Take a look at the great article from Employee Benefits Advisor on what employers need to know about healthcare with the collapse of the AHCA by Alden J. Bianchi and Edward A. Lenz.
The stunning failure of the U.S. House of Representatives to pass the American Health Care Act has political and policy implications that cannot be forecasted. Nor is it clear whether or when the Trump administration and Congress will make another effort to repeal and replace, or whether Republicans will seek Democratic support in an effort to “repair,” the Affordable Care Act. Similarly, we were unable to predict whether and to what extent the AHCA’s provisions can be achieved through executive rulemaking or policy guidance.
Here are some ways the AHCA’s failure could impact employers in the near term.
Immediate impact on employers
Employers were not a major focus of the architects of the ACA, nor were they a major focus of those who crafted the AHCA. This is not surprising. These laws address healthcare systems and structures, especially healthcare financing. Rightly or wrongly, employers have not been viewed by policymakers as major stakeholders on those issues.
In a blog post published at the end of 2014, we made the following observations:
The ACA sits atop a major tectonic plate of the U.S. economy, nearly 18% of which is healthcare-related. Healthcare providers, commercial insurance carriers, and the vast Medicare/Medicaid complex are the law’s primary stakeholders. They, and their local communities, have much to lose or gain depending on how healthcare financing is regulated. The ACA is the way it is largely because of them. Far more than any other circumstance, including which political party controls which branch of government, it is the interests of the ACA’s major stakeholders that determine the law’s future. And there is no indication whatsoever that, from the perspective of these entities, the calculus that drove the ACA’s enactment has changed. U.S. employers, even the largest employers among them, are bit players in this drama. They have little leverage, so they are relegated to complying and grumbling (not necessarily in that order).
With the AHCA’s collapse, the ACA remains the law of the land for the foreseeable future. The AHCA would have zeroed out the penalties on “applicable large” employers that fail to make qualified offers of health coverage, but the bill’s failure leaves the ACA’s “play or pay” rules in full force and effect. The ACA’s reporting rules, which the AHCA would not have changed, also remain in effect. This means, among other things, that many employers, especially those with large numbers of part-time, seasonal, and temporary workers that face unique compliance challenges, will continue to be in the position of “complying and grumbling.”
This does not mean that nothing has changed. The leadership of the Departments of Health and Human Services, Labor and Treasury has changed, and these agencies are now likely to be more employer-friendly. Thus, even though the ACA is still the law, the regulatory tone and tenor may well be different. For example, although the current complex employer reporting rules will remain in effect, the Treasury and IRS might find administrative ways to simplify them. Similarly, any regulations issued under the ACA’s non-discrimination provisions applicable to insured health plans (assuming they are issued at all) likely will be more favorable to employers than those issued under the previous administration.
There are also unanticipated consequences of the AHCA’s failure that employers might applaud. We can think of at least two.
1. Stemming the anticipated tide of new state “play or pay” laws
The continuation of the ACA’s employer mandate likely will put on hold consideration by state and local governments of their own “play or pay” laws.
In anticipation of the repeal of the ACA’s employer mandate, the Governor of Massachusetts recently introduced a budget proposal that would reinstate mandated employer contributions to help cover the costs of increased enrollment in the Medicaid and Children’s Health Insurance Program, known as MassHealth. Under the proposal, employers with 11 or more full-time equivalent employees would have to offer full-time employees a minimum of $4,950 toward the cost of an employer group health plan, or make an annual contribution in lieu of coverage of $2,000 per full-time equivalent employee. While the Governor’s proposal is not explicitly conditioned on repeal of the ACA’s employer mandate, the ACA’s survival may prompt a reconsideration of that approach.
California lawmakers were also considering ACA replacement proposals, including a single-payer bill introduced last month by Democratic state senators Ricardo Lara and Toni Atkins. Had the ACA’s employer mandate been repealed, those proposals were likely just the tip of an iceberg. When the ACA was enacted in 2010, Hawaii, Massachusetts, and San Francisco were the only jurisdictions with their own healthcare mandates on the books. But in the prior two-year period, before President Obama was elected and made healthcare reform his top domestic priority, more than two dozen states had introduced various “fair share” health care reform bills aimed at employers.
Most of the state and local “play or pay” proposals would have required employers to pay a specified percentage of their payroll, or a specified dollar amount, for health care coverage. Some required employers to pay employees a supplemental hourly “health care” wage in addition to their regular wages or provide health benefits of at least equal value. California, Illinois, Pennsylvania, and Wisconsin considered single-payer proposals.
To be sure, any state or local “play or pay” mandates would be subject to challenge based on Federal preemption under the Employee Retirement Income Security Act (ERISA). While some previous “play or pay” laws were invalidated under ERISA (e.g., Maryland), others (i.e., San Francisco) were not. In sum, given the failure of the AHCA, there would appear to be no rationale, at least for now, for any new state or local “play or pay” laws to go forward.
2. Avoiding upward pressure on employer premiums as a result of Medicaid reforms
The AHCA proposed to reform Medicaid by giving greater power to the states to administer the Medicaid program. Under an approach that caps Medicaid spending, the law would have provided for “per capita allotments” and “block grants.” Under either approach, the Congressional Budget Office, in its scoring of the AHCA, predicted that far fewer individuals would be eligible for Medicaid.
According to the CBO: CBO and JCT estimate that enacting the legislation would reduce federal deficits by $337 billion over the 2017 to 2026 periods. That total consists of $323 billion in on-budget savings and $13 billion in off-budget savings. Outlays would be reduced by $1.2 trillion over the period, and revenues would be reduced by $0.9 trillion. The largest savings would come from reductions in outlays for Medicaid and from the elimination of the ACA’s subsidies for non-group health insurance.
While employers rarely pay attention to Medicaid, the AHCA gave them a reason to do so. Fewer Medicaid-eligible individuals would mean more uncompensated care — a significant portion of the costs of which would likely be passed on to employers in the form of higher premiums. As long as the ACA’s expanded Medicaid coverage provisions remain in place, premium pressure on employers will to that extent be avoided.
Long-term impact on employers
As we conceded at the beginning, it’s not clear how the Republican Congress and the Administration will react to the AHCA’s failure. If the elected representatives of both political parties are inclined to try to make the current system work, however, we can think of no better place that the prescriptions contained in a report by the American Academy of Actuaries, entitled “An Evaluation of the Individual Health Insurance Market and Implications of Potential Changes.”
The actuaries’ report does not address, much less resolve, the major policy differences between the ACA and the AHCA over the role of government — in particular, the extent to which taxpayers should be called on to fund the health care costs of low-and moderate-income individuals, and whether U.S. citizens should be required to maintain health coverage or pay a penalty. And even if lawmakers can reach consensus on those contentious issues, they still would have to agree on the proper implementing mechanisms.
But whatever the outcome, employers are unlikely to play a major role.
See the original article Here.
Bianchi A. & Lenz E. (2017 April 6). How employers should proceed after the AHCA’s collapse [Web blog post]. Retrieved from address https://www.employeebenefitadviser.com/opinion/how-employers-should-proceed-after-the-ahcas-collapse
Great article from our partner, United Benefit Advisors (UBA) by Danielle Capilla
On February 23, 2017, the Department of Health and Human Services’ Centers for Medicare & Medicaid Services (CMS) released its Insurance Standards Bulletin Series, in which it re-extended its transitional policy for non-grandfathered coverage in the small group and individual health insurance markets.
States may permit issuers that have renewed policies under the transitional policy continually since 2014 to renew such coverage for a policy year starting on or before October 1, 2018; however, any policies renewed under this transitional policy must not extend past December 31, 2018.
If permitted by applicable state authorities, health insurance issuers may choose to continue certain coverage that would otherwise be cancelled, and affected individuals and small businesses may choose to re-enroll in such coverage.
As background, CMS’ transitional policy was first announced in November 14, 2013; CMS had most recently extended the transitional policy on February 29, 2016, for an additional year for policy years beginning on or before October 1, 2017, provided that all policies end by December 31, 2017.
Policies subject to the transitional relief are not considered to be out of compliance with the ACA’s single risk pool requirement or the following Public Health Service Act (PHS Act) provisions:
However, issuers can choose to adopt some of or all these provisions in their renewed policies.
Practically speaking, grandmothering provides some small employers the option to maintain a pre-ACA health plan. Although not every state allows grandmothering of policies and not all insurance carriers offer the option in those states endorsing it, there are still some employers in the 35 states that allow grandmothering who are able to be composite rated (rates based on the health status of the group), which protects young, healthy groups in particular. Grandmothered groups with older, unhealthy populations could still move to community-rated ACA- compliant plans, which were generally less costly for them, giving all groups the flexibility to save money. The UBA Health Plan Survey finds that though this grandmothered group is shrinking (8.1% of all plans compared to 17% in 2015), these employers have helped to keep overall average increases in check. In fact, premium renewal rates (the comparison of similar plan rates year over year) have increased an average of 5.9% for all plans—up only slightly from last year’s 5.6% increase. Small groups who found temporary protection this year through grandmothering and the PACE Act (depending on their state) were a significant factor in overall cost mitigation.
Capilla D. (2017 March 21). CMS allows states to extend life of “grandmothered” or transitional health insurance policies[Web blog post]. Retrieved from address http://blog.ubabenefits.com/cms-allows-states-to-extend-life-of-grandmothered-or-transitional-health-insurance-policies
With the fall of the AHCA find out what is next for employers in terms of healthcare from the great article at HR Morning by Christian Schappel.
The Republican’s best attempt to repeal the Affordable Care Act (ACA) to date has been axed. Where does that leave employers, and what can they expect next?
For starters, it leaves employers with the ACA and everything that comes with it … the employer mandate … the reporting requirements … the whole enchilada.
In other words, any organizations that relaxed their ACA compliance efforts — believing the Republican’s American Health Care Act would repeal and replace Obamacare — could be exposing themselves to non-compliance penalties.
The more complicated question is: What happens next?
With this appearing to be the GOP’s best shot at repealing and replacing Obamacare (or at least parts of it) in one stroke, and the party failing to push its legislation through Congress, President Trump and House Speaker Paul Ryan (R-WI) appear resigned to the fact that the ACA will remain in place indefinitely.
“We’re going to be living with Obamacare for the foreseeable future,” Ryan said after announcing the GOP bill would not be voted on in the House.
Trump has even indicated that after this loss for the GOP, he wants the party to focus on other issues, like tax reform.
But that doesn’t mean health reform will be on the back burner.
It now appears that Republicans’ best course of action to implement reform changes would be to attempt to “fix” parts of the ACA that are deemed to not be working. And it could do that by including small healthcare provisions in other pieces of legislation, like future tax reform bills.
Trump and his fellow Republicans could also seek to offer concessions to Democrats in future legislation as a means to get members of the left to agree to include certain provisions of the American Health Care Act in future bills.
Example, Republicans are still expected to push hard for a rollback of the ACA’s expansion of Medicaid, and members of the GOP could seek to include rollback provisions in future tax reform legislation in exchange for proposing a tax reform plan Democrats would find more palatable.
So why did the American Health Care Act fail, despite Republicans controlling the House, Senate and White House?
The answer starts with the fact that the GOP didn’t have the 60 seats in the Senate to avoid a filibuster by the Democrats. In other words, despite being the majority party, it didn’t have enough votes to pass a broad ACA repeal bill outright.
As a result, Senate Republicans had to use a process known as reconciliation to attempt to reshape the ACA. Reconciliation is a process that allows for the passage of budget bills with 51 votes instead of 60. So the GOP could vote on budgetary pieces of the health law, without giving the Democrats a chance to filibuster.
The problem for Republicans was reconciliation severely limited the extent to which they could reshape the law — and it’s a big reason the why American Health Care Act looked, at least to some, like “Obamacare Lite.”
Ultimately, what caused Trump and Ryan to decide to pull the bill before the House had a chance to vote on it was that so many House Republicans voiced displeasure with the bill and said they wouldn’t vote for it.
Specifically, here are some of what conservatives didn’t like about the American Health Care Act:
Schappel C. (2017 March 29). ACA repeal bill nixed: what’s next for healthcare reform, employers? [Web blog post]. Retrieved from address http://www.hrmorning.com/aca-repeal-bill-nixed-whats-next-for-healthcare-reform/
Does the implementation of the AHCA have you worried about your employee benefits? Take a look at this great article from Employee Benefit News about what the implementaion of the AHCA will mean for employers by Joel Wood.
In breaking down the Congressional Budget Office’s assessment of the proposed American Health Care Act, let’s look at the impact of the AHCA on employer-sponsored plans. The CBO estimates that 2 million fewer Americans will have employer-sponsored coverage in 2020, growing to seven million by 2027. Here’s CBO’s rationale:
These are valid points. The CBO experts are basing their estimates on sound economics and inside the constraints of their authority, and so of course we worry about any proposal that devolves employer-sponsored care. But, we also have to note that the CBO said much the same about the Affordable Care Act, which largely didn’t happen. And CBO notwithstanding, we at the Council of Insurance Agents & Brokers, too, feared something of a death spiral after the ACA was enacted.
The ACA’s employer penalties were very small in comparison to premiums, and it made sense that many would dump their plans, give their employees cash, and send them to the subsidized exchanges. Also, the subsidies were pretty rich — graduating out at 400% of the poverty line. That’s more than $90,000 for a family of four.
What we didn’t take into account in reference to the ACA were a number of things:
So employer-sponsored health insurance has, well, thrived since the enactment of the ACA — perhaps in spite of it, not because of it.
If the CBO is correct and seven million people lose ESI over the next decade, that’s problematic. But it ignores other opportunities that are being created through the proposed GOP bill and Trump Administration executive actions.
Republicans propose significant expansion of HSAs that will compliment higher-deductible ESI plans. They want work-arounds for state mandates on essential health benefits, even though their goal of “buying across state lines” can’t be realized through the tricky budget reconciliation process. And, ultimately, Republicans want to realize the potential for the ACA wellness provisions that have been eviscerated through years of EEOC/ADA/GINA conflicts. That would be a big win for employers.
The most important tradeoff between the “discussion draft” of a few weeks ago and the AHCA is that GOP House leaders junked their plan to tax 10% of employee contributions for ESI plans, in favor of pushing the Cadillac tax out five more years, to 2025.
Personally, I figure I’ve got another decade left in me to lobby for this industry, and that would get me eight years along the way. That’s a terrific tradeoff in my book, especially as Ways & Means Chairman Kevin Brady (R-Texas) emphasized he never intends for that tax to go into effect — it’s purely a budgetary gimmick. And, it’s a ridiculous “score” from CBO anyway. Everybody knows that no employer is going to pay that tax; they’ll work their plan design to get under the numbers.
Where does Donald J. Trump stand on parental leave, minimum wage and other important workplace issues? Here’s what employers need to know.
My conclusions at this moment in time, thus, are:
Sometimes, when lobbying blank-faced Republican leaders on the importance of ESI, I feel like the old BB King lyric: “Nobody loves me but my mother, and she could be jivin’, too.”
But because of, or in spite of, current legislative efforts that are dominating the headlines, I feel relatively well-poised for ESI to continue to be the means through which a majority of Americans receive the health insurance they like and they want to keep. Our job is for them to keep it. Notwithstanding lots of obstacles, we will.
Wood J. (2017 March 21). CBO estimate of AHCA impact on employer-sponsored benefits is off the mark [Web blog post]. Retrieved from address https://www.benefitnews.com/opinion/cbo-estimate-of-ahca-impact-on-employer-sponsored-benefits-is-off-the-mark
Does the repeal of the ACA have you worried? Checkout this great article about some of the changes that will come with the repeal of the ACA by Jared Bilski.
A draft of the Republicans’ Affordable Care Act (ACA) replacement bill that was leaked to the public is likely to look a lot different when it’s finalized. Still, it gives employers a good indication of how Republicans will start to deliver on their promises to “repeal and replace” Obamacare.
It should come as no surprise to employers that the GOP replacement bill, which was obtained by POLITICO, would scrap a cornerstone of the ACA — the individual mandate — as well as income-based subsidies and all of the laws current taxes (at least one replacement tax is included in the legislation).
According to the discussion draft of the replacement bill, it would offer tax credits for purchasing insurance; however, those credits would be based on age instead of income.
For example, a person under the age of 30 would receive a credit of $2,000. A person over the age of 60, on the other hand, would receive double that amount.
Some of the other highlights of the leaked legislation include:
Obamacare’s essential health benefits mandates require health plans to cover 10 categories of healthcare services, which include:
Under the bill, individual states would make the decisions about what types of services plans must cover — beginning in 2020.
The Medicaid expansion under Obamacare that has covered millions of people will be phased out by 2020 under the GOP bill. The replacement proposal: States would receive a set dollar amount for each person.
There would also be variations in the funding amounts based on an individual’s health status. In other words, more money would be allocated for disabled individuals, which is a huge departure from the open-ended entitlement of the current Medicaid program.
One of the most popular elements of the ACA would apparently remain untouched under the GOP bill: the Obamacare provision that prohibits health plans from discriminating against people with pre-existing conditions.
However, the legislation does take aim at older individuals. The GOP would allow insurers to charge older people up to five times more for healthcare than younger individuals. The current ACA limits that difference to three times as much.
The bill does aim to remedy this discrepancy by providing bigger tax credits for older people.
There is a slew of taxes built into the ACA — the manufacturer tax, and taxes on medical devices, health plans and even tanning beds — and the Republican bill would repeal those taxes.
But those taxes help cover the cost of the ACA. So to make up for the shortfall that would result in killing those taxes, the GOP is floating the idea of changing the tax treatment of employer-based health insurance. As employers are well aware, employer-sponsored health plan premiums currently aren’t taxed. Under the GOP proposal, this would be changed for some premiums over a certain threshold — although the specifics of such a change remain murky.
Such a move would surely be met by fierce opposition from the business community. In fact, major employer groups are already preparing to fight such a proposition.
Bilski J. (2017 March 01). ACA replacement proposal leaked: some of the finer points for HR [Web blog post]. Retrieved from address http://www.hrmorning.com/aca-replacement-proposal-leaked-some-of-the-finer-points-for-hr/
Great article from Kaiser Health News about all the changes that could be coming with the ACA overhaul by Michelle Andrews
As Republicans look at ways to replace or repair the health law, many suggest shrinking the list of services insurers are required to offer in individual and small group plans would reduce costs and increase flexibility. That option came to the forefront last week when Seema Verma, who is slated to run the Centers for Medicare & Medicaid Services in the Trump administration, noted at her confirmation hearing that coverage for maternity services should be optional in those health plans.
Maternity coverage is a popular target and one often mentioned by health law critics, but other items also could be watered down or eliminated.
There are some big hurdles, however. The health law requires that insurers who sell policies for individuals and small businesses cover at a minimum 10 “essential health benefits,” including hospitalization, prescription drugs and emergency care, in addition to maternity services. The law also requires that the scope of the services offered be equal to those typically provided in employer coverage.
“It has to look like a typical employer plan, and those are still pretty generous,” said Timothy Jost, an emeritus professor at Washington and Lee University Law School in Virginia who is an expert on the health law.
Since the 10 required benefits are spelled out in the Affordable Care Act, it would require a change in the law to eliminate entire categories or to water them down to such an extent that they’re less generous than typical employer coverage. And since Republicans likely cannot garner 60 votes in the Senate, they will be limited in changes that they can make to the ACA. Still, policy experts say there’s room to “skinny up” the requirements in some areas by changing the regulations that federal officials wrote to implement the law.
The law requires that plans cover “rehabilitative and habilitative services and devices.” Many employer plans don’t include habilitative services, which help people with developmental disabilities such as cerebral palsy or autism maintain, learn or improve their functional skills. Federal officials issued a regulation that defined habilitative services and directed plans to set separate limits for the number of covered visits for rehabilitative and habilitative services.
Those rules could be changed. “There is real room for weakening the requirements” for habilitative services, said Dania Palanker, an assistant research professor at Georgetown University’s Center on Health Insurance Reforms who has reviewed the essential health benefits coverage requirements.
Oral And Vision Care For Kids
Pediatric oral and vision care requirements, another essential health benefit that’s not particularly common in employer plans, could also be weakened, said Caroline Pearson, a senior vice president at Avalere Health, a consulting firm.
Mental Health And Substance Use Disorder Services
The health law requires all individual and small group plans cover mental health and substance use disorder services. In the regulations the administration said that means those services have to be provided at “parity” with medical and surgical services, meaning plans can’t be more restrictive with one type of coverage than the other regarding cost sharing, treatment and care management.
“They could back off of parity,” Palanker said.
Prescription drug coverage could be tinkered with as well. The rules currently require that plans cover at least one drug in every drug class, a standard that isn’t particularly robust to start with, said Katie Keith, a health policy consultant and adjunct professor at Georgetown Law School. That standard could be relaxed further, she said, and the list of required covered drugs could shrink.
Preventive And Wellness Services And Chronic Disease Management
Republicans have discussed trimming or eliminating some of the preventive services that are required to be offered without cost sharing. Among those requirements is providing birth control without charging women anything out of pocket. But, Palanker said, “if they just wanted to omit them, I expect that would end up in court.”
Pregnancy, Maternity And Newborn Care
Before the health law passed, just 12 percent of health policies available to a 30-year-old woman on the individual market offered maternity benefits, according to research by the National Women’s Law Center. Those that did often charged extra for the coverage and required a waiting period of a year or more. The essential health benefits package plugged that hole very cleanly, said Adam Sonfield, a senior policy manager at the Guttmacher Institute, a reproductive health research and advocacy organization.
“Having it in the law makes it more difficult to either exclude it entirely or charge an arm and a leg for it,” Sonfield said.
Maternity coverage is often offered as an example of a benefit that should be optional, as Verma advocated. If you’re a man or too old to get pregnant, why should you have to pay for that coverage?
That a la carte approach is not the way insurance should work, some experts argue. Women don’t need prostate cancer screening, they counter, but they pay for the coverage anyway.
“We buy insurance for uncertainty, and to spread the costs of care across a broad population so that when something comes up that person has adequate coverage to meet their needs,” said Linda Blumberg, a senior fellow at the Health Policy Center at the Urban Institute.
Andrews M. (2017 February 21). Health law’s 10 essential benefits: a look at what’s at risk in GOP overhaul [Web blog post]. Retrieved from address http://khn.org/news/health-laws-10-essential-benefits-a-look-at-whats-at-risk-in-gop-overhaul/
Obamacare repeal could have a huge impact on employer healthcare plans. According to this article from Kaiser Health News large employers might feel some of the Obamacare overhauls ripple effect by Michelle Andrews
If you think that because you get health insurance through your job at a big company, you won’t be affected if Republicans overhaul Obamacare, think again. Several of the law’s provisions apply to plans offered by large employers too (with some exceptions for plans that were in place before the law passed in March 2010).
It’s not yet clear how President-elect Donald Trump and the congressional Republicans plan to revamp the federal health law. They have not agreed on a plan, and they do not have enough votes in the Senate to fully repeal the current statute. So they are planning to use a budgeting rule to disassemble part of the law, and that will limit what they can change. But they also may seek revisions in important regulations and guidance that have determined how the law is implemented.
Nonetheless, as the tensions grow in Washington over the future of the health law, it is important to understand some of its effects on large-group plans.
No Copays For Preventive Services
The health insurance offered by big companies is typically pretty comprehensive, the better to attract and keep good employees. But Obamacare broadened some coverage requirements. Under the law, insurers and employers have to cover many preventive services without charging people anything for them. The services that are required with no out-of-pocket payments include dozens of screenings and tests, including mammograms and colonoscopies, that are recommended by the U.S. Preventive Services Task Force; routine immunizations endorsed by the federal Centers for Disease Control and Prevention’s Advisory Committee on Immunization Practices; and a range of services that are recommended specifically for children and for women by the federal Health Resources and Services Administration.
The change that affects the most people on an ongoing basis is likely the requirement that plans cover without cost sharing all methods of contraception approved by the Food and Drug Administration. (There are limited exceptions for religious employers.)
“In terms of sustained costs, birth control is probably the biggest,” said Caroline Pearson, a senior vice president at Avalere Health.
No Annual Or Lifetime Limits On Coverage
Even the most generous plans often had lifetime maximum coverage limits of a few million dollars before the health law passed, and some plans also imposed annual coverage limits. The health law eliminated those dollar coverage limits.
Annual Cap On Out-Of-Pocket Payments For Covered Services
The health law set limits on how much people can be required to pay in deductibles, copayments or coinsurance every year for covered care they receive from providers in their network. In 2017, the limit is $7,150 for individuals and $14,300 for families.
“Many employers often had an out-of-pocket limit anyway, but this guarantees protection for people with high needs,” said JoAnn Volk, a research professor at Georgetown University’s Center on Health Insurance Reforms, who has written on this issue.
Adult Kids’ Coverage Expanded
The law allowed workers to keep their children on their plans until they reach age 26, even if they’re married, financially independent and live in another state. Republicans have said they may keep this popular provision in place if they dismantle the law.
Guaranteed External Appeal Rights
Consumers who disagree with a health plan’s decision to deny benefits or payment for services can appeal the decision to an independent review panel.
The provision applies to all new health plans, including those offered by self-funded companies that pay their workers’ claims directly and who were previously exempt from appeals requirements.
No Waiting Periods To Join A Plan
Employers used to be able to make new employees wait indefinitely before they were eligible for coverage under the company plan. No more. Now the waiting time for coverage can be no more than 90 days.
No Waiting Periods For Coverage Of Pre-Existing Conditions
Prior to the ACA, employers could delay covering workers’ chronic and other health conditions for up to a year after they became eligible for a plan. Under the ACA, that’s no longer allowed. As a practical matter, though, coverage of pre-existing conditions was rarely an issue in large-group plans, say some health insurance experts.
“It was difficult administratively, and the law of large numbers” meant that one individual’s health care costs didn’t generally have a noticeable impact on the group, said Karen Pollitz, a senior fellow at the Kaiser Family Foundation. (KHN is an editorially independent program of the foundation.)
Repeal could reopen the door to that prohibited practice, however.
Standardized Plan Descriptions
The law requires all plans to provide a “summary of benefits and coverage” in a standard format that allows consumers to understand their coverage and make apples-to-apples plan comparisons.
Basic Coverage Standards For Large-Group Plans
The health law isn’t as prescriptive with large-group plans about the specific benefits that have to be offered. They aren’t required to cover the 10 essential health benefits that individual and small-group plans have to include, for example. But the law does require that big companies offer plans that meet a “minimum-value” standard paying at least 60 percent of the cost of covered services, on average. Those that don’t could face a fine.
Initially, the online calculator that the federal Department of Health and Human Services provided to help large employers gauge compliance with the minimum value standard gave the green light to plans that didn’t cover hospitalization services or more than a few doctor visits a year. Now plans must provide at least that coverage to meet federal standards.
The result: Large employers generally no longer offer so-called “mini-med” policies with very skimpy benefits.
If the health law is repealed, that could change. In some industries with lower-wage workers and smaller profit margins, “they might begin to offer them again, and employees might demand it” to help make the premiums more affordable, said Steve Wojcik, vice president of public policy at the National Business Group on Health, a membership organization representing large employers.
Although the law strengthened coverage for people in large-group plans in several ways, consumer advocates have complained about shortcomings. It aimed to ensure that coverage is affordable by requiring that individuals be responsible for paying no more than 9.69 percent of their household income for individual employer coverage, for example.
If their insurance costs more than that, workers can shop for coverage on the marketplaces set up by the health law and be eligible for premium tax credits — if their income is less than 400 percent of the federal poverty level (about $47,000). But the standard does not take into consideration any additional costs for family coverage.
Consumer advocates also point to the wellness regulations as a problematic area of the law. The health law increased the financial incentives that employers can offer workers for participating in workplace wellness programs to 30 percent of the cost of individual coverage, up from 20 percent.
Such incentives can effectively coerce people into participating and sharing private medical information, critics charge, and unfairly penalize sick people.
“It potentially allows [plans] to discriminate against people with medical conditions, which the ACA is supposed to eliminate,” said Linda Blumberg, a senior fellow at the Urban Institute’s Health Policy Center.
Andrews M. (2017 January 17). Large employer health plans could also see some impacts from obamacare overhaul [Web blog post]. Retrieved from address http://khn.org/news/large-employer-health-plans-could-also-see-some-impacts-from-obamacare-overhaul/
Have you heard about the recent changes coming to the ACA? If not take a look at this great article from HR Morning about the recent changes that will be going into effect for the ACA by Jared Bilski
If you believe Republicans on Capitol Hill, the Affordable Care Act (ACA) isn’t long for this world. Still, the Obama administration continues to clarify how businesses are supposed to comply with the law’s many provisions.
The Department of Labor (DOL), Department of Health and Human Services (HHS) and the Internal Revenue Service (IRS) just put their heads together for the 35th time to address questions surrounding Obamacare reforms.
Here’s some of the most useful info to come out of this latest FAQ:
As HR Morning reported previously, the 21st Century Cures Act, among other things, allows certain small employers to offer a general purpose stand-alone health reimbursement arrangement (HRA) without violating the ACA. It is also referred to as a “qualified small employer health reimbursement arrangement” — or QSEHRA.
The FAQ touches on how this new law jibes with the ACA and clarified that in order to be a QSEHRA, the structure of the plan must:
One thing the 21st Century Cures Act (and the feds’ FAQ) doesn’t address: Whether the Employee Retirement Income Security Act (ERISA) applies to a QSEHRA.
The FAQ also addressed special enrollment for group health plans under the Health Insurance Portability and Accountability Act (HIPAA). Because HIPAA generally allows current employees and dependents to enroll in a company’s group health plan if the employees/dependents lose their previous coverage, they must be offered the same special enrollment option if they lose individual market coverage (i.e., health coverage they obtained through the individual Obamacare marketplace — or “exchanges”).
This could happen to individual market participants if an insurer that was covering an employee/dependent decides to stop offering that individual market coverage. As we saw last year, several major insurers have taken that step.
One exception to this special enrollment: If the loss of coverage is due to a failure to pay premiums in a timely manner — or “for cause.”
As you know, under the ACA, non-grandfathered health plans are required to provide recommended preventives services for women without any cost-sharing.
Those services are listed in the Health Resources and Services Administration’s (HRSA) guidelines, and the guidelines were just updated on December 20, 2016. The updated guidelines bolster many of the existing covered preventive care services for women in the areas of:
The services in the updated guidelines must be covered — without cost-sharing — for plan years beginning on or after December 20, 2017 (Jan. 1, 2018 for calendar year plans). Until then, plans can keep using the previous HRSA guidelines.
Bilski J. (2017 January 6). Feds pump out even more Obamacare instructions [Web blog post]. Retrieved from address http://www.hrmorning.com/feds-pump-out-even-more-obamacare-instructions/
Does ACA repeal have you worried? Look into this great article from Kaiser Health News about some of things that could disappear with ACA repeal by Julie Appleby and Mary Agnes Carey
The Affordable Care Act of course affected premiums and insurance purchasing. It guaranteed people with pre-existing conditions could buy health coverage and allowed children to stay on parents’ plans until age 26. But the roughly 2,000-page bill also included a host of other provisions that affect the health-related choices of nearly every American.
Some of these measures are evident every day. Some enjoy broad support, even though people often don’t always realize they spring from the statute.
In other words, the outcome of the repeal-and-replace debate could affect more than you might think, depending on exactly how the GOP congressional majority pursues its goal to do away with Obamacare.
No one knows how far the effort will reach, but here’s a sampling of sleeper provisions that could land on the cutting-room floor:
CALORIE COUNTS AT RESTAURANTS AND FAST FOOD CHAINS
Feeling hungry? The law tries to give you more information about what that burger or muffin will cost you in terms of calories, part of an effort to combat the ongoing obesity epidemic. Under the ACA, most restaurants and fast food chains with at least 20 stores must post calorie counts of their menu items. Several states, including New York, already had similar rules before the law. Although there was some pushback, the rule had industry support, possibly because posting calories was seen as less onerous than such things as taxes on sugary foods or beverages. The final rule went into effect in December after a one-year delay. One thing that is still unclear: Does simply seeing that a particular muffin has more than 400 calories cause consumers to choose carrot sticks instead? Results are mixed. One large meta-analysis done before the law went into effect didn’t show a significant reduction in calorie consumption, although the authors concluded that menu labeling is “a relatively low-cost education strategy that may lead consumers to purchase slightly fewer calories.”
PRIVACY PLEASE: WORKPLACE REQUIREMENTS FOR BREAST-FEEDING ROOMS
Breast feeding, but going back to work? The law requires employers to provide women break time to express milk for up to a year after giving birth and provide someplace — other than a bathroom — to do so in private. In addition, most health plans must offerbreastfeeding support and equipment, such as pumps, without a patient co-payment.
LIMITS ON SURPRISE MEDICAL COSTS FROM HOSPITAL EMERGENCY ROOM VISITS
If you find yourself in an emergency room, short on cash, uninsured or not sure if your insurance covers costs at that hospital, the law provides some limited assistance. If you are in a hospital that is not part of your insurer’s network, the Affordable Care Act requires all health plans to charge consumers the same co-payments or co-insurance for out-of-network emergency care as they do for hospitals within their networks. Still, the hospital could “balance bill” you for its costs — including ER care — that exceed what your insurer reimburses it.
If it’s a non-profit hospital — and about 78 percent of all hospitals are — the law requires it to post online a written financial assistance policy, spelling out whether it offers free or discounted care and the eligibility requirements for such programs. While not prescribing any particular set of eligibility requirements, the law requires hospitals to charge lower rates to patients who are eligible for their financial assistance programs. That’s compared with their gross charges, also known as chargemaster rates.
NONPROFIT HOSPITALS’ COMMUNITY HEALTH ASSESSMENTS
The health law also requires non-profit hospitals to justify the billions of dollars in tax exemptions they receive by demonstrating how they go about trying to improve the health of the community around them.
Every three years, these hospitals have to perform a community needs assessment for the area the hospital serves. They also have to develop — and update annually — strategies to meet these needs. The hospitals then must provide documentation as part of their annual reporting to the Internal Revenue Service. Failure to comply could leave them liable for a $50,000 penalty.
A WOMAN’S RIGHT TO CHOOSE … HER OB/GYN
Most insurance plans must allow women to seek care from an obstetrician/gynecologist without having to get a referral from a primary care physician. While the majority of states already had such protections in place, those laws did not apply to self-insured plans, which are often offered by large employers. The health law extended the rules to all new plans. Proponents say direct access makes it easier for women to seek not only reproductive health care, but also related screenings for such things as high blood pressure or cholesterol.
AND WHAT ABOUT THOSE THERAPY COVERAGE ASSURANCES FOR FAMILIES WHO HAVE KIDS WITH AUTISM?
Advocates for children with autism and people with degenerative diseases argued that many insurance plans did not provide care their families needed. That’s because insurers would cover rehabilitation to help people regain functions they had lost, such as walking again after a stroke, but not care needed to either gain functions patients never had, such speech therapy for a child who never learned how to talk, or to maintain a patient’s current level of function. The law requires plans to offer coverage for such treatments, dubbed habilitative care, as part of the essential health benefits in plans sold to individuals and small groups.
Appleby J., Carey M. (2017 January 12). Health law sleepers: six surprising health items that could disappear with ACA repeal [Web blog post]. Retrieved from address http://khn.org/news/health-law-sleepers-six-surprising-health-items-that-could-disappear-with-aca-repeal/?utm_campaign=KHN%3A+Daily+Health+Policy+Report&utm_source=hs_email&utm_medium=email&utm_content=40532225&_hsenc=p2ANqtz-8vl0H_K8CNgaURbqgYS5m3isu1NUGrj0FRIdsUX8JCwcifTDRV-UvKdu6lZGvB06FTyhENvPFLaOMOsIrr2IBVBTNWQg&_hsmi=40532225
Do you which medical conditions are driving your healthcare cost? Check out this great article from Employee Benefits Advisor about the cost associated with your employer healthcare by Phil Albinus
Healthcare costs surrounding diabetes reached $101 billion in diagnoses and treatments over the past 18 years — and the cost grew 36 times faster than the cost of ischemic heart disease, the leading cause of death in the U.S. Further, out of 155 medical conditions, only 20 accounted for half of all medical spending, according to a JAMA analysis of 2013 healthcare costs.
The third-most expensive medical condition, low back and neck pain, primarily strikes adults of working age while diabetes and heart disease is primarily found in people 65 and older.
The JAMA study found total health spending for these conditions totaled $437 billion in 2013. Diabetes, heart disease, low back and neck pain, along with hypertension and injuries from falls, comprise 18% of all personal health spending. All in all, 20 conditions make up more than half of all spending on healthcare in the U.S.
These stark figures shed light on the rising healthcare costs that employers pay when addressing their workforce’s ailments.
According to Francois Millard, senior vice president and chief actuarial officer for Vitality Group, one of the study’s sponsors, this is the first study to dig into the details of the leading ailments of the U.S. and its costs to employers and families as they deal with the conditions.
“In absolute terms, most money for care is in the working age population,” he says. “It impacts households and employers and contributes to the financial burden of families.”
“What we see is the financial burden increases as the disease increases, and while the paper doesn’t go into detail, we already have a significant knowledge of diabetes and heart condition. It is related to modifiable behavior.”
The JAMA study noted the differences between public health program spending from personal health spending, including individual out-of-pocket costs and spending by private and government insurance programs.
“While it is well known that the U.S. spends more than any other nation on healthcare, very little is known about what diseases drive that spending,” said Dr. Joseph Dieleman, lead author of the paper and assistant professor at the Institute for Health Metrics and Evaluation at the University of Washington, in a press statement. “IHME is trying to fill the information gap so that decision-makers in the public and private sectors can understand the spending landscape, and plan and allocate health resources more effectively.”
Despite using figures from 2013, the information can help employers as they identify where their healthcare dollars are going.
“Given the biggest increases in healthcare spending on impact working age populations, it requires employers to improve their work environments and facilitate good health. And [this study can] help increase the transparency of health within their populations,” says Millard.
“Employers need to think what they do that impacts beyond the four walls of the employers and create a symbiotic relationship with health within their societies,” he adds.
The study can also boost transparency into the healthcare data. “This study is also an accountability and outcome of the money they are spending on health treatment,” Millard says. “Is it sufficient to still pay for services or can we push for more accountability for health outcomes? The other thing this facilities is that employers get the adequate level of data. They can ask the right questions and determine accountability for the huge amounts of healthcare.”
He adds, “With all the uncertainty around 2017, perhaps this transparency will give employers a voice to all of the money that they are spending.”
The top 10 most costly health expenses in 2013:
1. Diabetes – $101.4 billion
2. Ischemic heart disease – $88.1 billion
3. Low back and neck pain – $87.6 billion
4. Hypertension – $83.9 billion
5. Injuries from falls – $76.3 billion
6. Depressive disorders – $71.1 billion
7. Oral-related problems – $66.4 billion
8. Vision and hearing problems – $59 billion
9. Skin-related problems, such as cellulitis and acne – $55.7 billion
10. Pregnancy and postpartum care – $55.6 billion
Albinus P. (2017 January 12). What medical conditions are driving employer healthcare costs?[Web blog post]. Retrieved from address http://www.employeebenefitadviser.com/news/what-medical-conditions-are-driving-employer-healthcare-costs?brief=00000152-1443-d1cc-a5fa-7cfba3c60000