Good Neighbor Insurance (www.gnazhealth.com and www.gninsurance.com) is continuing to update our clients on the new health insurance laws that were signed into law in the spring of 2010. There are six major coverage options for those in the US and even though some of the rules and regulations are similar for all many differences are there and it all depends on how old you are and for whom you work. Many critical details of this new insurance law will be clarified in the months and years to come.
These six major coverage options are:
(1) Individual or family coverage (private health care plans)
(2) Employee/employer group option for small businesses (typically under 50 employees)
(3) Employee/employer group option for large businesses (typically larger than 50 employees)
(4) Exchange options through the state you are residing in (fully integrated 1-1-2014 and are quasi-government and private insurance coverage combined)
(5) Medicare (which include Parts A, B, C, and D) for those 65 years onwards
(6) Full government health plans like Medicaid, CHIP, TRICARE, VA and other coverage plans as may be designated by the Department of Health and Human Services based mostly on financial criteria and/or military service.
The new health care reform law is already impacting the benefits landscape, but some provisions will not take effect until 2014 and beyond. Explore our timeline below to learn more about when changes under the law begin to take effect.
2011 Insurance Reforms
- New uniform coverage documents and standard definitions developed (applicable in 2012).
- Must meet minimum medical loss ratios.
- Rate review requirements will be effective.
Medical Reforms
- Medicare Advantage cost-sharing limits take effect.
- Medicare beneficiaries who reach the “donut hole” get a 50 percent discount on brand-name drugs.
- Primary care doctors and general surgeons practicing in underserved areas, such as inner cities and rural communities, get a 10 percent Medicare bonus.
- Medicare Advantage plans begin restructuring of payments and freeze 2011 payments at 2010 levels.
Other
- The voluntary long-term care insurance program starts. The program provides a cash benefit to help those with disabilities stay in their homes or pay nursing home costs. Benefits start five years after paying the coverage fee.
- Increased funding for community health centers to provide care for many low-income and uninsured people.
- Costs for over-the-counter drugs not prescribed by a doctor excluded from being reimbursed through an HSA or FSA.
- Employers may report the value of health care benefits on employee W2 tax statements (optional for 2011 tax year; mandatory thereafter).
- Start of new annual fees on pharmaceutical manufacturing sector.
2012 Insurance Reforms
Health System Changes
- Hospitals, doctors, and payers encouraged to join forces in “accountable care organizations.”
- Hospitals with high rates of preventable readmissions facing reduced Medicare payments.
- Administrative simplification rules required under ACA begin to phase in.
2013 Insurance Reforms
Taxes/Deductions
- Individuals making $200,000 a year or couples making $250,000 would have a higher Medicare payroll tax of 2.35 percent on earned income – up from the current 1.45 percent. A new 3.8 percent tax on unearned income, such as dividends and interest, also added.
- Contributions to flexible spending accounts (FSAs) limited to $2,500 a year – indexed for inflation. And the threshold for deducting medical expenses on taxes goes from 7.5 percent to 10 percent of income.
- Medical device manufacturers have a 2.9 percent sales tax on medical devices, with exemptions for some, like eyeglasses, contact lenses and hearing aids.
- No more deduction for expenses allocable to Medicare Part D subsidy for employers who maintain prescription drug plans for their Medicare Part D-eligible retirees.
2014 Insurance Reforms
Coverage Mandates & Subsidies
- New individual and employer coverage responsibilities.
- New individual affordability tax credits and expanded small business tax credits.
Health Insurance Exchange & Insurance Reforms
- State individual and small group health insurance exchanges operational.
- Guaranteed issue, guaranteed renewability, modified community rating and minimum benefit standards (“essential benefits” plan) effective.
- No more lifetime or annual dollar limits for essential benefits.
- No more excessive waiting periods.
- No pre-existing condition exclusions.
- New health plan disclosure and transparency requirements.
- New uniform insurance rating reforms.
- Provider non-discrimination requirements.
New taxes on health Insurers
- New taxes to be added and told to Americans and those living in the U.S. in 2013
Medicaid and Medicare Reform
- Medicaid expanded to cover low-income individuals under age 65 up to 133 percent of the federal poverty level – about $28,300 for a family of four.
- Minimum medical loss ratio of 85 percent required for Medicare Advantage plans.
2018 Insurance Reforms
- New tax (“Cadillax tax”) on employer-sponsored health plans that offer policies with generous coverage levels.
2020 Insurance Reforms
- Donut hole coverage gap in Medicare prescription benefit is fully phased out. Seniors continue to pay the standard 25 percent of their drug costs until they reach the threshold for Medicare catastrophic coverage.
Doug Gulleson loves to scuba dive overseas and makes sure he has his US health care and overseas health care, www.gnazhealth.com , information with him at all times when he travels Keep our blog close by you, www.gntravelinsurance.com, for continual updates on the changes with the US health care system.
