Archive for October, 2013

Innovative ways through the ACA provisions for employers

Employers are continuing looking for solutions that help manage there businesses more efficiently and also navigate the provisions of the Affordable Care Act (ACA).  If it make sense, employers should consider looking at alternative funding options – like Self Funding or Level Premium programs.

For those of you looking at these options, below are the provisions that do and don’t apply.

ACA Provisions That Do Apply:

  • Minimum Value Plans
  • Unlimited lifetime maximums
  • Out of pocket & deductible limits
  • Kids to age 26
  • Summary of Benefits and Coverages (SBC’s)
  • 60-Day Notice of Material Modification
  • 90-Day waiting period (exempt from California’s 60 Day)
  • W-2 reporting & plan transparency reporting to HHS
  • PCORI Fees & Transitional Reinsurance Fee
  • Discrimination based on health status

ACA Provisions That Do Not Apply:

  • Minimum Loss Ratio (MLR)
  • Comply with 3:1 pricing guidelines
  • Geographical rating areas
  • State or Federal review of premium adjustments
  • Annual Health Insurance Tax (HIT)
  • Provide Essential Health benefits “EHB”
    • Minimum Value is required so no loss of benefit
    • Self-funded plans typically provide richer benefits than fully insured plans

Interested in learning more?  Please contact us at 916-932-2864 – as we are happy to help.

Posted in: Business Insurance, Covered California, Health Care Reform (ACA)

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Three Strategic Steps to Getting Your Business Ready for 2014

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Health Care Reform (ACA) has so many provisions to be aware of that it can be downright overwhelming.  Here are the top three, often overlooked, strategies to help your company get ready for the changes to come.

 

  •   Determine who is eligible for the marketplace subsidy.  Unless you pay for 100 percent of your employees’ premium, you have the possibility of a backlash from your staff.  Here’s how it works: If their income is 400 percent or less of federal poverty levels, they are eligible for a federal subsidy to offset their premium and sometimes co-pay expenses (this could make the marketplace plan less expensive than your employers’ group health plan).  If you are providing affordable coverage for your employees this means they end up missing out on their subsidy.  This step may take additional footwork as you will need to find out what their household income is.  You can accomplish this through a simple survey, though you’ll want to make sure it is HIPAA compliant to protect their information.
  • Review all your options.  Purchasing health insurance is a completely different process now.  Self-funding options are now available for smaller groups. New products and financing options are surfacing that mimic group insurance but are individual products,   taking the perceived risk of self-funding out of the picture.
  • Evaluate your compliance.  Certain mandates will automatically be dealt with or are already put in place, such as essential benefits, dependent coverage and lifetime limits.  Others are set at the company policy level and many will need to be updated to stay in compliance.  In particular, note what your waiting period is (must be less than 90 calendar days from the date of eligibility) and how many hours worked are needed to be eligible for coverage (30 hours will be the new federal full-time standard on Jan. 1, 2015).  If you have seasonal or part-time employees, you’ll want to spend extra effort managing the hours they work so eligibility doesn’t catch you unaware.  Payroll services are adapting their products to assist business owners with tracking the hours of part-time and seasonal employees.

Certainly there is a lot more to consider and know regarding the compliance, management, administration and strategy of health care reform.  Unless you’re a large company with dedicated benefit professionals, you probably don’t have the staff or the time to dedicate to these new regulations.  Lean on Innovative Broker Services by calling at 916-932-2864 for guidance on other strategies you can use as you prepare for 2014 and beyond.

Posted in: Business Insurance, Health Care Reform (ACA)

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Why do we still have COBRA?

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With the advent of the health marketplaces, why do we still have COBRA?

The framers of PPACA decided that COBRA should be available even after the health marketplaces become available primarily to avoid possible disruptions in care.  They felt that COBRA beneficiaries, many of whom have significant health conditions, should be allowed to stay with their current health care providers if they chose to.  With reports of narrow networks in some of the marketplaces, this concern has some basis.

The marketplaces will not offer ancillary benefits, so some individuals will elect COBRA to have access to continued dental or vision coverage.  Individuals anticipating a short period before new group coverage becomes effective also may choose to elect COBRA as a simpler bridge than moving into and out of the marketplace.

However, most experts believe that most COBRA-eligible individuals will decline COBRA and elect coverage through the marketplace instead.  Due to the premium subsidies, marketplace coverage may be less expensive than COBRA; it also does not have a maximum coverage period like COBRA does.  As COBRA beneficiaries tend to have claims that exceed premiums, employers will benefit from a migration of this population to marketplace coverage.

It appears that the marketplaces will basically follow the HIPAA special enrolment rules.  This means that if a person elects COBRA they will need to complete the maximum COBRA period in order to enroll in the marketplace outside of open enrollment.

Employers will need to provide the general COBRA notice to newly eligible individuals even after January 1, 2014.  The Department of Labor has provided an updated model COBRA election notice (at COBRA Continuation Coverage) that mentions the marketplace that will need to be given following a qualifying event.  It is unclear when employers must switch to the new notice; since the marketplace coverage will not begin until January 2014 to avoid confusion waiting to move to the new notice until this December may be the best option.

Posted in: Business Insurance, Health Care Reform (ACA)

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PPACA penalty deadline could move

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The Obama administration might consider adjusting at least one Patient Protection and Affordable Care Act exchange application deadline.

Jay Carney, the White House press secretary, said today during a press briefing aired live on C-SPAN that the U.S. Department of Health and Human Services might be working on a fix for the conflict between the PPACA individual health insurance mandate penalty and the end of the open enrollment period..

Under current PPACA public exchange program rules, to get 2014 exchange health coverage in place by Jan. 1, consumers must sign up for coverage by Dec. 15.

But PPACA lets consumers buy exchange coverage on a true guaranteed-issue basis until March 31. After March 31, consumers with health problems might have to wait until the next open enrollment period to buy coverage.

PPACA also requires many consumers to have a minimum level of health coverage in place by March 31.

The law includes many “individual responsibility” mandate exceptions. But consumers who are subject to the mandate and fail to have a minimum amount of health coverage after March 31 may have to pay a $95 penalty or 1 percent of income, whichever is greater.

Some tax experts have said consumers would actually have to apply for coverage by mid-February to have the kind of coverage required by the mandate rules in place by March 31.

Carney said HHS officials want to do something about the conflict between the open enrollment deadline and the tax mandate deadline.

“They are working to align the policies — the disconnect — between the open-enrollment period and the individual responsibility timeframe,” Carney said.

In response to questions about problems with the HealthCare.gov federal exchange enrollment system, Carney said the administration is focusing on helping consumers get coverage rather than on determining who’s to blame for the problems.

When reporters asked about whether the administration would postpone general exchange application deadlines because of the HealthCare.gov problems, Carney said the country is just three weeks into a six-month enrollment period.

“We’re still early in the process,” and about 500,000 people already have submitted coverage applications through state and federal enrollment systems, Carney said.

“I’m not going to speculate about where we’re going to be in a few months,” Carney said. “We’re focusing on fixing problems now.”

Posted in: Business Insurance, Health Care Reform (ACA), Personal Insurance

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Brass Tacks = Employers and Health Care Reform (ACA)

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We’ve had a lot of employers request a simple, at-a-glance way to see all the PPACA requirements that apply to their business. This is no easy task given group size, SHOP exchanges and self-funding variables! Let’s just look at a few provisions that are effective for the plan year beginning on or after 1/1/2014:

 

Here’s what (non-grandfathered) large group insured plans (more than 50 employees) should be focused on:

  •  Eligibility waiting period maximum of 90 days
  • Pre-ex not permitted on anyone
  • Annual dollar limits prohibited on essential health benefits
  • Protections for those in clinical trials
  • Out of pocket may not exceed $6,350/$12,700
  • Guarantee issue and renewal apply
  • Revised wellness program rules

If you are a (non-grandfathered) small group (50 or fewer employees) insured plan, keep a watch on the following requirements that apply BOTH inside and outside the SHOP exchange:

  • Modified community rating applies
  • Essential health benefits (EHBs) must be offered
  • Deductible generally may not exceed $2,000/$4,000
  • Out of pocket may not exceed $6,350/$12,700
  • Must meet metal levels (60%, 70%, 80%, 90%)
  • Guarantee issue and renewal apply (subject to participation)
  • Single risk pool
  • Revised wellness program rules
  • Eligibility waiting period maximum of 90 days
  • Pre-ex not permitted on anyone
  • Annual dollar limits prohibited on essential health benefits
  • Protections for those in clinical trials

If you are a small OR large self-funded plan, the following requirements should be on your radar:

  • Eligibility waiting period maximum of 90 days
  • Pre-ex not permitted on anyone
  • Annual dollar limits prohibited on essential health benefits
  • Protections for those in clinical trials
  • Out of pocket may not exceed $6,350/$12,700
  • Revised wellness program rules
  • Transitional reinsurance fee, including reporting

If you need any additional clarification, do not hesitate calling us at 916-932-2864 as we’re here to help!

 

Posted in: Business Insurance, Health Care Reform (ACA)

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