For one year, White House revives health plans canceled under ACA
Originally posted November 14, 2013 by Tristan Lejeune and Brian M. Kalish on https://ebn.benefitnews.com
President Barack Obama announced that Americans whose health care plans have been canceled because they fall short of Affordable Care Act standards have been granted a one-year reprieve. With the decision, state governors and insurance commissioners would have the authority to keep would-be canceled plans active until the end of 2014.
“The Affordable Care Act is going to work for the American people,” Obama said from the White House briefing room in remarks that opened with sympathy and support for the typhoon-ravaged Philippines. Obama acknowledged that his team “fumbled the roll-out of the health care law,” but he hopes that extending existing plans will help win “back the confidence of the American people.”
The decision, which helps live up to a promise Obama made when pushing for passage of health reform, is couched as an administrative fix that says following ACA will not require insurance companies to upgrade their plan for individuals who have been in these existing plans so far. In what the White House is calling “an extension of grandfathering principle” Americans should now all be able to re-enroll in their current coverage so long as it is still offered by their provider.
“Two important things we require from insurance companies,” says the administration, “one is they notify consumers what protections these renewed plans do not include. And two, they notify consumers that they will have new options available on the marketplace that offer better coverage, and tax credits are available for many people.”
Insurers and participants in the individual and small group markets will not be considered noncompliant in these plans next year. This is a policy “targeted and very targeted” to those individuals who are in those policies today, it is not allowing to be sold to people not in plans. IN other words, the policy change only applies to extant plans; all new plans must comply with Obamacare in full.
Next year is an election cycle for 33 senators and the entire House of Representatives. This move will widely be seen as trying to appease voters furious about having their plans canceled after pledges were repeatedly made that exactly that would not happen.
State authorities can still decide to consider plans non-compliant next year and insist insurers get up to speed.
Obama said that Healthcare.gov enrollment is “absolutely not” where he wants it to be, “but there’s no question that there’s great demand for high-quality health care,” and he urged health care consumers not to try to throw out the baby with the bathwater and return to the landscape circa 2009.
“It’s important that we pretend that that’s not a place worth going back to,” Obama said. “And that’s why I will not accept proposals that are just a brazen attempt to overturn the law and go back to a broken system.”
He added: "This fix won't solve every problem for every person but it will help a lot of people. Doing more will require work with Congress."
Make Tax Day Also Enrollment Deadline, One Health Expert Says
Originally posted November 7, 2013 by Julie Appleby on kaiserhealthnews.org
With one small fix, the administration could satisfy calls from some members of Congress to extend the time people have to enroll in new health insurance through online marketplaces, a health policy expert says.
The fix would not create problems in the industry and would move the deadline to a point when many people have a little extra money, says Brian Haile, senior vice president for health policy at tax preparation firm Jackson Hewitt.
Haile says pushing the current March 31 deadline to April 15 would ensure more people have cash from tax refunds to buy insurance – and would not really change the effective date of coverage beyond the current deadline.
That’s because there is a mid-month cutoff for coverage to begin on the first day of the following month. Policies for those who sign up at the end of March or on tax day would be the same: May 1.
While no specific new open enrollment end date has been proposed by lawmakers, several members of Congress of both parties are considering legislation amid the ongoing difficulties with healthcare.gov, the federal insurance website operating in 36 states.
Insurers are generally opposed to an extension, saying they based their premium rates for next year on the idea that the enrollment period would end March 31. Delaying the penalty for not having coverage or extending the open enrollment period could result in higher premiums in the future, the industry’s trade lobby has warned.
Actuaries say that insurers assumed in their premium calculations that most people would sign up by mid-December for coverage to begin Jan. 1, granting them an entire year of premium revenue.
Insurers also are concerned that the problem-plagued federal healthcare.gov website has increased chances that the people who soldier through the hassles of enrolling are likely to be those with costly medical conditions who were shut out of coverage previously. Healthy customers are needed to balance the risk – and cost — in the insurance pool. Add to that the talk of extending enrollment deadlines, and insurers see more revenue slipping away, eaten up by medical inflation and fewer months to collect premium payments during the year.
Looking at expected medical inflation for next year, every month’s delay probably corresponds to an average of two-thirds of 1 percent higher cost for the insurers, said David Axene, fellow of the Society of Actuaries. “That starts to creep into the amount of margin built into rates.”
Haile, a former director of the Insurance Exchange Planning Initiative of Tennessee, argues that granting a short enrollment extension could help insurers pick up additional younger or healthier consumers. Some of those customers may have been sitting on the sidelines because they are strapped for extra cash until they get their tax returns.
Insurers “are not going to lose revenue, but will pick up some young invincibles,” Haile said.
Although federal officials are not talking about changing the enrollment period – they see getting the website fixed as the top priority — the administration has moved to resolve an issue about timing. The problem was that even though the law allows the enrollment season to continue until the end of March, anyone purchasing a policy after Feb. 15 would have faced a penalty. So the administration granted an extra six weeks for people to avoid a penalty in 2014 for not having coverage. The tax penalty is $95 or 1 percent of household income, whichever is greater.
Why employers need to pay attention to ACA's insurance exchanges
Originally posted November 06, 2013 by Al Karr on www.federaltimes.com
When the Affordable Care Act first passed, most self-insured employers thought they wouldn't need to pay much attention to the new health insurance exchanges (or marketplaces) created by the law. After all, they were intended to help uninsured people get access to insurance, and their employees were obviously insured. And President Obama did promise that if people liked their employer coverage, they would get to keep it. So there wasn't really anything for self-insured employers to worry about, right?
Well, it turns out that things aren't that simple. Employers do need to pay attention to the exchanges that have launched in their states — either by the state or the federal government — because even if their employees don't use them, the functioning of the exchanges depends pretty heavily on some critical interactions among exchanges, employers, and their employees.
Most employers are aware by now that the requirement for large employers to offer coverage has been delayed for one year. But there are still many provisions in the ACA that place burdens and obligations on employers related to the exchanges. Most importantly, all employers (regardless of whether they currently offer insurance) must still provide notification to their employees describing the exchanges, and explaining the implications of applying for a tax credit on the exchange. There are also regulatory processes for exchanges to verify with employers information that individuals provide on exchange enrollment applications.
So employers are starting to realize that they really do need a communications strategy for how to tackle exchange education with their employees. Simply mailing the required notification form to all employees and calling it a day won't cut it.
Confused employees
Employees are going to have questions — lots of them. Some have been following the health care reform discussion, and those that hadn't been following it probably are now, thanks to the major issues the federal exchange has been having since its launch on October 1. Employees are seeing TV ads, print ads in magazines and newspapers, in addition to the media coverage on the exchange launch. And policy experts have noticed that some of these advertisements are totally devoid of any mention that the exchange is Obamacare or the ACA, and most don't mention anything at all about the individual mandate and that the exchanges are how to fulfill the mandate.
Employees could come into contact with navigators, certified application counselors, or in-person assisters (individuals hired by exchanges to assist with enrollment), all of which will be emphasizing the exchanges and the individual mandate, but probably don't know much about employer-sponsored plans in general, let alone each individual's circumstances regarding employer-sponsored coverage.
Recent polls have shown that as many as half of Americans believe the ACA was either repealed, or held unconstitutional, so these messages will no doubt be confusing for employees to hear. Despite all of the media coverage of the disastrous exchange launch, there are still people out there who might know about exchanges, but don't know what the ACA means to them.
Employers should be taking action now to devise a communications strategy aimed at their employees that is relevant to their workforces and fits appropriately within their company cultures. We all know that employees don't read the volumes of (boring) information employers provide during open enrollment season. Educating employees about exchanges is going to require a different and more ongoing approach. Some of the tactics employers should consider include:
- Human resources staff should be meeting with executive leadership to devise and invest in an employee communications strategy
- Contracting with a call center to do outbound calling to every employee
- Requiring all employees to meet face-to-face with an HR staff member
- Producing short videos about the exchanges for use in company communications
- Requiring attendance at "all staff" meetings
- Creating one-pagers to post on company intranet sites or to distribute through company newsletters
Navigators
One thing that has been discussed by some employers, but that may not be the best thing to rely on as a sole tactic, are the navigators. While a lot of organizations have become navigators, there is general agreement among policy makers that the program itself is woefully underfunded. And since some exchanges are run by states themselves, and the federal government runs others, it’s anticipated that the number of navigators hired and the training they will receive will vary from state to state. Also, there is no statutory requirement that navigators be trained on the nuances of employer-sponsored coverage, so there is no guarantee that they will be able to answer employees' questions about the coverage they are offered at work.
How Employers Can Prepare for PPACA Compliance in 2014
Where has 2013 gone?
Has 2013 left you with questions about Benefit Reform, Human Resources, Retirement Reform or what's coming in 2014? Don't worry! We have an expert from each department to answer your questions. See how talking with our experts can give you the insight you need during health care reform.
Event Details
Time: Lunch will be served at 11:30 a.m.
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When we say experts, we mean EXPERTS
Jamie Charlton and Frank Lopez were on a recent episode of Business Talk. Watch the video now to hear what they had to say about Health Care Reform, how it will effect you, and what employers need to know moving forward.
Speakers
Jamie Charlton, CFP
Is it time to offer your employees more?
Show your employees that their company understands the impact this payroll tax change has had at home and that you are there to help them by offering a Financial Wellness Workshop.
We will come on-site to conduct a Lunch & Learn.
Almost Half Of Workers Don’t Know What Impact Affordable Care Act Will Have On Them
Originally posted November 06, 2013 on https://www.insurancebroadcasting.com
Online resources cited as most reliable source of information about law
COLUMBIA, S.C.--(BUSINESS WIRE)--A survey conducted online by Harris Interactive on behalf of Colonial Life & Accident Insurance Company shows nearly half of American workers don’t feel knowledgeable about how the Affordable Care Act will impact them personally.
“Despite all the attention the Affordable Care Act has received in the past few years, nearly half of American workers still say they don’t know much about it”
In a poll of more than 1,000 U.S. employees (full-time and/or part-time)1, 47 percent of workers say they are not very knowledgeable or not at all knowledgeable about the impact the Affordable Care Act will have on them. Thirty-three percent say they’re not very knowledgeable about the law and its proposed personal impact, and 14 percent say they’re not at all knowledgeable.
“Despite all the attention the Affordable Care Act has received in the past few years, nearly half of American workers still say they don’t know much about it,” says Steve Bygott, assistant vice president of core market services at Colonial Life.
In other survey findings, 48 percent of workers say federal government websites are the most reliable source of information about the ACA and its personal impact on them. They rated internet or other online news sources as the next most reliable, cited by 44 percent of employees. Other sources viewed as reliable options include:
Their employers or HR departments
36 percent
Insurance company websites or literature
30 percent
TV news programs
25 percent
Printed magazines or newspapers
20 percent
Family or friends
18 percent
Other
8 percent
“Workers clearly need help understanding this law and its personal impact on them and their families,” says Bygott. “Because employers are viewed as one of the top three sources of reliable information on this topic, they have a tremendous opportunity to help their workers get the information they need when they communicate their benefits programs.”
Survey results were included as part of a white paper recently published by Colonial Life called “Beyond Health Care Reform.” The research paper outlines what employers should know about health care reform, employee benefits and the subsequent need for increased benefits education.
Survey Methodology
This survey was conducted online within the United States by Harris Interactive on behalf of Colonial Life from September 3-5, 2013 among 2,046 adults ages 18 and older, among whom 1,023 are employed full-time or part-time. This online survey is not based on a probability sample and therefore no estimate of theoretical sampling error can be calculated. For complete survey methodology, including weighting variables, please contact Jeanna Moffett at Colonial Life at JMoffett@ColonialLife.com.
1 Online survey conducted within the United States for Colonial Life & Accident Insurance Company by Harris Interactive, Sept. 3-5, 2013, among 2,046 U.S. adults age 18 and older, among whom 1,023 are employed full-time or part-time.
Cost of benefits, ACA compliance main concerns of midsized businesses
Originally posted by Andrea Davis on https://ebn.benefitnews.com
The cost of health coverage, the Affordable Care Act and the volume of government regulations are the top three concerns of midsized business owners and executives, according to a new survey from the ADP Research Institute.
Seventy percent of midsized businesses – those with between 50 and 999 employees – surveyed said their biggest challenge in 2013 is the cost of health coverage and benefits. ACA legislation came in as the No. 2 concern, cited by 59%, a 16% increase over last year. And rounding out the top three list of concerns was the level and volume of government regulations, cited by 54%.
“What was a surprise to us was that midsized business owners’ level of confidence in their ability to comply with the laws and regulations doesn’t reflect reality,” says Jessica Saperstein, division vice president of strategy and business development at ADP.
For example, the survey finds that, overall, 83% of midsized businesses are confident they’re compliant with payroll tax laws and regulations, nearly one-third reported unintended expenses – fines, penalties or lawsuits – as a result of not being compliant.
“The majority say they’re confident but many of them are experiencing these fines and penalties,” says Saperstein. “On average, it’s about six times a year and the average cost of one of these penalties or fines is $90,000.”
Nearly two-thirds of benefits decision-makers at midsized companies are not confident they understand the ACA and what they need to do to be compliant. Ninety percent aren’t confident their employees understand the effects of the ACA on their benefits choices.
Self-insured win partial PPACA fee exemption
Originally posted October 28, 2013 by Dan Cook on www.lifehealthpro.com
Self-insured employers and self-administered health plans are about to catch a break, thanks to fine-tuning of the Patient Protection and Affordable Care Act by the Department of Health and Human Services.
In a soon-to-be-published compendium of rule modifications, HHS says it will exempt certain self-insured employers from the second two years of paying the reinsurance fee.
HHS says the proposed modifications — of which there are quite a few — are the result of its “listening” sessions with interested parties about specific requirements of the act. The full list can be found in the proposal, “Program Integrity: Exchange, Premium Stabilization Programs, and Market Standards; Amendments to the HHS Notice of Benefit and Payment Parameters for 2014.”
HHS doesn’t offer a whole of detail on the exemption matter. It says in order to address employer feedback that the fees are burdensome, it will accept payment of the fee in two chunks instead of one (at the beginning of 2014 and at the end of the year) and will “exempt certain self-insured, self-administered plans from the requirement to make reinsurance contributions for the 2015 and 2016 benefit years” in future rulemaking and/or guidance proposals.
However, all employers will be required to pay the first-year fee for the program, which begins in 2014.
The 2014 fee for the three-year Transitional Reinsurance Program was set at $63 per plan participant. Fee levels have not been set for 2015 and 2016.
The fees are designed to yield $25 billion over the three-year program – money that would help offset costs incurred by insurers covering high-cost individuals purchasing coverage in public insurance exchanges.
HHS’s missive addressed other matters, including what happens when a small company buys small group insurance, and then it becomes a large company. The employer can keep the small group insurance package as long as it doesn’t make substantial modifications to it. But if discontinues small group coverage, it will then have to purchase insurance through the large group exchanges.
HHS also promised to provide further guidance on the sticky issue of what constitutes a fulltime employee for purposes of the all-important employee head count.
The proposals are scheduled to be published in the Federal Register on Wednesday.
Most workers worry benefits will fall short
Originally posted October 18, 2013 by Dan Cook on benefitspro.com
The twin promises of “affordable” and “protection” contained in the Patient Protection and Affordable Care Act sound great. But they’re not enough, at least yet, to assuage the health insurance concerns of most employees.
Because most folks still receive health insurance at work, the throw-the-cards-up-in-the-air nature of health care reform has people worried that their employer may not provide coverage that protects them from the vagaries of life.
That’s the major contention of a white paper from Colonial Life & Accident Insurance Co., which advises employers that they need to look at their benefits plan from a holistic viewpoint if they want it to serve as a recruiting and retention tool.
“Although medical insurance is the cornerstone of a good benefits package, we encourage employers to think about their benefits as a whole right now,” intoned Steve Bygott, assistant vice president of core market services at Colonial Life. “Small and large employers face ongoing cost concerns, in addition to new legal requirements, that challenge their ability to remain competitive. Taking their eye off the big picture of employee benefits could be a costly mistake.”
Employers need to reassure their workers that their coverage will protect them and their families from both routine and unforeseen medical costs — if it does. And if not, employers need to address coverage gaps and serve as a resource to employees for filling those gaps in a cost-effective manner.
When Colonial’s researchers delved into whether employees trusted that their coverage would offer enough protection and be affordable, here’s what they found:
- 83 percent of U.S. employees (full-time and/or part-time, with or without coverage) are at least somewhat concerned about their ability to pay for health premiums.
- 82 percent are concerned with expenses no longer covered by their health insurance plan and the addition of or an increase in co-payments and deductible amounts.
- 81 percent express concern about unexpected medical expenses (emergency room visits, major surgery, etc.).
Given this level of concern, Colonial’s white paper emphasized the need to master a way to talk to workers about health coverage so that their concerns could be alleviated.
“Both large and small employers will need to pay more attention to benefits communication in the years ahead to help them attract and retain a strong workforce,” said Bygott. “Workers will look to their employers to provide them with good, reliable information so they can make the best benefits decisions for themselves and their families.”
Colonial suggested that employers that can’t afford to pay for coverage for their workers offer them voluntary benefits combined with a clear education about how those benefits work and what they cost.
"Voluntary benefits and personalized benefits education can be a tremendous asset to employers looking for a cost-effective way to offer a competitive benefits package," says Bygott. "Though health care reform has everyone asking lots of questions now, staying focused on the big picture will help employers stay competitive in the long run."
Can Obamacare Beat Your Employer's Insurance?
Originally posted October 14, 2013 by Susan Ladika on https://finance.yahoo.com
If you already have health insurance through your job, you're probably wondering whether Obamacare will give you some new options. Will you be able to comparison-shop for a plan on the new online exchanges that might be better than your employer health insurance? The answer is a big, resounding "maybe."
Like almost everything else having to do with health care reform, there are plenty of nuances and caveats. Trying to decipher them and choose the best health insurance plan for your situation "makes homeowners insurance seem really simple," says Brian Haile, senior vice president for health policy at the tax services company Jackson Hewitt.
Exchanges will be open to all, but ...
The exchanges are online health insurance marketplaces set up under the Affordable Care Act. In 34 states, the marketplaces operate through the federal government's HealthCare.gov website, while 16 states and the District of Columbia are running their own exchanges.
Even if your employer already offers health insurance, there's nothing to prevent you from shopping on your state's exchange. However, if you decide to leave your work-based plan and purchase coverage on the exchange, you "may not qualify for some of the benefits that the uninsured have," notes E. Denise Smith, a professor of health care management at Gardner-Webb University in Boiling Springs, N.C.
Here's the big hiccup: Unless your employer's coverage for an individual is considered unaffordable under the law (that is, if your share of the premiums costs more than 9.5 percent of your household income) or inadequate (picking up less than 60 percent of the cost of covered benefits), you aren't eligible for a government subsidy to help pay for your insurance. Subsidies are one of the things that can make plans on the new state exchanges appealing.
Subsidies in the form of tax credits are available even if you earn up to 400 percent of the federal poverty level, currently about $46,000 for an individual and $94,000 for a family of four. The subsidies vary based on income and the size of your family.
Trade in your employer plan?
And that brings us back to the central question: If you have employer health insurance, should you check out the Obamacare exchanges anyway? There are differing opinions.
"It would generally not benefit an employee to leave their employer-sponsored plan," Smith concludes, adding that your employer would be under no obligation to help pay for an exchange plan.
Haile says you may not be able to do better than your work-based coverage. "Look at how robust your employer plan is" and the benefits it provides, such as whether it includes dental and vision care, which are not part of the essential health benefits that must be offered with plans sold in the Obamacare exchanges, he says.
Still, if your employer-sponsored health insurance seems to eat up a big chunk of your budget, you might want to explore your options on the state exchange, Haile says.
Few workers have 'unaffordable' plans
Again, one of the key criteria of whether you'd qualify for subsidized insurance through your state's exchange is if your share of the premium for an individual health plan where you work would amount to more than 9.5 percent of your household income. Whether you take more expensive family coverage doesn't matter; the benchmark is what an individual policy would cost.
The rule means that someone earning $40,000 a year and paying $3,775 for individual coverage would not be eligible for a subsidy, says Brian Poger, CEO of Benefitter, a software company that's helping employers navigate their way through health care reform. That same worker paying even more for family coverage would still not be eligible because, again, the premium for an individual is less than $3,800 (or 9.5 percent of $40,000).
The 9.5 percent-of-income threshold is one that few workers would meet, according to one recent study. The ADP Research Institute found that only 8.6 percent of employees are required to pay premium contributions that would meet the Affordable Care Act's definition of "unaffordable."
How will you know whether your premiums and income put you in that group and make you a good candidate for an exchange plan? Right now, it's a little unclear.
"The answer is sort of a mish-mash," Haile says. Many of Obamacare's employer requirements were delayed until 2015, though companies were still supposed to provide notices by Oct. 1 telling workers whether their current coverage would be considered affordable. But the U.S. Labor Department says there's no fine or penalty for failing to provide the notices.
Exchange coverage for family members
Under those same delayed "employer mandate" provisions, companies with at least 50 full-time workers will be required to offer health insurance to their workers and the workers' dependent children in 2015. But coverage for workers' spouses will not be mandatory, notes Christine Barber, senior policy analyst at Community Catalyst, a health care advocacy group.
"If your spouse isn't covered by your employer's insurance and doesn't have insurance through his or her own employer, your spouse could shop for insurance on the exchange and potentially qualify for a subsidy," Barber says.
Others who might find it valuable to shop on the exchanges are working singles under the age of 30 who don't have health issues and would be able to purchase a catastrophic plan, Haile says.
Catastrophic plans available on the state exchanges will have low monthly premiums but high deductibles. According to Haile, they're not eligible for subsidies.
All workers at a particular company often pay the same rate for their employer health insurance, regardless of age or medical history, he says. Opting for an Obamacare catastrophic plan "could be cheaper if you're the young kid on the block," especially if your co-workers are decades older, which could drive up everybody's insurance costs.
Shutdown stalls remaining DOMA guidance
Originally posted October 10, 2013 by Andrea Davis on ebn.benefitnews.com
While much attention has been focused on the federal government shutdown and its effect on Affordable Care Act regulations, employers are still awaiting guidance on another key piece of legislation with benefits plan implications, the Defense of Marriage Act.
“The good news is the most critical guidance has already been issued,” says Todd Solomon, partner in the employee benefits practice of Will McDermott & Emery. “The IRS and DOL have already come out with their notices that explain the state of celebration rule for federal tax purposes so we know the way forward for plan administration.”
Plan sponsors, however, are still awaiting federal guidance on two key issues: retroactivity and the deadline for plan amendments.
“The retroactivity is a bigger issue because plans can and probably will be getting claims with or without the IRS guidance,” says Solomon. “The theory was that the IRS was going to address what employers had to do with retroactivity, and employers were going to hold their breath and hope nothing came with respect to retroactive claims until the IRS guidance came out.”
A delay in the guidance will only affect employers if they get claims for retroactive benefits, says Solomon, with the most likely scenario being a claim for a survivor annuity within a pension plan.
“If a same-sex employee died six months ago, for example, and the plan didn’t pay a survivor benefit to the same-sex spouse, the spouse can make a claim. The plan has to decide whether it’s going to pay that benefit and there’s no clear answer right now on whether the plan is required to,” he says.
“Plans without guidance are in a bit of a box — on the one hand, you could say ‘just pay,’ because that makes the issue go away but, of course, just paying costs money to the trust and if it’s not something that’s required under the terms of the plan, money should never leave a retirement plan trust.”
The IRS also needs to issue guidance about a deadline for when plans need to revise their definition of the term ‘spouse.’
“Absent guidance, it would need to be done by the end of the year,” says Solomon. “If they [federal agencies] want to extend that, they’d need to do that fairly quickly. … it’s not hard guidance to issue so I would guess the shutdown should not impact that too much as long things don’t go on too long.”
Following the Supreme Court’s decision striking DOMA down last June, the Internal Revenue Service and Department of Labor issued regulations adopting a state-of-marriage approach — anyone who is legally married in a state or country recognizing same-sex marriage is now treated exactly the same as an opposite-sex spouse for all qualified plan purposes, including the taxation of medical, dental and vision benefits.