Healthcare Reform Issues

We want to share with our clients and friends some of the issues being discussed in the Insurance Industry. We will only post things that seem to be effecting you now or soon will. There are many many more areas of concern. These are just a few for conversation.

Key Feature of the Law

Individual Mandate began 1/1/14. State Exchanges  became active. You must enroll in either the annual Open Enrollment for the 1st of the year or have a Special Enrollment reason to qualify mid year. This is all NEW and different. Please inquire if you loose coverage mid year. Some states allow for Temporary coverages but the rules are different. This is what makes the law effective or not.

Areas of concern are Rights and Protections, Insurance Choices, Insurance Costs, 65 or Older, Employers coverage.

Concerns about State Exchanges for Individuals, Small Employers and Large Business are continuing to be exposed. One of our biggest concerns continues to be that of COMPLIANCE. Many employers will need to enhance their on-boarding packets or annual distribution of required forms. “Skinny Plans” have been created and reviewed. Many employers are attracted to the cost but are concerned about the coverage they provide. Many have even been questioned as to their meeting the 60% Min Actuarial Value test.

Penalties

The part of the law for Employers that states “Pay or Play”  This ONLY applies to employers with 50 or more full time employees. But, don’t forget to calculate correctly for the part time and seasonal. There will be 2 types of penalties. One due to employer coverage that is “unaffordable” and the other is the employer fails to offer Minimum Essential Benefits (which includes not offering coverage at all).

“Un-affordable” means the employee pays over 9.5% of their wages for healthcare. If you believe you qualify for an exemption check out what the IRS SAYS.

Updates

  • Timeline of Healthcare Reform Changes can be found HERE.
  • Individual Tax Credit Calculator provided by Kaiser Foundation HERE This is very interesting if you test a few scenarios.
  • Check back for more updates.

Maryland Exchange Carriers

Maryland residents and small employers through Maryland Health Connection will start with the following list of carriers and breakdown of the markets they will serve. Each state has their own approved list of Carriers and plans.

INDIVIDUAL

INDIVIDUAL

  • Aetna (Medical): Aetna Life Insurance Co.
  • United Health Care (Medical): All Savers Insurance Co.
  • Delta Dental (Dental): Alpha Dental Programs, Delta Dental of PA
  • CareFirst: CareFirst Blue Choice (Medical), CFMI (Medical and Dental), GHMSI (Medical and Dental)
  • Coventry: Coventry Health and Life (Medical and Dental), Coventry Health Care of DE (Medical)
  • DentaQuest Mid-Atlantic (Dental)
  • Dominion Dental Services (Dental)
  • Evergreen Health Cooperative
  • Guardian Life Insurance Co. (Dental)
  • Kaiser Foundation Health Plan
  • United Concordia Life and Health
SHOP

SHOP

  • Aetna (Medical): Aetna Health Co., Aetna Life Insurance Co.
  • Delta Dental (Dental): Alpha Dental Programs, Delta Dental of PA
  • BEST Life and Health Insurance (Dental)
  • CareFirst: CareFirst Blue Choice (Medical), CFMI (Medical and Dental), GHMSI (Medical and Dental)
  • Coventry: Coventry Health and Life (Medical and Dental), Coventry Health Care of DE (Medical)
  • DentaQuest Mid-Atlantic (Dental)
  • Dominion Dental Services (Dental)
  • Evergreen Health Cooperative (Medical)
  • Guardian Life Insurance Co. (Dental)
  • Kaiser Foundation Health Plan (Medical)
  • United Healthcare: MAMSI Life and Health (Medical), Optimum Choice (Medical), United Healthcare Insurance Company (Medical), United Healthcare of the Mid-Atlantic (Medical)
  • Metropolitan Life Insurance Co. (Dental)
  • United Concordia (Dental): United Concordia Dental Plans, United Concordia Life and Health.
SMALL EMPLOYERS FOCUS AND ISSUES TO CONSIDER

Small Employers Focus and issues to consider

In some cases Small Employers, as a definition, have <50 employees but it will change to <100. Two big issues that pertain to your company size is the Tax Credits and Participation Requirements.

Rules vary for all 4 Types of Plans- Large Self Funded, Large Fully Funded, Small Self Funded and Small Fully Funded. Be sure to know which you have for which reporting year.

Rates are now calculated differently. No more average age or age bands. You may be surprised that community rating will change everything across the board. Check for options that make sense for your business.

Thoughts for each state SHOP Exchange– Many Small Employers are considering disbanding and having employees apply for individual coverage to take advantage of subsidies while they are available. We see this in various specific industries.

The Maryland Exchange is called “Maryland Health Connection”  The exchange allows individuals and Small Employers to compare rates, benefits and quality among plans. And, the exchange will calculate and provide Tax Credits to those eligible. Private insurers outside of the exchange will compete with them. The SHOP in Maryland start date was changed from January to March 2014 and now January 2015 (Using the new Federal plan dates). You may enroll in the SHOP plans through us.

When a company considers it’s number of Full Time Employees they must also count part time and seasonal in part of the formula. These employees are Full Time Equivalents. This seems to be confusing many small businesses.

Companies majority owned by common owners will likely be combined for the purpose of calculating employer size.

THOUGHTS-

One area for Small Businesses to consider is IF they report or have over 250 W2’s for 2012. Employers with a significant number of variable hour or seasonal employees need to pay close attention to new reporting requirements.

A very confusing component will be how the Tax Credit is calculated for Small Employers. First you will determine if you qualify with number of employees, average wages, employer premium contributions, and more. If you are a small employer, PLEASE keep great records or who pays for what, work with a good CPA or hire a Payroll Company to help make sure you handle this correctly.

The Tax credits are only available if you small group coverage is in the exchange. We have noticed that the very best situation to get the most benefit for employers are those with less than 10 employees and an average wage of less than $25,000.
Higher employee count and average wages “melt” the credit away very quickly. We are happy to discuss and show this to our groups.

2015 Changes

Welcome to 2015. Concerns this year will focus on Mandate and Reporting. We will see effects of the Pay or Play rules, Compliance with the rules over the past few years to include Section 6055 and 6056 (IRS Reporting on plans and participants) We still may see changes on these requirements and/or timing.

2014

2014 CHANGES

2014 Changes

Some of the many changes in 2014 included Eliminating wait period exceeding 90 days, all Pre-Existing limitations, Routing Cost coverage, Out of Pocket exposures were limited for HDP to $6350/12,700, Qualified Wellness program increases from 20 to 30% of cost, 200+Employee groups require Auto Enroll, Grandfathered plans now must cover children up to age 26 and Transitional Reinsurance fees are set to begin 1/1/15.

Many of the changes are done automatically through your carrier plan.

2013

2013 CHANGES

2013 Changes

New decision to hold off penalties for another year. July 1, 2013 it was decided to begin the Large group requirement to offer ACA approved coverage January of 2015 (from January 2014). A short reprieve for businesses to make plans and work on new strategies.The law is still in effect even if there is no penalty. Planning early is the key.

FSA new cap of $2500 was enacted, Employee Medicare Tax increase, Part D Deduction by Employer for Retirees was changed, PCORI fee doubled, W2 issue over 250 per company consideration and HHS notice requirements went into effect.

2012

2012 CHANGES

2012 Changes

Lately, the most recent updates concern new required Benefit Summaries of Coverage that are uniform and short and proper plans that fit the new HSA requirement and limits for 1/1/2013.

You may notice this information coming to you from your insurance carrier or your Administrator. This does not mean your plan is different. They are adhering to the new law that requires easier to read and understand information on your plan. Also, many plans that had a 1200/2400 deductible with HSA accounts are now out of compliance with the new limits. This is why you may see your plan change to a higher deductible.

Patient Centered Outcomes Research Institute (PCORI)

PCORI– Patient Centered Outcomes Research Institute. On 12/6/12 the IRS issued final regs regarding the “temporary”annual payment of the fee. Beginning July 2013 applicable plans will pay the fee of $1 per covered life. This can be calculated in 3 different methods. More to come on this new fee. Another reason to remember why the cost seems to be creeping up.

If you have a Self Funded plan, HRA or FSA, the employer must provide the information and billing. If you have a fully funded insurance plan the carrier will bill you accordingly.

Written notice from Employers to Employees about the exchanges is to begin 3/1/13.  That date WAS pushed out to October 2013. Model notices came out June 2013 for employers to use. As soon as the employers were told to send out notices, we were informed there is no penalty for non-compliance. Still, good to inform employees regardless.

Expanded coverage for Women’s Preventative Services for Non-Grandfathered plans, Health FSA contribution limit changes, Medicare Tax increase for high earners (0.9% wages >$200K), Restrictions on Annual Limits, W2 reporting, SBC and PCORI will all begin in 2013. Another thought on why costs can increase.

You will start to hear more about PCORI- Patient Center Outcomes Research Institute) which will be yet another fee we are all responsible for according to PPACA. This is a fee that will be due July 2013 for plan years ending 10/1/12. The money is to be used for research that will evaluate and compare health outcomes and the clinical effectiveness, etc. Fees will be determined by # covered lives on a plan.

2011

2011 CHANGES

2011 Changes

FSA, HRA and HSA changed rules to not include OTC drugs unless with a prescription and Long Term Care Optional CLASS program offered (and scrapped) Most concerns were with the coming insurance mandate and new laws being set at this time. Most unrest seemed to be with the “unknown”