The Patient Protection and Affordable Care Act

Transcription

1 The Patient Protection and Affordable Care Act Collective Bargaining, Research and Benefits Department USW Constitutional Convention Las Vegas, Nevada August 15-18, 2011

2 The Patient Protection and Affordable Care Act The Patient Protection and Affordable Care Act (ACA) became law on March 23, The ACA protects and improves the benefits of those who have them, and provides quality, affordable health care for Americans who are uninsured or underinsured. Because of the ACA, 95% of Americans will have access to health insurance.

3 Topics to Cover A. What the ACA Costs and How It s Paid For B. Key Reforms Effective for plan years on or after September 23, 2010 C. Other Provisions

4 Part A: What the ACA Costs and How It s Paid For

5 What It Costs & How It s Paid For Non-partisan Congressional Budget Office: $938 billion over the next 10 years Congressional Budget Office: reform will reduce the federal deficit by more than $100 billion over the next 10 years and more than $1 trillion over the second decade by cutting government overspending and reining in waste, fraud and abuse Paid for in part by requiring more employers to contribute to the cost of coverage for their workers, and by requiring wealthy individuals to pay higher taxes

6 The Excise Tax What is an excise tax? A tax on the use or consumption of a certain product. Excise taxes are sometimes included in the price of a product It is NOT an income tax.

7 Excise Tax The Facts Facts Employers are required to report the dollar value of an employee s healthcare benefits on 2012 W-2s in anticipation of the excise tax that will begin to apply in 2018; but individuals will not be taxed on the dollar value of their benefits Beginning in 2018, insurers will be taxed on just part of a participant s benefits that rise above a certain level Your union will continue to work to make sure that the insurers do not pass along the cost of the excise tax to you and your families

8 Excise Tax What it Pays For Excise tax on high-cost health care plans was significantly improved: the tax itself was delayed until 2018 and the level at which the tax would kick in was raised In the final bill, we reduced the revenue from the excise tax by 85 percent Now, the tax only accounts for 3 percent of the funding Your union and all of labor worked with House and Senate Leadership and the White House to replace that source of funding Now the majority of the revenue to fund health care reform comes from a tax on people making over $200,000 per year or $250,000 per year for joint returns

9 Part B: Key Reforms Effective for Plan Years on or after September 23, 2010

10 Grandfathered vs. non-grandfathered plans Grandfathered = a fully insured or self funded plan that was in existence on March 23, A grandfathered plan will remain grandfathered until it makes certain changes to the plan that cause a loss of grandfathered status. Non-grandfathered = a fully insured or self funded plan that was not in existence on March 23, 2010, OR a plan which was previously grandfathered but which lost its grandfathered status due to certain plan changes. Most of the insurance reforms provided by the Act apply regardless of the plan s grandfathered status. However, some provisions are not applicable to grandfathered plans until such time as the plan loses its grandfathered status.

11 Key reforms that apply regardless of grandfathered status Effective for plan years beginning on or after 9/23/10 (meaning 1/1/11 for calendar year plans): Restriction on annual maximums for essential benefits (the plan cannot limit payment of claims to a annual dollar limit maximum with regards to essential benefits and leave the participant responsible for all remaining costs; beginning in 2014, annual maximums are completely prohibited); essential benefits include hospital and ER services, doctors visits, prescription drugs, maternity and newborn care, mental health and substance abuse care, rehabilitation, lab tests, preventative and wellness care, and pediatric care Prohibition on lifetime maximums (the plan cannot limit payment of claims to a lifetime dollar limit maximum and leave the participant responsible for all remaining costs)

12 Key reforms that apply regardless of grandfathered status Effective for plan years beginning on or after 9/23/10 (meaning 1/1/11 for calendar year plans): Prohibition on rescission of coverage (the plan cannot drop coverage of a participant when the participant gets sick) Prohibition on pre-existing condition exclusions for children under age 19 (beginning in 2014, the prohibition extends to everyone)

13 Key reforms that apply regardless of grandfathered status Extension of coverage to adult children up to age 26 if no coverage is offered by their employer (beginning in 2014, coverage will be extended to those adult children with an offer of employer coverage) An eligible adult child can be covered regardless of: - Marital status (child may be single, married, divorced) - State of residence (child does not have to live in your state) - Student status (child does not have to be a FT student) - Tax dependency status (child does not have to be your tax dependent) Your adult child is not eligible for coverage under your plan if: - He has an offer of coverage through his job or his spouse s job (even if the coverage is expensive and he elects not to take it) Coverage under your plan does not extend to: - Your adult child s spouse - Your adult child s children

14 Key reforms that apply regardless of grandfathered status Effective for plan years beginning on or after 9/23/10 (meaning 1/1/11 for calendar year plans): Rebate of medical loss ratios: Insurance companies are required to spend at least 85% (80% for small groups) of premium dollars on health care. - So 85 cents of every dollar must be spent on actual health care and not overhead, administrative costs, or advertising. Does not apply to self-insured plans.

15 Key reforms that apply ONLY to non-grandfathered plans Effective for plan years beginning on or after 9/23/10 (meaning 1/1/11 for calendar year plans): Coverage of preventative health services - no cost-sharing (no copays or coinsurance) - preventative health care services include: blood pressure screening, colorectal cancer screening, type 2 diabetes screening, immunizations, mammograms, cervical cancer screenings, and others Patient protections (requirements relating to choice of primary care doctor, coverage of ER services without prior authorization, out of network cost sharing, and referrals) Improved appeals process for denied claims

16 Collectively Bargained Plans The reforms that apply to both grandfathered and nongrandfathered plans (no lifetime limits, extension of dependent coverage, etc.) are NOT subject to any collective bargaining delays. As a result, these reforms can become effective during the term of the collective bargaining agreements ratified before March 23, 2010 The reforms that apply ONLY to non-grandfathered plans MAY be delayed if the non-grandfathered plan is fully insured and covered by a CBA.

17 Cost of the First Wave of Reform Mandates Experts have estimated that the reforms effective for plan years beginning on or after September 23, 2010 will increase premium costs about 4-6%.

18 Part C: Other Provisions

19 Health Care Exchanges Effective January 1, 2014 Starting in 2014 insurance can be purchased through an Exchange - an insurance marketplace where individuals and small businesses can buy affordable and qualified health benefit plans. Exchanges will offer a choice of health plans that meet certain benefits and cost standards. Starting in 2014, Members of Congress will be getting their health care insurance through Exchanges. We do not know a lot of details yet about how the Exchanges will operate

20 Help for Retirees EARLY RETIREE REINSURANCE PROGRAM (ERRP) Helps early retirees (pre-65) by creating a temporary reinsurance program to help VEBAs and employers offset the costs of providing healthcare benefits for retirees age Full coverage for preventative screenings for Medicare beneficiaries, and lessening of the donut-hole for prescriptions Donut Hole this refers to a gap in prescription coverage for people on Medicare. Medicare covers a portion, but then participants have to pay out of pocket before they reach a new level of coverage.

21 Help for Our Small Businesses Small businesses that choose to offer coverage will begin to receive tax credits of up to 35 percent of premiums to help make employee coverage more affordable This may help hundreds of small businesses where USW members work we can suggest this in bargaining

22 Bargaining Power Health care costs are the single biggest issue at the bargaining table Reform helps lower costs for all of us, offers alternatives so that we can focus on wages, pensions, health and safety and other issues Helps our employers be more competitive, which saves jobs The path we were on was simply unsustainable

23 Tools and Resources Online toolkit Latest information on what law means for you Fact sheets and resources Talking points, flyers Videos and more Staffing: War room staff at USW headquarters research, support District coordinators Legislative staff in D.C. monitoring reform implementation, impact on bargaining, etc. and standing up for you in these debates.

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