A Tip From Naama......

Reducing unnecessary emergency room (ER) visits is a great place to start!

When you  use the ER for non-emergencies, you may end up paying a lot more out of your pockets than you would if you went somewhere else. And overuse of the ER can affect everyone’s health care premiums.          

The following are some of the alternative options:

  • Retail health clinic — A clinic staffed by health care experts who give basic health care services to “walk-in” patients. Usually found in a major pharmacy or retail store.
  • Walk-in doctor’s office — A doctor’s office where you don’t already have to be a patient to get care. And you don’t have to have an appointment. Can handle routine care and common family illnesses.
  • Urgent care center — A group of doctors who treat conditions that should be looked at right away but aren’t as bad as emergencies. Can often do X-rays, lab tests and stitches.

Ask Us For More Information About....

Whether it's the densely populated Southern California coast or the mountains of rural Northern California, geography is going to play a larger role in the cost of health insurance under the federal health care overhaul set to take effect next year.

Health insurers are facing new rules and restrictions on how they set prices as part of the Affordable Care Act's aim to expand coverage to millions of Americans. No longer can insurers deny coverage because of a preexisting condition or place lifetime limits on medical care. While a person's age will remain a factor in setting rates, older customers cannot be charged more than three times what younger customers pay.

California also has rejected an option under the federal law that allows health insurance companies to charge smokers up to 50 percent more for their premiums.

All this leaves geography as one of the few ways insurers can adjust premiums. The premiums will not be set for most consumers under the law until summer, although estimates are available at the website of California's health benefits exchange

Call Us For More Information at:  818-508-7177

Obamacare and Doctor Choices

Why You Will See Fewer Doctor Choices Under Obamacare
From: Real Health Care Reform


As I’ve discussed before, theAffordable Care Act is going to (perhaps ironically) cause health insurance to become less affordable for most people.  One way insurance companies may try to counteract these rising costs is by narrowing the number of available doctors and hospitals that policyholders can use.

Return of the HMO

In the 1980s, Health Maintenance Organizations, or HMOs, were promoted as a way to keep rising health costs under control.  The way they attempted to do this was to require policyholders to go to a primary care physician first, before they could see any specialist.  Only when the primary care physician approved a visit to a specific specialist, would the care be covered under the policy.

The primary way the HMO tried to reduce expenses was by limiting coverage, and allowing policyholders to only see a small set of physicians that had contracted with the HMO.  As you can imagine, most of these plans became highly unpopular as people had to jump through hoops to get their health care.

With the full implementation of the health care reform law in 2014, these narrow networks are coming back.

Why Networks Will Be Smaller

Starting in 2014, everyone who does not have a grandfathered health insurance plan that went into effect before Obama signed the act into law March 2010 will have to switch to a new government-approved plan.  And, it looks like most of the PPO networks will be much smaller than those currently available to most policyholders.

As you can imagine, the reason smaller networks save insurance companies money is because the companies contract with the least expensive providers.  So, as a policyholder, if you have a major or complicated health situation, you may end up not being able to see the physicians that may offer you the best chance of a successful outcome.

Another reason carriers will be offering less attractive networks is because they will want to discourage the most unhealthy applicants for applying for coverage.  Starting in 2014, anyone can purchase health insurance, regardless of pre-existing conditions.  An insurance company trying to avoid business is one of the perverse consequences of this misguided law.

What This Means to Yo

If you are one of the millions of people that will be forced to choose a new plan in 2014, in addition to your new premium, you should make sure your physician is in the network, and then look at the size of the network itself.  The plans with the most narrow networks are likely to be least expensive, but balance the money saved against the increased risk you’ll face in a smaller network.

The reason I carry health insurance is to protect against the major unexpected health situations that can wipe out my savings.  I’m not too worried about paying for checkups.  If something major does happen, I want to be able to go to the best doctors out there.

This may not be possible even in the best networks, which is why I’m happy to have a sizable savings built up in my Health Savings Account.   But, I’m still going to be looking very closely at any changes in the PPO network I have access to as I move into 2014.

For all clients of HSA for America, we’ll be sharing detailed information about network availability as that information becomes available.

 

 

Anthem Lowers California Rate Increase

The Los Angeles Times  (2/15, Terhune) reports, "In response to pressure from California regulators, Anthem Blue Cross agreed to a slightly lower rate increase for about 630,000 individual policyholders that will save consumers an estimated $54 million." The average rate increase will now be around 14%, with some customers seeing their premiums increase by as much as 25%. Despite the increase in rates, Anthem "expects to lose money on its individual health insurance business in California this year, primarily because of rising medical costs."

Health Care Reform and Insurance Rate Increases

Why Are Rate Increases Happening Now?

From:  Real Health Care Reform

 

The past few years, we have seen low price increases on medical care, with costs growing less than 4 percent a year over the past three years.   Though various political groups may want to take credit, the main reason that medical inflation has slowed is the sluggish economy.  People are getting laid off, cutting costs, and putting off medical care.  As demand drops, so do prices.

So… why are health insurance rates increasing?

Health insurance rates have been increasing substantially, all across the country.  Ten- to 20-percent rate increases are not uncommon right now.  Some people are attributing this to “greedy” insurance companies, but the situation is actually not so murky.

As families look for ways to cut their costs in a slowing economy, one item that may end up on the chopping block is health insurance.  People who are in good health and not using their coverage much may decide to take a chance, but people with chronic health conditions are more likely to keep their coverage.

As healthy people drop their coverage and unhealthy people retain insurance, the average health of the pool (all those covered) goes down, and the people still insured use more services.  Thus, the rates increase.

What This Has to Do with The Potential Collapse of Obamacare

The next implementation of the Affordable Care Act in January of 2014 will eliminate most underwriting by insurance companies.  Anyone will be able to sign up for a plan, regardless of pre-existing conditions.  An increase in unhealthy people in the insured pool will put further upward pressure on premiums.

In an effort to counter this math, Obamacare is requiring all healthy people to purchase coverage.  It is also requiring the youngest (and generally healthiest) applicants to pay higher premiums in order to subsidize the premiums of older policyholders.  I will not be surprised to see premiums double or even triple for young men.

This system may work out (well, except for the young healthy people facing the biggest rate increases) – but only if everyone plays the game.  If enough people drop out and decide not to carry coverage, then rates further increase for everyone else.

 

Call Our Office For Any Questions:  818-508-7177

 

 

Are Higher Insurance Premiums In Your Future?

Study: One Third Of Health Insurance Policies Could See Higher Premiums Next Year.

The Kaiser Health News   report, "Consumers who buy their own health insurance will see the total amount they could pay out of pocket for medical care capped starting next year, but some will likely pay higher premiums as a result" of the Affordable Care Act. According to a study by HealthPocket, "currently, when deductibles are included, 36 percent of policies offered to individuals on the private market exceed that limit." For the study, the researchers "looked only at policies sold on the private market to individuals, who buy their own coverage because they don't get it through their jobs."

Should You Keep Your Grandfathered Health Insurance Plan?

From: Real Health Care Reform

Grandfathered plans may be the most misunderstood part of health care reform. If you bought a policy before health care reform was enacted, it’s not subject to all the new mandates. That’s all the term “grandfathered” means in this case. Whether you keep one of these policies or upgrade to a new policy can make a world of difference in your health care. Here are the main questions you need to consider.

Would You Benefit from More Fully Covered Health Care?

Grandfathered plans do not have to cover recommended preventive health care. These services are recommended specifically because research shows they help prevent major medical problems, and major expenses, in the long run.  But keep in mind that you are paying for this extra coverage, and many people may be better off with a less expensive plan, and paying for their own preventive care.

How Do My Current Premiums Compare to New Plans?

A grandfathered plan could offer lower premiums because it doesn’t have to include all health care reform required benefits.  The numerous mandates and requirements on new plans are expected to result in large premium increases in 2014.

I recommend being cautious about dropping a grandfathered plan because you won’t be able to get it back once you cancel it or stop paying the premiums.  I think new plans will be more expensive than many grandfathered plans because applications from people who are sick cannot be declined in 2014.  The huge influx of people who need health care is going to put massive upward pressure on premiums.  But the only way to make a smart decision is to compare your current rates with what a new plan would cost.

There’s a similar issue, though not as immediate, with grandfathered plans.  Because these policies are no longer being sold to new applicants, the premium rates for grandfathered policies will probably ultimately rise.  No healthy, young people will be buying those plans, but aging policyholders will need more health care. So ultimately, you may end up eventually changing to a new plan anyway.

Will My Present Plan Qualify for Minimum Coverage in 2014?

Essential benefits to be offered by all newly issued plans next year are still being debated. States have already begun to make different decisions about what basic coverage will be required from plans in their territory.  Some changes taking place in 2014 may be limiting. Your current policy may offer you greater options with provider choices, prescription benefits and more.

If you have a grandfathered plan, then you can keep it even though it will not meet minimum coverage requirements in 2014.  If your coverage started after March of 2010, then you will be forced to get a new plan.

Immigration Reform Proposal Does Not Include Healthcare.

CQ (1/29, Bunis, Subscription Publication) reports, "The estimated 11 million illegal immigrants living in the United States probably would still not qualify for federal health care benefits under an immigration policy overhaul proposed by a group of senators Monday." After outlining the bipartisan proposal, the article notes that "one of the bullet points in the proposal says: 'Current restrictions preventing non-immigrants from accessing federal public benefits will also apply to lawful probationary immigrants.'" This means "that anyone under the probationary status would not be eligible for Medicare, Medicaid or the Children's Health Insurance Program."

A Bit of News About "Covered California"

California has moved ahead in creating an exchange and named it "Covered California". It has received nearly $1.5 billion in Federal and Private Grant funding to have it operational by October 1, 2013 for a January 1, 2014 effective date. It will primarily focus on individuals but will also offer plans for small employer groups. One of the key elements of the exchange will be to administer a Federal Health Insurance Premium Subsidy for individuals and a Federal Health Insurance Tax Credit for small businesses.

Five Answers To Your Health Care Reform Questions

From: Real Health Care Reform


When talking about health care reform, there are still areas about the law that are filled with uncertainties.  Below are the five commonly asked questions about the Affordable Care Act: 

1.    What is the individual mandate?

The individual mandate by the health care reform law requires every American to have a health insurance plan in place by 2014 or pay a penalty.  The annual penalty is $695 or up to 2.5 percent of your income (for 2016 and beyond).

2.    Could I have a waiting period before employer coverage is available?

Companies subject to the employer mandate of the health care reform law (those with 50 or more full-time employees) will have a grace period of 90 days before offering new hires minimum essential coverage without incurring any penalties starting January 2014. On day 91 onwards, failure to offer affordable and adequate employer-sponsored healthcare coverage would mean paying a per person penalty.

3.    What if employers offer coverage that’s unaffordable? 

Employers with 50 or more full-time employees offering unaffordable health care coverage to their workers with at least one full-time employee getting health insurance via the exchange would still have to pay a penalty.  Employers will be fined an annual penalty of $3,000 per full-time employee (the first 30 workers will be excluded).

4.    How does household income determine if a plan is affordable?

Coverage is said to be unaffordable if the employee have to contribute more than 9.5 percent of their family income to employer coverage.  According to the IRS, an employee’s household income will be verified using your tax filings.  For individuals with income levels below 400 percent of the federal poverty guidelines, you’re qualified to get federal premium subsidies in the form of tax credits or free choice voucher.  Under the law, the health insurance exchange will be ready by January 1, 2014.

5.    What is a free choice voucher?

If your employer offers adequate coverage but is not affordable, you can request a free choice voucher from your employer to get health insurance coverage through the state-based health insurance exchange. The amount of the voucher is equal to the amount contributed by your employer for an individual or family plan. The voucher would still be tax deductible for employers.  Take note that you can choose either the premium tax credit available via the exchange or get the free choice voucher from your employer.  You cannot get both at the same time.

All Stories

The Employer and the Affordable Care Act

What are the Employer Shared Responsibility provisions?

 

Starting in 2014, employers employing at least a certain number of employees (generally 50 full-time employees and full-time equivalents, explained more fully below) will be subject to the Employer Shared Responsibility provisions under section 4980H of the Internal Revenue Code (added to the Code by the Affordable Care Act). Under these provisions, if these employers do not offer affordable health coverage that provides a minimum level of coverage to their full-time employees, they may be subject to an Employer Shared Responsibility payment if at least one of their full-time employees receives a premium tax credit for purchasing individual coverage on one of the new Affordable Insurance Exchanges. 

To be subject to these Employer Shared Responsibility provisions, an employer must have at least 50 full-time employees or a combination of full-time and part-time employees that is equivalent to at least 50 full-time employees (for example, 100 half-time employees equals 50 full-time employees). As defined by the statute, a full-time employee is an individual employed on average at least 30 hours per week (so half-time would be 15 hours per week).

Important News on Your Health Insurance Premiums!

Will Your Health Insurance Premiums Be Higher in 2014?

From:  Real Health Care Reform


Today, you have access to plans catastrophic plans with high deductibles, but many such plans will disappear in 2014. Fortunately, catastrophic plans with more limited benefits will still be available for people under age 30. According to a senior fellow at the Urban Institute, Linda Blumberg, adding more benefits is tantamount to premium hikes. Premiums will also increase on younger people, because they will be subsidizing older insureds.  Young men will also be subsidizing the premiums for women, so they can expect the largest rate increases.

The health care reform law also mandated a lot of added health care benefits that are responsible for some of the increases in health insurance premiums. The removal of underwriting starting in 2014 will also result in much higher claims, and are expected to further drive costs up.

And, that’s not all that’s changing in 2014.  Preventive care services are already covered with no out-of-pocket costs, but people are treated quite differently once they get sick. If they have to buy their own policy on the individual market, applicants with pre-existing conditions may find their application is denied.  That’ll change as of 2014 and they’ll have guaranteed acceptance then. But, insurance companies will increase premiums in
order to cover added claims.

For those who find it impossible to pay for health insurance, the Affordable Care Act provides federal subsidies. Tax credits will be provided to individuals with incomes below 400 percent of the federal poverty level if they get health care coverage via a state exchange. According to the Department of Health and Human Services, compared to the cost of health insurance under the current rules, the tax credits could help a family of four with an income of $33,525 save $14,900.

How to Save on Health Insurance Right Now

Of course, with 2013 just rolling into view, you have opportunities to save on your health insurance right now.  We offer our Annual Comprehensive Policy Review to see if a plan is available that has either a lower premium or more comprehensive coverage than your current plan.  This is a free service and it comes with no obligation. December is one of the best times to compare health insurance.  That’s because companies hand out rate hikes for Jan. 1.  If you find a plan with 2012 rates this month, you can probably avoid switching to higher premiums for a whole year.

If you qualify, we can also help you establish a Health Reimbursement Arrangement.  This can enable married self-employed people to legally run all their medical and insurance expenses through the business, saving potentially thousands in taxes every year.

 

Too Bad That My Prediction is Coming True.

Health Insurance Premiums Rise Nationwide. NBC Nightly News (1/8, story 7, 2:20, Williams) reported, "Now to an unwelcome surprise for millions of Americans this new year, health insurance premiums that are causing sticker shock, double-digit increases in some places, suddenly a whole lot of families are watching this happen in the era of the so-called Affordable Care Act, better known as Obamacare." NBC (Myers) added, "Some insurance companies in California including Anthem Blue Cross, Aetna and Blue Shield of California are proposing rate increases of 20% or more for some individual customers. ... And it's not just California. In Florida and Ohio, insurers have instituted double-digit rate increases. New York, which unlike California has power to roll back rates, has generally held increases below 10%. Overall, medical costs are projected to rise only 7.5% this year, so some experts are puzzled by the double-digit premium increases, and question whether it has something to do with the Obamacare law, which will bring big changes next year."

Exciting News for Baby Boomers

New Devices Help Baby Boomers Stay In Their Homes.

The Detroit Free Press (12/26, Erb) reports, "From talking pill dispensers to tracking devices tucked inside tennis shoes to digital medical scanners that can transmit vital signs to the doctor, today's gadgets help seniors stay in their homes and can give relief to loved ones and caregivers." Now, "the new gadgets - once available only to hospitals and the wealthiest consumers - are accessible now to more modest-income homes."

Your Business and Health Care Reform

Does Your Business Face Health Care Reform Penalties?
From: Real Health Care Reform


1. How do you know if your business is subject to the employer mandate?

The threshold for compliance can be determined with this formula, which you calculate on a monthly basis:

Take the number of employees working full-time (those who average more than 30 hours a week for the month) and add that to the number of hours part-time employees worked during the month plus 120 hours. That’s how to figure the full-time equivalence or FTE for employees who don’t work at least 30 hours a week.

2. How much will it cost to meet the new coverage requirements?

That can differ depending on your operation, as well as how minimum coverage is defined through the regulatory process.

3. What is the premium tax credit?

There is a federal subsidy to be used by those earning an amount up to 400% of the federal poverty level to help them afford coverage. The tax credit is available through the state health insurance exchanges, which play a vital role in certifying whether people are eligible for the premium tax credit.

4. Do all small businesses have to provide coverage?

No, only some do.  Employers who have less than 50 full-time-equivalent employees cannot be subjected to the employer tax penalties.

5. Does the new law require part-time workers to be covered?

No, not necessarily. Part-time employees (those working an average of less than 30 hours per week) are counted only to determine whether a small business owner meets the 50 full-time equivalent threshold that’s required under the law. The employer responsibility section of the law does not require employers to provide health care coverage to part-time employees, or to pay health care penalties.

6. Who will have to pay a penalty for not providing health care coverage?

That will fall on employers whose business meets that 50 full-time equivalent standard. Those employers may opt not to provide health care coverage to full-time employees, but it could result in a penalty. If at least one employee uses a premium tax credit to get coverage at a state exchange, the employer will be subject to pay a penalty of $2,000 per full-time employee per year (or $167 per month).

Small business owners may exclude the first 30 full-time employees when calculating this penalty. For example, let’s say an employer has 60 full-time employees and does not offer health insurance coverage, but one or more employees use a premium tax credit on the state exchange.  That employer could face a yearly penalty of $60,000, assuming a constant workforce.  That would be figured as 60 total full-time employees minus the 30 full-time employees excluded from the calculation.  The result would be 30 employee times the $2,000 penalty giving a $60,000 penalty.  And, it should be noted that the penalty is computed and assessed on a monthly basis.

7. What type of health coverage would need to be offered to full-time employees?

Business owners who employ more than the 50 full-time equivalent of employees need to provide affordable “minimum essential coverage” with at least a 60-percent actuarial value in order to meet what the law requires. “Minimum essential coverage,” however, is still being defined through the regulatory process.

 

 

US Mental Healthcare Examined

Newtown Tragedy Provides Impetus To Examine US Mental Healthcare.

 

NBC Nightly News (12/17, story 5, 1:25, Williams) reported, "This tragedy in Newtown, Connecticut has already ignited a national conversation about guns, as we have just seen." However, mental illness has been a "component...in all the serious gun crimes we have covered. One in 17 Americans lives with a serious mental illness, that's according to the government, and their symptoms range in severity, of course. But fewer than a third of them receive treatment." Chief medical editor Nancy Snyderman, MD, explained, "Less than 10% of our healthcare dollars are spent on mental healthcare." While well-to-do people can pay for care and the poor may get some care through Medicaid, other people fall through the cracks.

Lawmakers Call For Conversation On Mental Health Issues. CQ    (12/18, Attias, Subscription Publication) reports, "Lawmakers in both chambers are calling for Congress to start a conversation about mental health issues in the wake of last week's deadly shooting at a Connecticut elementary school, with one goal of ensuring adequate funding for services for those who need treatment." Even though "much of the discussion since last week's shooting has focused on gun policy, several members are also emphasizing the role mental illness has played in many national tragedies." But, "beyond a broader policy push, the shooting in Connecticut could also make it more difficult for Congress to allow spending reductions for mental health services as part of the fiscal cliff, deficit reduction efforts or the appropriations process next year."

Health Care Reform and Your Business

How Will Health Care Reform Affect My Business in 2013?

From:  Real Health Care Reform

 

2013 is here!  How will the mandates of health care reform affect your business, and what do you need to change about the way you provide health care benefits? Here are answers to some of the most commonly asked questions to help you decide.

1. What’s my deadline for complying with health care reform?

For businesses with 50 or more full-time employees, you have until 2014 to provide “adequate” and “affordable” health care coverage or face penalties. If your business employees less than 50 full-time workers, you are exempt from penalties, but you are still required to carry personal health insurance.

2. Will I be required to provide health care benefits to all employees?

You are required to provide affordable “minimum essential coverage” to workers if you have 50 or more employees working full time beginning in 2014. Failure to do so would mean paying a $2,000 “per person” penalty (although the first 30 workers are not included in that).

For part-time employees, you are not required to provide health care coverage, but remember there is a full-time equivalent of part-time workers.

3. How do I figure the full-time equivalent?

To get the FTE, determine the number of employees who work 40 or more hours weekly.  Then, add up wages paid to part-time employees, and divide the total by 2,080. The FTE is equal to the number of full-time employees and full-time equivalent part-time employees, and the total is rounded to the lowest whole.

4. Is my business eligible for small business tax credits, and when do those start?

Certain small businesses with up to 25 full-time-equivalent (FTE) workers that contribute to employees’ health insurance are eligible to get tax credits.  That began January 1, 2010. To learn more, you can visit the IRS website http://www.irs.gov/uac/Small-Business-Health-Care-Tax-Credit-for-Small-Employers.

5. Are health benefit costs reported on W-2 forms taxable?

Health benefit costs reported on the W-2 are not taxable.

6. Are my two companies each considered as separate employers?

Not necessarily. Check with your tax advisor if you are defined as a single employer under the “Common Control” clause found in the tax code [IRC Sections 414 (b), (c), (m), (o)]. If you’re considered as a single employer, all your full-time employees in both companies will be combined together. If the number totals 50 or more, you will have to provide affordable coverage with minimum essential benefits.

Businesses and Health Care Reform

One Thing Health Care Reform Did Not Change For Your Business
From: Real Health Care Reform


Under federal regulations, businesses are prohibited from directly paying for employees’ individual health insurance premiums and medical expenses without the use of an HRA (Health Reimbursement Arrangement), or another tax-free arrangement that is IRS/HIPAA/ERISA qualified.

The two main reasons for this are that 1) Such payments make it would look as if the company is endorsing an individual health insurance policy, and 2) These direct payments would be taxable income to employees.

By paying directly for workers’ individual health plans, according to federal law, a company is treating the policy as if it’s part of an employer-sponsored plan that is regulated by ERISA (Employee Retirement Income Security Act).  The problem here is that your company can be out of compliance with the act because many policies fail to meet the minimum ERISA requirements for group plans.

Your company can also be in violation of HIPAA-privacy requirements because employers are not permitted access to their staff’s HIPAA-protected medical cost details.  That includes the medical expenses covered by health insurance.

The federal government has developed guidance explaining how companies can avoid ERISA and HIPAA regulation violations.  And, to ensure your company does, set up an HRA that is HIPAA and ERISA compliant.  With an HRA, your company can legitimately reimburse employees for medical costs and for health insurance premiums.

Even though, this is the very last month of the year, businesses still have until December 31 to set up an HRA for 2012. This can allow the business to reimburse for the entire year’s health insurance expenses.  Small business owners can see how to establish an HRA, which may help cut health insurance expenses in half, at 105 HRA Plans for Small Business Owners. An HRA is also an option for certain sole proprietors, who can learn more about this at 105 HRA Plans For The Self-employed.

Once established, very minimal administration is required to maintain an HRA.  And, employers have a lot of flexibility in how they wish to structure arrangements.  Employees can also be easily added or removed from HRAs, and because these are reimbursement plans, little upfront funding is

Health Care Reform News for those Under 30.

Under 30?  Here's What You Need To Know On Health Care Reform

From: Real Health Care Reform



The health care reform law, according to the Congressional Budget Office (CBO), tends to increase health insurance premiums for people who are young and healthy. According to the CBO, health insurance premiums will rise ten to thirteen percent, unless you qualify for the subsidy, while you’re still shy of 30.  I predict that for most, it will unfortunately be much ore than that.

The CBO estimates about 57 percent of customers will receive federal tax credits that will cover almost two-thirds of their total premiums. This could reduce costs below what is being charged for such policies now, depending on your income level. The law has set up four levels of health benefits: bronze, silver, gold and platinum. Tax credits are intended to cap health insurance premiums at between two percent and 9.5 percent of your income, based on the cost of the silver option.

New Special Rules For Young Adults

If you’re under 30, you have an option that’s not available to older people under Obamacare. High-deductible plans that aren’t generally available will continue to be for young adults. That’s true, in part, because it’s anticipated that most of them will require less health care than older individuals who develop chronic, expensive health problems. And, since high deductibles equate to lower premiums, the writers of this law are hoping this will convince healthy young people to invest in coverage.

Even though the state health insurance exchanges, which will start operation in October, will be offering catastrophic health plans with minimal coverage for persons under 30, tax credits won’t be available to offset the price of premiums. Catastrophic coverage prices are typically on the low end, anyway.

Existing Rules That Remain In Force

Like all other plans, these policies will completely cover recommended preventive health care services even when the deductible has not been met if: (1) you go to an in-network doctor, and (2) the services are billed by the provider as preventive, instead of diagnostic.

Once someone reaches age 30, they will be required to purchase a more expensive, lower deductible plan.

 

 

This Week in Health Care Reform

How A Defined Contribution Plan Can Lower Business Benefit Costs
From:  Real health Care Reform


If you are a business owner, you have plenty to do simply running your business.  Do you also have to be in the health insurance business?  With ObamaCare requirements, it is going to become increasingly expensive to provide group health insurance coverage.  One strategy many business owners are taking is setting up Defined Contribution Plans.
 
Defined contribution plans can be set up with a Health Reimbursement Arrangement, or HRA.  This allows your business to reimburse employees for their health insurance or other medical expenses, as a tax-free fringe benefit.  A health reimbursement arrangement (HRA) can provide employees with a monthly allowance with which they can buy coverage through a state health insurance exchange.  An HRA can act as a business expense account specifically for health care.
 
The biggest hurdle involves HIPAA privacy obligations for dealing with personally-identifiable health information (PHI).  These obligations apply to employers offering HRAs, which are basically self-insured health plans.  And, failure to comply with HIPAA can subject a company to up to $100 per violation in civil penalties.
 
To avoid that, have medical expenses substantiated by a third-party.  Substantiation must confirm that the expenses have a medical basis, which means dealing with the specifics that get into the realm of privacy violations.
 
Thus, your business must have written PHI privacy procedures and must also appoint a privacy officer.  That officer needs to set up how employees can file complaints and a process for responding to complaints.  It’s that officer who will be responsible for ensuring PHI is kept separate from decisions about benefits and employment.
 
With that handled, your business can use an HRA to reimburse employees for dental and health care on a 100-percent tax-free basis.  That includes the cost of health insurance premiums.  When an HRA meets three requirements, the HRA money employees receive is deductible for the business and it’s excluded from gross income for employees. Here are those requirements:
 
1.    A medical connection must exist.
2.    Employee expenses must be substantiated.
3.    Employees must return amounts they receive that exceed actual expenses.
 
The steps to set up an HRA are straightforward:
 
1.    Choose an administrator.
2.    Setup the plan by specifying what makes employees eligible, how reimbursement works, and a monthly allowance.
3.    Then, provide HRA documents to employees and enroll them.
 
Having employees selecting their own policy greatly reduces administrative overhead, as does having third-party oversight.  HIPAA-compliant claims officers can substantiate and process employee requests for reimbursement up to the HRA balance.  Once the initial set-up work is finished, the business can maintain the HRA with a minimum of time to free up HR for other work.