Why are my rates going up? The recent 2014 health insurance rates ranging in 15-20% increase is having a profound impact especially on small businesses. Benefits are furthermore deteriorating with new deductibles adding a 10% to the out of pocket costs for a net total 25-30% rate increase.
No pre-existing condition. Several new cost contributors aside from Essential Health Benefits Mandate are assigned. Recent articles such as Kaiser’s Popular Provision Of Obamacare Is Fueling Sticker Shock For Some Consumers attributes new Pre-Existing condition waiver as a factor. Starting Jan 1, 2014 anyone with or without prior health insurance can get immediate treatment without a 12 month waiting period. “But the provision also adds costs. To a larger degree than other requirements of the law, it is fueling the “sticker shock” now being voiced by some consumers about premiums for new policies, say industry experts.” With the guaranteed issue there are unknown costs that cannot be accounted for just yet. Example: An uninsured individual we know is delaying needed surgeries until January for this reason. The member will pay a $250/month premium and get a $40,000 surgery paid for immediately. How many young healthy members are needed to offset this cost?
Transitional reinsurance fee. This is paid by fully insured and self-funded plans. The goal of the fee is to stabilize the individual markets by reimbursing companies who insure a disproportionately large number of individuals who are high utilizers of health care services. Fees will be collected between 2014, 2015, and 2016.
Health insurance providers’ fee, also referred to as a health insurance tax, annual fee, and insurer fee. This will be assessed annually beginning in 2014 on health insurance carriers. The total amount to be collected in 2014 is $8 billion. The tax is based on premiums and by some estimates is expected to have a cost impact of 2 to 2.5 percent in 2014, and higher in subsequent years.
Exchange fee. For 2014, our state’s online exchange marketplace is funded through federal start-up grants. But states that run their own exchange, such as Washington, have been tasked with implementing a funding mechanism after 2014. In the session that ended in June, the Washington State Legislature approved a funding plan for our exchange that authorizes the use of a current insurance premium tax for the qualified health plans (QHPs) sold in the exchange and, if necessary, an additional assessment on carriers who sell QHPs through the exchange.
Patient-Centered Outcome Research Institute (PCORI) fee (also known as comparative-effectiveness fee). Health insurance issuers and sponsors of self-funded group health plans will be assessed this annual fee beginning in 2012 and ending in 2019. It funds patient-centered outcomes research. PCORI is a nonprofit corporation whose mission is to help people make informed health care decisions, and improve health care delivery and outcomes. The Group Health Research Institute has received two research awards from PCORI to study ways to improve care for back pain, and connect patients with community resources.
Essential Health benefits. The quintessential question asked is why are my rates going up so much this year has multiple answers with new Essential Health Benefits leading the way. The Essential Health Benefits Not Delayedarticle explains that The Affordable Care Act mandates that the plans include ten essential benefits, from care for pregnant mothers to substance abuse treatment. Popular local plans such as Healthy NY and Brooklyn Healthworks have afforded coverage for over a decade are are missing Mental Health, Chiropractic, and have a $3,000 Rx limit. All Individual Healthy NY and Sole Proprietors are terminating this year . Existing small businesses must buy the full version with Essential Health Benefits.
CASE: A Healthy Ny client just had an increase for singles from $412 to $519. She is a successful generous Caterer who is covering majority of a staff of 10 employees which is unusual for that industry. Her staff had an affordable benefits as well. They loved paying only $20, her Rx copay was only $10/generic and $20/brand for providers she did not have any deductibles. Hospitalization had full coverage with a modest copay. Statistically nearly 90% do not use more than $3,000 Rx. her new plan rolls automatically into the GOLD PLAN increasing her premium 25% along with a new $600 deductible on all benefits and a $40 copay for Specialist. She asked me I thought the new tax was only .9% medicare tax but evidently this IS HER NEW TAX.
So much for if you like your plan you can keep it promise. Even supporters such as Former President ClintonWeighs in on Obamacare. “Obama should honor his health-care promise: Pres. Clinton”, He personally believes President Barack Obama should honor his promise that people who have and like their insurance can keep it.
Do not under estimate the power of the Bill. The President is reviewing ways to allow some to keep their health plan but this would only apply to policyholders losing coverage. Stay tuned.
You can download the complete Essential Health Benefits NYS. Also, for a downloadable guide on self-insuring and secondary market reinsurance for your group please send contact form below. In the meantime, please visit to view past blogs and Legislative Alerts at https://360peo.com/feed.
HSA holders own the assets in the accounts and can build up substantial sums over time. Enrollment in HSA-compatible insurance plans has increased to 10 million earlier this year, from 1 million in March 2005, according to, America’s Health Insurance Plans (AHIP), a trade group.
HSAs were authorized starting in January 2004. Since then, AHIP has conducted a periodic census of health plans participating in the HSA/HDHP market.
The number of people with HSA/HDHP coverage rose to more than 11.4 in January 2011, up from 10.0 million in January 2010, 8.0 million in January 2009, and 6.1 million in January 2008.
30 percent of individuals covered by an HSA plan were in the small group market, 50 percent were in the large-group market, and the remaining 20 percent were in the individual market.
14% of all workers in the private sector that have access to a Health Savings Account acc. to Bureau of Labor Statistics.
States with the highest levels of HSA/HDHP enrollment were California, Ohio, Florida, Texas, Illinois and Minnesota.
HSA Advantages:
Opportunity to build savings – Unused money stays in your account from year to year and earns tax-free interest. The HSA also gives you an investment opportunity.
Tax-free contributions and earnings – You don’t pay taxes on contributions or earnings.
Tax Free Money allowed for non traditional Medical coverage– As per IRS Publication 502, unused moneys can be used for dental,vision, lasik eye surgery, acupuncture, yoga, infertility etc. Popular Examples
Portability – The funds belong to you, so you keep the funds if you change jobs or retire.
Our overall experience with HSAs have been positive when employer funding is at minimum 50% using either the HSA or an HRA (Health Reimbursement Account-employer keeps unspent money). Traditional plans trend of higher copays and new in network deductibles has also led to the popularity of an HSA.
Is your HSA compliant? Which pre-tax qualified HSA, FSA, HRA spending card is right is right for you ? Please contact our team at Millennium Medical Solutions Corp (855)667-4621 for immediate answers.. Stay tuned for updates as more information gets released. Sign up for latest news updates.
The New FSA Carry Over. U.S. loosens FSA rules and will allow a carry over of up to $500 to the next year. The use-it-or-lose-it rule scared off many workers, with just 25 percent of eligible workers participating in healthcare FSAs.
According to a WSJ article “Consumers Can Roll Over $500 in an FSA”, about 14 million families use FSA accounts and the new plan would be a welcome relief for them. That’s because until now any unused funds used to go the employer, so people were forced to use up the funds, especially toward the end of the year by spending on frivolous things. Moreover, many were fearful of signing up, lest they lose any unused amount.
The most recent prior change to FSA this year was a limit of $2,500 that a worker can set aside.
The health care Flexible Savings Account (FSA) can reimburse you or help you pay for eligible health care expenses not covered by your health plan. The portion of your paycheck you put into your FSA is taken out before you pay federal income taxes, Social Security taxes and most state taxes. It’s a great way to save money.
Generally, contributions you make to your FSA are not subject to federal income taxes or social security taxes. In most instances, there are no state taxes taken out either. The amount you may save depends upon:
The amount you put into your FSA
The tax percentage you would normally pay on that money (tax bracket)
Let’s say you want $2,000 taken out of your paycheck this year to put into your FSA. The money you direct to your FSA is taken out of your check before taxes are taken out. That reduces your taxable income by $2,000.
Let’s say you normally pay 30 percent in federal, social security and state taxes on your income. In this example, you would enjoy a tax savings of 30 percent of the $2,000. In other words, you could get a $600 tax savings on the $2,000 you directed to your FSA.
This example should not be taken as tax advice. See a tax advisor to seek the best advice for your situation. To see how much you may save, check out Aetna’s FSA Savings Calculator.
Is your FSA compliant? Which pre-tax qualified HSA, FSA, HRA spending card is right is right for you ? Please contact our team at Millennium Medical Solutions Corp (855)667-4621 for immediate answers.. Stay tuned for updates as more information gets released. Sign up for latest news updates.
We are certified and appointed to sell senior plans from Empire Blue Cross, AARP United Healthcare, Humana and Aetna to help people in New York currently enrolled in Medicare or those who are aging in to Medicare (turning 65) with a wide variety of options. Some of these are Medicare Advantage (HMO, PPO), supplement plans and Part “D” prescription plans (PDP,s).
There are also some special enrollment periods (SEP) available to individuals under certain conditions. The Annual Enrollment Period (AEP) for Medicare is October 15 to December 7 this year. Those currently on Medicare can shop around and switch their plans at this time. The initial enrollment period (IEP) of 7 months. This is from 3 months prior to your 65th birthday, the month of your birthday and the 3 months following your birth month. It is wise to contact an expert to help you find the coverage that best suits you during these enrollment periods. You can call or email us at any time for comprehensive, “no pressure” advise.
Resource:
Download a Copy Of The Medicare and You 2014 Handbook Here.
You can start getting plan information for 2014 premiums and benefits.
October 15 — December 7
This is the Annual Election Period (AEP). During this time, you can make changes to your existing Medicarehealth or prescription drug plan or select a new plan for 2014.
January 1 — February 14
This is the Medicare Advantage Disenrollment Period. During this time, you can prospectively disenroll from your Medicare Advantage (MA) plan and return to Original Medicare.
If you are turning 65:
– If you aren’t getting Social Security (for instance, because you are still working), you will need to sign up for Medicare benefits. You should contact Social Security three months before you turn age 65. – You can enroll in a Medicare plan starting three months before the month of your 65th birthday, the month of your birthday, and for up to three months after your 65th birthday, for a total period of seven months.
The Health Exchange also known as The Health Marketplace or Obamacare Exchanges are set to open in less than 12 hours. Are you ready or aye you like most asking What is an Exchange? Starting Oct 1 you can enroll until March 31, 2014, though you’ll generally need to sign up by Dec. 15 of this year, to be covered as of Jan. 1. You can find your state’s marketplace at healthcare.gov. The prices for the marketplace plans are likely to be similar to those sold privately. A plan that is also available on the exchange may be eligible for subsidies. Heres an easy top 10 list of what you need to know.
10. Locate your State Exchange
Look up your state’s exchange here and Healthcare.gov. Some states are running their own exchange, others are running it through the federal government see www.healthcare.gov. For NY Tri-State the sites are:
NYS – http://info.nystateofhealth.ny.gov See rates here
CT – https://www.accesshealthct.com See rates here
9. Individual Mandate Penalty
For 2014, the annual penalty is $95 or 1% of your income, whichever is greater. The penalty will increase over the first three years. Coverage can include employer-provided insurance, individual health insurance, Medicare or Medicaid.
Health Insurance Individual Penalty for Not Having Insurance Pay the greater of the two amounts
Year
Percentage of Income
Set Dollar Amount
2014
1%
$95 & $285/family max
2015
2%
$325 & $975/family max
2016
2.5%
$695 & $2,085/family max
8. Individual Subsidies
Individuals who do not have affordable minimum essential coverage from their employer will be eligible for tax credit subsidies for their health insurance purchase on a state exchange if their income is below 400 percent of federal poverty level.
If you make under $45,960 or your family makes under $94,200, you could get a real break on health insurance costs More low-income people will also be eligible for free coverage under Medicaid For those eligible, the subsidies will cap the amount you pay for your exchange policy at between 2% and 9.5% of your income (on a sliding scale, based on your income). To find out how much you would pay, estimate your income for this year and plug it into any health subsidy calculator. You can also see estimate subsidies with these “health subsidy charts”.
7. Small Business Subsidy – SHOP Exchange
A key change is that the small business health care tax credits will only be available ONLY through the SHOP Exchange marketplace in 2014. Small businesses with 25 or fewer employees who receive less than $50,000 a year in wages may be eligible for tax credits if they purchase the plan through the SHOP marketplace. These credits will cover up to 50% of the employer’s cost (35% for non-profits) for the first two years of coverage. Click here to read more about the small business health care tax credits.
6. Your income
not your assets, such as your house, stocks or retirement accounts – will count toward determining whether you can get tax credits. When you buy your plan, you estimate your income for next year, and your tax credit is based on that estimate. The next year, your tax returns will be checked by the IRS and compared against your estimate.
5. Pre-Existing Conditions Eliminated
Your insurer generally can’t drop you, as long as you keep up with your insurance premiums and don’t lie on your application. Generally, people will be able to enroll in or change plans once a year during the annual open enrollment period. This first year, open enrollment on the exchanges will run for six months, from Oct. 1 through March of next year. But in subsequent years the time period will be shorter, running from October 15 to December 7.
4. Essential Health Benefits Covered
Each plan covers 10 “essential health benefits,” which include prescription drugs, emergency and hospital care, doctor visits, maternity and mental health services, rehabilitation and lab services, among others. In addition, recommended preventive services, such as mammograms, must be covered without any out-of-pocket costs to you. More info here.
3. Ninety-Day Maximum Waiting Period
Group health plans and health insurance issuers may not impose waiting periods of more than ninety days before coverage becomes effective. This also applies to grandfathered plans.
2. Annual or Lifetime Limits
Group health plans, including grandfathered plans, may no longer include more than restricted annual or any lifetime dollar limits on essential health benefits for participants. Limits may exist in and after 2014 for non-essential benefits.
1. Not Everyone is Eligible
Immigrants who are in the country illegally will be barred from buying insurance on the exchanges. However, legal immigrants are permitted to use the marketplaces and may qualify for subsidies if their income is no more than 400 percent of the federal poverty level (about $46,000 for an individual and $94,200 for a family of four).
members of certain religious groups and Native American tribes
incarcerated individuals
people whose incomes are so low they don’t have to file taxes (currently $9,500 for individuals and $19,000 for married couples)
Conclusion:
There has been a lot of news about individual Obamacare provisions getting delayed – Obamacare Employer mandate Delayed. Some people may assume that means the health law is being slowly dismantled, or put off for an additional several years. .The Affordable Care Act is an extremely complicated law with a lot of moving parts, but ultimately, the biggest provisions are still moving forward. There will likely be more hiccups along the way. As the enrollment period opens for Obamacare’s new exchanges, industry experts predict there will probably be other issues that need to be ironed out — but that doesn’t mean the whole law is collapsing
Still confused?
Don’t be. These are the common questions that we are working through with our clients daily. Am I better off going SHOP Exchange vs. Individual for my business? Am I better off going off Exchanges or onto Private Exchanges? Whats my minimum employer contribution? Do I have to cover employee and dependents? Is dental and vision included? What happens to my Healthy NY when it shuts down Jan 1, 2014? What employer notices must I be posting?
Please contact our team at Millennium Medical Solutions Corp if you have additional questions regarding how SHOP Exchanges and Individual Exchanges can benefit you Stay tuned to our site for updates as more information gets released. Sign up for latest news updates.
Health Exchange Notification Due Oct 1 – Employers Must Distribute Required Exchange Notice
If your organization hasn’t done so already, you have until October 1 to inform employees about their option to enroll in a public health exchange under theAffordable Care Act.
Notice Must Be Provided to Current and New Employees. Following a delay in the original effective date, employers will need to comply with the new requirement to provide each employee a written notice with information about a Health Insurance Exchange (also known as a Marketplace) beginning this Fall.
Employers are required to provide the written notice to each current employee not later than October 1, 2013, and to each new employee at the time of hiring (within 14 days of the employee’s start date) beginning October 1, 2013. Two model notices are available from the U.S. Department of Labor:
Model Notice for Employers Who Offer a Health Plan Model Notice for Employers Who Do Not Offer a Health Plan
Employers must provide the notice to each employee regardless of plan enrollment status (if applicable) or of part-time or full-time status. Employers are not required to provide a separate notice to dependents or other individuals who are or may become eligible for coverage under the plan but who are not employees.
The notice may be provided by first-class mail, or, alternatively, it may be provided electronically if certain requirements are met. More information on the notice requirement is available from the U.S. Department of Labor.
IMPORTANT: The model notice contains an optional section about employer-sponsored coverage details. The model notice is three pages long and contains an optional section on page three (questions 13 though 16). An employer is in no way obligated to provide the optional information requested on the model notice. Also, an employer may modify the notice as long as the end result corresponds to the overall basic content guidelines. However, the employer should carefully weigh the value of providing additional information about the cost and value of the employee’s group health plan options.
Technically, the law does not impose any fines for failing to provide the notices. However, the Affordable Care Act is intertwined with other laws (this particular provision is embedded in the FLSA in a new section, 8A), so it is considered a good idea to comply to avoid possible legal complications.
Who Must Receive the Notices?
Notices must be given to all employees, whether or not they work full time, and regardless of whether they are currently receiving health benefits. The October 1 deadline is to give these notices to all employees. After October 1, the notices must be given to new hires within two weeks of coming on board.
The notices must “be provided in writing in a manner calculated to be understood by the average employee,” says the Department of Labor (DOL) in Technical Release 2013-02. They can also be provided via e-mail, but only to employees for whom accessing e-mail is “an “integral part of the employee’s duties” and who can access the system easily.
Which Employers Must Send the Notices?
The notice requirement must be met by employers that must comply with theFair Labor Standards Act (FLSA). In general, the FLSA applies to employers with one or more employees who are engaged in, or produce goods for, interstate commerce. For most firms, a test of not less than $500,000 in annual dollar volume of business applies.
The FLSA also specifically covers the following: hospitals; institutions primarily engaged in the care of the sick, the aged, mentally ill, or disabled who reside on the premises; schools for children who are mentally or physically disabled or gifted; preschools, elementary and secondary schools, and institutions of higher education; as well as federal, state and local government agencies.
Model Notices
The DOL has issued a pair of model notices you can use. One is for employers which currently offer health benefits and another for those which do not. On Part B of the forms, you will see information the employees will need if they plan to purchase coverage on the exchange, assuming they are eligible.
The Part B information would allow employees who apply to their state’s exchange (or the federal version, if no state-run exchange exists) to complete a required questionnaire to determine their eligibility for the program.
The model notice for employers that do currently offer health coverage features a lot of slots for information about your health plan in Part B. Since the law doesn’t actually require you to provide the information, and because some of the information may be hard to dig up employers may decide to disregard some or all of Part B, especially if the information is uncertain or likely to change, employers to be “cautious about volunteering too much information.”
Ask us about our Online Notification Tool developed by our payroll partner. Be sure to visit our section on Health Care Reform for information on other notices required to be provided and to download additional model notices available for employers and group health plans.
Obamacare Simplified Using Youtoon by Kaiser is just what the Doctor ordered. With less than 60 days to go to the October 1, 2013 Health Exchanges Open Enrollment Period what better way to ease the confusion than a 7 minute cartoon?
CMS maintains the HealthCare.gov website, and this is where individuals can find more information on health insurance exchanges, the enrollment for which begins on October 1, 2013. Depending on which state individuals reside in, one may be able to enroll in an exchange plan, or may be directed to their state’s own exchange enrollment site. Employers can also use this site to learn about the Small Business Health Options Program (SHOP) which can help them provide coverage for employees.
Several resources have been made available to help people weed through the information and to make you aware of what requirements and deadlines apply to you. The Kaiser Family Foundation (KFF) brought some levity to the topic by creating an animated video explaining the upcoming changes in health coverage under the ACA. Narrated by Charlie Gibson, “The YouToons Get Ready for Obamacare,” explains what is and isn’t changing under the law and is posted on the KFF site, along with other resources on the topic. KFF President, Drew Altman, was quoted as saying, ’[t]his cartoon is meant to demystify a complex law and explain what it means for you, whether you support or oppose Obamacare.”
For a comparison and additional questions on which Exchange – Individual or SHOP Exchanges is right for you please contact our team at Millennium Medical Solutions Corp. Stay tuned for updates as more information gets released. We’re inside of 45 days until exchanges open, and information will be coming quickly in the next few months. Sign up for latest news updates.
Interfaith Hospital Planning Shutdown. The Bedford Stuyvescent Hospital entered bankruptcy court this week to approve its closing and send layoff warning notices to its 1,544 employees. Pending court and state approval, on Aug. 12 the hospital will end inpatient admissions and divert ambulances to other hospitals. Elective surgeries will end Aug. 19, the emergency department will shut Sept. 11, and all patients will be transferred from the hospital by Sept. 12. Outpatient programs will end Oct. 12 and detoxification and rehabilitation programs Nov. 11.
The bankruptcy court hearing for Interfaith is August 15. The hospital services 175,000 people with closest hospital in this predominantly minority community is about two and a half miles away.
The threatened closing of another Brooklyn hospital, Long Island College Hospital in Cobble Hill, has become an issue in the mayoral campaign. The 506-bed hospital — which it said to be losing $4 million was taken over by Downstate in 2011, inheriting a $170 million debt. The Hospital’s location is very sought after and will likely be purchased by developers. Developers are coveting LICH’s $1 billion in prime brownstone Brooklyn waterfront buildings.
Breaking Westchester Health Care News: As reported in The Journal News earlier. A Stellaris Hospitals Break Up is planned; Phelps, Lawrence, Northern Westchester and White Plains may form new alliances. Stellaris had been in the news in recent years with down to the wite negotiations with Empire Blue Cross Empire & Stellaris Reach Pact effective 8/1/10.
A Stellaris Hospitals Break Up is not surprising. This is viewed as possible strategic move for acquisition form larger local hospitals or even national chains such as Cardinal Health or HCA. Insurers have also purchaszed recenlty medical groups,see UnitedHealthcare Buying Medical Groups? Will it our market allow an Insurer to purchase a Hospital?
4 hospitals seek to cut Stellaris ties
By Jane Lerner
Four hospitals in Westchester County want to cut ties with their parent organization — a move that could signal their interest in forming new consolidations and alliances with other health-care facilities.
Phelps Memorial Hospital Center in Sleepy Hollow, Lawrence Hospital Center in Bronxville, Northern Westchester Hospital in Mount Kisco and White Plains Hospital are seeking to leave the Stellaris Health Network.
“Stellaris and its member hospitals made this decision after a lengthy strategic review that evaluated a variety of alternatives to respond to a dynamic and ever more challenging health-care environment,” Stellaris said in a statement.
The state Department of Health has to approve any change in ownership of a hospital. Requests from the four hospitals to “dis-establish” Stellaris as “active parent and co-operator” were filed with the state last week.
Leaving Stellaris will enable each hospital to seek new partners.
“By becoming independent, each hospital can move forward in the direction that each feels is best for its community,” said Arthur Nizza, who is on his way out as president and chief executive officer of Stellaris.
All four hospitals declined to comment.
As the parent organization of the four hospitals, Armonk-based Stellaris handled their negotiations with commercial insurance companies, purchasing and information technologies.
Stellaris will continue to provide IT support and some other services to the hospitals. But once they leave the network, they will be able to seek new partners to increase their bargaining power and share services and expenses.
Numerous hospital consolidations and mergers are taking place nationwide.
“I think in time — not immediately — the idea of a freestanding community hospital is going to be passe,” said Kevin Dahill, president of the Northern Metropolitan Hospital Association, an industry group.
Sound Shore Medical Center in New Rochelle and its Mount Vernon Hospital are seeking to merge with Montefiore Medical Center in the Bronx once the Westchester County institutions emerge from Bankruptcy Court. In New York City, Mount Sinai Medical Center and Continuum Health Partners, a network that includes Beth Israel and two St. Luke’s-Roosevelt campuses, agreed last week to merge.
“Hospitals are doing what they have to do to position their organizations,” Dahill said.
Stellaris was formed in 1996 as an alliance between White Plains and Northern Westchester hospitals. In 1997, Phelps and Lawrence joined and, in 2000, the company formed an emergency medical service to provide paramedic service to part of Westchester.
Nizza will become CEO of St. Francis Hospital and Health Centers in Poughkeepsie next month. Sharon Lucian, who has been with Stellaris since 1999 and is vice president and chief financial officer, will replace him.
Governor Cuomo announced yesterday that New York’s Health Benefits Exchange have been approved . Additionally, the New York Times yesterday published an article highlighting that the rates in the individual market that will be offered in 2014 are at least 50 percent lower than they are now. The article link and Governor’s office press release are included below.
5 things we now know about the NYS Exchanges:
Importantly, Insurers must still confirm that they will be in either the individual exchange and/ or shop exchange
The rates approved yesterday are subject to final certification of the insurers’ participation in the exchange.
Many of the networks used on the Exchange appear to be smaller than the group rated.
Some new insurers have eneter the marketplace such as OSCAR and Freelancers. While a few such as EmblemHealth have taken a wait and see approach.
Additionally, NYS individual market rate will drop significantly in 2014 but they have been historically always the highest. An individual/Direct Pay HMO is approximately $1,000-$1,200/month. They are still approximately 18% highest.
The Department of Financial Services (DFS) has approved New York’s Health Health Insurance Exchange rates for 17 insurers seeking to offer coverage including eight new entrants into the market that do not currently offer commercial health insurance plans. Please click the following links for the Governor’s Press Release and the Individual and Small Group rates.
The following companies had health insurance plan rates for the health benefits exchange approved today by DFS. The rates approved today are subject to final certification of the insurers’ participation in the exchange.
Aetna
Affinity Health Plan, Inc.
The cheapest you’ll pay for individual health insurance in NY
American Progressive Life & Health Insurance Company of New York
Capital District Physicians Health Plan, Inc.
Health Insurance Plan of Greater New York
Empire BlueCross BlueShield
Excellus
Fidelis Care
Freelancers Co-Op
Healthfirst New York
HealthNow New York, Inc.
Independent Health
MetroPlus Health Plan
MVP Health Plan, Inc.
North Shore LIJ
Oscar Health Insurance Co.
United Healthcare
If you have additional questions regarding how SHOP Exchanges and Individual Exchanges can benefit you please contact our team at Millennium Medical Solutions Corp. Stay tuned for updates as more information gets released. We’re inside of 75 days until exchanges open, and information will be coming quickly in the next few months. Sign up for latest news updates.
In an unexpected announcement pre-July 4th the big news was Obamacare Employer Mandate Delayed with penalties under the Affordable Care Act (ACA) until 2015. The mandate also known as the “Employer Shared Responsibility” requires employers with 50 or more FTEs to offer affordable health insurance coverage to their workers or face financial penalties for not doing so. Those penalties would originally have been applied beginning in 2014.
There has been a follow up guidance issued last week July 9th by the IRS. According to the IRS, the delay will give employers more time to prepare for the change in how health insurance is provided and will also give the Obama Administration time to simplify the insurance-related reporting requirements that employers face. This transition relief appears to come with “no strings attached.” Although the IRS guidance encourages employers to voluntarily comply with the employer mandate and maintain or expand health care coverage in 2014, the IRS will not impose penalties for a failure to do so.
Although the IRS guidance encourages employers to voluntarily comply with the employer mandate and maintain or expand health care coverage in 2014, the IRS will not impose penalties for a failure to do so.Notably, the guidance issued on July 9th also does not require employers to make “good faith” efforts to comply. As a result of this transition year, employers will have the option of deciding to what extent (if any) they will continue efforts to comply with the employer mandate during 2014.
Employers who intended to rely on one of the transition rules previously announced for 2014 should keep in mind that the latest IRS guidance does not provide special transition rules for 2015. Other group health plan requuirements still apply as discussed in our prior blog Essential Health Benefits Not Delayed.
This means that for plan years beginning on and after January 1, 2014, all group health plans must:
Eliminate all pre-existing condition exclusions (regardless of age);
Maximum Cost Sharing Deductible to $2,000/individual ($4,000/family); limit in-network out-of-pocket maximums to $6,350/individual ($12,700/family)
Individual Mandate Still Applies. individuals will still be required to obtain health care coverage or pay a penalty for each month they do not have coverage, beginning January 1, 2014
Exchanges (Marketplaces) Open for Enrollment October 1, 2013.
The IRS notice makes it clear that individuals who enroll in coverage on the marketplaces will continue to be eligible for a premium tax credit if their household income is within a specified range and they are not eligible for other minimum essential coverage.
Employers Must Send Notice of Exchanges (Marketplaces) Before October 1, 2013. These notices must be sent to current employees by October 1, 2013. Then, beginning October 1, 2013, employers must send this notice to new hires within 14 days of their start date.
New taxes still apply – Patient Centered Outcomes Research Institute (PCORI) excise taxes and transitional reinsurance program fees;HRA/HSA/FSA clients also pay a monthly $1/employee tax.
We will continue to monitor ACA developments and will provide you relevant updated information when available. In the meantime, please visit to view past blogs and Legislative Alerts at https://360peo.com/feed.
The pre-July 4th news of Obamacare Employer Mandate Delayed until 2015 decision may have started early fireworks. The administration did not, however, delay the larger new requirements facing employers who choose to offer health insurance in the small group market––employers with less than 50 workers. The biggest requirement – Essential Health Benefits not delayed.
Whether the rationale was to alleviate business pressure to meet new mandates by Jan 2014 or the real fear that Employers have already begun making necessary employment hours cut backs to avoid the $2,000 penalty. A $3,000/employee penalty was also looming for Employers offering unaffordable insurance.
Keep in mind that this limited delay does not affect other provisions of the Affordable Care Act slated to go into effect in or before 2014, such as:
Individual mandate which requires most individuals to purchase insurance by January 1, 2014, or pay a tax penalty.
a 90-day maximum on eligibility waiting periods;
monetary caps on annual out-of-pocket maximums;
total elimination of lifetime and annual limits (including expiration of waivers that permitted certain “mini-med” plans and stand-alone Health Reimbursement Arrangements to stay in place through plan years beginning in 2013);
Patient Centered Outcomes Research Institute (PCORI) excise taxes and transitional reinsurance program fees; HRA/HSA/FSA clients also pay a monthly $1/employee tax.
a notice informing employees of the availability of the new health insurance Exchanges (a model notice is available on the U. S. Department of Labor website); and insurance market reforms.
The biggest impact is the Essential Health Benefits (EHB) which will not be delayed and this affects fully insured or ALL Small Businesses. While small employers are not required to offer coverage, if they do then they come under that large number of new essential health benefit mandates and group rating rules that won’t apply to large employers. These small group requirements are expected to increase the cost of small group coverage by an average of 15%––with wide variation by state and the average age of the group.
An employer sponsoring a Healthy NY or Brooklyn Healthworks Plan today for example would be disqualified as this does not carry all Essential Health Benefits. The very popular Healthy NY is slated to shut down for Jan 2014 and most Employers have just received this transition letter last week. Individual and Sole Prop Healthy NY is terminating and small business Healthy NY must be reapplied under a new higher cost version. While the plan did not carry Ambulance and had a $3,000 limited Pharmacy plan it is priced 35% below market and did manage to capture hundreds of thousands that would otherwise had been uninsured. The same is true for those on Hospital Only or high deductible catastrophic plans.
So what are these Essential Health Benefits?
All individual and small group policies on and off-Exchangemust cover ten categories of minimum essential health benefits.
Under the ACA, each state must choose one plan from among popular health insurance plans offered statewide to serve as a benchmark for EHBs. The benchmark plan will act as the model for how plans must define and include EHBs in their coverage — in both the individual and small group markets. New York selected the benefits of the State’s largest small group plan as its EHB benchmark. There is also a Minimum Value requirement, See NYS Minimum Value STANDARD BENEFIT DESIGN COST SHARING DESCRIPTION CHART (5-6-2013) Some of the plan’s components include:
No cost-sharing for routine preventive services
Pediatric dental and vision coverage
Habilitative and rehabilitative services, including physical therapy, speech therapy and occupational therapy
Rich mental/behavioral health services
No annual or lifetime dollar limits on benefits
Conversely, a shift to self- insurance is underway as self-insureds can avoid many taxes and instead ONLY cover the Minimum Essential Coverage which is different than the Essential Health Benefits. The strategy coupled with reinsurance is a great sophisticated model usually reserved for larger groups. This segment will be able to avoid local additional State mandates which in States like NY account for 14-16%% of the costs. Thats a total swing of 30% for a fully insured NY group. Also, self-insured groups do NOT pay added taxes such as the health insurance tax of $9 Billion annually over the next 10 years.
The administration has shown their sensitivity to larger groups. This segment already covers 94% of its employees at least in some fashion while small businesses cover less than 50%.
Why not do the same for small employers as well? And while they are at it, use the time to reconsider the impact many of these regulations are likely to have on the number of small employers continuing to offer coverage.
For a downloadable guide on self-insuring and secondary market reinsurance for your group please send contact form below. In the meantime, please visit to view past blogs and Legislative Alerts at https://360peo.com/feed.
Obama administration announced that the employer shared responsibility mandate also known as “Pay or Play” aspect of the Patient Protection and Affordable Care Act (PPACA) will be delayed by one year.
This mandate requires businesses with 50 or more workers to provide health insurance coverage to employees. As a result, the administration will start enforcing the mandate in 2015, rather than January 1, 2014, in an effort to give businesses more time to prepare.
There will be additional changes tied to this delay, and the administration has stated that they will provide formal guidance within the next week.
More details will be available for our July 11th WebMeeting. Medical Solutions Corp is working with the various regulatory agencies to understand the specifics surrounding this ruling, and will continue to provide updates through Legislative Alerts and on our blog.
The sheer technological volume of it all could bring “rolling brown outs” similar to electrical grids. Try to imagine a scenario of credit union Experien working with IRS then Social Security & Center for Medicare & Medicaid Services’s dated mainframe computer system while balancing HIPAA and privacy sensitive information. All this while millions of people converge simultaneously onto the information highway. Visualize all of the U.S. Daily Commuters driving into Manhattan today.
As reported below by Reuters’ Sharon Begley Obamacare 1.0: States brace for Web barrage when reform goes live: “Obamacare, formally known as the Patient Protection and Affordable Care Act (ACA), could fail for many reasons, including participation by too few of the uninsured and a shortage of doctors to treat those who do sign up. But because its core is government-run marketplaces selling health insurance online, the likeliest reason for failure at the opening bell is information technology snafus, say experts who are helping with the rollout.”
(Reuters) – About 550,000 people in Oregon do not have health insurance, and Aaron Karjala is confident the state’s new online insurance exchange will be able to accommodate them when enrollment under President Barack Obama’s healthcare reform begins on October 1.
What Karjala, the chief information officer at “Cover Oregon,” does worry about, however, is what will happen if the entire population of Oregon – 3.9 million – logs on that day “just to check it out,” he said. Or if millions of curious souls elsewhere, wondering if Oregon’s insurance offerings are better than their states’, log on, causing Cover Oregon to crash in a blur of spinning hourglasses and color wheels and an epidemic of frozen screens.
Multiply that by another 49 states and the District of Columbia, all of which will open health insurance exchanges under “Obamacare” that same day, and you get some idea of what could go publicly and disastrously wrong.
Obamacare, formally known as the Patient Protection and Affordable Care Act (ACA), could fail for many reasons, including participation by too few of the uninsured and a shortage of doctors to treat those who do sign up. But because its core is government-run marketplaces selling health insurance online, the likeliest reason for failure at the opening bell is information technology snafus, say experts who are helping with the rollout.
Although IT is the single most expensive ingredient of the exchanges, with eight-figure contracts to build them, experts expect bugs, errors and crashes. In April, Obama himself predicted “glitches and bumps” when the exchanges open for business.
“This is a 1.0 implementation,” said Dan Maynard, chief executive of Connecture, a software developer that is providing the shopping and enrollment functions for several states’ insurance exchanges. “From an IT perspective, 1.0’s come out with a lot of defects. Everyone is waiting for something to go wrong.”
Two states that intended to build their own exchanges, Idaho and New Mexico, announced this spring that because of the tight timeline and daunting challenges they would have the federal government operate their IT systems.
“Nothing like this in IT has ever been done to this complexity or scale, and with a timeline that put it behind schedule almost before the ink was dry,” said Rick Howard, research director at the technology advisory firm Gartner.
WHAT COLOR WAS YOUR VOLVO?
The potential for problems will begin as soon as would-be buyers log onto their state exchange. They’ll enter their name, birth date, address and other identifying information. Then comes the first IT handoff: Is this person who she says she is?
To check that, credit bureau Experian will check the answers against its voluminous external databases, which include information from utility companies and banks on people’s spending and other history, and generate questions. The customer will be asked which of several addresses he previously lived at, for example, whether his car has one of several proffered license plate numbers, and what color his old Volvo was.
It’s similar to the system that verifies identity for accessing personal Social Security information. If someone gets a question wrong, he will be referred to Experian’s help desk, and if that fails may be asked to submit documentation to prove he is who he claims to be.
The next step is determining if the customer is eligible for federal subsidies to pay for insurance. She is if she is a citizen and her income, which she will enter, is less than four times the federal poverty level. To verify this, the exchange pings the “federal data services hub,” which is being built by Quality Software Services Inc under a $58 million contract with the Centers for Medicare & Medicaid Services (CMS).
The query arrives at the hub, which does not actually store information, and is routed to online servers at the Internal Revenue Service for income verification and at the Department of Homeland Security for a citizenship check.
The answers must be returned in real time, before the would-be buyer loses patience and logs off. If the reported income doesn’t match the IRS’s records, the applicant may have to submit pay stubs.
These federal computer systems have never been connected before, so it’s anyone’s guess how well they’ll communicate.
“The challenge for states,” said Jinnifer Wattum, director of Eligibility and Exchange Solutions at Xerox’s government healthcare unit, is that they have to build “the interfaces needed with the federal data services hub without knowing what this system will look like.” That makes the task akin to making a key for a lock that doesn’t exist yet.
CMS’s contractors are working to finish the hub, but “much remains to be accomplished within a relatively short amount of time,” concluded a report from the Government Accountability Office (GAO), the investigative arm of Congress, in June. CMS spokesman Brian Cook said the hub would be ready by September, and that the beta version had been tested for its ability to interact with the exchanges Oregon and Maryland are building.
The federal hub has to verify even more arcane data, such as whether the insurance offered to a buyer through his job is unaffordable, in which case he may qualify for federal subsidies, and whether the buyer is in prison, in which case she is exempt from the mandate to purchase insurance.
If someone’s income qualifies him for Medicaid, or his children for the Children’s Health Insurance Program (CHIP), software has to divert him from the ACA exchange and into those systems. Many of the computers handling Medicaid and CHIP enrollment are, as IT people diplomatically put it, “legacy systems,” meaning old, even decades old.
Many are mainframes, lacking the connectivity of cloud computing. They typically process eligibility requests in days, not seconds.
The legacy systems “rely on daily or weekly batch files to pass information back and forth,” and often require follow-up phone calls, said Wattum of Xerox, which is working to configure Nevada’s exchange so it can interface with the federal hub.
‘NO WRONG DOOR’
A “we’ll call you” message is unacceptable under Obamacare, which has a “no wrong door” goal: A buyer must never come to a dead end. If she is diverted to Medicaid, for instance, she must not be required to resubmit information, let alone wait a week for an answer about whether she’s now enrolled.
State IT systems must therefore “be interoperable and integrated with an exchange, Medicaid, and CHIP to allow consumers to easily switch from private insurance to Medicaid and CHIP,” said an April report from the Government Accountability Office (GAO), the investigative arm of Congress.
To make all those systems communicate, the state exchanges must either develop entirely new systems or use application programming interfaces (APIs) that work with the legacy systems to exchange data in real time. APIs are programming instructions for accessing Web-based software applications.
GAO’s Stan Czerwinski compares the necessary connectivity to adapters that let Americanelectronics work with European outlets.
State officials told the GAO that verifying eligibility, enrolling buyers and interfacing with legacy systems are the most “onerous” aspects of developing their exchanges, “given the age and limited functionality of current state systems.”
A key goal for exchange officials is keeping would-be buyers in the portal so they don’t give up and use a state’s ACA call center, which could quickly be swamped.
To avoid this, Oregon brought in potential users to test design prototypes, recorded what people did and where they had trouble, and tweaked the consumer interface to make it as user-friendly as possible, said Karjala.
“Even with that, if you have a family of four and you’re eligible for a tax credit to offset your premium,” he said, “you could be sitting at the computer for a long time.”
What everyone hopes to avoid is a repeat of the early days of the Medicare prescription-drug program in 2006. Some seniors who tried to sign up for a plan were mistakenly enrolled in several, while others had the wrong premium amounts deducted from their Social Security checks.
Another challenge is capacity. Websites regularly crash when too many people try to access them.
“I had no choice but to be extremely conservative” in estimates of how many simultaneous users Cover Oregon has to be prepared for, Karjala said. “Building capacity is the only way to avoid the spinning hourglass or the site freezing, so in our performance testing we’re seeing what happens if the whole U.S. population came to Cover Oregon to check it out.”
This summer, state exchanges will test their ability to communicate with the federal data hub, whose security frameworks and connectivity protocols are still works in progress. But whether Obamacare 1.0 flies won’t be known until the new health plans take effect on January 1. Robert Laszewski, president of Health Policy and Strategy Associates Inc, a consulting firm, said he wouldn’t be surprised if some patients showing up at doctors’ offices next year with Obamacare policies are told their insurers never heard of them.
(Additional reporting by Caroline Humer; Editing by Michele Gershberg and Prudence Crowther)
Usually, you can take care of your bites and stings at home with your parents’ help. Here’s what to do:
Mosquitoes, fleas and other small bugs
Wash the bite with soap and water.
Use calamine (rhymes with “pal–of–mine”) lotion or another cream that will help you stop the itch.
Don’t scratch the bites, even though that’s hard because they itch a lot!
Put ice on a swollen bite.
See a doctor if your bite looks worse or you just can’t stop scratching. Talk to your mom, dad, or another adult about it.
Bees and wasps
Tell a grown-up right away that you’ve been stung.
Take out the stinger if it’s still in your skin – ask a grown-up for help.
Gently wash the sting with soap and water. You might have to do this a few times a day.
Put an icepack on the sting.
Apply a paste made with baking soda and water. Baking soda is something people cook with, but it also can make stings feel a lot better. Ask an adult to help you do this.
Ask your mom or dad if you can take some pain medicine.
Use some lotion or cream to stop the itch if it’s bothering you.
Sometimes, stings can be dangerous. To learn if you might have an allergic reaction to the sting, visit Reactions to bites and stings.
Spiders
Wash the bite with soap and water.Most spider bites can be treated by a grown-up.
Put on an ice pack to make it less puffy.
If you think a black widow or brown recluse spider bit you, tell a grown-up right away. You might need to see a doctor and go to the hospital.
Ticks
Don’t pull off a tick if you find one on your skin, but tell your mom, dad or another adult right away.
An adult should grab the tick with a tweezers close to your skin and pull straight up to remove the tick.
Treating Bites and Stings
Carefully look over the rest of your body. With your parents’ help, check all over, including behind the ears, to be sure there are no other ticks.
Never squeeze or crush a tick, because that can cause more venom to enter your body.
Save the tick in a jar of alcohol in case your doctor wants to see it later. The doctor might be able to tell you if this is the kind of tick that can cause Lyme disease, which can feel like the flu. To learn more, visit Reactions to bites and stings.
Happy Fathers Day in 100 languages. Happy Father’s Day to all the men that work so hard to make sure there kids have what they want and need. No matter how different each word is from the other, it means the same thing. Today, a great number of countries will celebrate Father’s day in their own ways.
Happy Fathers Day!
So, in celebration of Father’s day 100 ways of saying “dad” in different languages.
Afrikaans : vader Albanian : baba ; atë Apalai (Amazon) : papa Arabic : babba ; yebba ; abbi (classical) Aragones : pai Asturian : pá Aymara : awki
Bangla : Baba ; Abba Basque : aita Bergamasco : pàder Bolognese : pèder Bosnian : otac Brazilian Portuguese : pai Bresciano : bubà ; pàder Breton : tad
Calabrese : patre ; patri ; pa ; papà ; papallu ; patra Caló : batú ; bato ; batico ; dadá Catalan : pare Catanese : pattri ; opà Chechen (Caucasus) : daa Chechen : da Cree (Canada) : -papa Croatian : otac Czech : táta, otec
Dakota (USA) : ate Dutch : vader ; papa ; pappie Dzoratâi : pére
East African : baba English : father ; dad ; daddy ; pop ; poppa ; papa Esperanto : patro Estonian : isa Faeroese : faðir
Faeroese : faðir Filipino : tatay, itay, tay ; ama Finnish : isä Flemish : vader French : papa Frisian : heit
Galician : pai German : banketi, Papi Griko Salentino : ciúri Greek : pater (the -ter is pronounced “tare” and the e should have a macron over it) Guaran : túva ; ru
Hebrew : abba(h) Hindi : Papa ; Pita-ji Hungarian : apa Hungarian : apa ; apu ; papa ; édesapa
Icelandic : pabbi ; faðir Indonesian : bapa ; ayah ; pak Irish : athair ; daidí Italian : babbo
Japanese : otosan, papa Judeo-Spanish : padre ; baba ; babu
Kikuyu : baba Kiswahili : Baba Kobon (New Guinea) : bap Kurdish Kurmanji : bav
Ladin : pere Latin : pater ; papa ; atta Latvian : tevs Leonese : pai Ligurian : paire Limburgian : vader ; vajer ; pap Lingala : tata Lithuanian : tevas ; pradininkas ; protevis Lombardo Occidentale : bubà Lunfardo : viejo Luo (Kenya) : baba
Maasai : papa ; paapa ; olaiiu Malagasy : ray Malay : bapa Maltese : missier Mandarin : bà ; bàba (informal) Mandarin Chinese : baba Mantuan : upà ; papà ; babbo Maori : haakoro ; kohake Mapunzugun : chaw ; chao Modern Greek : babbas Moravian : tata Mudnés : pèder Modern English : father, daddy Middle English : fader
Nadsat : Pee Nahuatl (Mexico) : ta’ Napulitano : pate Nepali : buwa Norwegian : pappa ; far
Occitan : paire Old English : faeder (the ‘ae’ is the short a sound in cat)
Parmigiano : päder Persian/Farsi : pedar, pitar ; simply Baabaa Piemontese : pare Pipil (El Salvador) : tatah Polish : tata ; ojciec Portuguese : pai
Rapanui : koro ; matu’a ; matu’a tane Reggiano : peder Romagnolo : bà Romani : dad Romanian : tata Romanian : tata ; parinte ; taica Romansh : bab Russian : papa
Saami : áhcci Samoan : tama Sango : baba Sanskrit : tàtah ; janak Sardinian (Limba Sarda Unificada) : babu Sardinian Campidanesu : babbu Sardinian Logudoresu : babbu Shona : baba Sicilian : patri Slovak : otec Slovenian : ôèe Spanish : papá ; viejo ; tata Spanish,Latin : padre Swahili : baba ; mzazi Swedish, Norwegian, and Danish : fadar Swedish : pappa Swiss German : Vatter
Tagalog : tatay ; ama Triestino : pare Turkish : baba Turkmen : däde ; kaka
Urdu : Abbu ; Abbu-ji ; Abbu-jan ; bap
Valencian : pare Venetian : pare ; popà ; ‘opà ; pupà ; papà Viestano : attèn’
In an effort to improve the safety and efficacy of sunscreen products sold in the U.S. and limit misleading claims, the U.S. Food and Drug Administration officially released a new set of requirements that sunscreen manufacturer’s must begin to follow when making and marketing their products. No more claims of “waterproof” or “sweat proof” (thee claims are overstated). No agonizing over SPFs higher than 50 (there is no sufficient data to show that products with SPF values higher than 50 provide greater protection). And if a manufacturer wants to slap a “broad spectrum” claim on the label, first the product will need to pass a test that proves it does indeed protect against both UVA and UVB rays. Some manufacturers will begin to incorporate these mandates right away, while others may wait until the official ruling kicks in the summer of 2012.
So what’s a sun-savvy consumer to do in the meantime? Dermatologist John Anthony, M.D. of Cleveland Clinic’s Strongsville Family Health and Surgery Center weighs in with these helpful tips about choosing the best sun protection:
• The jury is still out on how chemical sunscreens with ingredients such as oxybenzone, Vitamin A (retinol), and PABA (para-aminobenzoic acid) affect human health. But Dr. Anthony says that if you’re looking to avoid chemical sunscreens, choose a mineral-based one instead since these use physical blockers such as zinc oxide or titanium dioxide. Because mineral sunscreens in spray form create nanoparticles that can be absorbed into the lungs, play it safe and use mineral-based creams and lotions instead of sprays.
• Look for sunscreens that block both ultraviolet A rays (UVA rays contribute to photo-aging and may cause skin cancer) and UVB rays (the ones that cause those red sunburns that blister).
• Choose a middle-of-the road sun protection factor (SPF) of 30 to 50. Any lower and you really limit the amount of time you can spend in the sun before getting burned by UVB rays (roughly 30 minutes) and needing to reapply. Any higher and Dr. Anthony says you risk thinking that you’ve got so much protection you need not reapply every two hours or after swimming, the standard recommendation. Be smart and always reapply sunscreen after swimming or exercising.
• Get sun-sensible: If you can avoid being in the sun during primetime sun hours — from 10 a.m. to 2 p.m. — do. If not, wear a hat and protective clothing, and seek out the shade, says Dr. Anthony. “Sunscreen isn’t a bulletproof vest against sun damage. It’s just one tool that we can use to help protect us.”
Yoga initiatives improves health and reduces costs according to Aetna studies. A yoga and meditation initiative for stressed employees helped them reduce their heart rates and helped Aetna increase productivity and lower health benefit costs 7%, CEO Mark Bertolini told the Third Metric conference.
Ezekiel Emanuel of the University of Pennsylvania said while data on the efficacy of wellness programs overall is mixed, prevention efforts, including traditional wellness programs, are important for saving money and improving health.
In Huffington Post article Company Wellness Programs May Boost Bottom Lines, Aetna CEO Mark Bertolini Says when Aetna determined in 2010 that its workers with the highest levels of stress were costing the company $2,000 more each year than co-workers, the company created an initiative to promote yoga and meditation. Bertolini said at the Third Metric conference co-sponsored by The Huffington Post in New York Thursday. The results include improvements in heart rates and increased productivity.
“Stress can have a significant impact on physical and mental health, so there is a strong need for programs that help people reduce stress as part of achieving their best health,” said Aetna Chairman and CEO Mark T. Bertolini. “The results from the mind-body study provide evidence that these mind-body approaches can be an effective complement to conventional medicine and may help people improve their health, something that I have experienced personally.”
Yoga and Stretching
The study participants included 239 Aetna employees in California and Connecticut who volunteered for the two mind-body stress reduction programs. As part of the studies, 96 employees were randomly assigned to mindfulness-based classes, 90 were randomly assigned to therapeutic yoga classes and 53 were randomly assigned to the control group.
The Affordable Care Act recognizes the benefits of wellness which also includes alternative medicines such as yoga, massage therapy, acupuncture etc. Long awaited guidance on how employers can institute a wellness program using financial incentives and discounts were released recently – Final Wellness Incentive Rule Released.
Does your company offer a wellness program? For more information, you may review the final rulesin their entirety. For MMS Corp previous blogs on wellness, clickhere. we will keep you posted on future PPACA wellness program opportunities. Ask us for more info on Aetna Wellness, Yoga, and how we can help you implement a healthy program for your staff.
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The views expressed in this post do not necessarily reflect the official policy, position, or opinions of MMS Corp. This update is provided for informational purposes. Please consult with a licensed accountant or attorney regarding any legal and tax matters discussed herein.
Final Wellness Incentive Rule Released. Final rules set forth the criteria for wellness programsoffered in connection with group health plans that must be satisfied in order for the plan to qualify for an exception to the prohibition on discrimination based on health status under the federal Health Insurance Portability and Accountability Act (HIPAA). The final rules will be effective for plan years beginning on or after January 1, 2014.
Many employers already offered incentives for employees participating in wellness programs. The main change in the new rule is an increase in the maximum incentive levels for several PPACA designated programs. For smoking cessation efforts, employers will be allowed to offer a reward or penalty of up to 50% of an employee’s health plan cost. For all other wellness programs, the number will be 30%, up from the current 20%. These increases are intended to promote healthy behavior which in turn, advocates claim, reduce health care spending.
Key Highlights Significant provisions included in the final rules include:
Increasing the maximum permissible reward under a health-contingent wellness program, from 20% to 30% of the cost of coverage;
Further increasing the maximum permissible reward for wellness programs designed to prevent or reduce tobacco use, from 20% to 50% of the cost of coverage; and
Clarifications regarding the reasonable design of health-contingent wellness programs and the reasonable alternatives they must offer in order to avoid prohibited discrimination.
Types of Participatory Wellness Programs The final rules continue to divide wellness programs into two categories:
1)”participatory wellness programs,” which are a majority of wellness programs,
2)and “health-contingent wellness programs.”
A participatory wellness program is one that either does not provide a reward or does not include any conditions for obtaining a reward that are based on an individual satisfying a standard related to a health factor. These include programs that reimburse for the cost of membership in a fitness center; provide a reward to employees for attending a monthly, no-cost health education seminar; or reward employees who complete a health risk assessment, without requiring them to take further action.
Participatory wellness programs are generally permissible under the HIPAA nondiscrimination rules, provided they are available to all similarly situated individuals regardless of health status.
Health-Contingent Wellness Programs In contrast, a health-contingent wellness program requires an individual to satisfy a standard related to a health factor to obtain a reward. This standard may be performing or completing an activity (an “activity-only wellness program”), or it may be attaining or maintaining a specific health outcome (an “outcome-based wellness program”).
Examples of health-contingent wellness programs include programs that provide a reward to those who do not use, or decrease their use of, tobacco, or programs that reward those who achieve a specified health-related goal, such as a specified cholesterol level, weight, or body mass index, as well as those who fail to meet such goals but take certain other healthy actions.
In order to qualify for an exception to the HIPAA nondiscrimination rules, health-contingent wellness programs must meet five additional standards related to frequency of opportunity to qualify; size of the reward; reasonable design; uniform availability and reasonable alternative standards; and notice of the availability of reasonable alternative standards.
Example
The final rule provides an example of how this reward/penalty might work:
An employer sponsors a group health plan. The annual premium for employee-only coverage is $6,000 (of which the employer pays $4,500 per year and the employee pays $1,500 per year). The plan offers employees a health-contingent wellness program with several components, focused on exercise, blood sugar, weight, cholesterol, and blood pressure. The reward for compliance is an annual premium rebate of $600…[T]he plan also imposes an additional $2,000 tobacco premium surcharge on employees who have used tobacco in the last 12 months and who have not enrolled in the plan’s tobacco cessation program (Those who participate…are not assessed the $2,000 surcharge).
The total of all the rewards (including the absence of a surcharge for participating in the tobacco program) is $2,600…which does not exceed the applicable percentage of 50% of the total annual cost of employee-only coverage ($6,000 x 50%=$3,000). Tested separately, the $600 reward for the wellness program [excluding] tobacco use does not exceed the applicable percentage of 30 percent of the total annual cost of employee-only coverage ($6,000 x 30%=$1,800).
In excellent article in the Atlantic –The Future of Getting Paid to Be Healthy“Incentive programs are not wellness programs,” said Dr. Ronald Goetzel, Director of Emory University’s Institute for Health and Productivity Research and President and CEO of The Health Project. “That can be a component, when done smartly, of a comprehensive program, but if that’s all your program is going to be, you’re going to fail miserably, and people are going to be resentful,” he explained. According to Goetzel — who has studied worksite wellness programs at large corporations such as Dow Chemical and Johnson & Johnson, and is being funded by the Centers for Disease Control and Prevention to study best practices in the field — incentive programs can help get people excited about health and keep them on track, but ultimately people’s habits will only change if they are given the resources to change them and if the workplace norms and environments change.
Without the other pieces to facilitate behavior change — healthy cafeterias, opportunities to exercise, flexible work hours, supportive leadership and middle managers, and health risk assessments and coaching — incentive programs will only penalize, not change, those who are least healthy.
For more information, you may review the final rules in their entirety. For MMS Corp previous blogs on wellness, click here. we will keep you posted on future PPACA wellness program opportunities. In the meantime, please visit to view past blogs and Legislative Alerts at https://360peo.com/feed.
The views expressed in this post do not necessarily reflect the official policy, position, or opinions of MMS Corp. This update is provided for informational purposes. Please consult with a licensed accountant or attorney regarding any legal and tax matters discussed herein.
Montefiore Buying Sound Shore Hospital. According to the PR release Sound Shore Health System (“SSHS”) announced today it has entered into an Asset Purchase Agreement with Montefiore Health System for Montefiore to acquire its assets. The transaction, which is expected to close by the end of this year, subject to Bankruptcy Court and regulatory approval, will enable Montefiore to continue, and enhance, the provision of care at Sound Shore and Mount Vernon Hospitals as well as at the Schaffer Extended Care Center.
Earlier in May, negotiations between Westchester Medical Center and the Sound Shore Health System broke off after Westchester Medical ended the merger talks.
Sound Shore system was facing a $3 million to $5 million year-end loss when talks with Westchester Medical began late 2012.
Westchester Medical Ceneter has been in the news in recent years embattled with insurance carrier stand-offs. The first was with Empire Blue Cross in Nov 2010 which had been resolved but not with Oxford Health Plans which had terminatedits contract in May 2012.
Still, there are concerns of Hospital and Provider consolidations changing the market place. The Hospital will possibly be transitioned into an ambulatory/multi-specialty center/urgent care center.
Urgent Care have been the good news in bending of the health care cost curve. Approximately 45% of acuities in a hospital ER can be done at an Urgent Care Center. Urgent Care Centers will be filling in the gap between regular family doctors and sitting in an ER. Cost of Urgent Care are up to half of ER. The patient also avoids high ER copays that average $200 aside form possible high in-network deductible. Yet if the Hospital indeed transitions to ambulatory surgery/multi speciality Westchester Hospital available area-hospital beds may further be reduced.
With only 6 month away from full implementation of 2014 Patient Protection Affordability Care Act (PPACA) employers are understandably uncertain. Below are Health Care reform – five things employers can do now to prepare and take action.
UPDATE JULY 2nd: Since blog posting the President Administration has delayed 1 year Employed Shared Responsibility Mandate i.e. Pay or Play to Jan 2015.
1. Employee Communications
Employers must notify employees of the online insurance marketplace known as a Healthcare Exchange. Recently released federal guidelines require employers to notify their workers of eligibility requirements for their state exchange starting Oct. 1, 2013 Open Enrollments for Jan 2014 effective date. To the relief of many, the U.S. Labor Department also provided model notices that employers can give to their workers, which eliminates the need to develop their own notifications.
Additionally, Employers sponsoring a health plan must give employees a Summary of Benefits and Coverage (SBC). The purpose of the Summary of Benefits and Coverage, or SBC, is to present benefits and coverage information in clear language and in a consistent format. Inspired by the Nutrition Facts Label on packaged food, theSBC (pdf) includes two medical scenarios: having a baby and managing Type II diabetes. It estimates how much a patient would pay for medical care in each scenario with specific insurance plans.
It’s the employer’s responsibility to distribute the SBCs to employees.
This requirement applies to health plan renewals after Sept. 23, 2012.
Department of Labor will NOT impose penalties for non-compliance with the SBC notice during the first year as long as employers show a “good faith” effort to comply. Read the FAQ on SBC and ACA pdf here.
2. Determining which Employers must offer health care.
Because employers with 50 full-time equivalents face penalties for not providing affordable, minimum value insurance an employer should know whether it is subject to these requirements or not. Common law employees of the employer and any commonly controlled company must be counted. Employers with temporary or leased employees will want to discuss with their advisors whether these employees will be considered “common law employees” for purposes of determining how many FTEs an employer has. Employers with employees who are paid based on unique payment models (stipends, work product, etc) will want to discuss how to calculate these employee hours with their benefits advisors.
Employers with 50 or more employees will incur penalties of up to $2,000 per employee if they cancel their existing health care program (which up until 2014 would be considered an optional benefit to provide). They will also incur penalties if their plan is too costly, and they do not meet the affordability standards.
Employers with less than 50 employees will not incur penalties if they cancel their health care plan, and that decision will need to be made on a business by business basis. They can also choose to offer partial coverage and contribute up to the minimum 50% of single coverage not to exceed 9.5% employee
The good news is Employers can subtract 30 FT employees. This portion is known as the Employer “play or pay” option. Specific case example and details are found at Pay or Play Employer Guide.
To encourage businesses to offer health benefits to their employees, the federal government is offering tax credits to small businesses. These credits are available to an estimated 4 million small businesses, including nonprofits.The IRS has set up a web page with information: Small Business Health Care Tax Credit for Small Employers. The maximum “credit” (which offsets taxes dollar for dollar and is better than a “deduction” which reduces taxable income) is 35 percent of the amount an employer pays towards employee health insurance.
Who’s eligible?
To qualify, small employers must:
Have fewer than the equivalent of 25 full-time workers
Pay average annual wages below $50,000
Cover at least 50% of the cost of health care coverage for their workers
Because of the high wages paid in most industries in NY/NJ/CT Tri State, few small employers that provide coverage pay such a low average wage. Note, however, that the calculation of average wages and number of employees excludes the wages of an owner and his or her family members.
medicalsolutionscorp.com help clients gather the appropriate information and do a preliminary estimate of the credit amount. This information will help you and your accountant determine whether applying for the credit makes financial sense. Find out what the new tax credit could mean for your coverage. Call us at 855-667-4621.
4. Determine affordability
Beginning Jan. 1, 2014, an employer with 50 or more employees must pay a tax penalty if they either: a) Do not provide health insurance with minimum benefits or 60 percent of healthcare expenses; b) Require employees to contribute more than 9.5 percent of an employee’s household income for the health insurance and those employees obtain a government subsidy for coverage.
Companies will be required to pay $3,000 per employee without affordable coverage. (Note: there are a number of caveats that might affect the actual penalty paid, so consult your tax advisor.)
It is crucial to Understand the difference between FT and Full Time Equivalent. To determine the FTE (Full Time Equivalent) you must count FT and PT employees. Full Time Employees are those working 30 hours+/week.* The number of full-time employees excludes those full-time seasonal employees who work for less than 120 days during the year.4 The hours worked by part-time employees (i.e., those working less than 30 hours per week) are included in the calculation of a large employer, on a monthly basis, by taking their total number of monthly hours worked divided by 120.
For example, a firm has 35 full-time employees (30+ hours). In addition, the firm has 20 part time employees who all work 24 hours per week (96 hours per month). These part-time employees’ hours would be treated as equivalent to 16 full-time employees, based on the following calculation:
20 employees x 96 hours / 120 = 1920 / 120 = 16
Thus, in this example, the firm would be considered a “large employer,” based on a total full-time equivalent count of 51—that is, 35 full-time employees plus 16 full-time equivalents based on part-time hours.
In the coming months, Millennium Medical Solutions Inc will host seminars and will share information you’ll need to know as the countdown continues to October 1st.
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This blog is not intended to represent legal advise and one should consult with a tax and/or legal expert.
* IRC 4980H(c)(4)
Disclaimer: This blog is not intended to represent legal advise and one should consult with a tax and/or legal expert.
In Time magazine’s March issue Bitter Pill: Why Medical Bills Are Killing Us Steven Brill gets to work on answering the ever elusive Why are Medical Costs So High? The 21,000 word article is longest article in Time Magazine history that can boiled down to simply there is no free marketplace in health care. We think everything in this country is a free market but is there a free market when one needs to got to an emergency room or a free market when one must take a cancer pill? According to Howard Dean the singular reason is to get away form the current fee for service system where providers get paid per procedure and not per patient.
Here’s an eye opener: “Insurance Companies are not really the problem they run pretty terribly. They process claims, a lot of us think they process claims and fairly consistently but they are increasingly at the mercy of hospitals which are consolidating buying a doctors practices. We should tax profits on so-called nonprofit hospitals and put that money back into the system. We should control all the prices for prescription drugs because if I have a monopoly a cancer wonder drug I can charge anything I want for them that’s obviously not a free market and it’s completely two different uses you see this article once you follow the money.”
Transcript of the video:
“This is not a free-market. You don’t get health care because you want it. You don’t wake up in the morning and gee I love to go down to the emergency room today. You enter that market and will you know nothing about the products of you being asked by no choice of those products. Hi I am Steve Brill I’ve got the cover story this week in TIME Magazine looking at the health care debate from a very different perspective. Everybody focuses on who should pay for the exorbitant cost of health care and that I decided to do was ask for more fundamental question which is why does health care cost so much.
I look behind the bills and trace the bills all the way back to who’s getting what money is making what profits and the results are really surprised one of the things I found that everybody in the healthcare industry knows about that that nobody else knows his something called the charge-master. The charge master is a internal listing each hospital of the thousands of different items that they charge and nobody could explain it to me. Indeed would be hard to explain for example why would you charge $77 for a box of gauze pads? You can buy for a dollar at the drugstore. why would you charge thousands of dollars for CAT scan it really isn’t cost you anything?
It’s emblematic if you will, of the irrationality of the higher healthcare system because no one can explain the cost no one tries to and the only people who are guaranteed surefire to pay to be asked to pay the charge-master prices are the poorest people who don’t have health insurance.
Real profit makers are way hospitals markup very expensive drugs that you get. If you have cancer to have pneumonia but they’re making thousands of dollars on these drugs and drug companies in turn making still more thousands of dollars.
Obamacare does very little to solve any of these problems and just probably why you got to Congress I’m it doesn’t do anything to control the prices of prescription drugs or medical devices CAT scan. In fact if anything it will increase the profitable the players in the market by making equal insurance and therefore more people are in the marketplace with the funds from insurance companies to buy all these products.
Insurance Companies are not really the problem they run pretty terribly. They process claims, a lot of us think they process claims and fairly consistently but they are increasingly at the mercy of hospitals which are consolidating buying a doctors practices. See Provider Consolidation Info-graph– “The proliferation of hospital mergers and hospitals’ appetite for buying doctors’ practices—in part to assure a steady stream of patients to fill hospital beds—could create local monopolies that raise prices without increasing efficiency. ‘Historically,’ says Deloitte’s Mr. Keckley, ‘hospital consolidation hasn’t reduced costs.’”
We should tax profits on so-called nonprofit hospitals and put that money back into the system. We should control all the prices for prescription drugs because if I have a monopoly a cancer wonder drug I can charge anything I want for them that’s obviously not a free market and it’s completely two different uses you see this article once you follow the money.”
The ACO (Accountable Care Organization) referenced in our post NYU Beth Israel Merger and ACOs are models encouraged in Obamacare in fact as examples of Provider capitated reimbursement that Howard Dean is in favor of. An ACOI cordiantes patient care and provide the full range of health care services for patients. The health reform law provides incentives for providers who join together to form such organizations and who agree to be accountable for the quality, cost, and overall care of Medicarebeneficiaries who are enrolled in the traditional fee-for-service program who are assigned to the ACO.
The fee-for-service system has evidentially driven costs by incentivizing volumes of added procedures. The ACO model is built on par excellence hospitals such as Mayo Clinic where there is team of providers are financially incentivized for patient care coordination outcomes and high quality of care. The ACO’s payment would be tied to achieving goals that improve health care and save money. Members of the ACO would divvy up that payment. Today’s payment system, investments in providing better care are doubly penalized. If a hospital hires a nurse to follow up with patients after they are discharged in order to reduce readmissions — for example, to help patients with diabetes improve blood sugar control — it must pay for the nurse, which is typically not reimbursed by insurance companies or Medicare, and it loses revenue by preventing the readmission.
Congress included ACOs in the health care law as a way to rein in Medicare spending. That federal program pays for health care for people 65 and older and the disabled. The federal government estimates ACOs could save the Medicare program up to $940 million over four years. Medicare recently began testing this system with 32 pilot ACOs in 18 states, including one in the New York City area – Bronx Accountable Healthcare Network.
Some have pointed to ACO Model just as a pro-merger supporting argument with the FTC. These significant mergers create market dominance and therefore limit competition and drive up health care dollars. And yet Hospitals operate on thin profit margins and cannot afford to lose market share therein lies is the conundrum.
Note: At time of this article MVP and Hudson Valley Health Plans announced a merger –Hudson Health Plans joins MVP. Hudson Health Plan, the Medicaid managed care organization based in Tarrytown, will join the MVP Health Care group of companies, the two nonprofit health plans jointly announced today.
“Size and diversity of offerings are important for health plans in the new world of the health insurance marketplaces. A 55-year-old person would like to join a health plan that can continue to cover him when he turns 65. Likewise, if someone is no longer eligible for Medicaid, she might prefer to buy a commercial product from that same insurer. Together, MVP and Hudson now can cover people through all of life’s stages and changing needs.
In the coming months, Millennium Medical Solutions Inc will host seminars and will share information you’ll need to know as the countdown continues to October 1st. Please contact us for immediate information on how to implement these initiatives for your group-specific needs at info@medicalsolutionscorp.com or Call (855) 667-4621.
Want to cook up a plan to keep your immune system in tip-top shape? Some experts believe that even slight deficiencies in certain nutrients can lower our defenses. hile an apple a day is a good start, it definitely takes a bigger — and brighter — cornucopia to boost your disease-fighting ability. Here below are natural best foods to boost immunity.
Quick, Don’t Get Sick! We’ve all been there: We feel a cold coming on, so we start popping megadoses of vitamin C. We’ve been doing it for decades even though there’s little evidence to suggest it will keep us from getting sick. According to the Cochrane Database of Systematic Reviews, which looked at 30 trials involving a total of 11,350 participants,vitamin Chad no effect on how often people caught colds. It did slightly reduce the cold’s duration — by 8 percent, or roughly 9.5 hours for a five-day illness — but only if taken before symptoms arose.
However, a Canadian over-the-counter pill (available in the U.S.) called COLD-fX, made from North American ginseng, has shown dramatic results. Healthy people reduced their risk of colds by 56 percent, the severity by 31 percent and duration by 35 percent. And in nursing home seniors, it reduced their risk of the flu by 89 percent. The only downside: You have to take it twice a day for the entire cold and flu season (four months).
Color of Health A healthy diet full of antioxidant-rich fruits and vegetables is a vital part of a well-functioning immune system. Antioxidants are food-based chemicals, such as vitamins and minerals, that neutralize free radicals in our bloodstream. Free radicals — toxic by-products of digestion, pollution and cigarette smoke — damage DNA, cause many types of cancer and suppress the immune system.
Eating fortified, processed foods, supplemented with a multivitamin, might get you all of the vitamins you need, but, explains Joel Fuhrman, MD, author of Eat for Health and Eat to Live, we’re depriving ourselves of thousands of micronutrients that we haven’t even discovered yet. “It’s very hard to duplicate Mother Nature,” he says. “More than half of the micronutrients in plants are phytochemicals, not vitamins.” Phytochemicals are compounds produced by plants to protect themselves from environmental stresses like UV damage. Research shows that by eating foods rich in phytochemicals, we can boost our health as well. According to Dr. Fuhrman, these chemicals keep our cells from aging, while some even cause cancer cells to self-destruct. A few of the heavy hitters you’ve probably heard of include lycopene (tomatoes), polyphenols (tea) and resveratrol (grapes). Broccoli and other cruciferous vegetables, like cabbage, brussels sprouts and cauliflower, contain some of the most powerful cancer fighters that we know of — actually shrinking tumors in laboratory experiments.
For the best protection, David Katz, MD, MPH, director of the Yale University Prevention Center, and Dr. Fuhrman recommend eating a wide variety of fruits and vegetables that cover the entire color spectrum. “Foods work together to maximize immune function, which then prolongs health and helps prevent chronic disease,” Dr. Fuhrman says.
Good Fat, Bad Fat To beef up your immune system, try to reduce the amount of red meat and saturated fat that you eat, and replace them with fish andomega-3 fatty acids, recommends Charles Stephensen, PhD, a research scientist with the USDA at the Western Human Nutrition Research Center. “Saturated fats activate the immune system, promote inflammation and are associated with increased cardiovascular risk,” Dr. Stephensen says.
Inflammation occurs when the immune system senses an intruder, so in a sense, these fats make the body think there’s an invader that has to be isolated and wiped out. Chronic inflammation can result in Alzheimer’s, diabetes, heart disease and arthritis.
“Omega-3s, on the other hand, seem to have the opposite effect on the immune system,” Dr. Stephensen says. Eating fatty fish or taking afish oil supplement (one to two grams a day) reduces levels of inflammation in the body.
D Is for Defense When we talk about boosting the immune system, what we’re really discussing is making it run optimally, Dr. Stephensen says. Once an infection or virus is gone, the immune system needs to be able to stop its attack. An overactive response can lead to autoimmune diseases, where the body turns on itself, attacking its own tissue as if it were a foreign threat. Some examples are rheumatoid arthritis, type 1 diabetes and lupus. According to Dr. Stephensen, it is now suspected that a vitamin D deficiency may increase our risk of flu and worsen the effects of autoimmune diseases. “Vitamin D can act directly on the immune system. It seems to be able to protect against bacterial infections and regulate our immune response. A deficiency allows an overstimulation of the system,” he explains.
Vitamin D is produced in our body when our skin absorbs the sun’s ultraviolet rays. Because it’s present in very few foods, and sunscreen blocks the sun’s effects, it’s very difficult to get your daily recommended dose. In fact, a recent study published in the Archives of Internal Medicine reports that 75 percent of U.S. teenagers and adults are vitamin D deficient. What’s more, Dr. Stephensen says that the recommended daily allowance, which ranges from 200 to 600 IU, depending on your age, may be too low. Thomas Morledge, MD, of the Center for Integrative Medicine at the Cleveland Clinic,recommends aiming for 1,000 IU daily. Although higher doses may be needed, this should be guided by your doctor. Good sources include fortified milk and fish; a 3.5-ounce serving of salmon contains 360 IU, while a glass of milk has about 100 IU. Ten minutes of sun (sans sunscreen) is also a good source of vitamin D. That said, Dr. Morledge recommends that everyone take a vitamin D supplementsince it’s unlikely you will get your required daily allowance through food and limited, unprotected sun exposure.
Many follow up questions on the postPay or Play Employer Guide have been raised. A Pay or Play FAQ hopefully adds some clarification.
Will I be required to offer health insurance coverage to my employees?
No. However, if you have at least 50 full-time employees, and you don’t offer coverage, you will owe a penalty starting in 2014 if any full time employee is eligible for and purchases subsidized coverage through an exchange. This penalty is called the “free rider” penalty.
We employ about 40 full-time employees working 30 or more hours per week and about 25 part-time or seasonal employees. So we are not subject to the employer mandate penalties, right?
You may be. The health reform law does not require you to provide coverage for employees working on average less than 30 hours per week (“part-time”). However, the hours worked by part time employees are counted to determine whether you have at least 50 full-time employee equivalents and therefore are subject to the employer mandate. This is done by taking the total number of monthly hours worked by part time employees (but not to exceed 120 hours for any one part-time employee) and dividing by 120 to get the number of “full time equivalent” employees. You would then add those “full-time equivalent” employees to your 40 full-time employees.
The hours worked by seasonal employees are also counted to determine whether you have at least 50 full-time employee equivalents and therefore are subject to the employer mandate. For purposes of determining whether you are a large employer, seasonal employees are workers who perform labor or services on a seasonal basis (i.e. exclusively performed at certain seasons or periods of the year and which, from its nature, may not be continuous or carried on throughout the year) for no more than 120 days during the taxable year and retail workers employed exclusively during holiday seasons. There is an exemption from the employer mandate that says you would not be considered to employ more than 50 full-time employees if:
Your workforce only exceeds 50 full-time employees for 120 days, or fewer, during the calendar year; and
The employees in excess of 50 who were employed during that 120-day (or fewer) period were seasonal workers.
Our workforce numbers go up and down during the year. How do we determine if we had at least 50 full-time employees on business days during the preceding calendar year?
For purposes of determining if you are a large employer, the formula requires the following steps:
1.Determine the total number of full-time employees (including any full-time seasonal workers) for each calendar month in the preceding calendar year;
2.Determine the total number of full-time equivalents (including non-full-time seasonal employees) for each calendar month in the preceding calendar year;
3.Add the number of full-time employees and full-time equivalents described in Steps 1 and 2 above for each month of the calendar year;
4.Add up the 12 monthly numbers;
5.Divide by 12. If the average per month is 50 or more, you are a large employer.
So if we offer coverage to our full-time employees, we will not have to pay a penalty?
Not necessarily. If you have at least 50 full-time employees and you offer coverage to at least 95% of your full-time employees, you are still subject to a penalty starting in 2014 if:
1.A full-time employee’s contribution for employee-only coverage exceeds 9.5% of the employee’s household income (Note: see below regarding a proposed affordability “safe harbor”) or the plan’s value is less than 60%; and
2.The employee’s household income is less than 400% of the federal poverty level; and
3.The employee waives your coverage and purchases coverage on an exchange with premium tax credits.
The penalty will be calculated separately for each month in which the above applies. The amount of the penalty for a given month equals the number of full- time employees who receive a premium tax credit for that month multiplied by 1/12 of $3,000.
We have more than 50 full-time employees so we are subject to the employer mandate penalties. How do we know which of our employees is considered “full-time” requiring us to pay a penalty if they qualify for premium tax credits at an exchange (if the employee has a variable work schedule or is seasonal)?
Through the end of 2014, for purposes of the employer mandate penalties, the guidance permits you to use a “look-back measurement period/stability period” safe harbor to determine which of your employees are considered full-time employees. You may use a standard measurement/stability period for ongoing employees, while using a different initial measurement/stability period for new variable and seasonal employees
How do the full-time employee safe harbors work for new hires?
They are generally based on the employee’s hours worked, or, the amount of hours the employee is reasonably expected to work as of their hire date.
New employee reasonably expected to work full-time (i.e. 30 or more hours per week)– If you reasonably expect an employee to work full-time when you hire them, and coverage is offered to the employee before the end of the employee’s initial 90 days of employment, you will not be subject to the employer mandate payment for that employee, if the coverage is affordable and meets the minimum required value.
New employee reasonably expected to work part-time (i.e. less than 30 hours per week)-– If you reasonably expect an employee to work part-time and the employee’s number of hours do not vary, you will not be subject to the employer mandate penalty for that employee if you don’t offer them coverage.
New variable hour and seasonal employees – If based on the facts and circumstances at the date the employee begins working (the start date), you cannot determine that the employee is reasonably expected to work on average at least 30 hours per week, then that employee is a variable hour employee. Because the term “seasonal employee” is not defined for purposes of the employer responsibility penalty, through 2014, you are permitted to use a reasonable, good faith interpretation of the term “seasonal employee”. The IRS has indicated that any interpretation of the term “seasonal” probably would not be reasonable if it included a working period of more than six months. Once hired, you have the option to determine whether a new variable hour or seasonal employee is a full-time employee using an “initial measurement period” of between three and 12 months (as selected by you).You would measure the hours of service completed by the new employee during the initial measurement period to determine whether the employee worked an average of 30 hours per week or more during this period. If the employee did work at least 30 hours per week during the measurement period, then the employee would be treated as a full-time employee during a subsequent “stability period,” regardless of the employee’s number of hours of service during the stability period, so long as he or she remained an employee. The stability period must be for at least six consecutive calendar months and cannot be shorter than the initial measurement period. If the employee then didn’t work on average at least 30 hours per week during the measurement period, you would not have to treat the employee as a full-time employee during the stability period that followed the measurement period, but the stability period could not be more than one month longer than the initial measurement period.
Example – Facts: For new variable hour employees, you use a 12-month initial measurement period that begins on the start date and apply an administrative period from the end of the initial measurement period through the end of the first calendar month beginning on or after the end of the initial measurement period.
Situation: Dianna is hired on May 10, 2014. Dianna’s initial measurement period runs from May 10, 2014, through May 9, 2015. Dianna works an average of 30 hours per week during this initial measurement period. You offer affordable coverage to Dianna for a stability period that runs from July 1, 2015 through June 30, 2016.
Conclusion: Dianna worked an average of 30 hours per week during her initial measurement period and you had (1) an initial measurement period that does not exceed 12 months; (2) an administrative period totaling not more than 90 days; and (3) a combined initial measurement period and administrative period that does not last beyond the final day of the first calendar month beginning on or after the one-year anniversary of Dianna’s start date. Accordingly, from Dianna’s start date through June 30, 2016, you are not subject to an employer mandate penalty with respect to Dianna because you complied with the standards for the initial measurement period and stability periods for a new variable hour employee. However, you must test Dianna again based on the period from October 15, 2014 through October 14, 2015 (your first standard measurement period that begins after Dianna’s start date) to see if she qualifies to continue coverage beyond the initial stability period.
Employee FT Testing Period Chart
As you can tell, there are many things to consider as you map out your plans for how your business is going to proceed with health care reform. Millennium Medical Solutions Corp hopes to be a valuable resource in the weeks and months ahead as you make these decisions. What about you? Do you have any glaring questions that we could answer for you about health care reform compliance?
For a FREE Affordable Care Act Guide leave your questions in the comments below or click the “Contact Us” button and we’ll do our best to answer your questions.
Please refer to the IRS Notice in the links below for more details and examples:
DISCLAIMER: We share this information with our clients and friends for general informational purposes only. It does not necessarily address all of your specific issues. It should not be construed as, nor is it intended to provide, legal advice. Questions regarding specific issues and application of these rules to your plans should be addressed by your legal counsel.
Health Insurance Mandates 2012. The Councel for Affordable Health Insurance in VA released their annual “Health Insurance Mandates in the States” for 2012 last week. While NYS did not crack the top 5 they did come close at number 7 this year.
NYS Mandates were discussed in our posting Empire Leaving Small Groups Nov 2011. ” Today, we have so many State mandates that many of the mandates(overage dependents coverage, preventive care, pre-existing for kids) in PPACA didnt even affect NY since they were already in place. Mandates account for approx 17% of the costs of which Small Businesses pay more than fair share. Large corporations and Unions can self insure and avoid some mandates as they are governed by ERISA and not State. To the relief of of our struggling clients on subsidized Healthy NYthe State doesn’t play by their own rules and instead opts out of its very own mandates.”
According to the study CAHI Identifies 2,271 State Health Insurance Mandates “The sheer number of state mandates will make it difficult for states to deliver on one of the key promises repeatedly made by supporters of Obamacare: it would provide all Americans with affordable health coverage. The essential health benefit plan design was supposed to give states the flexibility to craft benefit packages which would be suitable and affordable for their unique populations. But HHS shackled the states to the full load of mandated benefits on their books, and the prices of next year’s offerings in the health insurance exchanges are going to bear witness to the free-wheeling mandate craze of the last twenty years. Recent studies have predicted double digit increases in health insurance premiums next year — the mandates are coming home to roost,” said Roy Ramthun, CAHI’s Director of Federal Affairs.”
The United Hospital Fun estimates that approximately 2.2 million New Yorkers lacked insurance coverage in 2009, (Health Insurance Coverage in New York 2009.)
The collective cost of paying for New York’s health insurance mandates equates to 12.2% of overall premium cost. Based on 2008 premiums, this translates into $1,538 expense per year for an average family policy and $566 per year for a single person policy. (Employer Alliance, NYS Mandated Health Insurance Benefits, 2003)
Higher health care costs increase the number of uninsured. In New York, it is estimated that for every 1% increase in premiums, 30,000 New Yorkers lose health insurance. (Barents Group, 1999)
Mandates have a cumulative impact on premium costs. It is estimated that the cost of the 12 most common mandates can increase the cost of health insurance by as much as 30%. (Milliman and Robertson 1996)
Rising health care costs have the biggest impact on the small business sector. For every 1% increase in premium costs, small business sponsorship of health insurance drops by 2.6%. (Morrisey et al., 1994)
The percentage of US small business workers receiving insurance through their employer declined 5% between 1996 and 1998 – from 52% in 1996 to 47% in 1998. (KPMG Peat Marwick, 1999)
Nearly one of every four uninsured Americans has no health care coverage as the direct result of state mandates. (Jensen, Morrisey, 1999)
Health insurance premiums for New York’s working families skyrocketed between 2000 & 2007 increasing by 80.7 percent. (Families versus Paychecks, Families USA 2008)
Since 1999, family premiums for employer-sponsored health coverage have increased by 131 percent, placing increasing cost burdens on employers and workers. (Kaiser Family Foundation and Health Research and Educational Trust. Employer Health Benefits 2009 Annual Survey. September 2009).
the HIT is actually a hidden tax on small business. PPACA assesses a tax on all health insurance companies based on their “net premiums” written. The tax will raise $8 billion starting in 2014, $14.3 billion in 2018 and more in later years. This is [aid for by fully insured health plans which are comprised mostly by small businesses.
Map of State Exchanges Final. The final map of 2014 State Exchanges or health insurance marketplaces are now in.
States have had the option of either using Federal Grants to establish their own Exchanges or letting the Federal run their State’s Exchange. There is even a middle version, a Partnership Exchange Program. Under this arrangement, the State might oversee the selection and management of health plans and assisting people with enrollment. The federal government would have primary responsibility for the remaining marketplace operations, including managing the marketplace, their websites and call centers, accepting applications, and determining eligibility for premium subsidies.
Seventeen states and the District of Columbia have received conditional approval from HHS to operate a state-run marketplace in 2014. These states are: California, Colorado, Connecticut, Hawaii, Idaho, Kentucky, Maryland, Massachusetts, Minnesota, Nevada, New Mexico, New York, Oregon, Rhode Island, Utah, Vermont, and Washington.
This map is very close to last years blog we posted Map of State Exchanges Status May 2012 . For the most part this goes by partisan lines with majority of Federally Run State Exchanges located in GOP Governor States. An example of this is highlighted in our blog on NJ Exchange Chrstie Rejects State Exchange.
It is vital that as many uninsured’s get health coverage. Nationally approximately 30 million people are expected to gain coverage with 600,000 in States like NY.
Tick! tick! tick! As the 2014 Employer Mandate to either pay or play gets closer the nation’s employers move a step closer to having to make a decision: Do I play or pay? This Employer mandate under Patient Protection and Affordable Care Act (PPACA) does not apply to smaller groups under 50 FTE (full time equivalent) employees. Many small groups such as food service industry, retailers, construction etc. in fact have many FTE and while they may work minimal hours can trigger the “pay or play” mandate.
The IRS has released recently guidance published in the form of a Notice of Proposed Rulemaking (NPRM), addresses a number of issues tightly linked to an array of practical considerations related to the employer mandate. These include defining a “large employer,” determining “full-time” status for employees, clarifying the meaning of “dependents,” and determining what constitutes “affordable” coverage.
The guidance also tackles several stickier questions such as how and whether to count foreign or seasonal workers, as well as how to calculate the full-time status of employees who work unusual hours, such as teachers or airline pilots.
Three safe harbors relating to the provision of “affordable” coverage to employees in order to avoid exposure to the mandate penalties are also included in the guidance. Transition relief is offered in recognition of certain employers’ needing time to bring their plans into compliance.
Still, there are several regs that the IRS is awaiting commentary and resolution on due on March 18, 2013.
A Q&A summary of the rule has been released by the IRS and is available by clickinghere.
Some employers assert that the play-or-pay mandate will raise their costs and force them to make workforce cutbacks. As a result, a number are considering eliminating their health care coverage altogether and instead paying the penalty on their full-time employees. While the “pay” option might be worth considering, there are strong reasons why employers should look carefully at all of their options and do their best to calculate the actual outcomes of each.
Other Key Issues Addressed in the Proposed Rules Additional issues addressed in the proposed regulations include:
Determining which employers are subject to the “pay or play” requirements;
Determining who is a full-time employee, including approaches that can be used for employees who work variable hour schedules, seasonal employees, and teachers who have time off between school years;
Determining whether coverage is affordable and provides minimum value; and
Calculating the amount of the penalty due and how the penalty will be assessed.
When conducting a cost-benefit analysis, the key tax issues the employer should consider are:
Employer Tax Penalty for Not Offering “Qualified” Group Health
Not applicable for employers with less than 50 FTEs
$2,000 penalty per full-time employee (minus 30 employee credit)****
Employer Tax Penalty for Offering “Qualified” Health That is Not “Affordable”
Not applicable for employers with less than 50 FTEs
$3000 per employee receiving subsidy
Example:
Jungle Corp. has 100 full-time employees and is a leader in its market, using a talent differentiation strategy. Jungle’s family coverage costs $15,000, of which employees pay $3,000. Bob Smith, a highly skilled worker with a strong performance record, earns $50,000 and has family coverage through Jungle’s plan.
On Jan. 1, 2014, Jungle Corp. announces it is dropping its group health plan coverage and will instead pay the $2,000-per-full-time-employee penalty. On Jan. 2, Bob walks into HR and asks about receiving replacement compensation for the $12,000 that the business had been paying toward his family coverage.
Wanting to retain Bob in accordance with its strategy of maintaining market leadership with an experienced workforce, Jungle offers him another $12,000. But clever Bob points out that his share of Social Security and Medicare payroll (FICA) taxes will take a bite out of that $12,000, as will federal and state income taxes, so the HR manager agrees to make good on those amounts as well. Of course, the company will also have to pay its share of FICA taxes on Bob’s additional compensation. As a result, instead of paying $12,000 toward Bob’s family coverage using pre-tax dollars, Jungle Corp. now finds itself paying an additional:
Bob’s salary adjustment: $14,500
Employer’s share of FICA taxes: $1,109
Excise tax (penalty): $2,000 ———————————-
Total: $17,609 (versus $12,000 currently)
Similar per-employee costs will be reflected across the company’s workforce. A move that seemed like a no-brainer, the consequences could make you look silly.
For More Information Due to the complexity of the law in this area, and the absence of finalized guidance, employers are strongly advised to review their benefit plans to prepare for the changes ahead. Additional information regarding the penalty is featured on our Employer Shared Responsibilitypage.
In the coming months, Millennium Medical Solutions Inc will host seminars and will share information you’ll need to know as the countdown continues to October 1st. Please contact us for immediate information on how to implement these initiatives for your group-specific needs at info@medicalsolutionscorp.comor Call (855) 667-4621.
Is EmblemHealth (GHI formerly) leaving the small business market? Yes and no. The popular traditional EPO is slated to be chopped up for new business May 1 pending State approval. The remaining consumer driven health plans which have deductibles and coinsurance (a %) will stay in tact. With that Broker compensation commissions will be significantly cut as well. The family popular 2-tier rating is also phased out and new groups must submit everything clean within 30 days.
Our quote in todays Crains Health Pulse Crains EmblemHealth pulls small business plans Feb 2013 | Crain’s New York Businessreflects our deep concerns on market consolidations. “The unintended consequences of legislative changes has created a de facto single-payer system where Oxford is empowered to dictate to the New York market,” said Alex Miller, founder of Millennium Medical Solutions Corp. in Armonk, N.Y. To be fair Emblem has been steadily streamlining plans with in network only plan offerings and lowest HSA (Health Savings Account) family deductible starting out at $11,600. They are not the first insurer to do this as Empire Blue Crossissued a broader exit back in Nov 2011.
A healthy health insurance marketplace depends on competition as we all agree. From approximately 12 insurers 15 years ago we are today down to 2 active insurers Aetna and Oxford with Oxford claiming approx 2/3 of the small business marketplace. In NYS theMLR(Minimum Loss Ratios) are higher than any other state with additional state taxes. See NYS Surcharge on Health Insurance. The tight State Regulators allowing for razor thin margins while requiring insurers to maintain high reserves makes a burden many insurers are not excited. This resembles more of a utility company environment except ConEd realizes a 10% operating profit and do not have to have insurance reserves to prove solvency. Is there any surprise why there is no rush by outside insurers to compete here?
While on topic of ConEd we all know how customer care was in the aftermath of Hurricane Sandy. When was the last time an independent veteran consultant (not an ESCO) worked with you on your utility bill, servicing, negotiating, educating, and maximizing savings? Sure you can use a different supplier or ESCO but its still the local singular utility company that you are using. In comparison, same is happening in the health insurance field and the consequential exit of Health Insurance Brokers. Sadly, this is precisely the time when their training is most in demand and the most in need will be least likely to afford them.
The AHIP infograph provides visually a great infograph describing how provider consolidation increases costs. According to Wall Street Journal Article this week –Four Key Questions for Health-Care Law “The proliferation of hospital mergers and hospitals’ appetite for buying doctors’ practices—in part to assure a steady stream of patients to fill hospital beds—could create local monopolies that raise prices without increasing efficiency. ‘Historically,’ says Deloitte’s Mr. Keckley, ‘hospital consolidation hasn’t reduced costs.’”
If we as a society ask our hospitals to behave as industries then size matters in achieving economies of scale. However, the important question we must then answer are we operating in a true free market economy when someone gets sick?
An interesting NYT article today “Slower Growth of Health Costs Eases U.S. Deficit” describes the good news that actual spending has been reduced by 15% or $200 Billion than projected 3 years ago. New data also show overall health care spending growth continuing at the lowest rate in decades for a fourth consecutive year.
Its any ones guess to the exact cause of this good news I will venture to say a good part of is the severe escalating out of pocket costs. With average office copays $50 and $200 for ER and many replacing these plans with high deductibles is it any wonder there is lower utilization? One might argue are poor health plans the cause for middle class leading to lower usage? To get an updated picture of todays NY Small Business rates once can get instant quote on our site and implement strategies in “How to Reduce My Health Care Costs“. In some instances people are turning to self insured Health Savings Accounts carrying deductibles as high as $5000 Individual and $10,000 Family.
In 2014 Individual Health Exchanges will offer a subsidized rate for lower income. For example, a $25,000 Individual filer would get approximate 80% subsidized rate and pay approx. $100/month. However salaries are not geo-sensitive and the average NY Middle Class Household will not see this subsidy. There are a number of questions outstanding such as the quality of the network. Also some Governors such as Christy Has Rejected Exchange is capable of running this Exchange version.
On the higher end according to CBO “tax expenditures disproportionately benefit the most well-off. As Figure 2 shows, the most affluent 20 percent of Americans receive 66 percent of all tax expenditure benefits (the richest 1 percent alone getting 24 percent of the benefits), while the middle 60 percent of households received just 31 percent of the benefits. In contrast, the middle 60 percent of households receive a proportionate share (58 percent) of the benefits of entitlement programs on the spending side of the budget (see Figure 3). The poorest fifth of households receive 32 percent of these benefits.”
But the greatest looming concern are costs. is behavior changing? Are people initiating preventive care more readily? Are they enrolled in wellness programs, managing chronic conditions, seeking Urgent Care vs. ER, using generics vs brands? Is technology playing a greater role such as mobile devices in managing care? Are modern medicine efficiencies such as avoiding testing redundancies and EMR helping?
No one argues that medical costs are a drag on the economy and are directly linked to our prosperity. “Slower cost growth would have ramifications far beyond the deficit. According to calculations by White House economists, slowing the annual growth rate of health care costs by 1.5 percentage points might increase economic output by 2 percent in 2020 and 8 percent in 2030. It might also lead to higher wages for workers and more room for productive investments in the budget.”
The hope is medical care is becoming more efficient. Whether or not the rate is subsidized it is still being paid for by someone. With this new finding it does offer hope but unless there are added incentives such a preventive medications under an Health Savings Account card covered without a deductible the concerns are Middle Class families will be reluctant to access care and we all end up paying for this.
You can self quoteon our site. Contact us at 1-855-667-4621 for more customized information.
