Health Care Reform
Patient Protection and Affordable Care
Act (PPACA)
David Smith, Vice President
EBENCONCEPTS
Version 16
Deadlines, Regulations & 2010 Elections
• Deadlines vary based on the way law was written
– Some provisions go into effect in 2010
• All changes effective on PLAN anniversary on or after 9/23/10
– A number of Changes effective January 1, 2011, 2012, 2013
and then 2014
• Regulatory “Clarifications” come out every week
– HHS, DOL issuing regulations, FAQs answer many questions
• 2010 Elections will not fundamentally change employer
obligations
– Political Reality
– Carrier investments
– Efforts to repeal vs. realities of trying to repeal
2010
Grandfathered Plans
• Grandfathered Plans:
– Individuals and employer group plans can keep their
current “grandfathered” policy if the only plan changes
made are to add or delete new employee/dependents or
part of a collective bargaining agreement.
• Impacts plans in place as of March 23, 2010
• New regulations define what changes are permissible to
retain grandfathered status
– Plans that made changes between March 23 and June 14
have an opportunity to reverse any significant changes
made without losing grandfathering status.
• This must be done by the plan year following
September 23, 2010
2010
Grandfathered Plans
• Grandfathered plans are permanently exempt from the
following reforms:
–
–
–
–
–
–
–
–
Preventive services mandates
Annual cost sharing and deductible requirements
105(h) Nondiscrimination rules apply to fully-insured plans
Certain reporting requirements
Appeals process
Designation Rules for Primary Care Providers
Coverage of clinical trials
No discrimination against providers
• Main reasons to maintain status
– Savings of 1-5% in additional health care costs
– Non-discrimination rules
2010
Grandfathered Plans
• Grandfathered plans are subject to the
following requirements:
–
–
–
–
–
Changes in tax rules relating to health plans
Uniform explanation of coverage
Cost reporting and rebates
Automatic enrollment
Notification of availability of the exchange and
subsidies
– Notices regarding the exchange
– Requirement to provide employees vouchers
2010
Grandfathered Plans
• Grandfathered plans are subject to the
following requirements (continued):
– Six months after enactment
•
•
•
•
Limitation on lifetime and annual limits
Limitation on pre-existing condition exclusions
Limitation on waiting periods
Coverage of adult children (only if adult child is NOT
eligible to enroll in another eligible employer plan)
– 2014 for employees
• Prohibition on rescissions
2010
Grandfathered Plans
• Cannot retain grandfathered status if:
– Increase of 5%* or more of employee contribution amount for
any tier of coverage (EE only, ES, EC, Family)
– Change of 15%* or more of deductible
– Any increase in employee’s coinsurance % (e.g. 20% to 30%)
– Increase copayments by more than $5 or 15%
– Eliminate coverage to diagnose or treat a particular condition
– Obtain new policy, certificate or contract of insurance
• Obligations
– Notify employees of grandfathered plan status
2010
Grandfathered Plans
• New guidance – 10-12-10
– Multiple plans?
• Each plan would have be evaluated separately
– Implementing wellness discounts?
• Creates lower contribution levels may affect grandfathered
status
– Do these rules apply to dental or vision plans? No…
• If they are separate policies, certificates or contracts of
insurance
or
• If not separate, employees must have right to choose not
to have dental or vision benefits, and if they choose to
have them, must pay premium to cover it
2010
Grandfathered Plans
• What can you do?
–
–
–
–
Add family members or new employees
Disenroll employees
Make changes as a result of state or federal regulations
Make changes to voluntarily adopt some or all of the
law’s requirements
– Change third party administrator if you are self-funded
– Increase premiums
• Some uncertainty about…
– Change to from fully-insured to self-funded, altering
provider network, changing drug formulary
2010
Grandfathered Plans
• Most carriers have announced that all of their
post-10/1 plans will be compliant with mandates
– Higher costs, but not necessarily affecting group’s
grandfathered status
• Employer contributions may decrease more than
5% if the following conditions are met:
– Insurer requires plan sponsor (employer) to disclose its
contribution rate on March 23, 2010
– Insurer’s policies/certificates/contracts prominently
display requirement that employer must notify insurer if
contribution rate changes during the plan year
2010
Grandfathered Plans
• What are we doing?
– Providing our clients the “right” employee
notice of their grandfathered status at renewal
• Grandfathered
• Non-grandfathered
• Benefits are compliant but plan still grandfathered
– Carriers are not providing any guidance on this
issue
2010
(Very) Small Business Tax Credit
• Eligible small businesses are eligible for phase
one of the small business premium tax credit.
– Requirements:
• Less than 25 employees
• Must pay up to 50% of premiums
• Average salary must be $50,000 or less.
– Sliding scale based on # of employees and average
payroll
– Businesses and non-profits are eligible for the credit.
– Credit for amounts paid for dental and vision eligible
2010
(Very) Small Business Tax Credit
• Must have taxable income for the tax credit:
– Carry back 1 year / Carry forward 20 years
• Controlled Groups / Common Ownership are
treated as a single employer
• How subsidy claimed varies based on how taxes
paid by employer
– “C” Corporations - reflected on tax return
– “S” Corps or other disregarded entities – distributed to
owners via K-1
– Nonprofits – used to pay employment taxes
(but not more than annual amounts)
2010
(Very) Small Business Tax Credit
• How will it work?
– Take all employee hours from the prior year
• Example: 10 FT employees, 20 PT employees
• Determine # of employees
– 20 PT employees work, on average, 1,000 hours annually
– Add full-time employees hours (10 x 2080) and part-time EE
hours (20 x 1000) = 40,800 then divide by 2,080 = 19.6
• Determine average salary
–
–
–
–
Total salaries for all employees (except for owners)
Average salary for FT workers: $26,000
PT employees paid an average of $12/hr
Add FT employees salaries ($260,000) + PT ee’s income
($240,000) = $500,000 then divide by # employees above
(19.6) = $25,510.20
2010
(Very) Small Business Tax Credit
• How will it work?
• Amount paid for health insurance by employer
–
–
–
–
Only covering 10 FT employees
Employer portion is $200 per employee per month
Annual cost: $24,000
MUST PAY AT LEAST 50% OF EMPLOYEE COSTS TO BE
ELIGIBLE and the premium amount cannot exceed the state
average
– Tax credit amount reduced by any state tax credit for health
insurance
• What is the max tax credit?
– For Profit Business: No more than 35% of employer portion
» Tax CREDIT (not deduction) of $8,400
» Reduces tax deduction under Section 152 by the amount
of tax credit
– Non-profit Organization: No more than 25% of employer costs
» Tax CREDIT (not deduction) of $6,000
2010
(Very) Small Business Tax Credit
• Phase-out for amounts above certain
limits
• These formulas will calculate the REDUCTION in
subsidy to a small employer
– More than 10 FTE’s
» (number FTE’s – 10) / 15 * Max Tax Credit
Amount
» (19.6-10) / 15 = 0.64 * 8,400 = $5,376
– More than $25,000 average wage
» (average wage - $25,000) / $25,000
» (25,510-$25,000) / $25,000 = 0.0204 * 8,400 =
$171.36
– REVISED TAX CREDIT AMOUNT
» $8,400 - $5,376 - $171.36 = $2,852.64
» Still able to deduct $21,147.36 under §152
2010
(Very) Small Business Tax Credit
• New guidance as of December 5, 2010
– IRS Notice 2010-82 now available
– Who gets counted as an employee?
• Includes those who have terminated, or who waived
coverage
– Determining hours of service
• Can use any of the common methods (count actual hours,
days-worked or weeks-work equivalencies)
• Could use different methods for different employees within
same employer
• Form for filing for tax credit issued
– IRS Form 8941 (available on IRS website)
2010
(Very) Small Business Tax Credit
• What are we doing?
– Developed an excel spreadsheet to assist
employer-clients with determining their
eligibility and estimated amount of tax credit
for 2010
– Available for our clients through our sales
team
2010
“Older” Dependent Children
Coverage
• Mandate for all groups
– Employee’s children who are up to 26 years of age are eligible
to be on parents’ insurance
• Includes up to the date before the child turns 26
• Regardless of whether full-time student or a tax Dependent of
employee
• Still have COBRA eligibility for 36 months following loss of
eligibility (so covered until day before they turn 29 years old)
• Amount paid by employee is not taxable income (new change)
– Prohibited from vary premium contributions based on child’s age
• Does not apply to spouse of child, nor to the child’s child(ren)
• Other benefit restrictions still apply
– Per regs, creates new eligibility period employee and
dependent
– Grandfathered plans do not have to extend eligibility if the
child is eligible for other employer coverage
2010
“Older” Dependent Children
Coverage
• New guidance – 9-23-2010
– “Child” means:
•
•
•
•
Biological child
Step-child
Adopted child
Foster child
– Does not require the coverage of employee’s
grandchildren, custody arrangements or children of
domestic partner
• Could still extend to these “other” children, and could also
place restrictions on their inclusion (such as student status,
etc.)
2010
“Older” Dependent Children
Coverage
• What are we doing?
– Providing our clients the correct notice for the open
enrollment which is mandated under this provision
• Two different notices – grandfathered and nongrandfathered
– Recommending this notice be given out 30 days prior to
renewal to avoid retro adding dependent children
– Assisting our clients in communicating this information
to their employees and answering the “complex”
questions that will undoubtedly come
2010
Preventative Service Mandates
• New regulations issued July 12, 2010
– A part of the 2010 implementation mandates
• Outline list of tests/procedures to be covered
with no cost sharing to the plan participant
– Three page list of procedures to be covered includes STD
testing, pregnancy tests, mammograms, vision exams
for children, and colonoscopies
– Also includes covering costs of immunizations and other
well-child and well-baby care
– Likely to be the most expensive aspect of first phase of
HCR implementation
2010
Guidance on Notices
• USDOL/HHS announced early November
– Employers must provide the grandfathered
notice whenever they provide a participant or
potential participant a copy of their benefits
– May be given or delivered in paper or
electronically
Mini-Med Policies
2010
• Affects plans that do not provide
“comprehensive” medical benefits
– Lower annual caps (e.g. $25,000)
– Limited benefits for office visits, etc.
• Carriers could obtain waiver for mini-med to
continue to offer benefits, but must establish that
failure to obtain waiver will result in a:
– Significant decrease in access to benefits OR
– Significant increase in premiums
• Waiver only applies to EXISTING plans and does
not permit the sale of new policies
– Limited exception – existing mini-med customers
buying a replacement policy from a different carrier
Mini-Med Policies
2010
• If Plan is approved (HHS determination),
employer must provide a notice to mini-med
participants
– Notice must:
• Clearly indicate the dollar amount of the annual limit and
the benefits affected by the lower annual limit
• Be prominently displayed in 14 point bold type
• State waiver is good for only one year
– Model language is available
– Obligation to provide notice is an EMPLOYER
responsibility and not one for the CARRIER
High Risk Pools
2010
• Creates high-risk pool coverage for people who
cannot obtain current individual coverage due to
preexisting conditions.
– Employers and Insurers cannot put people in the pool—
would pay penalty.
– Could work with existing state high-risk pools
– Ends January 1, 2014, when Exchanges are operational
– It will be financed by a $5 billion appropriation.
2010
Reinsurance for Early Retirees
• Federal gov’t will assume partial risk for early
retiree health costs
–
–
–
–
Only for early retirees who are 55 or older
Plans would pay first $15,000 in claims
Share risk on the next $75,000 on an 80/20 basis
Plan assumes liability for costs in excess of $90,000
Federal Reinsurance
$15,000
Plan paid stoploss coverage
$90,000
2010
Reinsurance for Early Retirees
• Federal gov’t assumes some risk for early
retirees’ health care costs
– Effective June 23, 2010
– Impact: dramatically reduce costs for early retirees on
group health plans
• Health care costs for 55-64 populations are significantly
higher (estimated to be more than 30%) than younger
workers
• Health care costs for early retirees are higher than those
working
– Caveat:
• Must invest the difference in wellness and chronic care
management programs
– Ends January 1, 2014, when Exchanges are operational
2010
Reinsurance for Early Retirees
• The following are not eligible for reimbursement
–
–
–
–
–
–
–
–
–
–
–
–
Custodial care
Routine foot care (e.g., orthopedic shoes)
Personal comfort items (e.g., TV in a hospital room)
Routine services and appliances for vision (e.g., glasses, contact
lenses)
Hearing aids and auditory implants
Cosmetic surgery
Routine dental services
Assisted suicide
In-vitro fertilization, artificial insemination, sperm and embryo
procurement
Abortion services, except if the pregnancy resulted from rape or incest
or endangers the life of the woman
Drugs that are not covered by a standard Part D plan (unless covered
under Parts A or B)
Items or services not furnished in the United States
2010
Rescission of Coverage
• Plan may not rescind coverage unless:
– individual or person seeking coverage on behalf of
individual performs act, practice, or omission that
constitutes fraud or intentional misrepresentation of
material fact.
– “Inadvertent” failures to provide health information not
considered intentional misrepresentation.
– Regulation defines “rescission” as a cancellation or
discontinuance of coverage that has a retroactive effect.
30
2010
Rescission of Coverage
• Not considered “rescission” if cancellation is
prospective or only is effective retroactively to
extent attributable to a failure to timely pay
required premiums or contributions.
– Plan must provide 30-days advance written notice to
each participant affected (regardless whether individual
or group coverage).
– No guidance yet on cancellations (Preamble says will be
issued in future). Statute requires advance notice.
• Guidance: be very careful if you want to revoke
someone’s participation on plan
31
Benefit Changes
2010
• No Lifetime limits on benefits
• Some annual limits allowed for now
– prohibited completely by January 1, 2014
• Cover preexisting conditions for children 0-19
• Emergency services covered in-network
– Includes new limitations on copayments for going to ER
• Enrollees may designate any in-network doctor
as their primary care physician.
• New coverage appeal process.
• Federal grant program for small employers
providing wellness programs to their employees
Other Provisions
2010
• All group plans will be required to comply with
the Internal Revenue Section 105(h) rules that
prohibit discrimination in favor of highly
compensated individuals within six months of
enactment.
• Medicare Part D changes
– Deductibility for Part D subsidies is eliminated in 2013,
but this results in an immediate accounting impact.
– Provides a $250 rebate to seniors who hit the “donut
hole in 2010 (and closes the donut hole over time)
• Nursing mothers must be given breaks/location
– Employers with less than 50 employees may
not have to comply if there is “undue hardship”
Other Provisions
2010
• Expanded claims appeals process
– Six major changes include:
• Reducing urgent care claims from 72 to 24 hours
• Expanded notice requirements for denials
• Mandated use of state-based external review of claims
– Delayed enforcement until 7/1/2011
• All plans must provide new summary of benefits
(SPD) to enrollees at specified times.
– Can be no more than 4 pages in length and must be
culturally and linguistically appropriate
– 25% or more of eligible employees speak a language
other than
English as their primary language
Other Provisions
2010
• Approval process (waiver) for mini-med and annual plan limits
– Required since the lifetime limits and permitted annual benefit limits
would make most mini-med products in violation of PPACA
– Mini-med plans must show that failure to approve waiver would result
in either:
• Significant loss of benefits
• Significant increase in cost
– Numerous factors to be considered for approval
•
•
•
•
•
How many people would be uninsured by failure to approve
Current policy limits
Anticipated change in premium for failure to approve
Number/type of benefits subject to annual limits
Number of enrollees covered by mini-med plan seeking waiver
– 733 waivers have been approved though January 2011
• Mainly approved mini-med plans to continue
• Another focus on non-integrated HRA plans
2011
Changes Effective in 2011
• Penalty for use of HSA for nonqualified medical
expenses increases to 20%.
• OTC drugs no longer be reimbursable unless
prescribed by a doctor.
• Small employers (less than 100 lives) will be
allowed to adopt new “simple cafeteria plans.”
– Easier eligibility requirements
– Uniform eligibility to benefits
– Minimum contribution requirements based on nonelective or matching methods
– Cannot favor HCE or key employees
2011
Changes Effective in 2011
• MINIMUM MEDICAL LOSS RATIOS:
– Health plans must report to HHS information on loss
ratios for 2010 and later plan years
– Report must provide percentage of premium spent for:
• Reimbursement of clinical services
• Activities that improve health care quality
• All other non-claims expenses excluding state and federal
taxes, licensing or regulatory fees
– Reporting requirement details have been recommended
to HHS by National Association of Insurance
Commissioners (NAIC) as of October 2010
2011
Changes Effective in 2011
• MINIMUM MEDICAL LOSS RATIOS:
– Beginning January 2011, rebates must be provided to
consumers if health plans spend below minimum loss
ratios
• 85% for large group plans
• 80% for small group and individual
– This will result in some carriers sending rebates to
buyers
• Later guidance requires that any rebate be returned
proportionately by the employer to the contributing
employee
2012
Changes effective in 2012
•
The Department of Labor will begin annual studies on self-insured plans
using data collected from Form 5500.
•
All employers must provide a 1099 if any outside party is paid more than
$600 annually (includes utilities, rent, raw materials, etc)
– Will be reported in 2013 for 2012 spending
– Likely to be modified or eliminated by 2011 Congress
•
All employers must include on their W2s the aggregate cost of employersponsored health benefits.
– If employee receives health insurance coverage under multiple plans, the
employer must disclose the aggregate value of all such health coverage,
– Excludes all contributions to HSAs and Archer MSAs and salary reduction
contributions to FSAs.
– Applies to benefits provided during taxable years after
December 31, 2010.
Now December 31, 2011
2012
Changes effective in 2012
• Group plans (including self-insured) must report
whether benefits provided to employees:
– meet criteria (to be established) on improving health
outcomes, reducing medical errors, and wellness and
health promotion activities.
– This report must also be provided to plan participants.
• All plans must provide new summary of benefits
(SPD) to enrollees at specified times.
– Mandated to give notice of any “material benefit
change” at least 60 days prior to effective date.
2012
Changes effective in 2012
• CLASS Act
– What? A government program to pay for long-term care
expenses, but with a smaller benefit and mandatory
“taxes” to pay for this benefit
• Very similar to Social Security Disability
– Requirements?
• Monthly payment of $180-240 for a period of at least five
years to receive a small daily benefit for long-term care
expenses (rest home, etc.)
– Must opt out – either employer or employee or will
automatically be required to take out amount from
paycheck
2013
Changes effective in 2013
• Higher taxes:
– Additional 0.9% Medicare Hospital Insurance tax on selfemployed individuals and employees with respect to
earnings and wages above $200,000
individuals/$250,000 joint filers (not indexed).
– Self-employed individuals are not permitted to deduct
any portion of the additional tax.
– New 3.8% Medicare contribution on certain unearned
income (e.g. rental income) from individuals with AGI
over $200,000/$250,000 joint filers
2013
Changes effective in 2013
• The threshold for the itemized deduction for
unreimbursed medical expenses would be
increased from 7.5% of AGI to 10% of AGI for
regular tax purposes.
– The increase would be waived for individuals age 65 and
older for tax years 2013 through 2016.
• $2,500 Cap on Medical FSA contributions
annually indexed for inflation begins.
• All employers must provide notice to employees
of the existence of state-based exchanges.
Taxes and Fees
2014
• A new federal tax on fully insured and self-funded
group plans, equal to $2 per enrollee, takes
effect to fund federal comparative effectiveness
research takes effect in 2012.
• Imposes annual taxes on private health insurers
based on net premiums. Coverage must be
offered on a guarantee issue basis in all markets
and be guarantee renewable.
Rating Changes
2014
• Redefine small group coverage as 1-100
employees.
• Strict modified community rating standards for
pricing all small group products
– Premium variations only allowed for age (3:1), tobacco
use (1.5:1), family composition and geography
– Geographic regions to be defined by the states and
experience rating would be prohibited.
– Wellness discounts are allowed for group plans under
specific circumstances.
Exchanges
2014
• Requires each state to create an Exchange to
facilitate the sale of qualified benefit plans to
individuals, including new federally administered
multi-state plans and non-profit co-operative
plans.
• States must create “SHOP Exchanges” to help
small employers purchase such coverage.
– Each state cold choose to allow large groups (over 100)
to purchase coverage through the exchanges beginning
in 2017
2014
Individual Mandate
• All American citizens and legal residents to
purchase qualified health insurance coverage.
Exceptions:
–
–
–
–
religious objectors,
individuals not lawfully present
incarcerated individuals,
taxpayers with income under 100 percent of poverty,
and those who have a hardship waiver
– members of Indian tribes,
– those who were not covered for a period of less than
three months during the year
– People with no income tax liability
2014
Individual Mandate
• Penalty for non compliance
– flat dollar amount per person or
• The alternative is a fixed dollar
amount that phases in beginning
with $325 per person in 2015
to $695 in 2016.
– a percentage of the
individual’s income
• In 2014 the percentage of income
determining the fine amount will be
1%, then 2% in 2015, with the
maximum fine of 2.5% of taxable
(gross) household income capped at the average bronze-level
insurance premium (60% actuarial) rate for the person’s family
beginning in 2016.
– whichever is higher
2014
Individual Mandate
• Sliding-scale tax credits for non-Medicaid eligible
individuals
– Incomes up to 400% of FPL to buy coverage through the
exchange.
– Slight increases to the subsidy amounts for all subsidyeligible individuals and increases the cost-sharing
subsidies for those making 250% FPL or less.
2014
Employer Mandate
• Employer must count all full-time employees and
part-time employees – on a full-time equivalent
basis – in determining if they have 50 or more
employees
– Certain seasonal workers are not counted in determining
if employer has 50 workers
– Full-time = 30+ hours per week, determined on a
monthly basis
– Penalties assessed for “no coverage” or coverage that is
not “affordable”
– Does not mandate coverage for part-time workers
(those working less than 30 hrs per week)
2014
Employer Mandate
• Penalty if NO COVERAGE OFFERED
– If an employer fails to provide its full-time employees
(and their dependents) the opportunity to enroll in
“minimum essential coverage,” and
– One or more full-time employees enrolls for coverage in
an exchange and qualifies for a premium tax credit or
cost-sharing reduction, then
– Employer penalty = $2,000 for each of its full-time
employees in the workforce
2014
Employer Mandate
• Penalty if UNAFFORDABLE COVERAGE:
– If employer offers its full-time employees (and their
dependents) the opportunity to enroll in minimum
essential coverage, and
– One or more FT employees enrolls for coverage in an
exchange and qualifies for a premium tax credit or cost
sharing reduction because
• The employee’s share of the premium exceed 9.5% of
income, or
• The actuarial value of the coverage was less than 60%,
then
– Employer penalty = $3,000 for each full-time employee
who receives a tax credit or cost-sharing reduction
Summary of Potential Employer Penalties under PPACA, Cong. Research Service, May 14, 2010
2014
Employer Mandate
• Free Choice Vouchers
– Requires employers to provide a voucher to use in the
exchange instead of participating in the employerprovided plan in limited circumstances
• Employees must be ineligible for subsidies
• Employees share of premium must be more than 8% to
9.8% of family income that is less than 400% of FPL
• Employee can keep amounts of the voucher in excess of
the cost of coverage
2014
Other Responsibilities
• EMPLOYERS
– Must automatically enroll “new full-time employees” in
employer-sponsored coverage
• Required to provide adequate notice and opportunity to opt
out
• Applies to employers with “more than 200 full-time
employees”
• No effective date specified, but must be “in accordance
with regulations promulgated by the Secretary (of DOL)…”
(so presumably not effective until regulations are issued)
– Waiting periods in excess of 90 days are prohibited
• This mandate does go into effect until 2014
Benefits
2014
• Three benefit packages to be defined – Gold,
Silver, & Bronze
• Known changes to the benefit mandates
– Preexisting conditions limitations prohibited
– Prohibition on any annual limits or lifetime limits in all
group (even self-funded plans) or individual plans.
– Multiple levels available based on actuarial equivalents
– Self-funded plans may not be subject to all
requirements, but may not meet employer mandate
requirements if they don’t comply
– Allows catastrophic-only policies for those 30 and
younger.
Benefits
2014
• All plans must meet standard packages or be
based on actuarial equivalents
– The plans will define maximum cost-sharing amounts,
benefit mandates, and other minimum covered benefits
•
•
•
•
•
•
•
•
Ambulatory patient services
Emergency services
Hospitalization
Maternity and newborn care
Mental health and Substance use disorder services
Prescription drugs
Rehabilitative services and devices
Preventive and wellness services and chronic disease
management
• Pediatric services, including oral and vision care
Wellness
2014
• Codifies and improves upon the HIPAA bona fide
wellness program rules and increases the value
of workplace wellness incentives to 30% of
premiums with DHHS able to raise to 50%
– Establishes a 10-state pilot program to apply the rules
to HIPAA bona fide wellness program rules the individual
market in 2014-2017 with potential expansion to all
states after 2017.
– New federal study on wellness program effectiveness
and cost savings.
Beyond 2014
• Cadillac Tax:
– 40% excise tax on insurers of employer-sponsored
health plans with aggregate values that exceed $10,200
for singles and from $27,500 for families takes effect in
2018.
• Transition relief would be provided for 17 identified highcost states.
• Values of health plans include reimbursements from FSAs,
HRAs and employer contributions to HSAs.
• Stand-alone vision and dental are excluded from the
calculation.
• Premium values are indexed to CPI
• Allows plans to take into account age, gender and certain
other factors that impact premium costs
What happens from here?
• Regulatory Process
– Numerous federal agencies in charge of drafting rules
for implementing law
– HHS in charge (working with DOL, Treasury/IRS, EEOC,
FTC)
• State Implementation
– Legislatures, Governors, Insurance Commissioners
• Litigation
– Numerous states, numerous approaches
– Virginia/Florida vs. Georgia
Questions?
Chris Harrison
harrison@ebenconcepts.com
David C. Smith
dcsmith@ebenconcepts.com