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Late last month Congress passed the Bipartisan Budget Act of 2015 (the Act) which provided the funding the government needed to avoid a shutdown.  Part of that bill, however, closed two prominent “loopholes” in social security benefits that will require some individuals in or near retirement to act fast or risk forfeiting a substantial amount of benefits.

The first and more prominent loophole eliminated was the File and Suspend Method.  This method allows a lower-earning spouse to claim benefits based on the higher earning spouse’s earning record (i.e. spousal benefits) even though that spouse is not currently receiving any benefits.  Since spousal benefits can be as much as one-half of the higher-earning spouse’s benefits, they are typically more than the benefits based on that lower-earnings spouse’s records. This method works by having the higher-earning spouse claim benefits at full retirement age (currently age 66), but then immediately suspend taking those benefits until a later date (at age 70 or earlier).  Since suspending the benefits allows you to increase your benefits by 8% each year, the file and suspend method allows both spouses to receive maximum benefits.

As a result of the Act, after April 30, 2016 an individual can only receive benefits based on the higher-earning spouse’s earnings records if that spouse is actually receiving benefits.  Fortunately, those individuals who have already been using the file and suspend method are not affected as they are grandfathered under the Act.  However, those higher-earning spouses that will be at their full retirement age or are past their full retirement age must act by April 30, 2016 to take advantage of this method.

The second loophole closed by the Act is the elimination of the Restricted Application Method (also known as the Claim Some Now, Claim More Later Method).  This method allows lower-earning spouses eligible for both spousal benefits and retirement benefits (based on own earnings) to claim spousal benefits at full retirement age, but delay taking benefits under his or her earnings record until a later date (at age 70 or earlier).  By suspending the benefits, the lower-earning spouse can receive spousal benefits while still allowing his or her own retirement benefit to earn delayed credits until as late as age 70. At that time, the spouse can then switch over to their own higher benefit.

For those individuals who turn 62 after 2015, the Act eliminates the ability to file a restricted application for only spousal benefits.  Those individuals who are age 62 or older in 2015, however, should still be able to use this method. Spouses who are already collecting benefits on their partners earnings record can also continue to do so and switch to their own larger retirement benefit at a later date —up to age 70. Kathi Iott is a partner in the tax services area of the firm with over 15 years of public accounting experience. Learn more about Kathi's expertise.

The Centers for Medicare and Medicaid Services (CMS) is out with a new proposed rule when it comes to payment and reimbursement. The proposed rule brings some positive changes for home healthcare providers. It also makes permanent a change implemented to respond to the COVID-19 pandemic.

Telemedicine

CMS proposes allowing home health agencies (HHAs) to continue to use telemedicine to provide care to Medicare recipients, even after the COVID-19 public health emergency is over. But, video appointments wouldn’t take the place of the in-person home care that’s part of the patient’s plan of care. CMS does note that telehealth visits could change the number of in-person visits as part of the plan of care. Home health providers still would not receive payment for telehealth care. The proposed rule does however allow HHAs to still report costs associated with telemedicine technology as part of their administrative costs on their cost reports, even after the COVID-19 public health emergency.

GJM’s Jamie Dixon works with many HHAs on their cost reports. 

“These front-line workers need all the tools they can get,” he says. “Being able to monitor and be present with their clients is efficient, safe and could be lifesaving.”

Reimbursements Boost

Also included in the proposed rule is an increase in reimbursements for home health agencies. CMS has estimated that Medicare payments to HHAs in the 2021 calendar year (CY) will increase by 2.6% (about $540 million) compared to the current calendar year. Last year’s predicted bump in reimbursements called for half that, a 1.3% increase from CY 2019 to CY 2020.

Home Infusion Therapy

The proposed rule also calls for new policies for Medicare enrollment for home infusion therapy providers and updates the payment rates for such services. The new payment rates would follow the CY 2021 Physician Fee Schedule.

“COVID has hit the entire healthcare industry extremely hard. Home Health Agencies always rise to the crisis. The additional tools and resources outlined in this proposed rule will assist them in what they do best.”

CMS announced the proposed rule on June 25 and has compiled a fact sheet with more information. 

Jamie Dixon, CPA is a member of the Gilmore Jasion Mahler (GJM) Healthcare Specialist Team, with an expertise in long-term care, home healthcare and hospice. A member of the Ohio Council for Home Care and Hospice, he has been a member of the organization’s Financial related committees for close to 20 years. Jamie also serves as GJM firm administrator.

Established in 1996, Gilmore Jasion Mahler, LTD (GJM) is the largest public accounting firm in Northwest Ohio, with offices in Maumee and Findlay. Locally owned, GJM offers cloud-based accounting and provides comprehensive services including assurance, business advisory, tax, risk advisory, healthcare management and outsourced accounting. The Firm’s professionals specialize in industries including construction & real estate, healthcare, manufacturing & distribution and utilities.  

“We don’t have data others would want”. I hear that statement quite often from executives and business owners regardless of size or industry. It typically prompts several data governance questions from me.

How do you know?  

What steps have you taken to understand your data? 

What information is important to you or your competitors? 

What information would be most damaging to your business if it became public? 

How do you plan to stop someone from stealing your data?

In the 2015 RSM Manufacturing & Distribution Monitor Survey¹, most businesses reported that their information is at little or no risk. Despite the concerns of some executives participating in the study, very few felt that their information is actually at risk. Although cyber-attacks and data breaches continue to make headlines, most companies feel they are immune to such a threat.

While many of the reported stories of information breaches involve large, well-known companies such as Target, Barnes & Noble, Nortel, Nissan, and others, in the world of cyber-crime size doesn’t matter – only information does. Just because an information breach isn’t splashed in the headlines doesn’t mean it isn’t happening. Companies large and small across the country and our region deal with this every day and the reality is that your business could be next. One company’s Internet footprint looks the same as another to anyone interested in finding something of value, whether it’s credit information, personnel information, intellectual property such as engineering drawings or processes, technology or other industrial assets.²

Cybersecurity is moving to a business imperative that is enabled by IT. No longer is this just an IT issue keeping your CIO up at night. Many boards and audit committees are finely tuned in to what is going on around the world related to cybersecurity and data governance. Executive leadership is increasingly being held accountable for protecting the company’s information assets. Regulators have continued to up their cyber game and pay closer attention to how a company’s information security program could impact the going concern of their business.

A strong information security program can facilitate business growth, create market advantages, and build brand trust. Data privacy and trust have become critical business requirements as exponentially more consumer and business information is generated and shared with your partners. 

What can your company do now?

Data governance is the foundation to implementing an effective information security program.  Unfortunately, there is no one size fits all approach. I would suggest that you kick start your data governance approach with three simple questions:

1. What is your most important data?
2. Who would want this information?
3. What are you doing to protect it?

Be thorough with the evaluation and document the findings. Performing this data inventory takes time; however the end result will provide significant insights in to the effectiveness of your current information security program. Cyber security and data governance are key components of your broader enterprise risk management activities. Taking a systematic approach to understanding, managing, and monitoring risk can give management better insight into company operations and may even allow your company to turn certain risks into opportunities.

A risk-management program can help identify, prioritize and monitor risks both inside and outside an organization.  Steps in such a program include the following²:

• Establish a formal, disciplined framework and governance strategy
• Formalize the process to identify all key risks within the organization, including their likelihood and impact
• Develop quantitative and qualitative measures
• Quantify risks, examine risk treatment and determine risk gaps
• Establish risk monitoring processes and continuous improvement opportunities

By implementing this type of program, executives can be justified in feeling that their information risks have been minimized.  With the rise in information breaches, keeping your data secure can be a competitive edge.

Just remember, you can’t protect everything, so be sure to protect what’s most important to you.

1 2015 Manufacturing & Distribution Monitor, RSM

2 Managing information security risk, RSM

Matt Hoverman is a director with Gilmore Jasion Mahler, LTD and leads the Firm’s IT consulting practice. He has spent his career helping businesses assess their risk level and creating a plan to secure their information.  Learn more about Gilmore Jasion Mahler’s risk advisory services when it comes to protecting your company’s data.

There are some news faces at GJM this fall. We like to share a bit about our new team members to welcome them to the Gilmore Jasion Mahler family and to give us all a chance to know them a bit better. Today we would like to introduce you to our new Accounting Services Manager Molly Wolf. Enjoy this Q&A with Molly as we ask everything from why she chose the accounting industry to her favorite type of music. Welcome, Molly!

Describe your role at GJM: Administration assistance, compliance, reconciliation and reporting for retirement plan clients. (still working on my role)

When did you start with GJM? September 10, 2019

Why did you choose the accounting industry? During high school I took a few accounting courses, which I enjoyed. I was lucky enough to find a passion for retirement plans.

What do you like best about accounting? Accounting is just a big puzzle, I enjoy finding each piece’s purpose and seeing the bigger picture.

Are you from the Toledo area originally? Yes, originally from Sylvania  

What do you like about living in Northwest Ohio? That you can have all four seasons in one day

Anything you’d like to share about your past professional experience? I have 13 years of retirement plan accounting.

Do you have any pets, hobbies, family? I am married to PJ Wolf and we have a 5-year-old son named Philip. We have two cats, Oliver and Karli. Hobbies include curling (the winter sport) tennis and softball. 

How do you like to spend your free time? Playing board/card games

Favorite song or music? Alternative and folk rock

Favorite book or movie? On Moonlight Bay

What is something people may be surprised to find out about you? I wish I could have met Doris Day.  

Anything else you’d like to add? I live in Portland, OR for the past 4.5 years and moved back to Ohio a few months ago.

Welcome to the team, Molly!

Established in 1996, Gilmore Jasion Mahler, LTD (GJM) is the largest public accounting firm in Northwest Ohio, with offices in Maumee and Findlay. Locally owned, GJM offers cloud-based accounting and provides comprehensive services including assurance, business advisory, tax, risk advisory, healthcare management and outsourced accounting. The Firm's professionals specialize in industries including construction & real estate, healthcare, manufacturing & distribution and utilities.

Question: I am an Ohio business owner concerned about sales tax requirements in the state. The exemptions are so confusing. Do I need to worry about this? Any suggestions would be much appreciated.

Tax Partner Steve Schult's answer: Yes – You should worry about this!  Ohio sales/use tax laws are extremely complicated.  In general, sales and use tax applies to the retail sale, lease and rental of personal property, unless there is a specific exemption (which there are many).  Most services are not subject to sales/use tax.  However there are specific services that are subject to tax. 

I recently heard that approximately 75% of Ohio tax court cases involve sales tax.  I would strongly advise you to meet with your CPA to review the application of these laws.  It is not unusual to see very large assessments on sales tax audits because the company didn’t understand their sales/use tax obligations.

Steve Schult joined Gilmore Jasion Mahler, LTD in 1998. He works with a variety of clients including those in manufacturing and healthcare. Learn more about Steve’s expertise.