Author Anthony Nefouse

 Judge Roger Vinson, in Pensacola, FlaVinson wrote 

“I must reluctantly conclude that Congress exceeded the bounds of its authority in passing the act with the individual mandate. That is not to say, of course, that Congress is without power to address the problems and inequities in our health care system. The health care market is more than one-sixth of the national economy, and without doubt Congress has the power to reform and regulate this market. That has not been disputed in this case. The principal dispute has been about how Congress chose to exercise that power here,”

It looks like this issue will go to the Supreme Court.

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http://www.c-spanvideo.org/program/LawonCo

Here at Nefouse and Associates we know how everyone enjoys watching C-Span especially when it comes to health insurance.  So I have watched it for you and will give you the update.

Health and Human Services Secretary Kathleen Sebelius testified on the impact of the 2010 health care law. The Secretary job is to interpret, clarify and install the health care law. She was asked specific questions by Senators about the law.

The chairman of the committee helped right the law so he was very happy to praise the law and not ask any difficult questions.
The next Senator was Mike Enzi  and his questions were geared towards the child stand alone policies. Under the law children under 19 are guaranteed issue and many carriers have pulled out of this market. So the Senator goes on to ask what is the Secretary doing to address the issue.  The Secretary responded that the states should force carriers to cover these markets.  The Senator asked specific questions about parents gaming the system by waiting until the child needs care to take out a policy.  The Secretary did not give a clear answer on this.

Senator All Franken was up next. He really tried to simplify the health care law by comparing it to a 3 legged stool.  There was not a lot of substance there. Almost to the point you wanted to ask him had he done his homework? The Senator did speak about Medical Loss Ratio and how it was his idea.

Senator John McCain was very prepared for this hearing. He asked about all the waivers that had been given to companies and why not make them permanent.  The Secretary assured the Senator that these companies just need time to adapt to the health care law. The Senator then asked about waivers for Medicaid so states could reach their budgets. The Secretary stated certain areas of Medicaid would not be eligible for waivers. Then The Senator ask if Malpractice caps could be introduced and if the Secretary would support it. She said Yes.

Senator Jeff Bigaman talked about the Work Force Commission and how those resources would help stream line health care services.  The Secretary spoke of the potential role this commission would have.

Senator Michael Bennett addressed the costly issue of readmission of Medicare Beneficiary. This was addressing the cost of Seniors on Medicare having multiple admissions to a hospital. He stressed the issue of Transitional Care  and a more Effective delivery model. The Secretary spoke on progress of these areas.

Senator Pat Roberts spoke about his past history with the Secretary and her family.  Then he addressed the head of the CMS and then talked about Independent Advisory Boards with regards to the Emergency Access centers in his home state.  The Senator was making statement rather than asking about questions.  There was no explanation on why this board needed to address ER access and who is even on this board.

Senator Jack Reed was stressing that the Mandatory coverage aspect of the law was pushed by the Insurance Industry.  He was stressing maybe even blaming the insurance industry for this mandate. The Secretary then “schooled” the Senator on how a Private Insurance Market stays Solvent and without the mandate the market would incur adverse selection.

Senator Richard Burr talked about the cost of the reform law. He pointed out that CMS had recently released a $200 billion short fall on the health care reform. The Secretary very calmly recognized that loss and did not dispute that. The Senator then asked a tough question about the Medical Device Tax that will lead to increase cost.  The Secretary did not agree the tax would increase the overall costs.

Senator Bernie Sanders talked about community health centers and how investing into them will lower cost down the road.  The Secretary agreed.

Senator Kay Hagan talked about children being allowed to stay on a parents group health plan until 26. She spoke about her personal experience and then the Secretary talked about her personal experience of finding her adult child a health insurance policy.

Senator Patty Murray spoke about how the law is going to make premium increases more transparent. The Secretary went on to explain that premium increases have to be justified by the carriers and the federal Gov. is giving resources to review those areas. The Secretary also explained how more information about the insurance company was going to be public record. So you can look up how many claims have denied by a carrier and so on.

So there you have a hour and half of testimony summarized into a blog posting.

I thought the Secretary was prepared for this hearing she did a good job explaining certain aspects of the law.  Where I feel she is letting the country down is on the cost of the law. There was only one Senator that asked about the cost.  Only 3 Senators really asked tough questions the rest were set up questions for the Secretary to explain. There is 2,700+ pages of this law and then 1,000’s more  pages clarifying the law.  The Senate should have asked much deeper questions.

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Here at Nefouse & Associates we have found a carrier that will insure Individuals that are suffering from Diabetes.

There are some very strict underwriting guidelines. The diabetes has to be treated with medication and not insulin. Also the applicant cannot be taking more than 3 medications.

This is a true health insurance plan.

Let us know if you have questions.

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I know most people find health care debate to be boring but the reality is this is going to effect you one way or the other.

Congress has formed two committees to investigate the entire law and the impacts that it will have on the economy.  I know some people feel this might be a waste of time but we really do not know what is in the 2000+ pages of the law.  The law effects 1/6Th of our economy and will effect all of us personally.  There should be plenty of bills being introduced to change certain aspect of the law.

So keep your ears open to the debate.

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Health care reform bill components

The health care reform bill passed earlier this year contains a variety of different components that, cumulatively, will have a substantial impact on the overall health care landscape. The following information breaks down some of the various components of the bill.

Grandfathered Health Plans

Your current health care plan, whether individual or through your employer, can generally be kept intact on a grandfathered basis if the only plan changes are limited to the addition or deletion of dependents. An exception to this guideline is if your employer makes changes to your plan as a result of a collective bargaining agreement. However, even if your plan is grandfathered, some of the health care reform bill’s provisions will still be applicable.Grandfathered status is available for plans effective immediately.

Small Employer Tax Credits

A tax credit is available for small employers that provide health care coverage to their employees and meet certain requirements. To qualify, the business must have no more than 25 full-time employees for the tax year and the average annual wages of its employees for the year must be less than $50,000 per full-time employee. Effective with tax years beginning in 2010.

Blue Cross Blue Shield Plans

Blue Cross Blue Shield plans are required to expend at least 85 percent of their total premiums on reimbursement for clinical services provided to enrollees in order to take advantage of the special tax credits that have been provided to them. Effective with tax years beginning in 2010.

Employer Subsidies of Medicare Part D Premiums

Employer subsidies of Medicare Part D premiums are eliminated. Effective with tax years beginning in 2013. However, there is an immediate accounting impact.

Grants for State Insurance Ombudsman Programs

The secretary of the Department of Health and Human Services can award grants to states to establish or expand health insurance ombudsman programs. For fiscal year 2010, $30 million is appropriated to fund the grants. Additional money will need to be requested to fund additional years. Effective immediately.

Rate Review

Federal review is established to monitor increases in health insurance premiums.  Additional money is made available to states to increase their review and approval of health insurance premium rate hikes. Effective immediately.

Therapeutic Discovery Tax Credit

Creates a federal tax credit for businesses with up to 250 employees that make a qualified investment in acute and chronic disease research. Effective immediately based on investments paid in taxable years beginning in 2009 or 2010.

Indian Health Benefits

Native Americans may exclude from gross income the value of qualified health benefits received directly or indirectly from the Indian Health Service or from an Indian tribe or tribal organization. Effective immediately for health benefits and coverage provided after enactment of the health care bill.

Pre-existing Condition Coverage for Individual Market Consumers

High-risk pool coverage is established for those who have been uninsured for at least six months and who can’t get current individual coverage due to pre-existing conditions. Effective within 90 days of enactment of the health care bill. Ends on Jan. 1, 2014.

Early Retiree Reinsurance Program

This temporary program provides partial reimbursement to employers providing health insurance coverage to retirees over the age of 55 who aren’t eligible for Medicare. Effective within 90 days of enactment of the health care bill. Ends on Jan. 1, 2014.

Web-based Information Portals

You will have access to portal options, including an Internet site, that provide information on affordable health coverage, Medicaid, Children’s Health Insurance Program and high-risk pool coverage. Available no later than Oct. 1, 2010.

Excise Tax on Indoor Tanning

A 10 percent excise tax is established on amounts paid for indoor tanning services. This applies whether or not your insurance policy covers the service. Effective for services performed on or after July 1, 2010.

Salary-based Health Plan Rules

Group health plans must comply with IRS rules that prohibit favoritism toward highly compensated individuals.  Effective with plan years beginning on or after Sept. 23, 2010. Grandfathered status applies.

Limits on Lifetime Benefits

Lifetime limits on the dollar value of benefits are prohibited. This includes health plans with grandfathered status.Effective with plan years beginning on or after Sept. 23, 2010.

Limits on Annual Benefits

Annual limits on benefits are limited to non-essential benefits for plan years beginning prior to Jan. 1, 2014. Annual limits are prohibited entirely for subsequent plan years. Effective with plan years beginning on or after Sept. 23, 2010.

Increased Dependent Coverage

The age of dependents eligible for health plan coverage increases to 26 years of age. Dependents can be married. The group health insurance income tax exclusion applies to the value of the benefits provided for these dependents. Through 2014, for grandfathered group health plans, coverage is only extended to these dependents if they don’t have employer-sponsored health insurance. Effective with plan years beginning on or after Sept. 23, 2010.

Policy Rescissions

Your health insurer can no longer rescind your health coverage once you become sick. Exceptions are made for cases of fraud. Effective with plan years beginning on or after Sept. 23, 2010.

Preventive Care Coverage

Mandates coverage for specific preventive care and screening services with no cost sharing by you. Covered care and services come under recommendation of the U.S. Preventive Services Task Force, the Health Resources and Services Administration and the Advisory Committee on Immunization Practices of the Centers for Disease Control and Prevention. Effective with plan years beginning on or after Sept. 23, 2010. Grandfathered status applies.

Emergency Services Coverage

Emergency services must be covered at in-network levels regardless of provider. Effective with plan years beginning on or after Sept. 23, 2010. Grandfathered status applies.

Designating a Primary Care Physician

You may designate any in-network doctor as your primary care physician (including OB/GYN and pediatrician) if your plan requires the designation of a primary care physician. Effective with plan years beginning on or after Sept. 23, 2010.

Coverage Appeals

Health plans are required to have coverage appeal processes in place. Effective with plan years beginning on or after Sept. 23, 2010. Grandfathered status applies.

Coverage for Children’s Pre-existing Conditions

Health plans must cover pre-existing conditions for children 19 years of age and younger. Effective with plan years beginning on or after Sept. 23, 2010. Grandfathered status applies.

Grants for Small Employer Wellness Programs

$200 million in funding from fiscal years 2011 through 2015 is available to create grants for small, employer-based wellness programs. Effective Oct. 1, 2010.

Minimum Loss Ratios

A minimum loss ratio of 85 percent will be established for large employer health plans and 80 percent for individual and small employer (100 and below) health plans. Minimum loss ratio is the specified minimum percentage of premium dollars spent on medical care. Your health insurance carrier must issue a premium rebate if they fail to meet the minimum loss ratio requirement. Requirements and potential rebates apply to the 2011 plan year.

W2 Form Reporting

For informational purposes, your employer must put the aggregate cost of the employer-sponsored health care coverage they offer on your W2. Contributions to health savings accounts, Archer medical savings accounts and salary reduction contributions to flexible spending arrangements are excluded. Effective for benefits payable during taxable years beginning 2011.

Health Savings Account Distribution Tax Increase

The tax on health savings account distributions not used for qualified medical expenses will increase from 10 percent to 20 percent. Effective for distributions beginning in 2011.

Over-the-Counter Drug Exclusion from Account-Based Plans

If you have a health savings account, medical flexible spending arrangement, health reimbursement account or Archer medical savings account, over-the-counter drugs will no longer be reimbursable unless prescribed by your doctor. Effective for taxable years beginning 2011.

Tax on Brand-Name Prescription Drug Manufacturers

Drug manufacturers and importers will be subject to a new annual non-deductible fee. Payable in 2011 for sales in 2010.

Safe Harbor Cafeteria Plan for Small Employers

Employers with 100 or fewer employees may establish a cafeteria plan if they satisfy certain minimum participation and contribution requirements. Cafeteria plans allow employees to choose from a list of benefit options. Effective Jan. 1, 2011.

CLASS Act

Creates a new public long-term care program that your employer automatically enrolls you in unless you opt-out.Effective Jan. 1, 2011.

Business Tax Reporting (1099 Forms)

Business tax reporting will expand to include a wider variety of payments. Effective Jan. 1, 2012.

Federal Study on Large-Employer Plans

A federal study is mandated that will examine the impact on large employer health plans that result from the market reform requirements of the health care bill. Completion required prior to March 23, 2011.

Federal Study on Self-Insured Plans

Annual federal studies are mandated on self-insured plans that include such information as number of participants, benefits offered, assets and liabilities. In a self-insured plan, a company provides group health care insurance directly to its employees rather than purchased through an insurance provider. Completion required prior to March 23, 2011.

Non-profit Hospitals

Non-profit hospitals must meet new requirements to satisfy their tax-exempt status. Applicable to taxable years beginning after March 23, 2010.

Summary of Benefits

When you apply, enroll/re-enroll for coverage, or if the terms of your coverage are modified, you will receive a summary of benefits and coverage explanation containing more information than was previously presented.Notification must begin no later than March 2012.

Group Health Plan Quality Information Reporting

During the annual open enrollment period, you must be provided with a report detailing whether or not your health plan meets health quality criteria established by the secretary of the Department of Health and Human Services. The reports will also be made available through an Internet website. Must begin no later than March 23, 2012.

Tax on Group Health Plans to Fund Comparative Effectiveness Research

A premium tax on group health plans designed to fund a comparative effectiveness research program. Effective for plan years that end after Sept. 30, 2012.

Health Insurer Executive Compensation Limits

A $500,000 deduction limitation will be imposed on taxable year compensation to officers, employees, directors and service providers of covered health insurance providers. Applies to compensation paid during taxable years beginning on or after Dec. 31, 2012. Also applies to deferred compensation earned in the taxable year beginning after Dec. 31, 2009.

Flexible Spending Arrangement Limit

Will limit flexible spending arrangement contributions for medical expenses to $2,500 per year. The cap is indexed for inflation. Effective for taxable years beginning Jan. 1, 2013.

Tax on Medical Devices

Medical device manufacturers will be subject to a new excise tax equal to 2.3 percent of the price for which the device is sold. Devices of the type available for regular retail purposes such as eyeglasses and hearing aids will be exempt. Effective Jan. 1, 2013.

Medicare Payroll Tax Increase

For those with earnings and wages above $200,000 (individual) or $250,000 (joint filers), the Medicare payroll tax will increase to 0.9 percent. Those who are self-employed will not be allowed to deduct any portion of the additional tax. For those with adjusted gross income of more than $200,000 (individual) or $250,000 (joint filers), there will be a new 3.8 percent Medicare contribution tax on certain unearned income. Effective Jan. 1, 2013.

Medical Expense Tax Deduction Limitation

The threshold for the itemized deduction for unreimbursed medical expenses will increase from 7.5 percent of adjusted gross income to 10 percent of adjusted gross income. If you are 65 years of age or older, the increase will be waived for tax years 2013 through 2016. Effective Jan. 1, 2013.

Employer Notice Requirement

Your employer must notify you about the existence of Exchanges. Exchanges allow you to compare a variety of health insurance plans at a glance. Effective March 1, 2013.

Pre-existing Conditions

Coverage must be offered on a guaranteed issue basis and be guaranteed renewable. Guaranteed issue is a governmental requirement that says that health plans must allow you to enroll regardless of your health or other factors that might predict your use of health services. Prohibits exclusions based on pre-existing conditions. Effective for plan years beginning on or after Jan. 1, 2014. For enrollees under the age of 19, pre-existing conditions are prohibited beginning with plan years on or after Sept. 23, 2010. Grandfathered status applies for group health plans.

Tax on Private Health Insurance Premiums

Private health insurers will be subject to annual taxes based on net premiums written and third-party agreement fees received. The tax will not apply to self-insured plans and governmental entities. Self-insured plans are those where employers operate their own health insurance plan and pay a third party to administer it. Effective Jan. 1, 2014, for net premiums written after Dec. 31, 2012, and third-party agreement fees received after Dec. 31, 2012.

Modified Community Rating Requirements

Modified community rating standards with premium variations only allowed for age, tobacco use, family composition and geographic region will be in place for individual health insurance policies and fully-insured employer group policies covering 100 lives or less. Effective for plan years beginning on or after Jan. 1, 2014.

Group Size

Small employer groups will be redefined as having 1-100 employees. States may also elect to reduce this number to 50 employees for plan years prior to Jan 1, 2016. Effective Jan. 1, 2014.

State-Based Exchanges

Every state must create an Exchange to facilitate the sale of qualified benefit plans to individuals. A catastrophic-only policy will be available for those age 30 and younger. States must also create SHOP Exchanges to help small employers purchase coverage. Effective Jan.1, 2014.

Employee Free Choice Requirements

If you don’t enroll in the health plan offered by your employer and your household income is less than 400 percent of the federal poverty level, your employer can give you a free choice voucher that requires you to contribute between 8 percent and 9.8 percent of your household income toward the cost of coverage. The vouchers must be used in the aforementioned Exchanges to purchase coverage. Effective Jan. 1, 2014.

Essential Benefits

Standards will be established for coverage including mandated benefits, cost-sharing, out-of-pocket limits and a minimum actuarial value of 60 percent (meaning insurance covers an estimated 60 percent of health care expenses). Those 30 years old and younger can benefit from catastrophic-only policies. Effective for plan years beginning on or after Jan. 1, 2014.

Tax Credits for Lower Income Individuals

Sliding-scale premium assistance tax credits to buy coverage through the Exchange will be available for non-Medicaid eligible individuals with incomes of up to 400 percent of the federal poverty level. Effective Jan. 1, 2014.

Medicaid Expansion

The Medicaid eligibility level will increase to 133 percent of the federal poverty level. Effective Jan. 1, 2014.

Premium Assistance for Employer-Sponsored Coverage

States must offer premium assistance and Medicaid wrap-around benefits (Medicaid services that exceed coverage limitations) to Medicaid beneficiaries who are offered employer-sponsored coverage if cost-effective to do so.Effective Jan. 1, 2014.

State-Level Subsidy Programs

States may establish a federally-funded non-Medicaid state plan for people who fall between 133 percent and 200 percent of the federal poverty level. These people must not have access to affordable employer-sponsored coverage and would otherwise be eligible for subsidized coverage through a state-based Exchange. Effective Jan. 1, 2014.

Employer Mandate

Employers will have to pay a fine if they don’t offer coverage and employ more than 50 full-time equivalent employees (seasonal workers excepted) and one or more employees receives a premium assistance tax credit to buy coverage through an Exchange. The fine is $2000 per year times the number of full-time equivalent employees.

Employers will also have to pay a fine if they do offer coverage and employ more than 50 people and one or more full-time employees receives the premium assistance tax credit. The fine is the lesser of $3000 for each of those employees receiving a tax credit or $2000 for each of their full-time employees total.

Premium assistance tax credits will be available to individuals with family incomes up to 400 percent of the federal poverty level and the actuarial value of their employers’ coverage is less than 60 percent or their employer requires them to contribute more than 9.5 percent of their family income toward the cost of coverage. Effective Jan. 1, 2014.

Employer Waiting Period for Coverage

For new employees, the waiting period for coverage must not exceed 90 days. This also includes grandfathered plans. Effective Jan. 1, 2014.

Auto-Enrollment by Employers

Employers of 200 or more workers must auto-enroll all new employees into any available employer-sponsored health insurance plan. Waiting periods can apply. Employees can opt-out if they have another source of coverage. Effective date to be determined.

Individual Mandate

All American citizens and legal residents must purchase qualified health insurance coverage. The penalty for noncompliance will be an excise tax of either a flat dollar amount per person or a percentage of the individual’s income, whichever is higher.

Exceptions to this mandate include the following:

  • Religious objectors
  • Incarcerated individuals or those not lawfully present
  • Individuals who can’t afford coverage
  • Taxpayers with incomes less than 100 percent of poverty
  • Members of Indian tribes
  • Individuals who’ve received a hardship waiver
  • Individuals with incomes below the federal income tax filing threshold
  • Individuals who weren’t covered for a period of less than three months during the year

Effective Jan. 1, 2014.

Coverage Documentation

Health plans must provide coverage documentation to both individuals and the IRS. Effective Jan. 1, 2014.

Employer Wellness Plans

Wellness programs will be strengthened and the value of workplace wellness incentives will be increased to 30 percent of premiums with the cap possibly being increased to 50 percent. Effective with plan years beginning on or after Jan. 1, 2014.

Individual Market Wellness Plans

A 10-state pilot program will be created that will allow for wellness program rules to be applied to the individual health plan market during years 2014 through 2017. A study will also take place that examines the effectiveness and cost savings of wellness plans. Effective no later than July 1, 2014.

Children’s Health Insurance Program

The Children’s Health Insurance Program (provides insurance to uninsured children) will be extended through Sept. 30, 2015, but then must be reauthorized. Reauthorization by Oct. 1, 2015.

State Opt-Out Provisions

Provided that they create their own programs meeting specified standards, individual states will be allowed to apply for a waiver for up to five years for the following requirements relating to qualified health plans:

  • Exchanges
  • Cost-sharing reductions
  • Tax credits
  • Individual responsibility requirement
  • Shared responsibility for employers

Effective with plan years beginning on or after Jan. 1, 2017.

Large Groups in the Exchanges

States may allow large employer groups (100+ employees) to purchase coverage through the Exchanges. Effective Jan. 1, 2017.

Cadillac Tax

Insurers will begin paying a 40 percent excise tax on “Cadillac” health insurance plans (those plans thought to provide unusually generous benefits). These plans have values that exceed $10,200 for individual coverage and $27,500 for family coverage. Effective with taxable years beginning after Dec. 31, 2017.

DISCLAIMER:

The information provided in this document is for discussion purposes only.  IndianaHealthInsuranceExchange.com is not responsible for the tax and/or legal consequences resulting from the adoption and/or application of any plan or health insurance exchange language described in this document and/or the operation of your employee health benefit plan.

All data on this website is copyright © IndianaHealthInsuranceExchange.com. This data is not to be re-distributed, sold or used anywhere without the express written consent of IndianaHealthInsuranceExchange.com. We strictly enforce our copyright and if you are found to be in violation of this, we will seek a judgment against you.

© 2015 Nefouse & Associates
This website is operated by Nefouse & Associates Inc. We are certified to offer the federal exchange so we do comply with Personal Identifiable Information. This means any information you submit to this website will not be sold or misused. We will only use that information to assist you with obtaining a health insurance policy. At any time you may request us to destroy/deleted all information you have submitted. These are the rules under 45 CFR 155.220(c) and (d) and standards established under 45 CFR 155.260 that protect your privacy.

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Q: When does the new health care reform law take effect?

A: The health care reform law was enacted on March 23, 2010. Some of the law’s provisions took effect immediately. Other provisions will roll out gradually over the next several years.

Q: Are employers required to offer health care coverage?

A: Employers will have to pay a fine if they don’t offer coverage and employ more than 50 full-time equivalent employees (seasonal workers excepted) and one or more employees receives a premium assistance tax credit to buy coverage through an Exchange. Exchanges allow comparison of a wider variety of health plans at a glance.

Employers will also have to pay a fine if they do offer coverage and employ more than 50 people and one or more full-time employees receives a premium assistance tax credit.

Premium assistance tax credits will be available to individuals with family incomes up to 400 percent of the federal poverty level and the actuarial value of their employers’ coverage is less than 60 percent or their employer requires them to contribute more than 9.5 percent of their family income toward the cost of coverage.

Q: Am I required to have health insurance?

A: The law requires that all American citizens and legal residents purchase qualified health insurance coverage. The penalty for noncompliance will be an excise tax of either a flat dollar amount per person or a percentage of the individual’s income, whichever is higher. There are exceptions to this requirement that include:

  • Religious objectors
  • Incarcerated individuals or those not lawfully present
  • Individuals who can’t afford coverage
  • Taxpayers with incomes less than 100 percent of poverty
  • Members of Indian tribes

Q: I like my current health care coverage. Will I be allowed to keep it?

A: If your health care plan was already in place before the date of the law’s enactment, your plan is exempt from having to comply with some of the new law’s provisions. These are considered “grandfathered” plans. However, some of the law’s provisions impact grandfathered plans as well. Therefore, you may see some changes.

Q: What exemptions exist for grandfathered health care plans?

A: Generally, grandfathered plans are exempt from having to provide you with certain mandated health care benefits relating to emergency services and your choice of doctor. Grandfathered plans are also exempt from the requirement that prohibits discrimination (in eligibility/benefit offerings) in favor of highly compensated employees.

Q: Are grandfathered health care plans required to comply with any of the new law’s provisions?

A: Yes. Some of the law’s provisions impact grandfathered plans. The provisions that regulate lifetime and annual benefit limits, policy rescissions for sick enrollees and lengthy employee waiting periods (more than 90 days) for coverage all apply to grandfathered health care plans.

Q: Can my health care plan ever lose its grandfathered status?

A: Yes. Your plan could potentially lose its grandfathered status if it fails to meet any number of requirements. Following are some of the requirements:

  • Health plans must not eliminate any previously covered benefits that diagnose or treat a specific illness.
  • Health plans must not change their coinsurance levels for covered items or services in any way.
  • Health plans must not go beyond certain predetermined inflation calculations when they make changes to fixed-dollar cost-sharing amounts.

Q: I work for a small company struggling to provide health insurance to its employees. Will the new law help these companies in any way?

A: A tax credit is available for small employers. To qualify, the business must have no more than 25 full-time employees for the tax year and the average annual wages of its employees for the year must be less than $50,000 per full-time employee.

Q: Many health plans impose strict caps on annual and lifetime benefits. Will this change?

A: The new law prohibits lifetime limits on the dollar value of benefits. The law also limits caps on annual benefits to those benefits deemed non-essential.

Q: I have dependents on my policy. Will the new law impact them?

A: The age of dependents eligible for health plan coverage will increase to 26 years of age. Dependents can also be married.

Q: Does the new law address those with pre-existing health conditions?

A: Yes. Coverage must be offered on a guaranteed issue basis and be guaranteed renewable. Guaranteed issue is a governmental requirement that says that health plans must allow you to enroll regardless of your health or other factors that might predict your use of health services. You can’t be excluded based on pre-existing conditions. Health plans must also cover pre-existing conditions for children 19 years of age and younger.

Q: What happens to my coverage if I become extremely sick?

A: The law prohibits your health insurer from taking your coverage away if you become sick.

Q: Does the new law address preventive care coverage? What about emergency services?

A: The law mandates a certain level of coverage for specific preventive care and screening services with no cost-sharing by you. Emergency services must be covered at in-network levels regardless of provider.

Q: Does the new law impact my choice of doctors?

A: You may designate any in-network doctor as your primary care physician (including OB/GYN and pediatrician) if your health plan requires such designation.

Q: My health care benefits can be hard to understand. Will the new law help?

A: When you apply, enroll/re-enroll for coverage, or if the terms of your coverage are modified, the law requires that you receive a summary of benefits and coverage explanation that contains more information than you currently receive.

Q: I’m concerned about the quality of the health plans offered to me. Will the new law address this?

A: During the annual open enrollment period, you must be provided with a report detailing whether or not your health plan meets health quality criteria established by the secretary of the Department of Health and Human Services.

Q: What impact will the new health reform law have on my taxes?

A: For those with earnings and wages above $200,000 (individual) or $250,000 (joint filers), the Medicare payroll tax will increase to 0.9 percent. Those who are self-employed will not be allowed to deduct any portion of the additional tax. For those with adjusted gross income of more than $200,000 (individual) or $250,000 (joint filers), there will be a new 3.8 percent Medicare contribution tax on certain unearned income.

 

© 2015 Nefouse & Associates
This website is operated by Nefouse & Associates Inc. We are certified to offer the federal exchange so we do comply with Personal Identifiable Information. This means any information you submit to this website will not be sold or misused. We will only use that information to assist you with obtaining a health insurance policy. At any time you may request us to destroy/deleted all information you have submitted. These are the rules under 45 CFR 155.220(c) and (d) and standards established under 45 CFR 155.260 that protect your privacy.

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For 2011 we have seen a increase in underwriting standards for policies to be issued.

There are different levels of approval. Preferred Best would be the best rating which means you have no ongoing health conditions. Standard 2 would be the highest risk where a Insured has multiple conditions that are being treated or high risk.

In 2010 carriers were excepting standard 2 clients. Now we are seeing a shift where they are declining them. It’s very common in our population to have someone overweight and suffering from high blood pressure or cholesterol. These people we use to be able to obtain a policy but now they are being declined.

Many people are not organized with their own health conditions. It’s very important while you are looking  for a policy that you communicate all of your conditions to your broker before you apply.  Some carriers will decline those condition while others will rider them. Speak to a professional that can guide you through this process before submitting applications to a carrier.

With underwriting guidelines changing it extremely important to speak with an agent that knows the market place.

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I listened very closely to the speech given by our president on the State of the Union. I concentrated very closely on the small portion dedicated to  health insurance.  The speech was very broad and in a sense contradictory to the Presidents actions for the last two years.

The fact the President stated that he is open to idea to fix the current law is a huge stepping point. There is so much in the  law that is wrong. We are still waiting for clarification on about 1000+ of the law.  Right not politicians are only speaking about a handful of things that are good for the individual in the law from a coverage standpoint.  When the President spoke about removing the 1099 aspect of the law for small business I thought that was great.  From a Math if you remove those taxes what is the Gov. going to tax next?  The health care law created 149 new gov. agencies. So it was difficult for me to hear the President talking about making Gov. more efficient.

When the true cost of this law comes to light I think most people are going to be in for a huge shock.  There is major concerns with the states and how they are going to pay for the expansion of medicaid. This year a lone we have seen premiums go up and not down and this came from the health care law and the essential benefits.  This health care law could implode our entire medical system because of cost.

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There is going to be big news on these debate. The repeal passed the house and now it’s on to the Senate. Most experts give it little hope in the Senate. What is interesting about this debate is both side are really only focused on a small % of the total law.  The law has specific guidelines to Medical loss Ratio, Underwriting, Exchanges and Coverages.  These aspect have been talked about openly.  The other 1,000 pages to the law have not been discussed or even clarified.

As the debate goes on people need to know about the rest of the law and how it could impact us. 

Both sides of the debate view health care very differently. The Republicans believe  you create competition to lower the cost of health care and then more people will have coverage. The Democrats believeincreased benefits will bring down the cost in the long run and cover everyone. The Republicans do not want to gamble with 1/6th of the US economy. The democrats want every to be covered. Both of them want coverage that is affordable.

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If you are the controller or an owner of a small business there are  major decision you will have to make on an employee health insurance. The one that I will focus on here is age based vs composite premium calculations. These will impact your employees.

Age base premium is exactly what they sound like. The premium is calculated by your age. So the younger employee benefit with this because they pay less in premium. The older employee pays much more.

Composite rates are an average of the employee ages. So every employee pays the same amount.

There are pros and cons to both approaches. Composite is much easier to administer because everyone pays the same price. The age based makes it much cheaper for younger employees which can help with retaining young health people on the plan.

Each case is different but these are things to think about when establishing a plan or renewing a group health plan.

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