NOTE: We have divided the questions we received into the following categories:
- PARENTS & CHILDREN
- SMALL BUSINESSES
- SENIORS
- GRANDFATHERED
- HIPAA
- CHIPRA
Power Group client questions are in bold purple. We have presented information and related questions and answers from several sources, including the Department of Health & Human Services, the Kaiser foundation, Meritain Health, and our own staff.
As always, if you don't find the information you are looking for here, please contact your Power Group representative.
PARENTS & CHILDREN
One question that has come up has to do with the pre-existing conditions for children that will soon become law. From my understanding, children's pre-existing conditions are not to be a factor for children receiving health insurance or affect their premiums within the next couple of months. Is this true? What ages are considered a "child" as far as this part of the reform goes?
Q: Can I now get coverage for my 6-year-old who has a pre-existing condition?
A: Yes. Effective 6 months from now it will be illegal for health insurance companies that cover children to deny coverage to your child based on a pre-existing condition. This applies to all new employer plans, new plans in the individual market, and existing employer plans.
Q: How do I get my 21 year old onto my plan?
A: Six months from now, insurers will be required to permit children to stay on family policies until age 26. This applies to all plans in the individual market, new employer plans, and existing employer plans, unless your adult child has an offer of coverage through his or her employer. This requirement will take effect the next time your plan comes up for renewal. Adult children who are on their parents' plan now but who lose that coverage when they graduate from college will have the option of rejoining their parents' policy in the new plan year beginning 6 months from now. Those whose parents work at self-insured companies will also be eligible if they do not have an offer of employer-sponsored insurance.
Both married and unmarried dependents qualify for this dependent coverage.
Beginning in 2014, children up to age 26 can stay on their parent's employer plan even if they have an offer of coverage through their employer.
Also, does this also cover the pre-existing condition or waiting periods that insurance companies put into place for maternity care? From my understanding, it is almost impossible to get coverage for maternity if you and/or your family have an individual plan for the first two years under that plan. I'm wondering if the reform bill affects that in any way.
Q: How will the legislation affect the kind of insurance I can buy? Will it make it easier for me to get coverage, even if I have health problems?
A: If you have a medical condition, the law will make it easier for you to get coverage; insurers will be barred from rejecting applicants based on health status once the exchanges are operating in 2014.
In the meantime, the law will create a temporary high-risk insurance pool for people with medical problems who have been rejected by insurers and have been uninsured at least six months. This will occur this year.
Starting later this year, insurers can no longer exclude coverage for specific medical problems for children with pre-existing conditions nor deny coverage to children with pre-existing illnesses.
Insurers later this year will also be barred from setting lifetime coverage limits for adults and kids. In 2014, annual limits on coverage will be banned.
New policies sold on the exchanges will be required to cover a range of benefits, including hospitalizations, doctor visits, prescription drugs, maternity care and certain preventive tests.
SMALL BUSINESSES
Thank you! I am interested in the impact that this legislation will have on small companies, in particular. (i.e. <25 or <50). Will we be required to provide health insurance or simply to have it available to our employees? What other factors will affect our business for a small employer? Thank you for hosting this event, I look forward to attending.
Most of the details that I am reading talk about companies with more than 50 employees and the things they will need to do to comply with new changes. What about the business who have less than 50 employees how will this directly affect them and what will they need to do to comply? (My company has two locations but only 19 employees.)
Based on your best guess, what coverage do you expect to be mandated and the cost per participant.
Q: My sister has a BBQ restaurant in Texas. She only has 6 employees. Does this new health care reform bill require her to provide insurance? She currently doesn't because she is in a very small business market and needs to know for the future.
A: The new law will not require your sister to provide insurance. However, it will provide your sister with tax credits if she chooses to provide insurance to her employees. Starting this year--indeed starting retroactively to January 1, 2010--a new small business health care tax credit will be in effect that will provide a 35% tax credit on health premiums, with the credit increasing to 50% in 2014. Your sister's restaurant is one of about 4 million firms that will be eligible for this tax credit, and small business owners can now find information on the tax credit online.
Q: What is the small business tax credit and how do I know if I am eligible?
A: Effective January 1, 2010, tax credits are available to qualifying small businesses that offer health insurance to their employees. So if your business qualifies for a tax credit, you are eligible right now.
About 4 million small businesses will be eligible to receive tax credits if they provide insurance.
The tax credit is worth up to 35 percent of the premiums your business pays to cover its workers--25 percent for nonprofit firms. In 2014, the value of the credit will increase to 50 percent--35 percent for nonprofits.
Your business qualifies for the credit if you cover at least 50 percent of the cost of health care coverage for your workers, pay average annual wages below $50,000, and have less than the equivalent of 25 full-time workers (for example, a firm with fewer than 50 half-time workers would be eligible).
The size of the credit depends on your average wages and the number of employees you have. The full credit is available to firms with average wages below $25,000 and less than 10 full-time equivalent workers. It phases out gradually for firms with average wages between $25,000 and $50,000 and for firms with the equivalent of between 10 and 25 full-time workers. To learn more about the small business tax credit, you can also visit IRS.gov
Q: Am I required to offer insurance to my employees?
A: No. There is not a so-called "employer mandate" in the legislation.
Q: Are there small business tax increases in this new law?
A: No. In fact, small businesses get tax breaks for health insurance rather than tax increases under the law.
Q: What if my small business doesn't offer insurance today, but I choose to start offering insurance this year. Will I be eligible for these tax credits?
A: Yes. The tax credit is designed to both support those small businesses that provide coverage today as well as those that newly offer such coverage.
Q: Can I join a pool now to lower my costs?
A: Beginning in 2014, reform will create state-based health insurance exchanges that pool small businesses and their employees, which will spark competition and give you the kind of purchasing power that big businesses enjoy today. The exchange will offer the same types of private insurance choices that the President and Members of Congress will have. Increased purchasing power and competition will make premiums more affordable. The exchange will also reduce administrative costs for your businesses and your employees, enabling them to easily and simply compare the prices, benefits, and quality of health plans.
SENIORS
I would like to know how the Healthcare Reform will affect senior citizens.
Q: My prescription drug spending will push me into the donut hole this year. What relief will I get?
A: Seniors who hit the gap in Medicare prescription drug coverage known as the donut hole will be provided with a $250 rebate in 2010.
Beginning in 2011, seniors in the donut hole will receive a 50 percent discount on prescription drugs. In addition, the Medicare share of costs will increase so that the donut hole will be completely closed in 2020.
Q: When does my free preventive care start and what does it cover?
A: Effective January 1, 2011, proven preventive services will be free. In addition, a new annual wellness visit that provides a personalized prevention plan services, including a health risk assessment, will be provided under Medicare.
Q: Can you define the doughnut hole?
A: Medicare Part D provides prescription drug benefits to Americans on Medicare. This benefit comes with a $310 deductible. After you've spent $310, you pay 25 percent of the cost of your prescriptions until the total cost of all the medicine you have received in a year hits $2,830. Then, you are stuck with 100 percent of the bill until the total cost of your medicines hits $6,440. The gap when Medicare does not cover the cost of your prescription drugs is known as the doughnut hole.
Health reform will close the donut hole. Reform also offers immediate relief by providing a $250 rebate this year to seniors who hit the doughnut hole.
Q: How will the $250 benefit toward coverage gap cost be received by beneficiaries? What's the Eligibility?
A: Once you have hit the prescription drug doughnut hole, you will eligible for a $250 rebate. That check will be sent directly to you from Medicare. There's no application process and no private company will be involved in getting your rebate check to you.
Q: I'm covered by a Medicare HMO which served my health very well. Will I be able to maintain the same coverage I have after health insurance reform is implemented?
A: Unfortunately there has been a lot of misinformation about Medicare Advantage plans. Seniors have a choice when they turn 65 and beyond, enroll in the traditional Medicare plan or enroll in a Medicare HMO or Medicare Advantage Plan. Medicare Advantage plans will continue to offer services to beneficiaries. Companies right now choose whether to offer Medicare Advantage plans. Some may make the business decision to exit the market, but nothing in health reform forces these plans to stop offering benefits and services.
Q: I cannot get Medicare until I am 62. I do not have health coverage. I cannot get health coverage because I have a pre-existing condition. Do I get a piece of this new health care plan?
A: Absolutely. Beginning this year, you will be eligible to receive coverage through the new high-risk pools. Today, too many insurance companies reject Americans with pre-existing conditions or charge exorbitant rates. High-risk pools will offer these individuals access to affordable insurance and in 2014 there will be a new market that will prevent insurance companies from eliminating anyone with preexisting conditions. We will have more details regarding the high-risk pools in the weeks ahead. You can read about the first step we have taken here: http://www.hhs.gov/news/press/2010pres/04/20100402b.html
Q: Leonard from CA asks: How will the new health care law affect those of us who are under age 65 but still disabled and on Medicare? Is there anything that is different for us than those on Medicare due to age? For people who are disabled, how does the new law impact them?
A: If you're on Medicare, nothing will change for you. You will continue to receive your Medicare benefits and reform makes Medicare stronger. Today, Medicare beneficiaries must pay 20 percent of the cost of many preventive services and office visits. Reform eliminates deductibles, copayments, and other cost-sharing for recommended preventive care, and provides free annual wellness check-ups starting in 2011. Reform will also improve the quality of care you receive, fight Medicare fraud and extend the financial health of Medicare by 9 years.
GRANDFATHER RULE
I have a few questions if time allows...Under the grandfathering provision for self insured plans, what types of plan design changes are allowed without jeopardizing the grandfathering provision? For example, can we adjust co-pays, deductibles and out of pocket maximums without losing the grandfathered status?
5.1: When they use the word "grandfather" what do they mean?
The Grandfather Rule allows plans that were established on or before March 23, 2010, to be grandfathered in. This means you do not have to comply with many of the provisions that were mandated.
5.2: Will the grandfather rule only apply to those plan participants enrolled in my plan as of March 23, 2010?
The Grandfather Rule is not limited to current plan participants but rather allows you to add new employees and dependents as well as family members of current employees to your grandfathered plan.
5.3: Is there anything that we as clients need to do to have our plans considered "grandfathered in"?
Group health plans that were in effect on March 23, 2010 are automatically exempt from complying with many of the key provisions of the Bill. We are not aware of any additional steps that need to be taken at this time.
5.4: What would make our current plan lose its grandfathered status?
Our interpretation of the Bill indicates the only way to lose your grandfathered status is to terminate your health plan. This could change; however, in light of future regulations that may be issued.
5.5: If I later add a plan, would that plan be eligible to be grandfathered in?
If you add a new plan, that plan would not be eligible to be grandfathered. It remains to be seen whether or not adding a new plan option to your existing plan would be eligible for grandfathering status. This is an area we are going to follow closely and will communicate more with you as we learn more from the regulators.
5.6: If I switch plan administrators will I lose my grandfathered status?
At this time, we do not believe that clients will lose their status because they switch administrators
HIPAA
When does the requirement of providing HIPAA Certificates of Creditable Coverage go away?
The current legal requirement to provide certificates of creditable coverage was not removed from the law, which is temporarily sensible given that the New Law's elimination of pre-existing condition exclusions will not apply until 2014 for adults.
CHIPRA
I would be interested in knowing the specifics about the new CHIPRA notice requirements.
New CHIPRA Notice: Employers with employees who reside in one of the States in which there is a Medicaid or CHIP program in place to provide premium assistance to qualifying individuals must provide their employees who reside in one of those States an annual written notice about these programs. This requirement is effective on the later of May 1, 2010 or the first day of the first health plan year beginning after February 4, 2010.
The DOL has issued a form notice that may be used for this purpose, and it is found at http://click.bsftransmit1.com/ClickThru.aspx?pubids=454%7c76131%7c68361&digest=DSUUip0CEliyhnQtmcdcgw. Forty States already have such programs in place, and the DOL has advised that employers may send the form notice to all employees, not just those who reside in the growing number of States that already have programs in place.
