4 Point Compass Fall 2024

ACA Affordability Threshold Change for 2025 – The IRS has announced that employer-sponsored health coverage will satisfy the ACA “affordability test” for large employers in the 2025 year if the employer offers a Single coverage option that does not exceed 9.02% of an employee’s household income, which is an increase to the 2024 rate of 8.39%. To put the new 2025 number in perspective, for a $14/hour worker who works 30 hours a week, an applicable large employer may be penalized under the affordability test if they are charging more than ~$164 per month in 2025 for their least expensive single medical plan (previously ~$152 per month in 2024). If you need help making sure your medical plan meets these requirements now or in the new year, please reach out to your Stumm Insurance Account Executive.

2025 FSA Contribution Limits – The IRS has not officially announced the 2025 maximum limits for Flexible Spending Accounts (they typically come in October or November), but employers can plan accordingly based on projections. The 2024 annual dollar limit on employee contributions to a Health Care FSA is projected to increase to $3,300 (up from $3,200 in 2024), and the maximum carryover amount is projected to increase to $660 (up from $640 in 2024), while Dependent Care FSA contribution max should remain the same at $5,000. For employers who offer Transit/Commuter FSA programs, that account monthly pre-tax contribution limit is projected to increase from $315 to $325 in 2025. If you offer an FSA program to your employees, be sure to work with your Stumm Insurance team to adjust your FSA plan accordingly once the 2025 limits are announced and confirmed.

Medicare Basics – Has an employee ever asked you about their Medicare options or how it might compare to and/or coordinate with your group health coverage? These are valid questions, and we recommend being conscientious of your response (an employer should avoid advising an employee on Medicare since it is not sponsored by the employer) as the answers can be complex and vary depending on several factors such as the # of employees the employer has, the reason & timing of the individuals Medicare eligibility (Age, Disability, End-Stage Renal Disease or ALS) as well as the existing coverage the individual has in place. The best sources for the individual to contact are Medicare (www.medicare.gov / 1-800-MEDICARE), Social Security (www.socialsecurity.gov / 800-772-1213) or connect them with our Stumm Insurance Medicare Senior Sales Executive, Kristin Stumm. While your Stumm Insurance team can discuss with you the impact of Medicare and your group health plan, Kristin can work with these individuals. If you’d like to recommend Kristin to any Medicare eligible individual, just let your Stumm Insurance team know, and we will connect them with Kristin.

Looking to Enhance Your Benefit Offerings? – Due to the continued pressure to offer better benefits to retain & recruit, many employers are looking to offer more benefit options to stay competitive when hiring in their industry. Further motivating this idea is the fact that many insurance carriers give “package discounts” to employers who purchase additional lines of coverage. Some examples of this are adding the traditional lines of Dental, Vision, Additional Life Insurance, & Short/Long Term Disability, as well as the newer “Worksite products” (i.e., Accident, Critical Illness, or Hospital Indemnity insurance) that are individually owned and paid for by the employee but offered via the employer. If you would like more information about adding additional plans, feel free to contact your Stumm Insurance team to discuss further and have a proposal put together for you.

Should you have any questions or would like to discuss these or any other topics, please feel free to contact your Stumm Insurance Service Team.