Archive for May, 2013

Less than 50 Employees – Does Health Care Reform apply to me??

(Most of these do not apply to grandfathered plans)

Text Highlighted in Red = Requires action by the employer

o Mandate to cover specific benefits in the small group market – preventive, no preexisting for children, no lifetime limit, limitedannual maximum, no rescission, dependent to age 26 – 2010

o Existing plans grandfathered as of date of enactment from some, but not all, of the new plan requirements – 2010

o Non-discrimination requirements for insured plans – 2010

o An internal and external appeals process – 2010

o No prior authorization for emergency services – 2010

o Plans must allow designation of a primary care provider – 2010

o Small employer tax credits (for those who qualify) – 2010

o FSA, HSA, HRA definition of medical expenses – 2011

o Increase to 20% penalty for non-health withdrawals from an HSA or Archer MSA – 2011

o Wellness grants ‐ 2011 through 2015

o Increase Medicare payroll tax by 0.9% on earned income in excess of $200,000/$250,000 (unindexed); wages received after December 31,   2012

o Impose fee on health insurance and fully self-funded employer plans to fund comparative effectiveness research – 2012

o 3.8% investment tax on unearned income for taxpayers with AGI in excess of $200,000/$250,000

(unindexed) – taxable years after December 31, 2012

o Uniform explanation of coverage – November 1, 2012 (Fully Insured Clients – Carrier

o Notice of material modifications – September 2010 

o Elimination of tax deduction for retiree drug subsidies to employers – 2013

o Employee Notification of the Exchange – March 1, 2013 (This regulation was delayed as of 1/23/13 – ETA late 2013)

o Limit salary deferrals to FSAs to $2,500 – 2013, then indexed to inflation

o Eliminate deduction for Medicare Part D employer subsidy – 2013

o Raise 7.5% adjusted gross income (AGI) floor on medical expense deduction to 10% – 2013

o No preexisting condition exclusions for all participants – 2014

o Guaranteed issue – 2014

o Guaranteed renewability – 2014

o Must cover minimum benefit package – 2014

o Allows HIPAA wellness discount up to 30%(50%at Secretaries’ discretion) – 2014

o Limits on out-of-pocket cost sharing, maximum deductibles – 2014

o Coverage of routine costs associated with clinical trials – 2014

o Prohibition on waiting periods more than 90 days – 2014

o Must provide a minimum actuarial value for benefits – 2014

o File an annual report with HHS on employer and plan information – 2014

o Eliminate annual limits on benefits – 2014

o Limits premium underwriting – 2014

o Plan disclosure of claims payment policies and rating practices – 2014

o New SHOP Exchange for small-group and individual markets – 2014

o Limits on underwriting – 2014

o W2 reporting – 2013 tracking to be reported 2014; > 250 W-2’s

o IRS reporting – 2014

o 40% excise tax on high-cost plans – 2018

As always, confused?  Have questions?  Not sure what applies? 

Call your Health Care Reform Experts at 916-932-2357.

Posted in: Business Insurance, Health Care Reform (ACA), News You Can Use

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Exchange Model Notices – EMPLOYER ACTION REQUIRED!

On May 8, the U.S. Department of Labor issued employer notices regarding the Health Insurance Exchanges (Marketplaces).

In a nutshell, employers have until October 1, 2013 to decide whether they will offer or not offer insurance coverage to their employees.

Below are links to two forms: one for employers offering coverage and those which will not. The notice text must be used and there are penalties for not distributing them by October 1, 2013, the date open enrollment in the exchanges is set to begin.

        Notices were also released regarding COBRA:

Please contact us if you have any questions, we’re happy to assist!

Posted in: Business Insurance, Covered California, Health Care Reform (ACA), News You Can Use

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Covered California Takes A Major Step To Launching SHOP


Contract Awarded to Pinnacle Claims Management, Inc. to Administer Innovative, Affordable Marketplace

Sacramento, Calif. — The Covered California Board has approved Irvine-based Pinnacle Claims Management, Inc. (PCMI) to administer its Small Business Health Options Program (SHOP). The program will offer approximately 375,000 California small businesses unprecedented access to a considerable array of affordable health coverage options for its employees. California is one of a few states nationally that will be able to offer small businesses an array of health insurance options for their employees come this fall.  This contract is supported by federal funds provided under the Affordable Care Act, and continued funding will be provided by Covered California administrative revenue starting in 2015.

“We are excited to partner with PCMI in this historic moment when we can help thousands of small businesses provide affordable health care for their employees,” said Peter V. Lee, Executive Director for Covered California. “PCMI has demonstrated the requisite knowledge of California’s small business community and has shown us they can move quickly and effectively in providing all the services we require to help Covered California get up and running this fall.”

Small employers participating in the SHOP will be able to provide their employees with a broader choice of health plans that generally has only been available to large employers. Certain small businesses — those with 25 or fewer full-time equivalent employees paid an average annual wage of less than $50,000 — may be eligible to receive a 50 percent small business health care tax credit for coverage purchased through the SHOP.

Through SHOP, employers will be able to pick the level of support for their employees, and in turn employees will be able to pick from those options the specific health plan that is right for them and their families. All plans will provide a standardized set of benefits and cost sharing to make it easy for employers and employees alike to make apples-to-apples comparisons.

PCMI and its affiliates have more than 15 years of experience providing employer- sponsored health benefit management services, with a current client base of some 800 small employer groups in California and Arizona.

The contract with PCMI will cost an estimated $50 million over the three year term and includes the initial implementation of the program’s administration functions and ongoing operating costs. PCMI will provide eligibility, enrollment, marketing and fulfillment services, as well as agent and general agent sales management, financial management and the small business call center services.

“PCMI is thrilled to work with Covered California on this endeavor and to be part of this historic change in health care. We are looking forward to helping Covered California provide the services that will support employers and their employees as they enroll in the health plans offered through Covered California,” said David Zanze, President of PCMI.

Covered California will provide for health plan selection, certification and ongoing management of plan relationships, lead marketing efforts and provide policy guidance.

About Covered California

California was the first state to create a health benefit exchange following the passage of federal health care reform. Covered California is charged with creating a new insurance marketplace in which individuals and small businesses can get access to health insurance. With coverage starting in 2014, Covered California will help individuals compare and choose a health plan that works best for their health needs and budget. Financial help will be available from the federal government to help lower costs for people who qualify on a sliding scale. Small businesses will be able to purchase competitively priced health plans and offer their employees the ability to choose from an array of plans and may qualify for federal tax credits.

Covered California is an independent part of the state government whose only job is to make the new market work for California’s consumers, and is overseen by a five-member board appointed by the Governor and Legislature.

For more information on Covered California, please visit


Posted in: Business Insurance, Covered California, Health Care Reform (ACA), News You Can Use

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