Council Services Plus Update on Health Care Reform: Are You Prepared?

NYCON's insurance subsidiary Council Services Plus (CS Plus) offers info, resources and direct insurance assistance to nonprofits across NYS.  CS Plus only works with nonprofits, and has brought over $1 million in savings to nonprofit clients. Visit www.councilservicesplus.com for more info or e-mail.

Health Care Reform: Are You Prepared? The United States Supreme Court largely upheld President Obama's health care law, the Affordable Care Act in a mixed decision. The court's ruling, seen as one of the most significant in decade, is a crucial milestone for the law, allowing almost all of its far-reaching changes to roll forward. The decision did significantly restrict one major portion of the law: the expansion of Medicaid, the government health-insurance program for low-income and sick people. The ruling gives states more flexibility not to expand their Medicaid programs, without paying the same financial penalties that the law called for. The legislation for the Patient Protection and Affordable Care Act (PPACA) will impose significant new responsibilities on employers, some of which are already effective. While further guidance is expected on the application of these requirements, the following provides a summary and timeline of key provisions of the PPACA. As employers look ahead to the implementation of the PPACA, CS Plus will be providing additional updates to provide clients with compliance strategies in connection with various components of the new law. Summary of the Affordable Care Act The Affordable Care Act (umbrella term for the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act of 2010) was passed by Congress in March 2010 to overhaul the health care system, expand affordable coverage, change insurance rules and create an online marketplace (exchange) in each state for the individual and small group markets. Most U.S. citizens and legal residents will be required to have health insurance in 2014. Those without coverage would pay a tax penalty based on household income to be phased-in starting in 2014. Federal subsidies will be available to assist those who cannot afford to purchase coverage. Large employers (50 or more full-time employees) will be required to "pay or play" starting in 2014. Qualifying small employers (no more than 25 employees) are eligible for a tax credit for offering coverage beginning in 2010. The tax credit increases in 2014 if employers buy from the exchange, and then phases out in 2016.  How Health Reform will Impact Businesses The Patient Protection and Affordable Care Act (PPACA) impacts businesses in several ways - from the types of benefits offered under insurance plans, to the ways employers conduct their businesses. Some provisions are already in effect and more will be implemented over the next several years. General Impacts on Employer-Provided Coverage There are several mandates from the Patient Protection and Affordable Care Act (PPACA) already in effect. View the Timeline below for more information on timing of provisions. Some of the key mandates are below. Grandfathering - "Grandfathering" allowed some plans to be exempt from some Health Care Reform provisions. Lifetime Limits and Annual Limits - Law prohibits imposing annual limits on Essential Health Benefits and any lifetime dollar limits. Medical Loss Ratio (MLR) Reporting - A Medical Loss Ratio or MLR is the percentage of premium dollars insurers spend to provide covered medical services and improve the quality of health care for their members. No Pre-Existing Conditions Exclusions - As of September 2010 there are no pre-existing exclusions for children under age 19. Beginning in 2014, this provision applies to everyone, including adults. Patient-centered Outcomes Research Fee - The Patient-Centered Outcomes Research Tax, also known as the Comparative Effectiveness Research Fee, is a fee paid to the government to fund Patient-Centered Outcomes Research Institute (PCORI) research. Preventive Services - The Patient Protection and Affordable Care Act of 2010 (PPACA) requires health plans to cover designated preventive services without any member cost sharing. Summary of Benefits Coverage - The Departments of Health and Human Services, Labor and Treasury recently issued final regulations requiring health plans to provide a SBC and Uniform Glossary that clearly explain benefits and coverage within a standardized template with uniform language. W-2 reporting - PPACA contains a requirement for employers to report the cost of health coverage under an employer sponsored group health plan on an employees W-2 form. The cost includes both the cost paid by the employer and contributions from the employee. Women's Preventive Services - The Patient Protection and Affordable Care Act (PPACA) requires health plans to cover designated women's preventive services without cost sharing for the member. Cost-sharing includes deductibles, copayments and coinsurance. Some of the benefits and services outlined in the women's preventive guidelines are already included within the existing PPACA preventive services requirements.          Establishment of Health Insurance Exchanges On April 12, 2012 Governor Andrew M. Cuomo issued an Executive Order to establish a statewide Health Exchange. State-established health insurance exchanges must begin to operate on January 1, 2014. The Exchanges are virtual marketplaces that allow individuals and eligible employers to purchase health insurance. Initially in 2014, only employers with up to100 employees can purchase insurance for their employees through the Exchange. Prior to 2016, states can limit the size to businesses with up to 50 employees. Beginning in 2017, states can allow employers with more than 100 employees to purchase health insurance for their employees through the Exchange. How Does Health Care Reform Affect Small Businesses? In addition to the key provisions outlined, it's important to know that small businesses already have an opportunity to qualify for: Small business tax credits - In an effort to help small employers offer affordable coverage to their employees, the Patient Protection and Affordable Care Act provides for tax credits for qualified small employers. These credits began in 2010. The credits increase in 2014, but are only available for coverage purchased on an Exchange. The small group tax credit sunsets in 2016.   Timeline It will take several years for changes to be enacted and regulations written. However it's important to begin to understand what will be happening in the near future versus long term changes. To view a larger image of the timeline, CLICK HERE.

If you have any questions regarding this update, please contact Anthony DeCicco, Account Executive, Group Benefits at adecicco@councilservicesplus.com;  or by phone at (877) 501-4277, ext 123.

NONDISCRIMINATION TESTING FOR EMPLOYER-SPONSORED HEALTH PLANS

Council Services Plus has formed a partnership with Watson and West, LLP to assist employers with nondiscrimination testing requirements. We are following the legislation and updates to keep abreast of the mandate. We have the resources and expertise to provide the testing requirements once the rules and regulations are established. It will be imperative for employers to satisfy these rules to avoid penalties under section 2716 of the Public Health Services Act (PHSA).

You are receiving this email as a courtesy to help you and your organization prepare for compliance with this aspect of The Patient Protection and Affordable Care Act (PPACA).

Employers are familiar with Section 105(h) testing for retirement plans. PPACA includes similar testing for group health plans to ensure that highly compensated employees (HCE) do not receive favorable treatment in comparison to rank-and-file employees. The full picture of the impact is not yet available due to administrative reviews by the IRS and other federal government agencies; however, we can anticipate that employer groups with 100 employees or more will be required to perform nondiscrimination testing similar, but not the same as, Section 105(h). Oversight of nondiscrimination testing for health plans is shared by the US Departments of Treasury, Labor and HHS.

At this time, please be aware that nondiscrimination requirements focus on plan benefits, eligibility, premium contribution, and administration of benefits to prohibit employers from granting highly compensated employees health benefits that are more generous than the general population of employees. We anticipate clarification of regulations to be available around May. If you are interested in learning more details of the legislation, or want us to keep you informed regarding updates to the regulations, please feel fre to contact us.

For more information or questions concerning the above, please contact Cathy Connors, at (800) 515-5012 x131; or via email at cconnorscconnors@councilservicesplus.com

Health-Insurance Rates Set To Rise In 2010

Insurancenewsnet.com related that major health-insurance carriers serving Central New York are currently working to determine how much of a rate increase their customers will face in 2010.

Spokespersons for Rochester-based Excellus BlueCross BlueShield, Schenectady-based MVP Health Care, and UnitedHealthcare, which has its upstate headquarters in DeWitt, say it's "too early" to provide definitive rate information for their 2010 health plans. Carriers typically file their rates with the New York Insurance Department on Nov. 30.

However, recent survey reports and interviews with employee-benefit consultants shed some light on what businesses can expect to see in rate increases. Figures in the 2009 Small Business Health-Care Reform Survey from the National Small Business, Association indicate 92 percent of respondents are planning for an increase in their premiums in 2010.

The average expected increase is 13 percent, and about 20 percent of small businesses anticipate premium increases of more than 20 percent next year, the survey found.

Consultants and brokers in upstate New York say businesses should expect to see increases of at least 6 percent, ranging into double figures, depending on plan design.

Concrete numbers on health-plan rates won't be available until early November, says Christian (Chris) Marshall, executive vice president of brokerage services with Falcone Associates, Inc. of Syracuse.

New state taxes and fees imposed on health-insurance plans earlier this year will likely be reflected in 2010 premiums, says Ross Kraft, president of the Meridian Group of New York, Inc. in Utica and current president of New York State Association of Health Underwriters. Meridian helps clients in New York and neighboring states design employee-benefit programs for-their employees.

Rates for health-maintenance organization (HMO) plans in New York could rise between 15 percent and 20 percent because it's "a dwindling pool," says Kraft, referring to the decline in the number of people who are enrolling in HMO plans.

Another upstate employee-benefit consultant, Thomas Flynn, a Rochester-based principal with the consulting firm Mercer, agrees that HMO plans could see a double-digit rate increase. Flynn also believes health insurers are trying to help employers keep costs down by promoting their consumer-directed health-care plans.

CDHPs are high-deductible plans with an employee-controlled spending account - a health-savings account (HSA) or health-reimbursement arrangement (HRA).

MVP expects CDHPs will attract a larger share of the employer-sponsored health care market because of rising premiums, Gary Hughes, MVP's director of public and community relations, said in an e-mail message. Read more here.

If you are looking for health insurance assistance for your nonprofit, contact NYCON's insurance brokerage, Council Services Plus, for assistance and information.

Council Services Plus, the insurance brokerage of the NY Council of Nonprofits, informs nonprofits that Governor David Paterson has signed 3 of his healthcare reform proposals into law:

S.5471 (Breslin) / A.8400 (Peoples) - extends state mini-COBRA from 18 to 36 months. http://www.assembly.state.ny.us/leg/?bn=A08400&sh=t Effective date is July 1, 2009 and shall apply to all policies and contracts of insurance issued, renewed, modified, altered or amended on or after such date.

S.6030 (Breslin) / A.9038 (Morelle) - allows for dependent care coverage of children up to 29 years of age. http://www.assembly.state.ny.us/leg/?bn=A09038&sh=t Effective date is September 1, 2009 and shall apply to all policies and contracts of insurance issued, renewed, modified, altered or amended on or after such date.

S.5472-A (Breslin) / A.8402-A (Morelle) - HMO reform act. http://www.assembly.state.ny.us/leg/?bn=A08402&sh=t Various effective dates depending upon the specific provision of the bill.

Stay informed about insurance developments or receive assistance with your insurance needs from Council Services Plus. Contact them at (877) 501-4CSP or by e-mail.