Healthcare Reform – Year Later
Hello. It’s been awhile, hope you’re all well. To all who have inquired, my thanks for your concern, but all’s good. Hectic, but good. Lot’s going on and an awful lot of travel. I’ve had a chance to meet and talk with with insurance carriers, Health Human Services, Trade Groups, Broker panels and most importantly customers with spirited opinions such as yourselves. It’s been a great time to learn, recharge and stay a bit too busy to write any meaningful posts. While staying busy appears to be the new constant, I’ll try to find something worthy to share on a more regular basis.
Before I get into it some news at MMS Corp:
Check our new 360peo.com this summer. We began the redesign and update of our web site to make it more user friendly and features packed with the following:
1-Quoting Module – The quoting engine will offer cross leading plans based on your location, income and employee total. Not all plans and carriers will participate and it is recommended that you get in touch with us.
2-Health Care Reform Section-this tab is dedicated to the new PPACA law.
3 Instant Chat – Scheduled Fall 2011
4. Social 2.0- Find us on Facebook, Linkedin and Twitter.
5. HR Log In- For clients only. Some of you have already begun using this online HR Kiosk. We’ve deployed this in partnership with HR Connect Technologies to offer employers tools for common HR tasks such as Benefit Plan Admin, Forms for new hires, terminations, work-site postings and employee record keeping. HR-Connect is a secure, HIPAA-compliant, Internet driven system designed to simplify your human resource department. Employees can review their own personal information, but not other employee’s data. Click Video Demo here and just ask us to set it up for your business at no charge!
MMS has also been speaking on Health Care Reform at various business groups and organizations. We have done talks at Small Property Owners of NY , Manhasset Republican Club and Greek Property Owners of NY.
Lastly, we have been appointed earlier in 2011 to the Empire Broker Advisory Council which consists of top 10 of 5000 brokers that meets throughout the year to discuss relevant topics such as market insights, health reform changes and input on future plan designs. We take this opportunity seriously in giving voice to our clients and shaping a more consumer friendly plan. To Empire’s credit, they have been indeed listening and have taken suggestions seriously. New plan options released in the Fall will be examples of this.
For now, however, let’s play some catch-up:
Latest new is that US Court of Appeals has ruled that the Affordable Care Act is constitutional. The ruling is online here. The ruling stated that this is in synch with the commerce clause of interstate commerce. Furthermore, since Congress can force someone to buy health insurance because even if they don’t need insurance today they will at some point in their life. While this ruling is impactful and could influence future rulings, this is expected by many to go to Supreme Court. They have been loudly silent on this touchy topic thus far.
Regardless, this Individual Mandate has little teeth with penalties @ $95 or 1% for 2014, $325 or 2% in 2015 and $695 or 2.5% in 2016. In other words if one can still buy health insurance, face little penalties and no pre-existing condition whats stopping someone form buying insurance when they’re in the hospital?!
To date, many key provisions have already been enacted. Some of those are:
- Extending the age of adult children eligible for coverage under their parents’ health care plan to age 26
- Prohibiting individual and group health plans from placing lifetime limits on the dollar value of coverage
- Preventing health insurers from rescinding coverage (except in cases of fraud)
- Prohibiting health insurers from imposing pre-existing condition exclusions for children
- Mandating coverage for recommended immunizations and preventive care
PPACA items that died in 2011.
1. The non-discrimination provision for Group Health Plans have been delayed. The short answer is that IRS needs more funding to enforce this as well as additional guidance. See blog here
2. 1099 Repeal – See blog here
3. W2 Reporting delayed- the IRS said employers who file fewer than 250 Forms W-2 in 2011 will not be required to report the cost of health care coverage prior to January 2014
Items that have funding delays:
1. Free Choice Voucher Program Takes a Hit- The program would have provided funding of vouchers for lower income employees to subsidize the employer contribution. Under this provision, plan sponsors of employer-based plans (including self-funded benefit plans) would have been required to offer vouchers to employees who fall below a pre-defined income threshold, while the state-based exchanges would credit the employee the amount of the voucher that exceeded their monthly premium.
2. No Health Co-Ops- The goal of the program was to spur the creation of qualified nonprofit health insurance issuers that could offer health plans for individuals and small businesses in states where insurance issuers are licensed to offer them. The program also would have provided loans and grants to fund start-up and maintenance costs for these plans.
This is a bit disappointing as we looked to the highly rated Seattle-based Group Health Cooperative program as a successful at managing costs and offering consumer centric care, click here for more info.
3. Wellness Funding for Small groups- no updates as of yet on the $750 Million funding. This was forward thinking incentives for small groups to afford a a Wellness Program for smoking cessation, diet/nutrition, gym etc. Typically large groups have had these programs as their rates are directly linked to “experience” of their members. In small market the rates are spread over thousands of other small groups. This is a first come first serve funding that we are closely monitoring to help our groups.
We are partnering with Wellness Companies and Health Insurers on establishing a program for small groups. The ROI on this is typically 1.6 :1. If you think your group could benefit please drop us a note at firstname.lastname@example.org.
The biggest news really will be the Health Exchanges schedule to open by 2014. NYS in particular than most states has enjoyed 2 rounds of Federal seed capital with almost $30 million for this effort. Each state has to set up an exchange, or marketplace, where small employers and individuals whose employers don’t provide coverage, or who can’t afford the employer plans, can purchase insurance. About 2.7 million New Yorkers are uninsured.
Sponsors say it should also result in one statewide, online, streamlined system for enrolling and renewing enrollment in government-supported Medicaid, Child Health Plus and Family Health Plus programs.
Each state can implement their own version. Several states have rejected funding and do not want to participate in the exchange. By discounting health plan rates based on income its unclear of how much will fall as a state burden?
Florida is one state that has decided not to implement a state health insurance exchange altogether. That state is seeking to shift virtually all of its Medicaid population from government coverage into private plans starting in July 2012.
Two states, Massachusetts and Utah, each have existing state exchanges that differ fundamentally. The Massachusetts exchange is considered an “active purchaser” model, has a large organization and a sizeable budget. The state’s model does not allow all licensed insurers to participate in the exchange. The Utah model, on the other hand, is an “all-comer” model that allows any licensed health insurer to participate. Utah’s exchange initiative is much smaller in scope with only two full-time employees and a limited budget. Currently, the Massachusetts state exchange is suffering major cost overruns.
Rebecca Vesely, writing in Business Insurance, makes this clear in her article describing how two states, Vermont and Florida, are taking strikingly different paths in addressing health care reform. Vermont has taken the first step toward creating a single payer system by 2017. Legislation to set up a five member board to move the state in this direction has already been enacted. And while many details need to be worked out (funding, to name one) and Vermont will need to obtain a waiver from the Centers for Medicare and Medicaid Services to put the package together, the state is further down the road to single payer than any other.
With healthcare becoming a hot issue for 2012 both parties are entrenched. Democrats are promoting Medicare as an effective low cost plan that provides insurance for millions of people. The fact that it is imploding is seemingly lost. Republicans, on the other hand, are touting touting free enterprise system but the Medicare Part D law enacted by Bush in 2003 had been under estimated by half! Along with Medicare Advantage plans that have cost the Gov in excess of what was expected.
Rita Redberg, UCF professor of medicine writes an amazing editorial in NYT “Squandering Medicare Money”. While this war of words by both parties goes on no one is really minding the issues. There are things that can be done right now while Washington tries to get its own house in order. An honest appraisal of Medicare Advantage shows that the program doesn’t deserve a fatter payday; it demands a serious crackdown.
Limitations on funding both at the federal and state levels will need to be addressed to avoid a rise in government deficit levels. In the short term, PPACA will continue to face significant political and legal hurdles. Nonetheless, implementation will continue, with more provisions and offices becoming established under the law.
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As more information becomes available, MMS Corp is committed to keeping you up-to-date in a timely manner. Coming soon 360peo.com to view past Legislative Alerts in the “Newsroom” section. Or, you may visit alexmiller.wordpress.com for blog posts, polls, surveys and numerous resources. If you have any questions, please contact us. Thank you for taking the time to read through this important notification.