THE AFFORDABLE CARE ACT AN OVERVIEW FOR HUMAN RESOURCE & FINANCE PROFESSIONALS AT MID-SIZED COMPANIES

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1 THE AFFORDABLE CARE ACT AN OVERVIEW FOR HUMAN RESOURCE & FINANCE PROFESSIONALS AT MID-SIZED COMPANIES 1 Mid-Sized Retirement & Healthcare Plan Management Conference San Francisco, CA March 17, 2014

2 GOALS FOR TODAY: 1. Understand the basics of the Affordable Care Act & how it relates to your business 2. Learn about the new health care coverage options 3. Be Inspired about your role to get employees & others enrolled To improve people s health Help save a family/business from financial ruin Help improve country s economic future

3 HEALTH & HUMAN SERVICES (HHS) HAS TEN REGIONS

4 HHS RESOURCE Our office serves as the public interface with federal health programs Represents Regional Issues to Influence Operation of Federal Programs Share Best Practices Across Region

5 THE CURRENT SYSTEM 51 Million Americans Without Coverage Mostly due to the high cost of insurance Fast rising health care costs, partially due to uninsured Economic hardship for families, small businesses and the US Economy 5

6 CURRENT SYSTEM 17.6% of economic output tied up in health care system Without reform by 2040, 1/3 of economic output tied up in health care 15% of GDP devoted to Medicare and Medicaid Number of uninsured would grow to 58 million in 2020* *Source: Urban Institute: The Cost of Failure to Enact Health Reform: March 15, 2010

7 THE HEALTH CARE LAW In March 2010, President Obama signed into law the Affordable Care Act.

8 THREE AIMS OF THE AFFORDABLE CARE ACT AFORDABLE CARE ACTRRIDING THEMES OF THE AFFORDABLE CARE Patient-ACT Better Care Centered Care Coordination Quality Better Insurance Staying Healthy Accessibility Prevention Affordability Public Health 8

9 INDIVIDUAL PAYMENT January 1, 2014 Exemptions include: Financial hardship; Religious objections; Native Americans Without coverage for less than 3 months; Incarcerated individuals; and Cost exceeds 8% of indiv. income.

10 EMPLOYER REQUIREMENTS (SHARED RESPONSIBILITY) Less than 50 Employees exempt Over 50 & Employee Receives Tax Credit Phased In 2015/16 Not Providing Any Coverage Not Providing Adequate Coverage <2% Large Employers Will Pay

11 NEW INSURANCE COVERAGE OPTIONS FOR MILLIONS OF AMERICANS 0%FPL 133%FPL 400%FPL Medicaid $15,000/Indiv.; $31,000/Family Marketplaces with Tax Credits $45,000/Indiv.; $92,000/Family Marketplaces or Private Plan

12 STRENGTHENS OTHER PUBLIC PROGRAMS Maintains funding for Children s Health Insurance Program (CHIP) through FY2015. Medicare Improves Care and Lowers Costs Preventive care with no copays, Improves drug coverage, Strict anti-fraud measures and Better care coordination

13 NEW INSURANCE STANDARDS No more pre-existing condition denials No more lifetime dollar limits on coverage Insurance companies can t drop your coverage when you get sick No more coverage denials without appeal

14 NEW INSURANCE STANDARDS ESSENTIAL HEALTH BENEFITS Required Categories: 1. Ambulatory patient services 2. Emergency services 3. Hospitalization 4. Maternity and newborn care 5. Mental health/substance use disorder services/bh treatment 6. Prescription drugs 7. Rehabilitative and habilitative services/devices 8. Laboratory services 9. Preventive/wellness services and chronic disease mgt 10.Pediatric services, including oral/vision care

15 COVERED CALIFORNIA PLANS - INDIVIDUALS 1. Anthem Blue Cross of California 2. Blue Shield of California 3. Chinese Community Health Plan 4. Health Net 5. Kaiser Permanente 6. L.A. Care Health Plan 7. Molina Healthcare 8. Sharp Health Plan 9. Valley Health Plan 10.Western Health Advantage 11.Ventura County Health Plan 12.Contra Costa Health Services

16 SMALL BUSINESS OPTIONS PROGRAM (SHOP) Who s eligible? 2014 / Upper limit of 50 FTEs 2016 Marketplaces must accommodate 100 FTE and below 2017 and Beyond State will decide When can businesses enroll? October 1, 2013, for coverage that began January 1, Now, throughout the year

17 COVERED CALIFORNIA PLANS SMALL BUSINESS 1. Blue Shield of California, 2. Chinese Community Health Plan, 3. Health Net, 4. Kaiser Permanente, 5. Sharp Health Plan and 6. Western Health Advantage

18 CATASTROPHIC PLANS Who is eligible? Young adults under 30 years of age Those who can not afford coverage and obtain a hardship waiver What is catastrophic coverage? Plans with high-deductibles and lower premiums Includes coverage of 3 primary care visits and preventive services with no out-of-pocket costs Protects consumers from high out-of-pocket costs

19 EMPLOYEE NOTIFICATION REQUIREMENT: DEPARTMENT OF LABOR Starting October 1, 2013 Employers Covered by the Fair Labor Standards Act Must Provide Written Notice to All Employees Informing Them: About the Health Insurance Marketplace They may be able to lower their cost via the Marketplace based on their income Buying insurance through the Marketplace may mean they lose their employer contribution (if any) to their health benefits No Penalty for Non-Compliance

20 IRS TRANSITION RELIEF FOR 2014 INFORMATION REPORTING Section 6055 requires annual information reporting by health insurance issuers, self-insuring employers, government agencies, and other providers of health coverage. Section 6056 requires annual information reporting by applicable large employers relating to the health insurance that the employer offers (or does not offer) to its full-time employees. For 2014, reporting under 6055 and 6056 is optional, no penalties will be applied for 2014.

21 IRS TRANSITION RELIEF FOR 2014 INFORMATION REPORTING Transition Relief Will: Provide more time for dialogue with stakeholders in an effort to simplify the reporting requirements Provide employers, insurers, and other reporting entities additional time to develop their systems for assembling and reporting the needed data. Once rules are issued, voluntarily compliance with these information reporting provisions for 2014 is encouraged until implementation in 2015.

22 MILLIONS OF LIVES ALREADY IMPROVED Since 2010, the Affordable Care Act has been. Increasing Access, Expanding Benefits Making Care More Affordable Holding Insurance Companies Accountable 22

23 INCREASING ACCESS TO AFFORDABLE CARE Approximately 4 million people have now signed up for a private health insurance since October 1 Through December 6.3 million people had learned they were eligible for Medicaid or renewed their coverage Small Business Health Care Tax Credit has provided more than $1 billion in tax credits 71 Americans with private insurance now receive Preventive Care with no out of pocket charges, 3.1 Million Young adults under 26 are now covered Expanded Community health centers increasing total number of patients served by 3.1 million

24 MAKING CARE MORE AFFORDABLE Growth in health care spending at an historic low Health insurance companies paid rebates worth $1.1 billion to nearly 13 million consumers an average rebate of $151 per household

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26 THE COUNTDOWN FOR 2014 COVERAGE HAS BEGUN! Americans in all fifty states have access to new marketplaces where many are able to get help to purchase more affordable, high quality health insurance plans. On January 1, 2014, health care become a reality for millions of previously uninsured, hardworking Americans Until March 31 st, 2014 Americans can sign up for coverage for 2014.

27 YOU CAN MAKE A DIFFERENCE. Your friends, your neighbors, and your country are counting on YOU to spread the word. Sign up for updates at SignUp.HealthCare.gov Educate yourself about your state s new health care options at healthcare.gov/marketplace Spread the word in your community using the customizable, co-brandable resources at HealthCare.gov/Toolkit Facebook/HealthCare.gov

28 Bonnie Preston Outreach & Policy Specialist, Office of Regional Director Health & Human Services Region IX San Francisco, CA (415)