Wisconsin Benefit Planning

1. Wisconsin Benefit Planning Patient Protection and Affordable Care Act (PPACA)

2. A Timeline of the Health Care Provisions that could affect you.

3. 2010

4. 2010 Cont’d

5. 2011 • Over-the-counter drugs not prescribed by a doctor may not be reimbursed through an FSA or HRA nor on a tax free basis through an Archer MSA or HSA.

6. 2013 (IMPLEMENTATION OF THIS PROGRAM HALTED INDEFINITELY BY HHS) CLASS Act:A national long term care assistance/disability insurance plan is established. The benefit is tied to one’s inability to perform two or three Activities of Daily Living (ADLs) and the benefit amount is varied based on the “scale of functional ability” with a $50-7/day cash benefit. All working adults will be automatically enrolled in the program unless they choose to opt-out.

7. 2014

8. 2014 Cont’d New Health Insurance Tax is levied on insurance companies based on net premiums written. This tax will raise an estimated $8 billion in 2014, reaching $14.3 billion by 2018. The tax does not sunset and is indexed thereafter.

9. 2014 Cont’d

10. 2017

11. 2018

12. Closer Look at Medical Loss Ratios “Other non-claims costs,” such as administrative costs, cannot be more than 15% of the premium in the large group market or 20% in the small group/individual markets. In January 2011, HHS deemed that agent commission must fit within that 15%/20%, leading to a squeeze on agent compensation. Big “I” is focused on congressional legislation that would statutorily exclude agent compensation from the MLR formula. In the House Mike Rogers (R-MI) and John Barrow (D-GA) introduced H.R. 1206 which has over 200 bipartisan cosponsors. Senators Mary Landrieu (D-LA) and Johnny Isakson (R-GA) have introduced S.2288, the “Access to Professional Health Insurance Advisors Act of 2012” which is a companion to the House bill.

13. Closer Look at Individual Mandate Beginning in 2014, virtually every U.S. citizen and legal resident will be required to purchase health insurance or face a tax penalty. There are certain exemptions from the individual mandate including: those who choose not to buy a policy for religious reasons, undocumented immigrants, incarcerated citizens, members of Native American tribes, those with family income below the threshold requiring a tax return. To satisfy the mandate, individuals must obtain health insurance for the entire year through one of the following sources: Medicare, Medicaid, CHIP, veteran’s health programs, a plan offered by an employer, insurance purchased on your own that is at least at the Bronze level (60% actuarial value). The penalty for non-compliance will be phased-in according to the following schedule: $95 (or 1% of income, whichever is higher) in 2014, $325 (or 2% of income) in 2015, and $695 (or 2.5% of income) in 2016. After 2016, the penalty will be increased annually by the cost-of-living adjustment.

14. Closer Look at Employer Mandate Beginning in 2014, employers with 50 or more full-time employees that do not offer coverage and have at least one full-time employee who receives a premium tax credit will be assessed a fee of $2,000 per full-time employee, excluding the first 30 employees from the assessment. Employers with 50 or more full-time employees that offer coverage but have at least one full-time employee receiving a premium tax credit, will pay the lesser of $3,000 for each employee receiving a premium credit or $2,000 for each full-time employee, excluding the first 30 employees from the assessment. (Effective January 1, 2014). Employers with 200-plus full-time employees must automatically enroll their employees into health insurance plans.

15. Closer Look at Exchanges Exchanges are a government created platform for the sale of health insurance, intended to bring all “qualified” plans into one forum by establishing common rules regarding the offering and pricing of insurance, and providing information on these plans to consumers. Also through the exchanges, consumers may sign up for government programs such as Medicaid and Children’s Health Insurance Program (CHIP). In addition, through the exchanges qualified consumers (up to 400% of the poverty level) will receive government assistance to purchase private insurance through the use of premium tax credits. States face a Jan. 1, 2013 deadline for certification of their exchanges by HHS, initial enrollment on Oct. 1, 2013 and a “go live” date of Jan. 1, 2014. If they do not meet these deadlines, the federal government will step in. At this point, with the lack of progress in the majority of states, some level of federal involvement in the majority of exchanges is likely.