Congress has now passed and the President has signed comprehensive health care reform legislation. These health care reforms will mean significant changes for nonprofit organizations, their employees, and the people they serve. 

IRS Update
The IRS has proposed rules for the tax treatment of new accountable care organizations. The IRS notes that in order to qualify for tax exemption, qualified nonprofit health insurers must have received a loan from Centers for Medicare & Medicaid Services (CMS) for operation, and then provide the IRS a copy of both the notice of award issued by CMS and the fully executed loan agreement with CMS when applying for tax exemption.

The proposed (REG-135071-11) and temporary regulations (T.D. 9574), released February 7, 2012, also include a request for public comment. Comments are due to the IRS by April 9.

What Do Nonprofit Employers Need to Know?

Small Employer Credit:                                                                                                 

IS and its members advocated successfully for the application of new employer incentives to provide health insurance for employees to both nonprofit and for-profit employers. The IRS has released final guidance detailing how qualifying tax-exempt small employers will calculate and claim the credit.  LEARN MORE.

• How do I determine how to qualify for and claim the credit?
  
• How do I calculate my small employer credit?
  
• What resources and guidance have the IRS provided?

Grandfathered Status for Existing Health Care Plans:                                                Under new final regulations for "grandfathered" health plans, employers, including nonprofits will be able change insurers and keep plans that are similar to their existing coverage without having to meet all of the new health care plan requirements. LEARN MORE.

What's Next?

Federal agencies are beginning the implementation process of this landmark legislation. Some of the law's provisions will take effect immediately, while others will be instituted over the next four years.

• Implementation timeline (PDF) - Key effective dates for health care reforms
• Department of Health and Human Services (HHS) guidance - Updated implementation and process resources for individuals and employers
  
• Department of Labor (DOL) guidance - Updated health reform regulatory information for all employers

Additional Resources:

• Special rules for nonprofit hospitals - As part of health care reform, new standards have been established for nonprofit hospitals to maintain their tax exempt status.