YOUR BUSINESS, YOUR FUTURE: WHAT YOU NEED TO KNOW ABOUT HEALTHCARE REFORM

Transcription

1 YOUR BUSINESS, YOUR FUTURE: WHAT YOU NEED TO KNOW ABOUT HEALTHCARE REFORM Featuring: Gene Marks, The Marks Group, P.C. Decide On Healthcare Is Your Business Affected, And If So What Do You Do? NPCA 1

2 Still Divided. 1. Provide subsidies to low and moderate income Americans 2. Prohibit insurers from denying coverage because of health status 3. Provide tax credits to small biz that offer coverage to employees 4. Expands existing Medicaid programs to cover low income, uninsured adults regardless of whether they have children 5. Allows a govt panel to make decisions about end-oflife care TRUE TRUE TRUE TRUE FALSE NPCA 2

3 6. Allows undocumented immigrants to receive financial help from the government to buy health insurance 7. Cuts benefits that were previously provided to all people on Medicare FALSE FALSE 8. Creates a new govt run insurance plan to be offered with private plans FALSE 9. Requires all businesses to provide health insurance to their employees 10. Lance Armstrong used steroids when he won the Tour de France FALSE TRUE FALSE FIVE ESSENTIAL TERMS 1. Affordable Insurance Exchange 2. Employer Shared Responsibility 3. Individual Shared Responsibility 4. Essential Health Benefits 5. Small Business Healthcare Tax Credits NPCA 3

4 THE PROMISE Patient Protection and Affordable Care Act March 23, 2010 $1.1 Trillion cost $140 Billion reduction in the deficit Coverage for all: Cover 2/3 of the uninsured (the rest on Medicaid). A new market for million uninsured. State exchanges provide consumer protection/risk pooling/lower costs Average Annual Worker Premium Contributions and Total Premiums for Covered Workers, Single and Family Coverage, by Firm Size, 2013 $18,000 $16,000 All Small Firms (3-199 Workers) All Large Firms (200 or More Workers) $15,581 $16,715 $14,000 $12,000 $10,000 $8,000 $6,000 $4,000 $5,711 $5,967 $5,284 $4,226 $2,000 $0 $862 $1,065 Premium Worker Contribution* Premium* Worker Contribution* Single Coverage Family Coverage * Estimates are statistically different between All Small Firms and All Large Firms (p<.05). SOURCE: Kaiser/HRET Survey of Employer-Sponsored Health Benefits, NPCA 4

5 Seven Things You Need To Know 1. Understand The Timeline 2. Calculate Full vs. Part Time Employees 3. Determine If Your Plan Qualifies 4. Figure Out The Mandate 5. See If You re Eligible For A Tax Credit 6. Get Ready For The State Exchanges 7. Your Next Actions Now 2011 Higher Premiums Tax Credit Dependent Care Pre-Existing Conditions The amount that workers may contribute to their flexible spending accounts has been reduced to $2,500, down from $5,000. OTC drugs excluded from HSA Accounts 20% Tax on Distributions from HSA (unqualified exp) Automatic enrollment in health plans NPCA 5

6 Reporting - REPEALED W-2 Reporting Summary of Benefits and Coverage a few other interesting provisions Women's Preventative Health Care Amendment - Free contraceptives, breast-feeding supplies, screenings for sexually transmitted infections, counseling for domestic violence and routine check-ups for breast and pelvic exams, Pap tests and prenatal care. 10% Tanning Tax. Calorie Information In Restaurants Parent And Coping Skills - $1.5 billion so that young mothers who need them can get visits once or twice a month from nurses. Breast-feeding Friendly Workplace Bathrooms don t count NPCA 6

7 2013 Medicare Part D (prescription drug) deduction ends Individual Medicare taxes rise from 1.45% to 2.35% for high income people Additional 2.9% Tax on unearned income begins for high income people Capital gains tax increases from 15% to 20% Dividends tax increases from 15% to 20% Itemized deduction ceiling rises from 7.5% to 10% Flexible spending accounts limited to $2,500 withdrawals Notification to employees about Health Exchanges NPCA 7

8 2014 It Hits The Fan! Waiting periods cannot exceed 90 days Pre-existing conditions waived for everyone New reporting requirements to the government Employers must report on health coverage of each employee and family members covered: name, SSN, coverage detail. Individual Mandate SHOP Exchanges November BIG DELAYS: -Employer Mandate -Max Out Of Pocket Individuals $6,350/Families $12, What Was Delayed Now Happens 1. Employer Mandate 2. Max Individual Out Of Pocket - $6,350 Max Family Out Of Pocket - $12,700 NPCA 8

9 Seven Things You Need To Know 1. Understand The Timeline 2. Calculate Full vs. Part Time Employees 3. Determine If Your Plan Qualifies 4. Figure Out The Mandate 5. See If You re Eligible For A Tax Credit 6. Get Ready For The State Exchanges 7. Your Next Actions Now DO YOU HAVE 50 FTEs? NO? No health insurance requirement No penalties Tax credit available NPCA 9

10 DO YOU HAVE 50 FTEs? YES? You must provide (and pay for) a health plan for your FULL TIME WORKERS that covers 60% (a bronze plan) of their costs. AND It must be affordable. The employee can t be paying more than 9.5% of his/her HOUSEHOLD income for healthcare premiums. FULL VS PART TIME EMPLOYEES How many full time employees do you have? Those are the ones who you will have to cover How many full time equivalent employees (FTE) do you have. Those are the ones who will figure into your >50 calculation. NPCA 10

11 WHO IS FULL TIME? WHO IS PART TIME? IRS Notice Owners/family members excluded Common ownership/effective control: IRS rules Full-time employees: existing: 30 hours per week. Full-time equivalent of part-time employees: (divide the total annual hours of part-time employees by 2080) THE MATH -Assume common control -40 employees who work more than 30 hours per week -200 hours of part-time work is performed per week by 12 other workers. 200 x 52 = 10,400 hours that year -Divide by 2080 (40 hour week for 52 weeks per year) -you have 5 additional Full Time Equivalent Employees -you have a total of 45 FTEs NPCA 11

12 Seven Things You Need To Know 1. Understand The Timeline 2. Calculate Full vs. Part Time Employees 3. Determine If Your Plan Qualifies 4. Figure Out The Mandate 5. See If You re Eligible For A Tax Credit 6. Get Ready For The State Exchanges 7. Your Next Actions Now YOU WILL CHOOSE (AND PAY FOR) ANY (OR A COMBINATION) OF THESE PLANS: Bronze: Covers 60% of total costs Silver: Covers 70% of total costs Gold: Covers 80% of total costs Platinum: Covers 90% of total costs NPCA 12

13 THE PLANS MUST OFFER THESE ESSENTIAL HEALTH BENEFITS: Ambulatory patient services Emergency services Hospitalization Maternity and newborn care Mental health and substance use disorder services, including behavioral health treatment Prescription drugs Rehabilitative and habilitative services and devices Laboratory services Preventive and wellness services and chronic disease management Pediatric services, including oral and vision care Seven Things You Need To Know 1. Understand The Timeline 2. Calculate Full vs. Part Time Employees 3. Determine If Your Plan Qualifies 4. Figure Out The Mandate 5. See If You re Eligible For A Tax Credit 6. Get Ready For The State Exchanges 7. Your Next Actions Now NPCA 13

14 THE INDIVIDUAL MANDATE Beginning 2014 everyone must have coverage, either purchased individually or provided by an employer By 2019: Penalties for the individual is the higher of $695 or 2.5% of Adjusted Gross Income. The Phase-In: $95 or 1% of AGI in 2014, $325 or 2% of AGI in 2015) Exemptions: can t afford coverage, Indian tribes, hardship, religious conscience THE BUSINESS MANDATE Delayed until 1/1/15 Penalties for companies are $2,000 per employee with the first 30 FTE exempt No requirement to provide insurance for PT employees NPCA 14

15 Employers with >50 FTE Example Number of FTE 55 Health care premiums $330,000* Employer Covered $275,000** Penalty $50,000 *55 x $6,000 average per Kaiser study **55 x $5,000 average per Kaiser study YOU MUST PROVIDE AFFORDABLE COVERAGE Or your fine is $3,000. NPCA 15

16 THAT 9.5% THING? 1. You offer health insurance coverage that meets the minimum requirements 2. A FT employee is paying more than 9.5 percent of his household income for healthcare premium 3. AND he obtains health insurance through the public exchange 4. AND he receives a subsidy for coverage because he meets Fed Poverty Limitations (FPL) You pay a penalty of $3,000 per employee receiving the subsidy. FEDERAL POVERTY LEVEL RULE OF THUMB Single/families are eligible for assistance if they are within 400% of Federal Poverty Level (FPL) Rule of thumb: Single people earning up to $46,000 and family of four earning up to about $89,000. NPCA 16

17 Seven Things You Need To Know 1. Understand The Timeline 2. Calculate Full vs. Part Time Employees 3. Determine If Your Plan Qualifies 4. Figure Out The Mandate 5. See If You re Eligible For A Tax Credit 6. Get Ready For The State Exchanges 7. Your Next Actions Now THE TAX CREDIT <25 FTE <$50,000 average salary 35% - 50% credit for health insurance Starting in 2015 you ll need to buy your insurance from a state healthcare exchange Small Business Health Options Program (SHOP) NPCA 17

18 Employers with <10 FTE Example 2014 Number of FTE 9 Annual average wages $24,000 Percent covered 100% Cost to provide health insurance $45,000 Tax credit ($22,500) 50% Net cost for health insurance $22,500 Employers with FTE Example 2014 Number of FTE 20 Annual average wages $45,000 Percent covered 100% Cost to provide health insurance $100,000 35% Tax credit $50,000 50% FTE credit reduction ($4,480) Wage credit reduction ($11,200) ACTUAL CREDIT $34, % NPCA 18

19 Seven Things You Need To Know 1. Understand The Timeline 2. Calculate Full vs. Part Time Employees 3. Determine If Your Plan Qualifies 4. Figure Out The Mandate 5. See If You re Eligible For A Tax Credit 6. The State Exchanges 7. Your Next Actions Now NPCA 19

20 State Run: 17 Fed Run: 26 Fed "Partnership": 7 The Exchange 1. Established 10/1/ Open enrollment for ObamaCare's health insurance marketplace goes from Oct 1st, 2013 to March 31st, Coverage purchased on the marketplace by the 15th of each month starts the 1st of the following month. 4. You must have coverage by April 1st, 2014 to avoid the per month fee for not having health insurance in This is due to a coverage gap exemption from the individual mandate that allows every American three months in a row without insurance. NPCA 20

21 The Exchange 5. There are three types of cost assistance offered through the Health Insurance Marketplace tho those making under a certain amount of income who don't have access to employer based insurance. Medicaid for those making less than 138% of the Federal poverty level (FPL). Help with out-of-pocket costs for those making up to 250% of the FPL. Premium tax credits to reduce monthly premiums for those making up to 400% of the FPL. Why Exchanges? 1. No more raising prices or refusing to offer insurance to sick people; 2. Less price discrimination allowed against old people; 3. More regulation of what counts as insurance ; 4. About $950 billion in subsidies to lower-income participants over the first 10 years; 5. More direct and transparent competition between insurers; 6. Easier place to buy. NPCA 21

22 SHOP EXCHANGES...DELAYED UNTIL NOVEMBER 2014 Small Business Health Options Programs Employers can buy through SHOP or from private agents. Pools to purchase insurance Private insurance plans Multi State Health Plans (min 2 are required) Consumer Operated and Oriented Plans (Co-Ops) Seven Things You Need To Know 1. Understand The Timeline 2. Determine If Your Plan Qualifies 3. Figure Out The Mandate 4. Calculate Full vs. Part Time Employees 5. See If You re Eligible For A Tax Credit 6. Get Ready For The State Exchanges 7. Your Next Actions Now NPCA 22

23 Your Options. 1. Drop All Coverage 2. Bronze, Silver, Gold or Platinum 3. Drop But Compensate 4. Private Exchanges NPCA 23

24 SEARS: Discontinue health care A flat payment to employees Reflects tax effects Employee free to buy wherever WALMART : Newly hired part-time employees at Wal-Mart will have to work a maximum of 30 hours a week. 9/9/13: America s biggest employers, from GE to IBM, are increasingly moving retirees to insurance exchanges where they select their own health plans, an historic shift that could push more costs onto U.S. taxpayers. Elimination of some high premium plans FIVE ESSENTIAL TERMS 1. Affordable Insurance Exchange 2. Employer Shared Responsibility 3. Individual Shared Responsibility 4. Essential Health Benefits 5. Small Business Healthcare Tax Credits NPCA 24

25 THE BENEFITS Drop in Premiums!! Rise in Coverage!! Small businesses excluded and get a tax credit Business opportunities from growth in healthcare/bigger market Easier for workers to move from jobs Easier to budget Potential less admin for small companies ISSUES TO FOLLOW. Potential sticker shock to employers? If you re young why buy? If you re sick.why buy? More docs opting out of taking insured patients State participation in Exchanges? Medicaid? Who will enforce? NPCA 25

26 RESOURCES Kaiser Foundation Department of Health and Human Services Healthcare Reform Site Washington Post Wonkblog: NPCA 26