the Cadillac Tax

Alabama Captive Association Announces Board of Directors

Posted by Caitlin Miley on June 21, 2017

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Congratulations to Marc Escalona, Cobbs Allen Vice President of Captive Practice, who was announced as a new member of the Alabama Captive Association's Board of Directors. 

Through Marc's efforts, the captive practice has grown, and he has established himself as an experienced leader in the space. He is responsible for assisting companies effectively manage their corporate risks and control their insurance costs through a captive. He conducts feasibility analyses and coordinates the captive process to help clients achieve the highest possible degree of long-term success.

Marc holds the designation of Associate in Risk Management (ARM). He is a graduate of Louisiana State University with a Bachelor of Science. He has also received his master’s degree in business administration from the University of Alabama.

For a complete list of the Board of Directors, visit the Alabama Captive Association's website


Cobbs Allen Welcomes New Risk Consultants

Posted by Angela Wolfe on June 12, 2017

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Cobbs Allen is happy to welcome Ken Glanton to our Birmingham office and Daniel Kusmin to our Kansas City office. Both will serve as risk consultants in our property and casualty division.

Ken Glanton comes to Cobbs Allen from another brokerage firm and has two years’ experience. He has helped clients identify costly claims issues and consulted on ways to improve the issues as well introduce clients to the benefits of joining a group captive. Previously, Ken spent 10 years in the medical device industry consulting with surgeons both in and out of the OR. Ken has a B.S. in History and a Master’s in Public Administration from the University of Alabama in Birmingham.

Daniel Kusmin, ARM, comes to Cobbs Allen from Lockton Companies where he served as an associate account manager for two years. Daniel has a bachelor’s degrees in finance with a minor in economics from the University of Kansas and sits on the BIG for Big Brothers and Big Sisters of Kansas City. 


Cobbs Allen KC Hosts Open House

Posted by Caitlin Miley on June 9, 2017

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(Pictured from left to right: Daniel Kusmin, Matt Weaver, Olympic Gold Medalist Carly Patterson, Brandon Scarborough and Franco Olivier)

The Cobbs Allen of Kansas City office celebrated its growth in the Midwest market and the grand opening of its new location by hosting an Open House last Thursday evening, June 1. Joining our invited guests for the celebration was Olympic Gold Medal winner Carly Patterson.

With steady growth during the past two years, our Kansas City office has doubled its staff and outgrown its original space requiring a move to new, larger office.

"We are so appreciative to everyone that joined us on June 5th," said Brandon Scarborough, Cobbs Allen of Kansas City Vice President. "A huge thank you, also, to Team USA and gold medal winner Carly Patterson for their willingness to come and celebrate with us. We believe that the open house is just the beginning of something very special for Cobbs Allen in the Kansas City area."

To view pictures from the event, visit our Facebook page


Cobbs Allen Welcomes Summer Interns

Posted by Caitlin Miley on June 8, 2017

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(Pictured from left to right: Ben Waters, Sarah Butts, Dixon Simmons and Mahlon Dawkins)

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(Pictured: Caringtyn Julian)

Cobbs Allen is pleased to welcome five interns to our offices for the summer. Ben WatersDixon SimmonsMahlon Dawkins and Sarah Butts are all located in the Birmingham office and Caringtyn Julian is located in the Kansas City office. 

"The intern experience at Cobbs Allen is more than just a resume builder," said Ty Reed, Recruiter and HR Director for Cobbs Allen. "It immerses the best and brightest university talent in the most meaningful part of our business—relationships. So whether it is time with a mentor, time with a Fortune 500 CEO or time with peers to master the nuances of the workplace and professional culture, our interns walk away with a jump-start on their careers."

Ben Waters is a rising senior at the University of Alabama, majoring in Accounting and Management. His work experience includes a congressional internship for US Congressman Mo Brooks. His extracurricular activities include Sigma Tau Gamma and honors include the Dean’s List for spring 2015 and fall 2015. He is native of Decatur, Alabama.

Sarah Butts is a rising senior at Troy University, majoring in Global Business with a Concentration in Risk Management and Insurance. Her work experience includes Receptionist for Turner & Hamrick, LLC. Her extracurricular activities include Iota Gamma Sigma, Marketing Club, Kappa Delta Sorority and the Red Cross Club. She is native of Prattville, Alabama.


PCORI Fee due July 31st

Posted by Tracy Leeth on June 5, 2017

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As a reminder, the deadline for the PCORI Fee (Patient-Centered Outcomes Research Institute) is July 31stEmployers who sponsor certain self-insured health plans must submit IRS Form 720 (Quarterly Federal Excise Tax Return) with payment to the IRS, while insurers are responsible for fully-insured health plans.

The amount due is based on the health plan’s plan year and the average number of lives covered (enrollment) for the prior plan year.  Generally, the fee is due July 31st of the calendar year following the end of the plan year.  The fee per covered life (for plan years ending in 2016) is stated below:

  • $2.26 for plans with plan years beginning January 1, November 1 and December 1
  • $2.17 for plans with plan years beginning February 1, March 1, April 1, May 1, June 1, July 1, August 1, September 1, and October 1

View IRS Form 720
View Summary on PCORI Fee
View Summary on PCORI Fee FAQs
View Summary on Health Plans Subject to the PCORI Fee to determine what headcount information to use
View Summary on Reporting and Payment
View Summary of Rules for HRA’s (Health Reimbursement Account)
 
WHAT THIS MEANS TO EMPLOYERS:  If you offer a self-insured health plan and are unfamiliar with the rules and process, be sure to review the above Summary on Health Plans Subject to the PCORI Fee to determine applicability to your plans.  Your TPA should provide you with enrollment information for your plan year ending in 2016 to calculate covered lives using one of the IRS’ Counting Methods and to complete Form 720.  To determine the amount you owe the IRS, multiply the appropriate fee by covered lives.  Be sure to get the form and payment to the IRS by July 31st.

This fee is an excise tax and should not be included in your calculation of fully-insured equivalent rates for purposes of setting employee contributions for self-insured plans.  However, an employer may deduct the payment as an ordinary and necessary business expense.


May Client Spotlight: Nourish

Posted by Caitlin Miley on May 31, 2017

10-01-14_M._Drennen__T._Davis_040_copy.pngCompany Name: Nourish Foods

Owners: Mary Drennen and Tiffany Davis

Location: The Lakeview District in Birmingham, AL

Years in Business: 2 and a half

Industry: Prepared Meal Delivery

Website: www.nourishmeals.com

 

Founders Mary Drennen and Tiffany Davis were both married with kids (and busy schedules) when they recognized the need for healthy food options for people on the move.

Nourish Foods produces fully-prepared, healthy meals in its downtown Birmingham kitchen to distribute around the country. Customers can choose between three different plans—individual, couple, and family—based on how many people they are feeding.

“As new business owners, especially in the food business, there were a lot of question marks that we didn't understand from an insurance perspective,” Drennen said. “Cobbs Allen helped us lay the ground work for being properly protected. Today, more than two years later, we still find that it's essential to have a team like Cobbs Allen on our side, so we can focus on operating our business and growing quickly."