The Affordable Care Act for
Family Law Practitioners
July 10, 2014
LAF & The Sargent Shriver National Center on
Poverty Law
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AGENDA
• 1:00 – 1:45 pm: ACA Overview
• 1:45 – 2:00 pm: Questions
• 2:00 – 2:45 pm: ACA/Family Law Scenarios and
Considerations
• 2:45-3 pm: Questions
ACA Overview:
The Implementation of the ACA in
Illinois
Objectives
This session will help you understand:
• The basics of Medicaid and the Health Insurance
Marketplace in Illinois.
• Who might be eligible for premium tax credits and
cost sharing reductions in the Marketplace.
• Minimum essential coverage (MEC).
• Individual and employer shared responsibility
requirements.
5
The Affordable Care Act (ACA) at a Glance
ACA was signed into law on March 23, 2010 and
the major provisions started on January 1, 2014.
“Health Insurance Marketplaces” opened on
October 1, 2013 across the nation: Get Covered
Illinois is a single entry point for the Illinois
Marketplace and Medicaid enrollment.
Individuals are responsible to obtain health coverage
through an employer, directly from an insurance company
or through the Marketplace, Medicaid or Medicare.
Employers over 50 FTE are responsible for providing
coverage - but employer penalty delayed until 2015/2016
depending on employer size.
6
Four New Ways to Get Covered
#1 New Medicaid Adult Group available to adults age
19-64.
#2 New Insurance Marketplace to buy insurance and
receive financial help to pay for it.
#3 Medicaid available to former foster children up to
age 26 at any income level.
#4 Young adults 19-25 years old can stay on their
parents’ policy.
7
1.8 Million Uninsured in IL – Most Have
New Options for Coverage under ACA
New Consumer Protections for All Insurance
1.
2.
3.
4.
5.
6.
7.
8.
9.
No pre-existing condition exclusions.
Essential Health Benefits must be covered.
Holds insurance companies accountable for rate increases.
Coverage information in plain language.
Preventive services available without cost sharing.
No rescissions.
No lifetime or annual limits on care.
Extended dependent coverage available up to age 26.
Marriage equality.
*There are still some grandfathered health plans that do not need to provide these ACA protections:
http://insurance.illinois.gov/cb/2014/CB2014-04.pdf Also, there are some noncompliant, non-grandfathered plans in the individual
and small group markets that do not have to cover ACA changes until 2016 or 2017:
http://insurance.illinois.gov/cb/2014/CB2014-04.pdf
9
Prevention Services
New private plans offered after Sept. 23, 2010 are required to provide
these new preventive services (and others) without cost sharing
Type of Preventive Service
Alcohol Misuse
HIV
Aspirin
Diet/Obesity
Blood Pressure
Sexually Transmitted Infection (STI)
Cholesterol
Tobacco Use
Colorectal cancer
Breast Cancer/Mammograms
Depression
Immunizations
Type 2 Diabetes
Developmental screening for children
Full list of no cost preventive screenings available:
https://www.healthcare.gov/what-are-my-preventive-care-benefits/
What’s Covered? Essential Health Benefits
11
New Household and Income Considerations
for Families under the ACA
1. Tax Filing Status
2. Household Composition/Size
3. MAGI (Modified Adjusted Gross Income)
Tax Filing Status: Common Terms
There are five (5) filing statuses. (The status is based on
whether you are considered married or unmarried by the
Internal Revenue Service (IRS)):
•
•
•
•
•
Single
Married filing jointly
Married filing separately
Head of Household
Qualifying Widow/Widower with a dependent child
A person’s filing status is based on their marriage status as
of the last day of the calendar year for which taxes are
being filed.
• If more than one status applies, the person can choose the one that gives
them the lowest tax rate.
Why is Filing Status Important?
The tax filing status determines:
• The tax rate; and
• Standard deduction; and
• Eligibility for some tax credits.
• Premium Tax Credits can be claimed by persons who file
as Single, Married Filing Jointly, Head of Household and
Qualifying Widow(er) with a dependent child.
• Premium Tax Credits CANNOT be claimed if
Married but Filing Separately.
Tax Filing Status: Head of Household
A person
may file as
Head of
Household
if:
Unmarried or “considered unmarried” on the last day of the year; AND
Files a separate return; AND
A spouse did not live in the home in the last 6 months of the year; AND
Paid more than half the cost of keeping up a home for the year; AND
Able to claim an exemption for a child (however, this test is also met if
unable to claim the exemption only because the noncustodial parent can
claim the child); AND
Must pay more than half the cost of keeping up the home for a “qualifying
person”
Tax Status and Medicaid
The state considers three factors when
defining a Medicaid household:
• If the person expects to file a tax return; AND
• If the person is a tax dependent on a return; AND
• Relationship of the people who live in the home.
** If a married couple who live together is applying
for children in common, it’s important to know if
they are filing jointly or separately to determine
whether the children use tax filer rules or non-filer
rules to determine their family size.
Medicaid Household Grid
These rules apply to all living situations including people who are homeless.
Include in the
household …
Names you
don’t have to
include
Optional
Names to
include
Tax Filer
Tax Dependent
(regardless of age) of a
parent or step-parent
Applicant
Applicant
All claimed
dependents
The person filing the taxes
Spouse if living in
the home,
whether or not
filing jointly
The spouse of the tax filer
if living in the home
Anyone not on
the tax return
Anyone not on the tax
return
Not a Tax Filer and Not a Tax Dependent
Applicant and the following, if living in the home:
• spouse
• children (biological, adopted, and step)
• parent of their child if applying for the child
If applicant is under 19, include the following
people living in the home:
• parents (biological, adopted, and step); and
• siblings (biological, adopted, and step)
•
•
•
•
unmarried partner not requesting coverage
unmarried partner’s children
if over 19, parents in the home who do NOT
claim you as dependent
other adult relatives and unrelated persons
who file their own tax returns
•unmarried partner if there is a child in common; or
• any other child under age 19 that the applicant takes care of
Determining MAGI
Include in MAGI
Not included in MAGI
• Wages and tips, cash income
• Unemployment compensation
• Taxable amount of pensions, annuities, IRA
distributions and Social Security benefits
from retirement, disability and survivors
benefits (do not include Supplemental
Security Income)
• Business income, farm income, capital
gain, other gains (or loss)
• Dividends and taxable interest
• Tax exempt interest
• Alimony received
• Rental real estate, royalties, partnerships,
trusts, etc.
• Foreign income
• Other income not specifically excluded
• TANF, SNAP, SSI or other public benefits
(LIHEAP, WIC, etc.)
• Child support received
• Gifts/Inheritances
• Qualified scholarships (for tuition only)
• Certain salary deferrals (e.g., flexible
spending plans, contributions to 401(k)
plans)
Adjustments
•
•
•
•
•
•
•
Contributions to a health savings account
Job-related moving expenses
Student loan interest
IRA contributions
Alimony paid
Self-employment expenses
Educator expenses
MAGI vs non-MAGI Groups in IL
MAGI rules apply to:
•
•
•
•
•
ACA Adults
All Kids (children up to age 19)
Moms and Babies
FamilyCare –Parents / Caretaker relatives
ACA Adult Medical
MAGI rules do NOT apply to:
• Seniors (people 65 and over) who are not parents or caretaker relatives
• Cash/SNAP applicants
• Most people with disabilities
When using MAGI rules, resources/assets are not counted when
determining eligibility.
ILLINOIS MEDICAID
EXPANSION
Who is Eligible for the Medicaid Expansion?
• Age 19-64 and not eligible for other Medicaid
category.
• Citizen or Qualified Non Citizen
• Under 138% FPL or about $1340 per month for a
household of one ($16,105/year).
• No asset or disability test.
25
Federal Poverty Level: Income Limits for Coverage
Medicaid adjusts its’ income standards in April each year using the FPL amounts issued
at the end of January. The Marketplace uses the FPL that is in place at the start of
Open Enrollment and does not adjust the amount until the next Open Enrollment so for
all of 2015 the Marketplace will use the 2014 FPL.
2014 Federal Poverty Level
Medicaid Programs
AABD
ACA
Adult
FamilyCare
Marketplace
All Kids
Level 1
Moms and
Babies
All Kids
Level 2
CSR
APTC
Child
250%
400%
Household
Size
100%*
Adult
Child
Pregnant
or child
under 1
1
$11,670
$16,105
$24,396
-----
$37,116
$29,175
$46,680
2
$15,730
$21,707
$32,880
$33,504
$50,016
$39,325
$62,920
3
$19,790
$27,310
$41,364
$42,156
$62,928
$49,475
$79,160
4
$23,850
$32,913
$49,848
$50,796
$75,840
$59,625
$95,400
The income increases as the number of persons in the household increases.
26
Medicaid in Illinois At A Glance
Pre-ACA
Post-ACA
• FamilyCare for parents and other
caretaker relatives of children under
19
• All Kids
• Moms and Babies
• Aid to the Aged Blind and Disabled
(AABD)
• Health Benefits for Workers with
Disabilities (HBWD)
• Health Benefits for Persons with
Breast and Cervical Cancer (apply with
Illinois Dept. of Public Health)
• ACA Adult
• Former Illinois Foster Child
• FamilyCare for parents and other
caretakers of children under 18
• All Kids
• Moms and Babies
• Aid to the Aged Blind and Disabled
(AABD)
• Health Benefits for Workers with
Disabilities (HBWD)
• Health Benefits for Persons with
Breast and Cervical Cancer (apply with
Illinois Dept. of Public Health)
27
Medicaid Benefits for ACA Adults
ACA Adults are receiving a Medicaid benefit/service package called
the Alternative Benefit Plan (ABP).
• The ABP for adults is required to include:
– Essential Health Benefits
– Early and Periodic Screening, Diagnosis, and Treatment
services (EPSDT) for 19 and 20 year olds
– Federally Qualified Health Center (FQHC) and Rural Health
Clinic (RHC) services
– Non-emergency transportation
– Family planning services and supplies
Cost Sharing under Medicaid
• No Premiums
• ACA Adults will have the same co-payments as other Medicaid
adults, such as:
– Hospital inpatient services: $3.90
– Prescription drugs: brand $3.90, generic $2.00
– Primary care provider visit: $3.90
• No co-payment for Immunizations, Preventive Services,
Diagnostic Services or Family Planning. Family planning related
medical services require a co-pay for office visits.
• For more information:
http://www2.illinois.gov/hfs/SiteCollectionDocuments/100app12.
pdf
New Medicaid Managed Care in Illinois
•
•
•
2011 Medicaid reform law (P.A. 96-1501) mandates 50% of clients to be enrolled in “care
coordination” by January 1, 2015
Different health plans for different Medicaid populations
– Seniors and Persons with Disabilities (SPD) – Medicaid only & Medicare/Medicaid
(duals)
– Children, Parents/Caretaker Relatives, Pregnant Women – called “Family Health
Plans (FHP)”
– Children with Special Needs (CSN)
– Newly Eligible Adults under the Affordable Care Act – called “ACA Adults”
4 different models of Managed Care Entities
– Managed Care Organizations (MCO)
– Managed Care Community Networks (MCCN)
– Care Coordination Entities (CCE)
– Accountable Care Entities (ACE)
Care Coordination in Mandatory Regions
• Clients are in process of enrolling or being enrolled in Health
Plans in 5 mandatory regions
– Chicago region – 6 counties
– Rockford region – 3 counties
– Central Illinois region – 3 counties
– Quad Cities region – 3 counties
– Metro East region- 3 counties
• Clients in rural counties will continue to be in fee for service
(IL Health Connect) for awhile
• About 2 million Medicaid clients will be in Health Plans by
mid-2015
http://www2.illinois.gov/hfs/PublicInvolvem
ent/cc/Pages/default.aspx
ILLINOIS
MARKETPLACE
32
2014 & 2015 Open Enrollment
2014 Open Enrollment
2015 Open Enrollment
Oct. 1, 2013 – March 31, 2014
(April 15 for those “in line” )
Nov. 15, 2014 – Feb. 15, 2015
Enrollment Date/Period
Effective Coverage Begins
1st – 15th of month
1st of following month
16th – last day of month
1st of second following month
Qualifying Life Events (such as moving to a new state, marriage, or
having a baby) open a Special Enrollment Period (SEP)
Complex Cases during 2014 Open Enrollment also can open a SEP.
Medicaid is always open!
33
Special Enrollment Periods are called “SEP”
• Means that you can enroll in Marketplace any time
during the year even outside of open enrollment.
• Must be “triggered” by specific life event that causes
loss of MEC or other designated limited circumstances.
• Usually gives person 60 days after event to enroll.
• Healthcare.gov has a screening tool to determine is
someone is eligible to enroll in a SEP.
https://www.healthcare.gov/how-can-i-get-coverageoutside-of-open-enrollment/
34
HealthCare.gov
2014 Qualified Health Plans in Illinois
* 165 plans and 6 carriers
• Aetna
• Blue Cross Blue Shield
• Coventry
• Health Alliance
• Humana
• Land of Lincoln
* 13 Rating Areas
In 2015? DOI Announces 10 Issuers
Apply to Offer 504 QHPs
36
QHPs Offer Essential Health Benefits
QHPs are Put into 5 Categories:
4 Metal and 1 Non Metal
Catastrophic Health Plans
What is catastrophic coverage?
• Plans with high deductibles and lower premiums
• Pay all medical costs up to a certain amount
• Includes 3 primary care visits per year and preventive services with no
out-of-pocket costs
• Protects you from high out-of-pocket costs
Who is eligible?
• Young adults under 30
• Those who qualify for a hardship exemption
• Those whose plan was cancelled and believe Marketplace plans are
unaffordable
**Financial assistance (premium tax credits and cost sharing reductions) is
not available
HealthCare.gov: Plan Compare
Cost: Two Types of New Financial Assistance
Premium
Tax Credits
• Helps people pay the monthly
cost to have a plan
CostSharing
Reductions
• Decrease the charges (e.g.,
copays, deductibles) enrollees
must pay when receiving health
care services covered by the plan
41
Who Is Eligible for Tax Credits/Cost Sharing
Subsidies?
A U.S. Citizen and
• Ineligible for “minimum essential coverage,” such as coverage provided through an employer, Medicaid or
Medicare
• Eligible to enroll in a QHP through the Marketplace
• Part of a tax filing unit
• Has household income between 100% and 400% FPL
A non-citizen who is lawfully present and
• Unable to obtain affordable minimum essential coverage, such as coverage provided through an employer,
Medicaid or the Marketplace
• Eligible to enroll in a QHP through the Marketplace
• Part of a tax filing unit
• Has household income between 0-400% FPL although tax credit will be based on an income of 100% FPL even
if income is below 100% FPL.
Cost sharing subsidies are provided if eligible for a tax credit with an income
between 100%-250% FPL and enrolled in a silver plan through the Marketplace
42
Federal Poverty Level: Income Limits for Coverage
Medicaid adjusts its’ income standards in April each year using the FPL amounts issued
at the end of January. The Marketplace uses the FPL that is in place at the start of
Open Enrollment and does not adjust the amount until the next Open Enrollment so for
all of 2015 the Marketplace will use the 2014 FPL.
2014 Federal Poverty Level
Medicaid Programs
AABD
ACA
Adult
FamilyCare
Marketplace
All Kids
Level 1
Moms and
Babies
All Kids
Level 2
CSR
APTC
Child
250%
400%
Household
Size
100%*
Adult
Child
Pregnant
or child
under 1
1
$11,670
$16,105
$24,396
-----
$37,116
$29,175
$46,680
2
$15,730
$21,707
$32,880
$33,504
$50,016
$39,325
$62,920
3
$19,790
$27,310
$41,364
$42,156
$62,928
$49,475
$79,160
4
$23,850
$32,913
$49,848
$50,796
$75,840
$59,625
$95,400
The income increases as the number of persons in the household increases.
43
Expected Premium Contributions
Premium Tax Credit Calculator:
http://kff.org/interactive/subsidy-calculator/
44
Impact of Marketplace Financial Help on
People with Employer Insurance
• Not intended for those with employer coverage.
• Provisions in place to discourage those with
employer offer buying into exchange with financial
help.
• Employer offer of self-only coverage to employee is
not more than 9.5 % of the household income.
• Dependent coverage “glitch”
45
Culture of Coverage: Individuals
• The Individual Mandate requires most Americans to have
“minimum essential health coverage (MEC)” for each month
starting January 1, 2014.
• Also, called “Shared Responsibility Provision,” “Required
Coverage,” or “Health Insurance Requirement.”
• This applies to adults and children. The adult or married couple
who can claim a child or another individual as a dependent on
their federal income taxes is responsible for making the payment
if the dependent does not have coverage (or an exemption).
• Payments will begin in 2015
Culture of Coverage: Employers
• Employer Mandate/ Employer Shared Responsibility
– Only for Firms with 50+ FTEs (3.6% of firms in the US)
– Small Businesses (below 50 FTEs) are exempt!
– Must provide affordable and minimum value coverage to
employees and dependents
– Pay a penalty IF an employee takes a premium tax credit in
the Marketplace.
– Most larger firms already provide insurance
– Penalty waived until 2016 for firms w/ 50-99 FTEs; for larger
firms, it will be 2015 (must cover 70% of employees)
** More information: http://www.irs.gov/uac/Newsroom/Questions-and-Answers-onEmployer-Shared-Responsibility-Provisions-Under-the-Affordable-Care-Act
3 Choices Under the ACA
Maintain
P
MEC
Qualify for
an
Exemption
Pay the
Penalty
Requirement to Have Health Coverage
• Everyone is required to have minimum essential coverage
(MEC)
• Those without MEC will pay a shared responsibility payment
unless exempt
– Taxpayer is responsible for dependents
• Coverage requirement, penalties and most exemptions apply
on a monthly basis
• One day rule:
– A person has coverage for the month if they have coverage
for at least one day in the month
– A person is eligible for an exemption for the month if they
are exempt for at least one day in the month
What Counts As MEC?
•
•
•
•
•
•
Employer-sponsored coverage, COBRA coverage and retiree coverage
Coverage purchased in the individual market (inside or outside the Marketplace)
Government Sponsored Coverage, such as:
– Medicare Part A coverage and Medicare Advantage plans
– Most Medicaid coverage
– Children's Health Insurance Program (CHIP) coverage
– Certain types of veterans health coverage
– Most types of TRICARE coverage
– Refugee Medical Assistance
Self-funded health coverage offered to students by universities for plan or policy years
that begin on or before Dec. 31, 2014
State high risk pool plans that begin on or before Dec. 31, 2014
Other coverage recognized by the Secretary of HHS as minimum essential coverage
Full List here: http://www.irs.gov/uac/Questions-and-Answers-on-the-Individual-Shared-Responsibility-Provision
What Doesn’t Count As Minimum Essential Coverage?
•
Coverage consisting solely of excepted benefits, such as:
•
•
•
Stand-alone vision care or dental care
Workers' compensation
Accident or disability policies
Not MEC, but Transition Relief Available
•
•
•
•
•
•
•
Medicaid providing only family planning services
Medicaid providing only tuberculosis-related services
Medicaid providing only coverage limited to treatment of emergency
medical conditions
Pregnancy-related Medicaid coverage
Medicaid coverage for the medically needy
Section 1115 Medicaid demonstration projects
Specific TRICARE coverage
Individual Mandate or the “Penalty”
The penalty in 2014 is calculated in one of 2 ways. If the consumer does not maintain MEC,
they will pay whichever of these amounts is higher:
•
•
1% of yearly household income. (Only the amount of income above the tax filing
threshold, $10,150 for an individual, is used to calculate the penalty.) The maximum
penalty is the national average premium for a bronze plan.
$95 per person for the year ($47.50 per child under 18). The maximum penalty per
family using this method is $285.
In 2015, the fee will go up to 2% of annual household income or $325 per adult
($162.50 per child).
It is prorated for number of months without insurance in a year. This calculator can
be used to estimate the penalty for a consumer:
http://taxpolicycenter.org/taxfacts/acacalculator.cfm
20 Million Have Gained Coverage Due to ACA
Helpful Resources
• LAF – Specific Enrollment Resources
• HelpHub is an online community where ACA enrollment specialists in
Illinois can share their experiences helping consumers enroll & ask
questions to each other and policy experts. To request an invite, email
helphub@illinoishealthmatters.org with your name, the name of your
organization & details of your ACA involvement.
• Get Covered Illinois – FAQs & Resources
http://getcoveredillinois.gov/how-to-get-covered/faq-resources/
• Illinois Health Resources – a directory of useful websites, fact sheets, and
other resources on a variety of different topics for navigators and other
assisters: http://www.illinoishealthresources.org/
Questions? Contact:
Stephani Becker
stephanibecker@povertylaw.org
312.789.4482
Stephanie Altman:
stephaniealtman@povertylaw.org
312.789.4105