The Wall Street Journal first reported on the concept of “bare-bones”; or “skinny plans in May of this year (2013).
Then just this week (August 25, 2013), Kaiser Health News (KHN) published a story on the idea.
And since I have suggested the strategy to two of our clients to date (and mentioned it to untold numbers of colleagues and prospective clients), I thought I would make it the focus of this week’s blog post. Depending on the employer, the particular situation, or the industry, this strategy has the potential of saving affected employers thousands of dollars per year in associated ACA penalties.
As the 2014 open enrollment season comes to a close (bringing an overwhelming sense of relief and joy to HR professionals and Benefits Brokers/Consultants throughout the land!), I thought I’d review the major Affordable Care Act (ACA) related compliance issues addressed in preparation for the new (benefits) year.
Early plan renewal 12/1/13: Since many of the ACA related changes affect plans on their first plan anniversary date on or after January 1, 2014;, several health insurers offered (and many employers accepted) to change plan anniversary dates to 12/1/13.
This week’s post is dedicated to explaining one of the many new provisions of the Affordable Care Act (ACA) which is scheduled to be implemented in 2014 – MODIFIED COMMUNITY RATING (MCR for the rest of this blog post). Let me begin by stipulating which stakeholders this provision affects and which it does not:
MCR applies to health insurers in the Individual and non-grandfathered, fully insured, Small Group (less than 50 employees) markets, for plan/policy years effective on or after January 1, 2014.
MCR does NOT apply to large (50+ employees) fully insured groups, and partially self funded health plans of any size. (Note: once large group plans are permitted to be marketed in the exchanges/marketplaces…
OBESITY:
– has roughly the same association with chronic illness as 20 years of aging
– is associated with a 36% increase in inpatient and outpatient healthcare spending
– is associated with a 77% increase in medications
– is the number two (2) cause of preventable death in the U.S!!!
But until just recently, obesity was NOT considered a DISEASE. In June of this year (2013), the American Medical Association’s (AMA) House of Delegates voted to officially declare obesity a disease. To quote AMA board member Dr. Patrice Harris,
As someone who makes his living in the healthcare and health insurance industries (for nearly 30 years), I am often asked the question – how can we fix what is broken in our healthcare system, and assure that every citizen has access to care? More recently, I get the question – do you believe the Affordable Care Act (ACA) will be successful?
In attempting to answer these, and other healthcare reform related questions, I always start with the fundamental issue that our nation struggles to address; which is, do we desire a government run, universal, single payer system (see Canada, much of Europe, etc.), or a market based, largely private run, profit based system, such as the type we presently have?
The title of this entry says it all…”Madison Avenue meets the Affordable Care Act (ACA)”. It was announced today (7/25/2013) that the White House has authorized spending $684 million on a massive, national “publicity, marketing, and advertising” campaign to help promote and educate on the ACA. According to recent surveys, more than three quarters of the uninsured population (the veritable targets of the ACA) know little to nothing about the law. Their confusion is likely fueled by various government officials squabbling over various tenets of the law, to say nothing of the early July announcement delaying the so called employer mandate provision of the ACA. Research conducted by the Associated Press discovered that the massive Advertising and Promotion budget will not necessarily be evenly distributed.
Two recent blog posts informed of a one-year delay in implementing two parts of the Affordable Care Acts so called employer mandate – the reporting requirements and the associated pay-or-play penalties. Last week, the Treasury Department issued official guidance (in the form of Notice 2013-45) that clarifies the delay. Here are a few key points and implications extracted from the guidance:
Three specific ACA requirements (enforceable through IRS code) are affected by this delay:
1. Employers with self-funded plans, insurers, and other providers of health coverage will be required to submit a detailed report to the IRS concerning the health coverage it provided and the individuals to whom the coverage was provided.
Now that the dust has somewhat settled on last weeks exciting (and interestingly timed) announcement delaying the Affordable Care Acts so called “employer mandate”, let;s examine some of the fallout.
Technically speaking, the mandate itself was not delayed, but rather, the employer reporting aspect of the law. However, in effect, delayed reporting = delayed mandate. Once the seemingly universal exuberance over the announcement began to dissipate, the questions from policy wonks and stakeholders began to fly. The most significant question being – “how will the health insurance exchanges/marketplaces verify subsidy eligibility…
On June 26, 2013, the U.S. Supreme Court announced its decision regarding the constitutionality of the federal Defense of Marriage Act of 1996 (DOMA). The Court struck down Section 3 of DOMA, which limited marriage to opposite sex unions for purposes of federal law.
In a 5-4 decision, the court found this definition to be a violation of equal protection rights under the U.S. Constitution, holding that same-sex couples who are legally married under state law will be entitled to equal treatment under federal law with regard to income taxes and federal benefits. However, the Courts ruling does not establish a constitutional right to same-sex marriage.
The high courts decision will impact employers in states that…
Late this afternoon (7/2/2013), the Obama administration announced that it is DELAYING THE EMPLOYER MANDATE (also known as “employer shared responsibility” and “pay or play”) until 2015. In turn, the Treasury Department announced that – “it would delay its enforcement an entire year after hearing numerous concerns from employers about the challenges of its implementation”. Specifically, the assistant secretary for tax policy – Mark Mazur – said – “We have heard concerns about the complexity of the requirements and the need for more time to implement them effectively.
