The IRS Is Still Enforcing The Individual Mandate, Despite What Many Taxpayers Believe
Did you know that there are many people who still don't believe that they will be hit by tax penalty if they do not have health insurance? Here is an informative article by Timothy Jost from Health Affairs on why everyone should be keeping up with their health insurance in-order to avoid a tax penalty by the IRS.
There has been considerable speculation since President Trump’s Inauguration Day Affordable Care Act Executive Order as to whether the Internal Revenue Service is in fact enforcing the individual and employer mandates. The IRS website has insisted that the mandates are still in force, despite the Executive Order and despite the fact that the IRS decided not to implement for 2016 tax filings a program rejecting “silent returns” that did not indicate compliance with individual mandate requirements.
There is evidence, however, that many taxpayers do not believe it. An April report from the Treasury Inspector General for Taxpayer Services found that as of March 31, a third fewer taxpayers were paying the penalty than had been the case a year earlier. More importantly, insurers seem to believe that the IRS is not enforcing the mandate, or at least that taxpayers do not believe the IRS is enforcing the mandate, and are raising their rates for 2018 to account for the deteriorating of the risk pool that nonenforcement of the mandate will cause.
It is of note, therefore, that Robert Sheen at the ACA Times has identified several letters from the IRS reaffirming that it is still in fact enforcing the individual, and employer, mandates.
One is a letter reportedly sent in April by the IRS General Counsel to Congressman Bill Huizenga (R-MI) in response to an inquiry as to whether the IRS could waive the employer mandate with respect to a particular employer. The IRS replied that there was no provision in the ACA for waiver of the mandate penalty when it applied and that: “The Executive Order does not change the law; the legislative provisions of the ACA are still in force until changed by the Congress, and taxpayers remain required to follow the law and pay what they may owe.”
In a second letter in June, responding to an individual who had written to President Trump, the IRS similarly responded:
The Executive Order does not change the law; the legislative provisions of the ACA are still in force until changed by the Congress, and taxpayers remain required to follow the law, including the requirement to have minimum essential coverage for each month, qualify for a coverage exemption for the month, or make a shared responsibility payment.
Of course, whether taxpayers believe it, and whether insurers believe taxpayers believe it, is another question.
See the original article Here.
Source:
Jost T. (2017 August 21). The IRS is still enforcing the individual mandate, despite what many taxpayers believe [Web blog post]. Retrieved from address https://healthaffairs.org/blog/2017/08/21/the-irs-is-still-enforcing-the-individual-mandate-despite-what-many-taxpayers-believe/
ACA Revamp Odds Slip as Senate Gets New Expiration Date
Timeframe to repeal and replace has just shortened. Find out how this new timeline for the repeal of ACA will impact Senate and their plan for healthcare in this informative column by Laura Litvan from Think Advisor.
The Senate parliamentarian told lawmakers that Republicans’ ability to pass an Affordable Care Act change bill with just 51 votes expires at the end of this month, Sen. Bernie Sanders said Friday.
The preliminary finding complicates any further efforts by Republican leaders in Congress to pass a comprehensive GOP-only overhaul of the health care law.
Sanders, a Vermont independent, in a statement called the determination a "major victory" for those who oppose Affordable Care Act de-funding.
Senate Republicans, who control the chamber 52-48, failed to win enough support for their ACA de-funding and change bill in July as three GOP lawmakers joined Democrats to oppose the measure. Republican leaders haven’t ruled out reviving their effort, and some party members — including Lindsey Graham of South Carolina, Bill Cassidy of Louisiana and Ted Cruz of Texas — say they’re talking to colleagues about a possible broad-based bill.
At the same time, some senators are discussing a scaled-back, bipartisan health measure. It takes 60 votes to overcome a Democratic filibuster, and Democrats are united against de-funding of the Affordable Care Act, or the kinds of Affordable Care Act program changes proposed in the bills that have reached the House or Senate floor.
The Senate Health, Education, Labor and Pensions Committee has scheduled four hearings this month to examine bolstering the Affordable Care Act public health insurance exchange system.
Committee Chairman Lamar Alexander, a Tennessee Republican, and the panel’s top Democrat, Patty Murray of Washington, have pledged a bipartisan effort to shore up the exchanges, which provide consumers a place to purchase individual coverage with help from Affordable Care Act subsidies.
Earlier guidance from Senate Parliamentarian Elizabeth MacDonough dogged Republicans in their Affordable Care Act change effort throughout the summer. In late July, she issued a preliminary finding that key parts of a proposal drafted by Senate Majority Leader Mitch McConnell didn’t qualify for consideration under the budget reconciliation rules, dramatically complicating the already slimming prospects of passing a bill.
Republicans can still try to use the budget reconciliation process to get an Affordable Care Act change bill through the Senate with just a 51-vote majority, rather than a 60-vote majority, during the fiscal year that starts Oct. 1.
The House Budget Committee has drafted a fiscal 2018 budget that could be used for both de-funding the Affordable Care Act and tax reform. That budget may come to the floor in mid-September, and the Senate Budget Committee hopes to release its version of the budget in the coming weeks. Still, putting a tax overhaul and Affordable Care Act de-funding in the same legislation would be time-consuming and unlikely.
See the original article Here.
Source:
Litvan L. (2017 September 1). ACA revamp odds slip as senate gets new expiration date [Web blog post]. Retrieved from address https://www.thinkadvisor.com/2017/09/01/aca-revamp-odds-slip-as-senate-gets-new-expiration?t=health-insurance?ref=channel-top-news
Preparing for 2018 Open Enrollment
As open enrollment season nears, make sure you are staying compliant and up-to-date with everything that is happening in ACA. Here are some great tips by Carl C. Lammers from Benefit News on what you need to know to prepare yourself for open enrollment this upcoming year.
Open enrollment for employer-sponsored health and welfare benefits comes every year; usually with little fanfare as employers generally have a system in place to seamlessly handle enrollments.
This changed with the passage of the Affordable Care Act in 2010, but now seven years later, employers again mostly have open enrollment standardized. This year brings a new challenge – the Summary of Benefits and Coverage document that was created by the ACA has undergone its first major restructuring since 2012 when employers were first required to provide the SBC.
The new SBC template must be used for open enrollments that occur on or after April 1, 2017. For calendar year plans, the upcoming 2018 open enrollment is the first open enrollment where the new SBC templates must be used.
If you need a quick refresher, the SBC summarizes group health plan coverage for employees, describing many important plan features, such as deductibles, co-pays, co-insurance, and services covered, so that employees can better understand and make more informed choices about the available coverage options.
SBCs have a required uniform format and must contain certain information and examples, so that employees can compare an employer’s coverage options and options from more than one employer.
The uniform standard definitions of medical and health coverage terms and the required SBC template are distributed by the IRS, DOL, and HHS.
While the insurance carrier or third party administrator normally provides the SBC to an employer for distribution with open enrollment materials, employers are ultimately responsible for the SBC’s accuracy and distribution and for the recently increased penalties – of $1,087 per failure – for failure to distribute the SBC.
Employers should review the SBC’s provided for the upcoming open enrollment to be sure they have changed to reflect the new rules. Employers should also distribute the Section 1557 nondiscrimination notice with the SBC to avoid potential penalties.
The new finalized guidance on SBCs was issued by the Departments in April of 2016. The guidance states that while all prior formatting must still generally be complied with; SBCs can now have certain language and formatting alterations, such as differing font styles and margins in order to maintain the four page requirement. Definitions were also added to the Uniform Glossary, and the Departments state that SBCs may hyperlink the terms to a micro-site that HHS will maintain.
The required content of the SBC has also changed, with some of the most significant changes being:
A description of what an SBC is and where consumers can find more information, located at the beginning of the SBC.
A description of how family members must meet their own individual deductibles before the overall family deductible is met, and what services are covered.
- Changing of the term "person" to "individual."
- A statement that copays may not be included in out-of-pocket limits.
- The removal of the definitions of copayments and coinsurance.
- Change of the "Limitations & Exceptions" column to "Limitations, Exceptions, & Other Important Information" which must now include:
- When the plan does not cover a certain service category, or a substantial portion of a service category.
- When cost sharing for covered in-network services does not factor into the out-of-pocket limit.
- Visit and/or dollar limits.
- When services require preauthorization.
- Note: cross-referencing is allowed if including all information in this section would cause the SBC to exceed four pages.
- New language about minimum essential coverage, minimum value, and language access services.
- The addition of a third Coverage Example about costs for a fracture, and slightly altered formatting to the Coverage Examples section.
- A statement regarding whether abortions are covered by the plan.
One thing that is not part of the new SBC guidance is also important for employers: SBCs are likely considered "significant communications" for purposes of the nondiscrimination rules found in Section 1557 of the ACA, and the notice required by Section 1557 should be included with the SBC.
The Section 1557 notice must be included with all “significant communications” involving the medical plan. It is not clear whether the Departments have considered the addition of the Section 1557 language and its impact on the four page SBC limit.
We suggest including the 1557 notice with the new SBCs, but not as part of the new SBCs, in order to maintain the four-page length. Be sure to review any draft SBCs prepared by your insurer or TPA before distribution to ensure they meet the new formatting requirements.
See the original article Here.
Source:
Lammers C. (2017 July 31). Preparing for 2018 open enrollment [Web blog post]. Retrieved from address https://www.benefitnews.com/opinion/preparing-for-2018-open-enrollment
New House Healthcare Proposal a Mixed Bag for Employers
The House of Representatives has just introduced their new bipartiasn plan for healthcare reform. Find out how this new healthcare legislation will impact your employers' healthcare in this great article by Victoria Finkle from Employee Benefit News.
A new bipartisan healthcare plan in the House contains potential positives and negatives alike for employers.
The plan could provide much-sought relief to small and medium-sized businesses with respect to the employer mandate, but it could also institutionalize the mandate for larger firms and does little to reduce employer-reporting headaches. Critics say it also fails to endorse other employer-friendly reforms to the Affordable Care Act.
The Problem Solvers Caucus, a group of more than 40 Republicans and Democrats led by Reps. Tom Reed, R-N.Y., and Josh Gottheimer, D-N.J., unveiled their new plan last week to stabilize the individual markets, following the collapse of Senate talks that were focused on efforts to repeal and replace the Affordable Care Act last month. The proposal would be separate from an earlier bill that passed the House to overhaul large swaths of the ACA. Congress is now on recess until after Labor Day, but talks around efforts to shore up the individual markets are likely to resume when lawmakers return to Washington this fall.
PaulThe House lawmakers introduced a broad set of bipartisan principles that they hope will guide future legislation, including several key tweaks to the employer mandate. This plan includes raising the threshold for when the mandate kicks in from firms with 50 or more employees to those with at least 500 workers. It also would up the definition of full-time work from those putting in 30 hours to those working 40 hours per week. Among changes focused on the individual markets, the proposal would bring cost-sharing reduction payments under the congressional appropriations process and ensure they have mandatory funding as well as establish a stability fund that states could tap to reduce premiums and other costs for some patients with expensive health needs.
Legislative talks focused on maintaining the Obamacare markets remain in early stages and it’s unclear whether the provisions targeting the employer mandate will gain long-term traction, though lawmakers in support of the plan said that their proposed measure would help unburden smaller companies.
“The current employer mandate places a regulatory burden on smaller employers and acts as a disincentive for many small businesses to grow past 50 employees,” the Problem Solvers Caucus said in their July 31 release.
Observers note that raising the mandate’s threshold would likely have few dramatic effects on coverage rates. But critics argued that while the plan would eliminate coverage requirements for mid-size employers — a boon for smaller companies — it could ultimately make it more difficult to restructure or remove the mandate altogether.
“It would provide relief to some people — however, it will enshrine the employer mandate forever,” says James Gelfand, senior vice president of health policy at the ERISA Industry Committee. “You are exempting the most sympathetic characters and ensuring that large businesses will forever be subject to the mandate and its obscene reporting.”
The real-world impact of the change would likely be limited when it comes to coverage rates, as mid-sized and larger employers tend to use health benefits to help attract and retain their workforce. Nearly all firms with 50 or more full-time employees — about 96% — offered at least one plan that would meet the ACA’s minimum value and affordability requirements, according to the Kaiser Family Foundation/Health Research & Education Trust employer health benefits survey for 2016. Participation was even higher — 99% — among firms with at least 200 workers.
“At the 500 bar, realistically, virtually every employer is offering coverage to at least some employees,” says Matthew Rae, a senior policy analyst with Kaiser Family Foundation.
Gelfand notes that under the proposed measure, big businesses would still have to comply with time-consuming and costly reporting requirements under the ACA and would continue to face restrictions in plan design, because of requirements in place that, for example, mandate plans have an actuarial value of at least 60%.
“Prior to the ACA, big business already offered benefits — and they were good benefits that people liked and that were designed to keep people healthy and to make them productive workers,” he says. “[The ACA] forces us to waste a boatload of time and money proving that we offer the benefits that we offer and it constrains our ability to be flexible in designing those benefits.”
Susan Combs, founder of insurance brokerage Combs & Co., says that changing the definition of full-time employment from 30 to 40 hours per week could have a bigger impact than raising the mandate threshold, because it would free up resources for employers who had laid off workers or cut back their hours when they began having to cover benefits for people working 30 or more hours.
“Some employers had to lay off employees or had they to cut back on different things, because they had to now cover benefits for people that were in essence really part-time people, not full-time people,” she says. “If you shifted from 30 to 40 hours, that might give employers additional remedies so they can expand their companies and employ more people eventually.”
Two percent of firms with 50-plus full-time workers surveyed by Kaiser in 2016 said that they changed or planned to change the job classifications of some employees from full-time to part-time so that the workers would not be eligible for health benefits under the mandate. Another 4% said that they reduced the number of full-time employees they intended to hire because of the cost of providing health benefits.
Gelfand calls the provision to raise the definition from 30 to 40 hours per week “an improvement,” though he said a better solution would be to remove the employer mandate entirely.
He added that he would like to see any market stabilization plan include more items employers had backed as part of the earlier repeal and replace debate. While the House plan would remove a tax on medical devices, it does not address the Cadillac tax on high-cost plans, one of the highest priority items that employer groups have been working to delay or repeal. It also doesn’t include language expanding the use of tax-advantaged health savings accounts detailed in earlier House and Senate proposals.
“There’s not likely to be another healthcare vehicle that’s focused on ACA reform, so if you have a reform vehicle that goes through and it doesn’t do anything to give us tax relief and it doesn’t do anything to improve consumer-driven health options, like HSAs, and it doesn’t do anything to improve healthcare costs — wow, what a missed opportunity,” he says.
See the original article Here.
Source:
Finkle V. (2017 August 10). New house healthcare proposal a mixed bag for employers [Web blog post]. Retrieved from address https://www.benefitnews.com/news/new-house-healthcare-proposal-a-mixed-bag-for-employers
Kaiser Health Tracking Poll – August 2017: The Politics of ACA Repeal and Replace Efforts
With the Senate's plan for the repeal and replacement of the ACA failing more Americans are hoping for Congress to move on to more pressing matters. Find out how Americans really feel about the ACA and healthcare reform in this great study conducted by the Kaiser Family Foundation.
KEY FINDINGS:
- The August Kaiser Health Tracking Poll finds that the majority of the public (60 percent) say it is a “good thing” that the Senate did not pass the bill that would have repealed and replaced the ACA. Since then, President Trump has suggested Congress not take on other issues, like tax reform, until it passes a replacement plan for the ACA, but six in ten Americans (62 percent) disagree with this approach, while one-third (34 percent) agree with it.
- A majority of the public (57 percent) want to see Republicans in Congress work with Democrats to make improvements to the 2010 health care law, while smaller shares say they want to see Republicans in Congress continue working on their own plan to repeal and replace the ACA (21 percent) or move on from health care to work on other priorities (21 percent). However, about half of Republicans and Trump supporters would like to see Republicans in Congress keep working on a plan to repeal the ACA.
- A large share of Americans (78 percent) think President Trump and his administration should do what they can to make the current health care law work while few (17 percent) say they should do what they can to make the law fail so they can replace it later. About half of Republicans and supporters of President Trump say the Trump administration should do what they can to make the law work (52 percent and 51 percent, respectively) while about four in ten say they should do what they can to make the law fail (40 percent and 39 percent, respectively). Moving forward, a majority of the public (60 percent) says President Trump and Republicans in Congress are responsible for any problems with the ACA.
- Since Congress began debating repeal and replace legislation, there has been news about instability in the ACA marketplaces. The majority of the public are unaware that health insurance companies choosing not to sell insurance plans in certain marketplaces or health insurance companies charging higher premiums in certain marketplaces only affect those who purchase their own insurance on these marketplaces (67 percent and 80 percent, respectively). In fact, the majority of Americans think that health insurance companies charging higher premiums in certain marketplaces will have a negative impact on them and their family, while fewer (31 percent) say it will have no impact.
- A majority of the public disapprove of stopping outreach efforts for the ACA marketplaces so fewer people sign up for insurance (80 percent) and disapprove of the Trump administration no longer enforcing the individual mandate (65 percent). While most Republicans and Trump supporters disapprove of stopping outreach efforts, a majority of Republicans (66 percent) and Trump supporters (65 percent) approve of the Trump administration no longer enforcing the individual mandate.
- The majority of Americans (63 percent) do not think President Trump should use negotiating tactics that could disrupt insurance markets and cause people who buy their own insurance to lose health coverage, while three in ten (31 percent) support using whatever tactics necessary to encourage Democrats to start negotiating on a replacement plan. The majority of Republicans (58 percent) and President Trump supporters (59 percent) support these negotiating tactics while most Democrats, independents, and those who disapprove of President Trump do not (81 percent, 65 percent, 81 percent).
- This month’s survey continues to find that more of the public holds a favorable view of the ACA than an unfavorable one (52 percent vs. 39 percent). This marks an overall increase in favorability of nine percentage points since the 2016 presidential election as well as an increase of favorability among Democrats, independents, and Republicans.
Attitudes Towards Recent “Repeal and Replace” Efforts
In the early morning hours of July 28, 2017, the U.S. Senate voted on their latest version of a plan to repeal and replace the 2010 Affordable Care Act (ACA). Known as “skinny repeal,” this plan was unable to garner majority support– thus temporarily halting Congress’ ACA repeal efforts. The August Kaiser Health Tracking Poll, fielded the week following the failed Senate vote, finds that a majority of the public (60 percent) say it is a “good thing” that the U.S. Senate did not pass a bill aimed at repealing and replacing the ACA, while about one-third (35 percent) say this is a “bad thing.” However, views vary considerably by partisanship with a majority of Democrats (85 percent), independents (62 percent), and individuals who say they disapprove of President Trump (81 percent) saying it is a “good thing” that the Senate did not pass a bill compared to a majority of Republicans (64 percent) and individuals who say they approve of President Trump (65 percent) saying it is a “bad thing” that the Senate did not pass a bill.
The majority of those who view the Senate not passing an ACA replacement bill as a “good thing” say they feel this way because they do not want the 2010 health care law repealed (34 percent of the public overall) while a smaller share (23 percent of the public overall) say they feel this way because, while they support efforts to repeal and replace the ACA, they had specific concerns about the particular bill the Senate was debating.
And while most Republicans and supporters of President Trump say it is a “bad thing” that the Senate did not pass ACA repeal legislation, for those that say it is a “good thing” more Republicans say they had concerns about the Senate’s particular legislation (21 percent) than say they do not want the ACA repealed (6 percent). This is also true among supporters of President Trump (19 percent vs. 6 percent).
WHO DO PEOPLE BLAME OR CREDIT FOR THE SENATE BILL FAILING TO PASS?
Among those who say it is a “good thing” that the Senate was unable to pass ACA repeal and replace legislation, similar shares say the general public who voiced concerns about the bill (40 percent) and the Republicans in Congress who voted against the bill (35 percent) deserve most of the credit for the bill failing to pass. This is followed by a smaller share (14 percent) who say Democrats in Congress deserve the most credit.
On the other hand, among those who say it is a “bad thing” that the Senate did not pass a bill to repeal the ACA, over a third place the blame on Democrats in Congress (37 percent). About three in ten (29 percent) place the blame on Republicans in Congress while fewer (15 percent) say President Trump deserves most of the blame for the bill failing to pass.
HALF OF THE PUBLIC ARE “RELIEVED” OR “HAPPY” THE SENATE DID NOT REPEAL AND REPLACE THE ACA
More Americans say they are “relieved” (51 percent) or “happy” (47 percent) that the Senate did not pass a bill repealing and replacing the ACA, than say they are “disappointed” (38 percent) or “angry” (19 percent).
Although two-thirds of Republicans and Trump supporters say they feel “disappointed” about the Senate failing to pass a bill to repeal and replace the ACA, smaller shares (30 percent and 37 percent, respectively) report feeling “angry” about the failure to pass the health care bill.
MAJORITY SAY PRESIDENT TRUMP AND REPUBLICANS IN CONGRESS ARE RESPONSIBLE FOR THE ACA MOVING FORWARD
With the future of any other replacement plans uncertain, the majority (60 percent) of the public say that because President Trump and Republicans in Congress are now in control of the government, they are responsible for any problems with the ACA moving forward, compared to about three in ten Americans (28 percent) who say that because President Obama and Democrats in Congress passed the law, they are responsible for any problems with it. Partisan divisiveness continues with majorities of Republicans and supporters of President Trump who say President Obama and Democrats are responsible for any problems with it moving forward, while large shares of Democrats, independents, and those who do not approve of President Trump say President Trump and Republicans in Congress are responsible for the law moving forward.
Moving Past Repealing The Affordable Care Act
This month’s survey continues to find that more of the public holds a favorable view of the ACA than an unfavorable one (52 percent vs. 39 percent). This marks an overall increase in favorability since Congress began debating ACA replacement plans and a nine percentage point shift since the 2016 presidential election.
The shift in attitudes since the 2016 presidential election is found regardless of party identification. For example, the share of Republicans who have a favorable view of the ACA has increased from 12 percent in November 2016 to 21 percent in August 2017. This is similar to the increase in favorability among independents (11 percentage points) and Democrats (7 percentage points) over the same time period.
NEXT STEPS FOR THE ACA
The most recent Kaiser Health Tracking Poll finds that after the U.S. Senate was unable to pass a plan to repeal and replace the ACA, the majority of the public (57 percent) wants to see Republicans in Congress work with Democrats to make improvements to the 2010 health care law but not repeal it. Far fewer want to see Republicans in Congress continue working on their own plan to repeal and replace the ACA (21 percent) or move on from health care to work on other priorities (21 percent). About half of Republicans (49 percent) and Trump supporters (46 percent) want Republicans in Congress to continue working on their own plan to repeal and replace the ACA, but about a third of each say they would like to see Republicans work with Democrats on improvements to the ACA.
Six in ten Americans (62 percent) disagree with President Trump’s strategy of Congress not taking on other issues, like tax reform, until it passes a replacement plan for the ACA while one-third (34 percent) of the public agree with this approach. Republicans and Trump supporters are more divided in their opinion on this strategy with similar shares saying they agree and disagree with the approach.
MOST WANT TO SEE PRESIDENT TRUMP AND REPUBLICANS MAKE THE CURRENT HEALTH CARE LAW WORK
Regardless of their opinions of the ACA, the majority of the public want to see the 2010 health care law work. Eight in ten (78 percent) Americans think President Trump and his administration should do what they can to make the current health care law work while fewer (17 percent) say President Trump and his adminstration should do what they can to make the law fail so they can replace it later. About half of Republicans and supporters of President Trump say the Trump administration should do what they can to make the law work (52 percent and 51 percent, respectively) while about four in ten say they should do what they can to make the law fail (40 percent and 39 percent, respectively).
This month’s survey also includes questions about specific actions that the Trump administration can take to make the ACA fail and finds that the majority of the public disapproves of the Trump Administration stopping outreach efforts for the ACA marketplaces so fewer people sign up for insurance (80 percent) and no longer enforcing the individual mandate, the requirement that all individuals have insurance or pay a fine (65 percent). While most Republicans and Trump supporters disapprove of President Trump stopping outreach efforts so fewer people sign up for insurance, which experts say could weaken the marketplaces, a majority of Republicans (66 percent) and Trump supporters (65 percent) approve of the Trump administration no longer enforcing the individual mandate.
The Future of the ACA Marketplaces
About 10.3 million people have health insurance that they purchased through the ACA exchanges or marketplaces, where people who don’t get insurance through their employer can shop for insurance and compare prices and benefits.1 Seven in ten (69 percent) say it is more important for President Trump and Republicans’ next steps on health care to include fixing the remaining problems with the ACA in order to help the marketplaces work better, compared to three in ten (29 percent) who say it is more important for them to continue plans to repeal and replace the ACA.
The majority of Republicans (61 percent) and Trump supporters (63 percent) say it is more important for President Trump and Republicans to continue plans to repeal and replace the ACA, while the vast majority of Democrats (90 percent) and seven in ten independents (69 percent) want them to fix the ACA’s remaining problems to help the marketplaces work better.
UNCERTAINTY REMAINS ON WHO IS IMPACTED BY ISSUES IN THE ACA MARKETPLACES
Since Congress began debating repeal and replace legislation, there has been news about instability in the ACA marketplaces which has led some insurance companies to charge higher premiums in certain marketplaces. Six in ten Americans think that health insurance companies charging higher premiums in certain marketplaces will have a negative impact on them and their family, while fewer (31 percent) say it will have no impact.
There has also been news about insurance companies no longer selling coverage in the individual insurance marketplaces and currently, it’s estimated that 17 counties (9,595 enrollees) are currently at risk to have no insurer on the ACA marketplaces in 2018.2 The majority of the public (54 percent) say health insurance companies choosing not to sell insurance plans in certain marketplaces will have no impact on them and their family. Yet, despite the limited number of counties that may not have an insurer in their marketplaces as well as this not affecting those with employer sponsored insurance where most people obtain health insurance, about four in ten (38 percent) of the public believe that health insurance companies choosing to not sell insurance plans in certain marketplaces will have a negative impact on them and their families.
The majority of the public think both of these ACA marketplace issues will affect everyone who has health insurance and not just those who purchase their insurance on these marketplaces. Six in ten think health insurance companies choosing not to sell insurance plans in certain marketplaces will affect everyone who has health insurance while about one-fourth (26 percent) correctly say it only affects those who buy health insurance on their own. In addition, three-fourths (76 percent) of the public say that health insurance companies charging higher premiums in certain marketplaces will affect everyone who has health insurance while fewer (17 percent) correctly say it will affect only those who buy health insurance on their own.
MAJORITY SAY PRESIDENT TRUMP SHOULD NOT USE COST-SHARING REDUCTION PAYMENTS AS NEGOTIATING STRATEGY
Over the past several months President Trump has threatened to stop the payments to insurance companies that help cover the cost of health insurance for lower-income Americans (known commonly as CSR payments), in order to get Democrats to start working with Republicans on an ACA replacement plan.3 The majority of Americans (63 percent) do not think President Trump should use negotiating tactics that could disrupt insurance markets and cause people who buy their own insurance to lose health coverage, while three in ten (31 percent) support President Trump using whatever tactics necessary to encourage Democrats to start negotiating. The majority of Republicans (58 percent) and President Trump supporters (59 percent) support negotiating tactics while most Democrats, independents, and those who disapprove of President Trump do not (81 percent, 65 percent, 81 percent).
See the original article Here.
Source:
Kirzinger A., Dijulio B., Wu B., Brodie M. (2017 Aug 11). Kaiser health tracking poll-august 2017: the politics of ACA repeal and replace efforts [Web blog post]. Retrieved from address https://www.kff.org/health-reform/poll-finding/kaiser-health-tracking-poll-august-2017-the-politics-of-aca-repeal-and-replace-efforts/?utm_campaign=KFF-2017-August-Tracking-Poll&utm_medium=email&_hsenc=p2ANqtz-9GaFJKrO9G3bL05k_i4GzC04eMAaSCDlmcsiYsfzAn-SeJdK_JnFvab4GydMfe_9iGiiKy5LR0iKxm6f0gDZGbwqh-bQ&_hsmi=55195408&utm_content=55195408&utm_source=hs_email&hsCtaTracking=4463482c-5ae1-4dfa-b489-f54b5dd97156%7Cd5849489-f587-49ad-ae35-3bd735545b28
What Could Happen If The Administration Stops Cost-Sharing Reduction Payments To Insurers?
Has the President's recent threat to slash Cost-Sharing Reduction Payments for insurers left you worried about your healthcare costs? Find out how the loss of Cost-Sharing Reduction Payments will impact your health insurance in this informative column by Timothy Jost from Health Affairs.
August 4 Update: Voluntary Insurer Reporting Of Catastrophic Coverage Offered Through Exchange Continued
On August 3, 2017, the Internal Revenue Service released Notice 2017-41 informing insurers that for 2017, as for 2015 and 2016, they would be encouraged but not required to report coverage under catastrophic plans in which individuals were enrolled through an exchange. Insurers and employers are generally required to file 1095-B or 1095-C forms with the IRS, and to provide these forms to individuals whom they cover, documenting that the individuals have minimum essential coverage as required by the individual mandate.
Insurers are not, however, required to report qualified health plan coverage provided through the exchanges, because the exchanges themselves file 1095-A forms documenting QHP coverage and provide these forms to enrollees. But catastrophic health plans are not QHPs, so exchanges do not report catastrophic coverage either.
The IRS proposed regulations in 2016 to require insurers to report catastrophic coverage issued through the exchange and thus to fill this gap. These rules have not yet been finalized however. In the meantime, the IRS has encouraged insurers to report catastrophic coverage issued through an exchange voluntarily. The guidance extends this policy for another year. Insurers that voluntarily report catastrophic coverage will not be subject to penalties with respect to returns and statements reporting this coverage.
Original Post
Although the decision of the Court of Appeals for the District of Columbia Circuit to allow attorneys general from 17 states and the District of Columbia to join the House v. Price cost-sharing reduction (CSR) litigation as parties complicates President Trump’s ability to simply stop the CSR payments, rumors continue that he is preparing to do so. The CSR payments are made monthly; the next installment is due on August 21, 2017. If the administration intends not to make the August payment, it must announce its decision soon.
Changes to qualified health plan (QHP) applications in the federally facilitated exchange (FFE) are due on August 16, 2017, as are final rates for single risk pool plans including QHPs. Final contracts with insurers for providing QHP coverage through the FFE must be signed by September 27. If the Trump administration is going to defund the CSRs, now is the time it will do it.
The back story on the CSR issue can be found in my post on July 31, while the intervention decision is analyzed in my post on August 1. This post focuses on issues that will need to be resolved going forward if the Trump administration decides to defund the CSRs.
The Choices Insurers Would Face If CSR Payments Were Ended
First, insurers would have to decide whether to continue to participate in the exchanges. Those in the FFE have a contractual right to drop participation for the rest of 2017, but how exactly they would do this would depend on state law, and would probably require 90 days notice. Insurers would also not be able to terminate the policies of individuals covered through the exchange, although once the insurers left the exchange premium tax credits would cease and many policyholders would drop coverage. Insurers that tried to leave immediately would likely suffer reputational damage, and those that could financially would likely try to hold on until the end of the year.
Some insurers might well decide that the government is an unreliable partner and give up on the exchanges for 2018. Indeed, some would conclude that the individual market is too risky to play in at all. The individual market makes up a small part of the business of large insurers; even though it has become more profitable in the recent past, some insurers might conclude that the premium increases that would be needed to make up for the loss of the CSRs would drive healthy enrollees out of the individual market. Rather than deal with a deteriorating risk pool, they might leave the individual market entirely (although they would probably have to give 180 days notice to do so.)
Insurers that decide to stay would have to charge rates that would allow them to survive without the $10 billion dollars the CSR payments would provide. They would need to raise premiums significantly to accomplish this. How they did so would depend on guidance that they got from their state department of insurance or possibly from the Centers for Medicare and Medicaid Services.
The California Experience
On August 1, 2017, Covered California announced its 2018 rates. The California state-based marketplace is an example of how the Affordable Care Act can work in a state that fully supports it and has a big enough market to form a balanced risk pool. For 2018, the average weighted rate increase in California is 12.5 percent, of which 2.8 percent is attributable to the end of the moratorium on the federal health insurance tax. Consumers can switch to plans that will limit their rate change to 3.3 percent in the same metal tier. All 11 health insurers in California are returning to the market for 2018 (although one insurer, Anthem, is leaving 16 of the 19 regions in which it participated for 2017) and 82 percent of consumers will be able to choose between three or more insurers. About 83 percent of hospitals in California participate in at least one plan.
Covered California instructed its insurers to file alternate rates that would go into effect if the Trump administration abandons the CSR payments. The insurers were instructed to load the extra cost onto their silver (70 percent actuarial value) plans, since the CSRs only apply to silver plans. The alternative rates filed by the insurers project that if the CSRs are not funded, they would have to essentially double their premium increases, hiking premiums by an additional 12.4 percent.
Virtually all of this increase would be absorbed by increased federal premium tax credits for those with incomes below 400 percent of the federal poverty level. As the premium of the benchmark second-lowest cost silver plan increased, so would the tax credits. A Covered California study concluded that the premium tax credit subsidy in California would increase by about a third if the CSR subsidies are defunded.
Bronze, gold, and platinum plan premiums would not be affected by the silver plan load. As the premium tax credits increased, many more enrollees might be able to get bronze plans for free, and gold plans would become competitive with silver plans in price. More people would likely be eligible for premium tax credits as people higher up the income scale found that premiums cost a higher percentage of their household income.
Consumers who are not eligible for premium tax credits would have to pay the full premium increase themselves. Covered California has suggested, however, that insurers load the premium increase only onto silver plans in the exchange, since CSRs are only available in the exchange. Insurers would likely encourage their enrollees who are in silver plans in the exchange to move to similar products off the exchange that are much more affordable. Bronze, gold, and platinum plans would cost more or less the same on or off the exchange.
Other States Would Likely Make Different Choices Than California’s
It is likely that not all states would follow California’s lead. If state departments of insurance do not allow insurers to increase their premiums, more insurers would leave the individual market. If state departments require insurers to load the CSR surcharge onto all metal-level plans, both on and off the exchange, bronze, gold, and platinum plans would be more expensive and individual insurance would become much more costly for all consumers who are not eligible for premium tax credits. If insurers leave the market or consumers drop coverage, more consumers would end up using care they cannot afford, increasing medical debt and the uncompensated care burden of providers, and of hospitals in particular.
Some insurers in other states have likely already loaded a substantial surcharge onto their 2018 premiums in anticipation of CSR defunding and of other problems, such as uncertainty about the Trump administration enforcing the individual mandate. If insurers in fact profit from excessive rates, consumers might eventually receive medical loss ratio rebates, but 2018 rebates would not be paid out until late in 2019, if the requirement is still on the books by then.
Other Ramifications Of Ending CSR Payments To Insurers
CSR defunding could have other effects as well. Insurers have been reimbursed each month for CSRs based on an estimation of what they are paying out to actually reduce cost sharing. Each year the insurers must reconcile the payments they have received with those they were actually due. Insurers were supposed to have filed their reconciliation data for 2016 by June 2, 2017, and were supposed to be paid any funds due them, or to refund overpayments, in August. Reconciliation payments may also be due in some situations for 2015. If the administration cuts off CSR payments, it could conceivably cut off reconciliation payments as well.
Finally, defunding of CSRs would likely have an effect on risk adjustment payments as well. The risk adjustment methodology has been set for 2018 in the 2018 payment rule. It would likely not be amended for 2018 in light of the CSR defunding. Defunding would increase the statewide average premium on which risk adjustment payments are based. This would generally exaggerate the effects that risk adjustment would otherwise have. In particular, insurers with heavy bronze plan enrollment would end up paying more in, while insurers with more gold or platinum plans might receive higher payments.
Looking Forward
President Trump claims to see the CSR payments as a “bailout” to insurers, which surely they are not. They are a payment for services rendered, much like a Medicare payment to a Medicare Advantage plan. The effects of defunding would reverberate throughout out health care system, likely causing problems far beyond those identified in this post.
Fortunately, Senators Alexander (R-TN) and Murray (D-WA), the chair and ranking member of the Health, Education, Labor, and Pensions Committee, have announced that they will begin hearings on a bipartisan approach to health reform when the Senate returns in September, and funding of the CSR payments for at least a year seems to be at the top of their list. A bipartisan group of House members has also called for funding the CSRs. And pressure to fund the CSRs continues from the outside, with the National Association of Insurance Commissioners calling for it again last week. It is to be hoped that President Trump will not take steps that would sabotage the individual market and that a solution can quickly be found to the CSR issue that will bring stability to the market going forward.
See the original article Here.
Source:
Jost T. (2017 August 2). What could happen if the administration stops cost-sharing reduction payments to insurers? [Web blog post]. Retrieved from address https://healthaffairs.org/blog/2017/08/02/what-could-happen-if-the-administration-stops-cost-sharing-reduction-payments-to-insurers/
4 Ways Employers can Prepare for Healthcare Changes
With all the proposed changes coming to healthcare. Take a look at this article by Mark Johnson from Employee Benefit News and see what you can do to prepare yourself and your employees for that call the changes coming to healthcare.
The new healthcare bill, revealed by U.S. Senate Republicans Thursday, could bring significant changes to organizations and their employees. Granted, there’s a long way to go before any Obamacare replacement legislation is signed. But health insurance is a complex component of running any business, and it’s important that employers start preparing for what might come.
Here are four actions items employers should be addressing now.
1. Create a roadmap. A compliance calendar is a helpful tool in identifying major deadlines. Employers are legally obligated to share health insurance and benefits updates with their employees by certain dates. Employees must be given reasonable notice — typically 30 days prior — of a major change in policy. There will likely be a set date for compliance and specific instructions around notice requirements that accompany the new legislation.
One step to compliance is adhering to benefit notice requirements. Benefit notices (i.e., HIPAA, COBRA, Summary Plan Descriptions, Special Health Care Notices, Health Care Reform, Form 5500 and others) vary by the size of the organization. Other steps can be more involved, such as required changes to plan design (e.g., copays, deductibles and coinsurance), types of services covered and annual and lifetime maximums, among others. Create a compliance calendar that reflects old and new healthcare benefit requirements so you can stay on track.
2. Rally the troops. Managing healthcare compliance spans several departments. Assemble key external and internal stakeholders by department, including HR, finance, payroll and IT.
Update the team on potential changes as healthcare legislation makes its way through Congress so they can prepare and be ready to execute should a new bill be signed. HR is responsible for communicating changes to employees and providing them with information on their plan and benefits. Finance needs to evaluate how changes in the plan will affect the company’s bottom line. Payroll must be aware of how much of an employee’s check to allocate to health insurance each month. In addition, payroll and Human Resources Information Systems (HRIS) are used to track and monitor changes in employee population, which helps employers determine benefit notice and compliance requirements. All departments need to be informed of the modified health insurance plan as soon as possible and on the same page.
3. Get connected. It’s essential to verify information as it’s released, via newsletters, seminars, healthcare carriers, payroll vendors and consultants. These resources can help employers navigate the evolving healthcare landscape. Knowledge of changes will empower an organization to handle them effectively.
4. Evaluate partnerships. There’s no better time for employers to examine their current partners, from an insurance consultant or broker to the accounting firm and legal counsel. An employer’s insurance consultant should be a trusted adviser in working on budgeting and benchmarking the company plan, administering benefits, evaluating plan performance and reporting outcomes. Finding an insurance solution that meets a company’s business goals, as well as its employee’s needs, can be accomplished with a knowledgeable, experienced insurance partner.
Staying ahead of healthcare changes is essential for organizations to have a smooth transition to an updated healthcare plan. Strategic planning, communication among departments and establishing the right partnerships are key. Employers must be proactive in addressing healthcare changes so they are ready when the time comes.
See the original article Here.
Source:
Johnson M. (2017 June 23). 4 ways employers can prepare for healthcare changes [Web blog post]. Retrieved from address https://www.benefitnews.com/opinion/5-ways-employers-can-prepare-for-healthcare-changes
Rising Healthcare Costs Hurting Retirement Contributions
The rising costs of healthcare are starting to have a negative impact on employees. Find out how employees are having trouble saving for their retirement thanks to the rise of healthcare costs in the interesting article by Paula Aven Gladych from Employee Benefit News.
Rising healthcare costs have had a dramatic impact on the ability of workers to save for retirement and other financial goals.
The latest Bank of America Merrill Lynch Workplace Benefits Report finds that of the workers who have experienced rising healthcare costs, more than half say they are contributing less to their financial goals as a result, including more than six in 10 who say they are saving less for retirement.
What’s more, financial stress also is playing a big role in employee physical health with nearly six in 10 employees saying it has had a negative impact on their physical well-being. This stress weighs most heavily on millennials at 68%, compared with baby boomers at 51%, according to the research.
Because of these dire statistics, more and more employees are looking to their employer to help them through financial challenges.
“We spend a lot of our waking time working and a lot of our finances are made up of the compensation and benefits our employer provides,” says Sylvie Feast, director of financial guidance services for Bank of America Merrill Lynch. “[Employer’s] healthcare and 401(k) plans are really valued by employees. I don’t think it’s surprising that they are looking to their employer that provides essential benefits to help provide access to ways to better manage their finances.”
And because employers offer healthcare and retirement benefits, it isn’t a stretch for workers to expect their employers to offer financial wellness as a benefit as well, Feast says.
“There’s no silver bullet, but a continuing evolution of trying new things to see what works and has an impact with the workforce,” Feast says. “Culture has something to do with it.”
Online tools, educational content, professional seminars in the workplace and personal consultations can be especially effective offerings, Feast says, adding that those options can help employees get more comfortable talking about their finances at work and at home with their family.
“People are pretty private about their finances,” Feast says. “I think there’s this access the employer needs to provide, but there also needs to be an arms-length distance so it is not the employer delivering it.”
Retirement savings is the area most workers want help with, according to Bank of America Merrill Lynch’s survey. More than half of baby boomers (54% ), 53% of Generation X and 43% of millennials say they need help saving for retirement, with 50% of all respondents ranking it as their No. 1 financial issue.
For millennials, good general savings habits and paying down debt were their next most important financial priorities. For Generation X, paying down debt, good general savings habits and budgeting all tied for second, and for baby boomers, planning for healthcare costs and paying down debt were their next biggest financial priorities.
Eighty-six percent of employees surveyed say they would participate in a financial education program provided by their employer, according to Bank of America Merrill Lynch.
Financial education is a slow, but worthy process, Feast says.
“People don’t just automatically start to show an immediate impact to their behavior,” she says. But, “if [employees] take steps, [they] will start to gain control and get more confidence.”
See the original article Here.
Source:
Gladych P. (2017 June 7). Rising healthcare costs hurting retirement contributions [Web blog post]. Retrieved from address https://www.benefitnews.com/news/rising-healthcare-costs-hurting-retirement-contributions
Would States Eliminate Key Benefits if AHCA Waivers are Enacted?
If lower premiums were a possibility, would states actually enact waivers to exclude certain essential health benefits? Check out this article from the Kaiser Family Foundation to learn more about the possible result of giving states the power to use waivers when it comes to healthcare coverage.
As the debate over amending health insurance market rules continues, proponents of changing the law have proposed reducing the health benefits provided by non-group plans as a potential way to lower premiums in the market. The Affordable Care Act (ACA) prescribes 10 categories of essential health benefits that non-group and small-group policies must cover, and provides in most cases that the scope of these benefits should be similar to those in employer group health plans, which cover most non-elderly Americans. The American Health Care Act (AHCA), which passed the House of Representatives on May 5, would permit states to seek waivers to amend the required benefits if doing so would achieve one of several purposes, including lowering premiums.1 We look below at the benefits covered by non-group plans before the ACA as a possible indication of how states could respond to the waiver authority under the AHCA.
Background
The lack of coverage for benefits such as maternity and mental health care in many nongroup plans, which was a frequent point of criticism when the ACA was debated, was one (but not the only) reason why non-group coverage was less expensive before the ACA was enacted. In the pre-ACA market, certain benefits were excluded to make coverage more affordable and to guard against potential adverse selection by applicants with more predictable, chronic health care needs. Even with the ability to medically screen applicants for non-group policies, some insurers excluded coverage for conditions such as mental health and substance abuse care unless states required that they be covered.
States determined coverage requirements for health insurance policies prior to the ACA. A few states defined a standard benefit package to be offered by insurers in the nongroup market. Most states adopted some mandates to cover or offer specific benefits or benefit categories – such as requirements for policies to cover maternity benefits or mental health treatments. In addition to deciding which categories of benefits must be included or offered, states might also specify a minimum level or scope of coverage; for example, a few states required that mental health benefits have similar cost sharing and limits as other outpatient services (sometimes called parity).
Pre-ACA non-group plans varied considerably in scope and comprehensiveness of coverage, with some plans limiting benefit categories or putting caps on benefits, while others offered more comprehensive options. For example, some plans did not cover prescriptions, others covered only generic medications or covered a broader range of medications subject to an annual cap, while still others covered a more complete range of medications. This diversity was possible because insurers generally were able to decline applicants with pre-existing conditions, and could require their existing customers to pass screening if they wanted to upgrade to more comprehensive benefits. This prevented applicants from selecting the level of coverage they wanted based on their known health conditions, but also prevented many people from being able to obtain non-group coverage at all.
To look more closely at the benefits provided in pre-ACA non-group plans, we analyzed data submitted by insurers for display on HealthCare.gov for the last quarter of 2013. Beginning in 2010, insurers submitted information about their non-group plans to be displayed on HealthCare.gov; the data includes information on benefits, coverage levels for each benefit, benefit limits, premiums and cost sharing parameters, and enrollment. We focus here on the benefits and benefit limits. We use data from 2013 because it is the most current year prior to when the ACA’s major insurance market changes went into effect, provides more benefit categories than some earlier years, and has more information about benefit limits for each category. We note, however, that the ACA prohibition on annual dollar limits took effect shortly after enactment and was phased in between 2010 and 2013, so these types of limits would likely not be reflected often in data we received. This means that our analysis likely misses some of the limits (for example, dollar limits on prescriptions) that existed in nongroup policies before the ACA was enacted. We limit the analysis to plans where insurers report enrollment in the product upon which the plan is based. Our methods are described in more detail in the appendix.
Results
The data include 8,343 unique plans across 50 states and the District of Columbia. We looked at the percentage of plans that included coverage for major benefit categories. Not surprisingly, all of the plans covered basic benefits such as inpatient hospital services, inpatient physician and surgical services, emergency room services, and imaging services, while virtually all (99%) covered outpatient physician/surgical services, primary care visits, home health care services, and inpatient and outpatient rehabilitation services.
Certain other benefits, however, were covered much less often (Figure 1). Large shares of plans did not provide coverage for inpatient or outpatient mental/behavioral health care services (38% each), inpatient or outpatient substance abuse disorder services (45% each), and delivery and inpatient care for maternity care (75%).2 In addition, 6% of plans did not provide coverage for generic drugs, 11% did not provide coverage for preferred brand drugs, 17% did not provide coverage for non-preferred brand drugs, and 13% did not provide coverage for specialty drugs.
Even when coverage was provided, some policies had meaningful limits or restrictions for certain benefits. Mental/behavioral health care is a case in point. Among plans with coverage for outpatient mental/behavioral health services, 23% limited benefits for some or all mental/behavioral services to fewer than 30 visits or sessions over a defined period (often a year) and 12% limited it to 12 or fewer. A small share (about 5%) of plans providing coverage for outpatient mental/behavioral health services provided benefits only for conditions defined as severe mental disorders or biologically-based illnesses or applied limits (such as visit limits) if the illness was not defined as severe or biologically based. The definitions of these terms varied by state.3
Similarly, for plans covering outpatient substance abuse disorder services, 22% limited the benefit to fewer than 30 visits or sessions; 12% limited it to 12 or fewer. In many of these plans, visits for either mental health or substance abuse care were combined to apply toward the same limit.
Among the relatively few plans that provided coverage for delivery and inpatient maternity care, a small share (3%) applied separate deductibles of at least $5,000 for maternity services and some plans (6%) applied a separate waiting period of at least year before benefits were available. A few plans restricted benefits to enrollees enrolled in family coverage or required that the enrollee’s spouse also be enrolled.
Discussion
The ACA raised the range of benefits provided by non-group policies such that the benefits now offered by non-group plans are comparable to those offered in employer group plans. The desire to lower non-group premiums, however, has led policymakers to consider allowing states to roll back the essential health benefits prescribed by the ACA.
Among the pre-ACA policies we reviewed, virtually all included benefits for certain services: hospital, physician, surgical, emergencies, imaging, and rehabilitation. Other services were covered less often, including prescription drugs, mental/behavioral health care, substance abuse disorder care, and coverage for pregnancy and delivery. This latter group of services all have some element of predictability or persistency that make them more subject to adverse selection. For example, many people use drug therapies over long periods and would be much more likely to select policies covering prescriptions than people who do not regularly use prescription drugs. If states were to drop any of these services from the list of essential health benefits for non-group plans, access to them could be significantly reduced.
The difficulty is that insurers would be very reluctant to offer some of these services unless they were required in all policies because people who need these benefits would disproportionately select policies covering them. In the pre-ACA market, insurers were able to offer products with different levels of benefits because they generally were able to control who could purchase them by medically screening new applicants. Even existing customers faced medical screening if they wanted to change to a more comprehensive policy at renewal. Through these practices, insurers were able to avoid the situation where people could choose cheaper policies when they were healthy and upgrade to better benefits when their health worsened. The proposed AHCA market rules, however, would not guard against this type of adverse selection, because people with pre-existing health conditions would be able to select any policy offered at a standard premium rate, and change their selection annually without incurring a penalty, as long as they maintained continuous coverage. This means that the range of benefits provided by insurers in states with essential health benefit waivers would likely be more limited than what insurers offered in the pre-ACA non-group market. Benefit choice might be particularly limited in states that specify only a few benefits as essential.
It is hard to imagine that insurers would cover certain benefits if they were not required. For example, some insurers before the ACA did not offer mental health benefits unless required by a state, even when they could medically screen all of the applicants. And given the current problems with substance abuse in many communities, insurers would be reluctant to include coverage to treat them unless required. Offering these benefits as an option (for example, including them in some policies but not in others), would result in very high premiums for optional benefits because people who know they need them would be much more likely to choose them.
The AHCA presents state policymakers with a dilemma: they can reduce the essential health benefits to allow less expensive insurance options for their residents, but doing so may eliminate access to certain benefits for people who want and need them.
See original article Here.
Source:
Claxton, G., Pollitz, K., Semanskee, A., Levitt, L. (14 June 2017) Would States Eliminate Key Benefits if AHCA Waivers are Enacted? [Web Blog Post] Retrieved from address https://www.kff.org/health-reform/issue-brief/would-states-eliminate-key-benefits-if-ahca-waivers-are-enacted/
GOP’s Health Bill Could Undercut Some Coverage In Job-Based Insurance
Thanks to the new legislation passed by Congress health care is on the verge of changing as we know it. Check out this interesting article by Michelle Andrews from Kaiser Health News on how these changes to healthcare will affect Americans who get their healthcare through an employer.
This week, I answer questions about how the Republican proposal to overhaul the health law could affect job-based insurance and what the penalties for not having continuous coverage mean. Perhaps anticipating a spell of uninsurance, another reader wondered if people can rely on the emergency department for routine care.
Q: Will employer-based health care be affected by the new Republican plan?
The American Health Care Act that recently passed the House would fundamentally change the individual insurance market, and it could significantly alter coverage for people who get coverage through their employers too.
The bill would allow states to opt out of some of the requirements of the Affordable Care Act, including no longer requiring plans sold on the individual market to cover 10 “essential health benefits,” such as hospitalization, drugs and maternity care.
Small businesses (generally companies with 50 or fewer employees) in those states would also be affected by the change.
Plans offered by large employers have never been required to cover the essential health benefits, so the bill wouldn’t change their obligations. Many of them, however, provide comprehensive coverage that includes many of these benefits.
But here’s where it gets tricky. The ACA placed caps on how much consumers can be required to pay out-of-pocket in deductibles, copays and coinsurance every year, and they apply to most plans, including large employer plans. In 2017, the spending limit is $7,150 for an individual plan and $14,300 for family coverage. Yet there’s a catch: The spending limits apply only to services covered by the essential health benefits. Insurers could charge people any amount for services deemed nonessential by the states.
Similarly, the law prohibits insurers from imposing lifetime or annual dollar limits on services — but only if those services are related to the essential health benefits.
In addition, if any single state weakened its essential health benefits requirements, it could affect large employer plans in every state, analysts say. That’s because these employers, who often operate in multiple states, are allowed to pick which state’s definition of essential health benefits they want to use in determining what counts toward consumer spending caps and annual and lifetime coverage limits.
“If you eliminate [the federal essential health benefits] requirement you could see a lot of state variation, and there could be an incentive for companies that are looking to save money to pick a state” with skimpier requirements, said Sarah Lueck, senior policy analyst at the Center on Budget and Policy Priorities.
Q: I keep hearing that nobody in the United States is ever refused medical care — that whether they can afford it or not a hospital can’t refuse them treatment. If this is the case, why couldn’t an uninsured person simply go to the front desk at the hospital and ask for treatment, which by law can’t be denied, such as, “I’m here for my annual physical, or for a screening colonoscopy”?
If you are having chest pains or you just sliced your hand open while carving a chicken, you can go to nearly any hospital with an emergency department, and — under the federal Emergency Medical Treatment and Active Labor Act (EMTALA) — the staff is obligated to conduct a medical exam to see if you need emergency care. If so, they must try to stabilize your condition, whether or not you have insurance.
The key word here is “emergency.” If you’re due for a colonoscopy to screen for cancer, unless you have symptoms such as severe pain or rectal bleeding, emergency department personnel wouldn’t likely order the exam, said Dr. Jesse Pines, a professor of emergency medicine and health policy at George Washington University, in Washington, D.C.
“It’s not the standard of care to do screening tests in the emergency department,” Pines said, noting in that situation the appropriate next step would be to refer you to a local gastroenterologist who could perform the exam.
Even though the law requires hospitals to evaluate anyone who comes in the door, being uninsured doesn’t let people off the hook financially. You’ll still likely get bills from the hospital and physicians for any care you receive, Pines said.
Q: The Republican proposal says people who don’t maintain “continuous coverage” would have to pay extra for their insurance. What does that mean?
Under the bill passed by the House, people who have a break in their health insurance coverage of more than 63 days in a year would be hit with a 30 percent premium surcharge for a year after buying a new plan on the individual market.
In contrast, under the ACA’s “individual mandate,” people are required to have health insurance or pay a fine equal to the greater of 2.5 percent of their income or $695 per adult. They’re allowed a break of no more than two continuous months every year before the penalty kicks in for the months they were without coverage.
The continuous coverage requirement is the Republicans’ preferred strategy to encourage people to get health insurance. But some analysts have questioned how effective it would be. They point out that, whereas the ACA penalizes people for not having insurance on an ongoing basis, the AHCA penalty kicks in only when people try to buy coverage after a break. It could actually discourage healthy people from getting back into the market unless they’re sick.
In addition, the AHCA penalty, which is based on a plan’s premium, would likely have a greater impact on older people, whose premiums are relatively higher, and those with lower incomes, said Sara Collins, a vice president at the Commonwealth Fund, who authored an analysis of the impact of the penalties.
See the original article Here.
Source:
Andrews M. (2017 May 23). GOP's health bill could undercut some coverage in job-based insurance[Web blog post]. Retrieved from address https://khn.org/news/gops-health-bill-could-undercut-some-coverage-in-job-based-insurance/