Health Care Reform (ACA) Implementation Jan. 1st, 2014 – California Updates

September 24, 2013 By

Latest Updates

Individuals and Families
• Insurance Carriers are expected to release their health plan offerings for 2014 on Oct. 1st.
• The major carriers offering Individual/Family plans in the Bay Area will be Anthem Blue Cross, Blue Shield, Health Net and Kaiser.
• Individual & Family purchase mandates and penalties will go into effect on Jan. 1st. Large Employer Group (50+ Employees) mandates and penalties, however, have been postponed to 1/1/2015.

Small Employer Groups (50 or fewer employees)
• Model Notices — All Employers are required to give “Model Notices” to all their employees by Oct. 1st, and to new hires within 14 days of hire. This is a Dept. of Labor mandated notice, that talks about employees’ and dependents’ options, under ACA, to employer and individual health coverage, Exchanges, subsidies and tax credits.
• Previously, this Model Notice law carried a penalty to Employers of $1,000 per employee for non-compliance. Last week, the Dept. of Labor announced a waiver of the penalty for non-compliance. But they still want employers to send out those notices.
• Anthem Blue Cross will not be offering any Small Group health plans within the Covered California Exchange. But they will be offering a wide selection of non-standardized plans outside of the Exchange.

Large Employer Groups (50+ employees)
• Model Notices — Penalties waived, see above.

Medicare Individuals
If you are on Medicare, you are mostly unaffected by the implementation of ACA on Jan. 1st.

Phil Lee

Filed Under: Group Plans, Health Care Reform, Individual/Family Plans Tagged With: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Should Small Group Employers Renew Their Group Health Plans Early — in Dec. 2013 — ahead of ACA?

September 9, 2013 By

NOTE: This article applies to Small Group Employers with 50 or fewer employees.

(Please note that some of the information presented here are subject to change. Many of the ACA (Affordable Care Act) regulations and California Exchange rules are still being decided, clarified or modified by the regulators, and the carriers.)

Most Small Group Insurance Carriers are offering their members the opportunity to renew early on Dec. 1st, 2013, ahead of ACA implementation. If they wish to do so, they must submit Early Renew forms by certain deadlines.

Basically, for groups with renewal months between Jan. and June 2014, carriers have been offering a lower than normal renewal rate increase. They are doing this for business retention purposes, so that groups will not leave them en masse.

Whether you renew or not, there will be an increase of between 2% to 3.8% on Jan. 1st which is a pass-through of fees and taxes mandated by ACA to pay for the expenses of setting up the Exchanges. This is over and above any other increase.

Following are some of the reasons why a group would want to renew early. You can lock in your current plan design and known rate increase until Dec. of 2014. Most carriers have not released their 2014 rates and increases yet. But the following are possible reasons for you to renew early in order to be protected against these adverse effects until Dec. 2014.

1) If your current RAF (Risk Adjustment Factor) is less than 1.10, your group may suffer under the new ACA rules. RAF’s will go away. All groups will be rated the same regardless of risk. Healthy groups with low RAF’s will see their rates go up.
2) New ACA-compliant rules may change plan designs that may cause plans to become more pricey.
3) With ACA-mandated community-rating, premium differences due to age, which were at a 1:9 ratio (of young vs. old), will be compressed to 1:3, which means that companies with a large proportion of young employees will see significant increases in premium.
4) Premiums for families with children will go up because they will be assessing premium for each dependent child within a family up to 3, as long as they are 18 or under. (Children over 18 will be counted as adults in pricing.)

If you renew early, in Dec. 2013, then these changes will be postponed until Dec. 2014.

Since circumstances for everyone differ, if you need help on your specific situation please call Phil Lee, Lee Insurance Services at 800-286-7445.

Phil Lee
www.Health-Insurance.com
www.HealthPlanTalk.com

Filed Under: Group Plans, Health Care Reform, Individual/Family Plans Tagged With: , , , , , , , , , , , , ,

Group or Individual Plan After the Implementation of ACA 1/1/2014?

September 9, 2013 By

These are tough decisions for Consumers, Employees and Small Business Owners
1. Small Business Employers
Should Small Business Employers (<50 employees) Disband their Group plans, and allow employees to buy their own private Individual Health plans either inside Covered California (the State's Healthcare Exchange), or outside in the private marketplace? 2. Employees of Small or Large Businesses
Should Employees of Small Businesses enroll in their Employer’s Group Health plan, or try to apply for a subsidized plan from Covered California (the State’s Healthcare Exchange), or outside in the private marketplace?
Should Dependents (Spouses and children) of Employees who work for Small Businesses enroll them in their Employer’s Group Health plan, or try to apply for a subsidized plan from Covered California (the State’s Healthcare Exchange), or outside in the private marketplace?
3. Consumers who do not work for an Employer (Self Employed, Unemployed, Retired, etc.)
Should you continue your current plan, buy an Individual plan from the Exchange or buy one from the outside marketplace?

To help you in your decision-making, I have outlined some Pro’s and Con’s of Group plans vs. Individual plans.
Group Plans
Advantages
• Premiums tax-deductible to business
• Employee share of premiums tax deductible to employees.
• Possible Tax Credit available to Businesses with low income employees.
• A good health benefit plan makes an Employer more attractive when competing for competent employees.
• Employers may choose plans either within or outside of the Exchange. (To qualify for a tax credit, they are limited to just the Exchange plans.)

Disadvantages
• Employer’s time required to administer group plans.
• Employees cannot qualify for a tax subsidy if they are on an employer group plan.
• These plans are not portable for the employees if they terminate employment.

Individual Plans
Advantages
• Employees may apply for a tax subsidy if they are eligible.
• Employees may choose plans either from inside or outside of the Exchange.
• These plans are fully portable.
Disadvantages
• Premiums paid by the employees, are not tax deductible to the employees.
• If an employer reimburses the cost of individual premiums to employees, those contributions may not be deducted as a business expense.

Phil Lee
Phil Lee
www.Health-Insurance.com
www.HealthPlanTalk.com

Filed Under: Group Plans, Health Care Reform, Individual/Family Plans Tagged With: , , , , , , , , , , , , , , , , ,

Implementation of ACA (Health Care Reform)

August 20, 2013 By

California Health Care Insurance Exchange Updates
Many developments have occurred since my last update. I will give a brief recap of the most important items that may impact your personal health care insurance situation.
Due to the large number of regulations and sheer volume of information related to health care reform. I will give you brief summaries of the most important items, in bullet point fashion. I have divided the items into 4 categories so that you only need to read the category that’s relevant to you.
You may choose to buy health plans either inside the California Exchange (Covered California) or outside. The only difference is that if you want either a subsidy or a tax credit, you have to choose an Exchange plan.

Your objective should be to:
1. Be insured.
2. Find the most affordable plan for your needs.
3. Qualify for a subsidy or tax credit, if you are eligible.

Individuals and Families
1. Major carriers participating in the Individual Exchange will be Anthem Blue Cross, Blue Shield, Health Net and Kaiser.
2. The guarantee-issue rule for individual health plans will go forward as planned on Jan. 1st. Individuals and Families may enroll between Oct. 1st 2013 and March 1st 2014. Enrollment effective dates will be Jan. 1st or later.
3. Starting on Oct. 1st, Individuals and Families may start choosing and applying for Individuals health plans within Covered California (the State Individual Exchange) or from plans available outside the Exchange. Plan choices within the Exchange are likely to be more limited than plan offerings outside of the Exchange. However, if one needs a federal subsidy based on their income, they may only apply for plans within the Exchange.
4. Agents who are certified by the Exchange may offer health plans both inside and outside of the Exchange, and may assist consumers in applying for subsidies.
5. Federal and Cal Cobra will continue to be offered to terminated employees.

Small Groups (under 50 employees)
1. Major carriers participating in the Group Exchange, aka SHOP, will be Blue Shield, Health Net and Kaiser.
2. Tax credit will be available to employer groups with low salaried employees.
3. Most insurance carriers allow existing groups to renew early in Nov. or Dec. of 2013 so that they will not be subject to the new Jan. 1st ACA-compliant plans and rates for another 12 months.
4. 2 employee groups consisting of only the owner and spouse will no longer be allowed.
5. 1099 employees will not be considered employees for group eligibility.
6. Employer groups in CA must have 51% or more of its employees in CA in order to qualify. Out of State employees may enroll in an Individual/Family plan in their own state.
7. Agents who are certified by the Exchange may offer health plans both inside and outside of the Small Group Exchange, known as SHOP.
8. Flex Spending Account Salary Deferral limit of $2500 for 2014.
9. Employer Model Notices requirement – On Oct. 1st or within 14 days of hire.

Large Groups (50+ employees)
• The employer mandate to provide a minimum level of health insurance to employees, along with the associated penalties; have been delayed to Jan. 2015.

Medicare
• ACA and the Exchanges are not expected to affect Medicare.

For More Information:
Please go to the official website for the California Exchange, aka Covered California, at www.coveredca.com. You will find:
• Summaries of Exchange plans that will be available.
• Sample rates for Exchange plans for your age in your zip code.
• A calculator to help give you some idea if you might qualify for a subsidy.

Phil Lee
www.Health-Insurance.com
www.HealthPlanTalk.com

Filed Under: Group Plans, Health Care Reform, Individual/Family Plans, Medicare Plans Tagged With: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Will current Individual health insurance rates stay the same when Health Care Reform takes effect on Jan. 1st?

July 11, 2013 By

(The following information pertains to Individual and Family Health Insurance for those 64 years old or younger in California.)

Will current Individual health insurance rates stay the same when Health Care Reform takes effect on Jan. 1st?

We do not yet know what the rates will be. But rates are expected to be announced by the carriers in Sept. Those rates will take effect on Jan. 1st when the bulk of the ACA (Obamacare) rules take effect.
What we do know is that individual rates, which have traditionally been low in California, will rise to the level of the higher group rates. Young people will probably see their rates skyrocket. Those in older age groups will probably see more moderate increases.
The increases will likely be due to these factors:
1) The half dozen premium taxes, fees and other charges that will be levied to pay the expenses of the Federal program and the State-sponsored Exchanges.
2) The age band ratio changes from 1:9 to 1:3. Previously, the ratio could be as much as 1 to 9 of a younger person’s rate to that of the oldest age group. Under ACA, that ratio will be compressed to 1 to 3. This will drive up rates for young people while moderating those for the older groups.
3) Guarantee-Issue will result in higher rates. Previously the individual plan “pools” consisted of people who were generally healthy when they enrolled. With guarantee-issue, carriers will have to take all comers including those with significant pre-existing health conditions who previously could not qualify for these plans. This will drive up claims, and therefore premiums.
The carriers and the Exchanges will open for enrollment on Oct. 1st for plans to start on Jan. 1st. Plans will be offered both inside the State Exchanges and outside. The selection of plans within the Exchange will be more limited, but will allow you to apply for low income subsidies. Plans outside of the Exchange will have a much wider selection but will not be able to offer subsidies.
Premiums for similar plans will be the same, inside or outside of the Exchanges.

Phil Lee
www.HealthPlanTalk.com
www.Health-Insurance.com

Filed Under: Health Care Reform, Individual/Family Plans Tagged With: , , , , , , , , , , , , , , , , , , , , , , , , ,

Health Care Reform Employer Mandate or “Play or Pay” Delayed until 2015

July 3, 2013 By
The White House announced yesterday that enforcement of the Health Care Reform mandate, aka Play or Pay, will be delayed until 2015. This mandate requires large employers with 50 or more full-time equivalent employees to offer minimum essential coverage to full-time employees (and dependents) or incur a penalty tax of between $2,000 and $3,000 per employee should any full-time employee obtain coverage through a “marketplace” with the assistance of a federal subsidy. The delay of this (large employer) Pay or Play mandate does not affect employees’ access to premium tax credits, nor does it affect any other provision such as the Individual mandate. This delay is intended to allow the Treasury Department (IRS) time to consider ways of simplifying the new reporting requirements consistent with the mandate and also time to adapt health coverage and reporting systems while employers are taking steps toward making health coverage affordable and accessible for their employees. Formal guidance describing this transition is expected within the next week. Following is a link to one of many articles reporting on this story: http://www.bizjournals.com/bizjournals/washingtonbureau/2013/07/02/health-care-reforms-employer-mandate.html
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Applying to the right California Health Insurance Plan

June 11, 2009 By

Depending on your health condition, you may not be accepted into some plans like individual and family health plans.
Since health plans and rates are vastly different between the individual/family health insurance market, the Small Group market, the Cobra and HIPAA markets. You need to determine which is the most advantageous plans to apply to first. Usually this would depend on which plans have the lowest rates. If in the event you do not qualify for your top plan choice, you need to determine which alternatives to explore and in what order.
Frequently this is dependent on certain deadlines. For example you may be given 45 days after your termination from an employer to decide if you want to accept the Cobra that you are offered. Or you may have a 63 day window to decide if you want to apply for a guarantee-issue HIPAA plan after your Cobra expires.
In addition, the cost of each of these alternatives will have to figure into your decision. If you are unable to figure out the best course of action on your own, you may need the assistance of an experienced health insurance agent to help you select the most appropriate plans to apply to in different markets and in different orders or priority, based on your personal health and medical care needs, your pre-existing conditions, your guarantee-issue options, your risk tolerance and your budget.

© Philip W Lee, www.health-insurance.com, www.healthplantalk.com

Filed Under: Individual/Family Plans Tagged With: , , , , , , , , , ,

Who should buy Individual and Family Health Insurance Plans

June 11, 2009 By

Health insurance plans are not always provided by employers. In the 60 or so years since World War II it has become customary for employers to provide workers with their health insurance plans. But this was not always the case. During the wage freeze of WWII, Employers were not allowed to raise wages to entice women to join the workforce. Their solution was to provide benefits, starting with health insurance coverage. This has since become an entitlement.

If you are:
1. 0 through 64 years old.
2. Currently uninsured.
3. If you are paying too much for your current health plan.
4. If you change jobs frequently and prefer to have an individual plan as a backup in case you are disabled.
5. If you are self-employed.
6. If you own a small business.
7. If your employer does not offer group health insurance.
8. If your employer offers to pay for an individual health plan on your behalf.
9. If you don’t like the choice of plan offered by your employer.
10. If you are on COBRA.
11. If you are on an expensive guarantee-issue HIPAA mandated health plan.
12. If you are on an expensive out of state health plan.
13. If you are on a health discount program that are frequently disguised as affordable health insurance. These plans are dangerous and are not true health insurance.
14. If you have been laid off or are in between jobs.
15. If you are forced to seek individual coverage due to a divorce.
16. If your employer’s plan does not offer you the providers you need.
17. If you missed your employer’s open enrollment period for coverage.
18. If you got dropped from your parents plan due to age (19 to 24) or lack of full time student status.
19. If you retired before age 65 and need to bridge coverage to age 65.
20. If it costs too much to cover your spouse and children under your employer’s plan.
21. If you just started your own business.
22. If you just immigrated to the U.S.
23. If you plan to travel to other states or countries for a part of the year.
24. If you are uninsured and don’t want to rely on government run county or state hospitals and clinics.
25. If you are a physician with your own medical practice.
26. If you are on a work visa in the U.S.
27. If you are visiting the U.S. for an extended period of time.
28. If you are a Foreign Student.
29. If your College or University does not offer any medical care outside of an on-campus clinic.

© Philip W Lee, www.health-insurance.com, www.healthplantalk.com

Filed Under: Individual/Family Plans Tagged With: , , , , , , , , , , ,

Learn about California’s Efficient Health Insurance Market

January 1, 2009 By

California regulates health insurance to protect consumers, but does not overly restrict competition and free market forces.

California has a good number of insurance carriers each offering a wide selection of PPO and HMO type plans to consumers, small business and large corporations, in a free market environment.

All the rates, the plans and the benefits offered by all the health insurance carriers in California are pre-approved by the state’s regulatory agencies: the Department of Managed Care and the Department of Insurance.  All rate increases are also pre-approved by these state agencies.

Consumers in California can find affordable individual and family health insurance plans that are often one half, one third or less than those offered in states like New York and Massachusetts where well-meaning but misguided state regulations have driven out affordable health insurance plans.

California has a much larger network of physicians and hospitals than most other states.  Also, a very high percentage of doctors and hospitals participate in PPO and HMO Networks.

© Philip W Lee, www.health-insurance.com, www.healthplantalk.com

Filed Under: Group Plans, Individual/Family Plans Tagged With: , , , , , , , , , ,
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