To ensure our clients have the most up-to-date information regarding health care reform and other health care issues, the Leavitt Group offers a variety of services and educational material. Some of these services include:
- Full-time ERISA attorney.
- HealthReformUpdates.com (website) – includes timely updates and in-depth information regarding health care reform.
- Monthly health care reform update webinars covering the latest information and trends. Clients can sign up for email updates and “tweets” to stay informed.
We have also created this timeline as a useful reference which outlines the start dates of several laws regarding health care reform:
HEALTH CARE PROVISIONS AFFECTING PLAN SPONSORS
2012
- Annual dollar limits on essential health benefits must be at least $1.25 million for plan years beginning on or after September 23, 2011 and before September 23, 2012.
- Additional claims and appeals requirements. Non-grandfathered plans must provide additional information in claim denials and include a statement on non-English language services if 10 percent of county population is literate only in that non-English language.
- PCORI Fee (Comparative Clinical Effectiveness Fee). Insurers and self-funded health plans must pay an annual fee of $1/enrollee for the first plan year, fees increase through 2018 plan year. First payment is due July 31, 2013 for calendar year plans.
- W-2 Reporting of Value of Health Coverage. Employers who issued more than 250 W-2s in 2011 must report on 2012 W-2s (issued by 1/31/13) the value of 2012 health care. In January 2012 identify the plans and costs to be reported and ensure payroll collects data.
- Medical Loss Ratio (MLR) rebates. Insured health plan sponsors who receive MLR rebates from carriers must allocate the “plan assets” portion of the rebate among participants; rebates should be paid by August 1, 2012.
- Women’s preventive services, coverage with no cost-sharing. Non-grandfathered plans and policies must provide, for plan years starting on or after August 1, 2012; and must communicate availability of such coverage to plan participants.
- Uniform Summary of Benefits and Coverage (SBC) & Uniform Glossary. Health insurers and group health plans must provide SBCs and Uniform Glossaries to applicants and enrollees, as of the first open enrollment beginning on or after September 23, 2012.
- Mid-year material modifications to information in SBC. Plan must provide 60-day advance notice to participants.
- Quality of care reporting. Plans and insurers will have to report annually to HHS & provide report to enrollees at open enrollment. HHS was supposed to issue reporting requirements by March 2012.
2013
- Annual dollar limits on essential health benefits must be at least $2 million for plan years beginning on or after September 23, 2012 and before January 1, 2014.
- $2500 annual limit on employee pre-tax contributions to HFSAs.
- Medicare retiree drug subsidy, change in tax treatment. Employers who provide retiree drug coverage and receive a federal subsidy may no longer take a tax deduction for the subsidy amount they receive.
- Notice of health insurance exchanges and federal subsidies. Employers must provide notices to employees by March 1, 2013. Government has not yet provided templates.
- Additional Medicare payroll tax on “high-earners.” Employers must ensure an additional 0.9 percent Medicare tax (2.35 percent, up from 1.45 percent) is withheld from paychecks of employees as of the pay period the employer pays wages over $200,000.
- Medicare tax on investment income of “high-earners.” Employers are not responsible to withhold this new 3.8 percent Medicare tax, but may want to notify employees of it.
- Itemized tax deduction threshold for health expenses (for individuals) rises from 7.5 percent to 10 percent of AGI, except that for taxpayers 65 and older it remains at 7.5 percent through 2016.
- Initial open enrollment period for Health Insurance Exchanges for 2014. Begins October 1, 2013 (through February 28, 2014).
- Nondiscrimination rules. Will be effective some period of time after final guidance is issued, and will apply to non-grandfathered insured health plans. Expected to be effective in 2014 or possibly 2013.
- Plans sponsors must continue to provide required HCR notices; e.g., grandfather notice, notice of participants’ right to select PCP for non-grandfathered plans.
2014
- Individual mandate. Requires U.S. citizens and legal residents to have minimum essential health coverage or to pay a tax for failing to have coverage. Tax is the greater of: $95/person/year or 1 percent of household income in 2014; $325/person/year or 2 percent of household income in 2015; but increases to $695/person/year or 2.5 percent of household income in 2016 (cap of $2,085/family).
- Health insurance exchanges. Virtual insurance markets. State-based health benefit exchanges for individual market, and Small Business Health Options Program (SHOP) for small group market (up to 100 employees, or states can limit to up to 50 in 2014). Federal exchange will apply in states that have not (yet) set up state-based exchanges.
- Employer shared responsibility provisions. “Large” employers (more than 50 employees) must “Pay or Play.” May be subject to penalties if do not offer coverage that meets affordability and minimum value requirements to all employees (and dependents) who work at least 30 hours/week. One of two different penalty levels may apply if eligible employees buy insurance in an exchange and receive a premium tax credit.
- Federal subsidies for health insurance premiums and reduced cost-sharing. Refundable and advance tax credits and cost sharing subsidies for qualifying individuals with household incomes of 100 – 400 percent of the federal poverty level (FPL).
- Guarantee issue and renewability of insurance in the individual and small group markets and in the exchanges. Insurers cannot deny coverage due to pre-existing conditions for applicants of any age (no longer limited to under age 19).
- Modified community rating. Allows insurers to rate only on age (limited to a 3 to 1 ratio), geographic area, family tier, and tobacco use (limited to 1.5 to 1 ratio) in the individual and small group market and on the exchanges.
- No annual dollar limits on essential health benefits.
- Wellness plan limits (HIPAA). Employers may offer employees wellness rewards of up to 30 percent (up from 20 percent) of the total cost of coverage under the employer group health plan, if employees participate in a wellness program and meet certain health-related standards.
- Coverage of clinical trials. Non-grandfathered plans must provide coverage for routine medical costs for participants in clinical trials. Plan years beginning on or after 1/1/14.
- Nondiscrimination rules. Will be effective some period of time after final guidance is issued and will apply to non-grandfathered insured health plans. Expected to be effective in 2014 or possibly 2013.
- Small business tax credits of up to 50 percent of employer cost of providing employee health insurance, if employer purchases it through an insurance exchange for two years. Applies for small employers with no more than 25 employees and average annual wages of less than $50,000.
- Health insurance tax on insurers and re-insurers. Starts in 2014 and is fully implemented in 2018. Tax is on health insurance carrier’s net premiums. Expected that carriers will pass on the additional costs to plan sponsors of insured and self-insured plans. Effective 1/1/14.
2018
- Cadillac tax on high-cost insurance. An excise tax of 40 percent will be imposed on insurers of employer-sponsored health plans if the total benefits cost exceeds $10,200 for individual coverage or $27,500 for family coverage.
The coverages discussed herein are for illustrative purposes only. The terms and conditions of your specific policy may differ from those described. Please consult the provisions of your policy for the terms, conditions, and exclusions that apply to your coverage.
