Ready or Not, Its Time for the Affordable Care Act (ACA) Open Enrollment

Like it or Not / Ready or Not:Get Set for Health Care Reform

Oct. 1 Open Enrollment

August 20, 2013 – October 1, 2013 = 41 days!© 2013, Michael Chapman, TheMedicalInsuranceExchange.com. Reprints without prior authorization from author expressly prohibited.

August 20, 2013 – October 1, 2013 = 41 days!



• The time for denial, procrastination, political pontification is over…

• …ACA Open Enrollment is gonna happen!

© 2013, Michael Chapman, TheMedicalInsuranceExchange.com. Reprints without prior authorization from author expressly prohibited.

Session Overview

• Major Market Reforms• Individual/Employer Mandates• Public/Private Health Insurance Exchanges • Business Impact & What to Do• Employee/Individual/Family Impact & What

to Do• Timing and Action Plan Recommendations


Today’s Audience:

• Individuals / Families• HR Professionals.• Business Owners and Leaders


Today’s Presentation:

• Crammed with new, updated information and personal strategies.

• Q&A at end of presentation, please.• No jokes or funny pics.• Serious stuff.• Listen, think• Go back to Slideshare.net to review.• Designed to prompt you to take action.


Key Things to Know About ACA

CoverageMandates

MarketReforms

InsuranceExchanges

Disclosures &Communications



Individual Mandate

Everyone must have qualified health insurance coverage or pay IRS Tax Penalty

Employer Mandate

50+ Employers will be required to offer their employees qualified health insurance coverage (Delayed until 2015)

Exempt Employers

Employers with fewer than 50 full time employees will be exempt from coverage mandate

Penalties forIndividuals

The greater of a dollar amount or percent of income. In 2014 – $95 or 1%. In 2016 – $695 or 2.5%.

Penalties forEmployers

2015 - Penalties for 50+ employers based on whether insurance is offered at all, or at an affordable cost.

CoverageMandates

MarketReforms

InsuranceExchanges




Immediate Reforms – Prior to 2014

No lifetime limits; annual limits restricted

Dependent Coverage extended to age 26

Minimum Medical Loss Ratios (MLR)

Summary of Benefits and Coverage (SBC)

CoverageMandates

MarketReforms

InsuranceExchanges




CoverageMandates

MarketReforms

InsuranceExchanges


Summary of Benefits and Coverage (SBC)

Requirement Medical insurers must provide summaries of major medical coverage in a format dictated by HHS (September 2012)

PurposeTo provide individuals with standard information so they can compare medical plans as they make decisions

TimingEmployer must provide SBC to each employee and document acknowledgement of receipt by employee.



CoverageMandates

MarketReforms

InsuranceExchanges


W-2 Reporting Requirements

Requirement Employers filing 250+ W-2 Forms must disclose the value of certain health insurance plans on W-2 Forms (January 2013)



Reforms Beginning January 2014

No pre-existing condition Exclusions, Rate-ups

Guaranteed Issue Policies

Adjusted Community Rating

Essential Health Benefits (EHB)

Maximum Deductible Limits

CoverageMandates

Plans

InsuranceExchanges



Qualified (“Metal”) Insurance Plans

Plan LevelActuarial

ValueDescription

Bronze 60% Actuarial value equals the total value of health care expenses paid by the plan, ranging from 60% to 90%.

Actuarial values may be achieved by varying the level of cost-sharing across deductibles, co-payments and specific benefit offerings.

Silver 70%

Gold 80%

Platinum 90%

Catastrophic Limited to individuals under age 30 or in a defined financial hardship category


Essential Health Benefits – 10 Statutory Categories

1. Ambulatory Patient Services

2. Emergency Services

3. Hospitalization

4. Maternity and Newborn Care

5. Mental Health and Substance Use Disorder Services, including Behavioral Health Treatment

6. Prescription Drugs

7. Rehabilitative and Habilitative Services and Devices

8. Laboratory Services

9. Preventive and Wellness Services and Chronic Disease Management

10. Pediatric Services, including Oral and Vision Care




“Metal” plans assist comparison.

Big Changes in Medical Networks:

• PPO networks from Blue Cross, Cigna• Individual HMO Blue in TX, other states• Parkland HMO in Dallas County only

More Coverage: Maternity, Mental/Emotional/Alcohol/Drug Abuse

• More Wellness: Well Woman, Well Man, Immunizations, etc.

• Child dental, vision included

CoverageMandates

Plans

InsuranceExchanges



Key Things to Know


Adjusted Community Rating:• Rates Based on Claims within zip code of

company headquarters or individual.

• Rates are Unisex• Age Bands Changing from 6:1 >> 3:1 ratio• (++ for under age 35)• 50% increase allowed for smokers.

• Higher Federal Taxes in rates.

CoverageMandates

Rates

InsuranceExchanges



Key Things to Know


IRS Subsidies:• Companies:

• Subsidies up to 50%, 25 or less employees, $30,000 or less income

• Individuals:• Over 60% of Americans qualify($88,500 for family of 4)• Go to goo.gl/LbldeU & see if you qualify*

• Employee & Dependents not Eligible for Subsidy if Employer Offers Group Health Plan to Employees.

CoverageMandates

Subsidies

InsuranceExchanges


*(Or go to: TheMedicalInsuranceExchange.com/ obamacare-subsidy-calculator)


http://goo.gl/LbldeU

Key Things to Know

CoverageMandates

MarketReforms

InsuranceExchanges


Public/Private Exchanges for Small Employers and Individuals

Online Market for Health Insurance• TX: federally owned and managed Exchange• 4 defined plan levels with mandated components• Subsidies for income below 400% of poverty.

Agents, Brokers and Navigators• Agents and brokers can access public/private

exchanges through certification process• Navigators are contracted and trained by

exchanges


Comparing Health Insurance Exchanges

Public Exchanges Private Exchanges

OversightState Agency, Federal Government, or State-Federal Partnership

Carrier or Private Operator

Carrier Participation Regulated by State/Fed Exchange Contracted by Exchange Owner

Plan Participants Qualified Individuals, and Qualified Employers

Individuals, Small and Large Employers

Voluntary Products No Contracted by Exchange Owner

Plan Options and Design Mandated Actuarial-Value Plans (“Metallic Plans”)

Mandated Actuarial-Value Plans (“Metallic Plans”)

Guaranteed Issue with No Medical Underwriting

Yes Yes

Employer Financial Subsidy

Unclear; Employer May Offer HRA Subsidy to Offset Premium Cost

Not in TX (Yet)

Availability of FederalIncome-Based Subsidies

Yes Yes

Rating RestrictionsYes: Maximum Age Ratio 3:1; Smoker Ratio 1.5:1; Age-Based Rates; State-Specific Rates

Yes: Maximum Age Ratio 3:1; Smoker Ratio 1.5:1; Age-Based Rates; State-Specific Rates


Key Things to Know

CoverageMandates

MarketReforms

InsuranceExchanges



Federal Market for Individual Health Insurance in TX• TX: Blue Cross, CIGNA (Humana in Houston only)

Private Exchanges operated by Brokers and Agents• Perform same functions as Federal Exchange

• Secure subsidy qualification, application, health insurance selection, and checkout/payment.

• Better expertise, training, advice from Pvt. Exchanges• Service before, during and after from Pvt. Exchanges• Best in Class Example:

TheMedicalInsuranceExchange.com

Federal and Pvt. SHOP Exchanges for small businesses operated by Brokers and Agencies beginning in 2015


http://themedicalinsuranceexchange.com/

Key Things to Know

CoverageMandates

MarketReforms

InsuranceExchanges


Who Ya Gonna Call?

Navigators and Assisters• Unlicensed, 6 hrs. of training, can only help

answer questions about paperwork. Temporary positions.

National Call Centers & Insurance Carriers• Licensed, but can’t help you compare.• Little experience, many are temporary positions.• Good luck getting through.• No service after enrollment.

√ Broker/Agent Private Exchanges. • Superior Expertise, training, advice.• Service before, during and after enrollment.• Best in Class Example:

TheMedicalInsuranceExchange.com



Key Things to Know

CoverageMandates

MarketReforms

InsuranceExchanges


Who Ya Gonna Trust?

Would You Rather Share Your IRS Return, Social Security, and Protected Health

Information to Apply for Health Insurance and for Tax Subsidy with:

A. A Temporary Navigator or Assister?

B. A Call Center Temp from a carrier or from www.e-HealthInsurance.com, ExtendHealth, etc.?

C. √ A Licensed, Experienced, Trusted Broker & Employee Benefits Advisor from TheMedicalInsuranceExchange.com?


http://www.e-healthinsurance.com/

Key Things to Know

CoverageMandates

MarketReforms

InsuranceExchanges



Open Enrollment Period:•October 1, 2013-March 31, 2014

Earliest Coverage Effective Date:• January 1, 2014


Key Things to Know

CoverageMandates

MarketReforms

InsuranceExchanges


Make an Appointment Now for 10/1

• Less than 1% of Health Insurance Agents & Brokers have gone through certification, and many have left the industry or don’t know enough about ACA.

• ALL Navigators and Assisters have no experience, minimal training, and no background checks.

• TheMedicalInsuranceExchange.comCertified, trained, experienced employee benefits advisors.



For Business Owners/ HR Profs:Can Exchanges Help My Business?

BENEFITS FACTS:

• 78% of employment is within businesses with fewer than 100 employees.

• Fewer than 4 out of 10 of employers with less than 100 employees offered group health insurance plan in 2012.

• Projections are that fewer than 2 out of 10 employers with less than 100 employees will offer group health by 2015/6.



Options For Companies That DO Offer a Group Health Plan:

• Change Renewal Date to 12/1/13:

• Delays changes until 12/1/14

• Many carriers offering to do this at no cost to maintain, increase market share.

• This delays “Pain” for one year for employers and employees, but not necessarily the best option.

Public & Pvt. Exchanges vs. Group Health



Options For Companies That DO Offer a Group Health Plan: Self-Insurance Option

• For companies with 50+ (healthy) Employees

• Only pay employee claims (+ stop loss insurance)

• Escape Community Rating and some mandates, taxes.





Terminate the Group Health Plan, and encourage employees to purchase through a Private Exchange and payroll deduct premiums:

• Allows Employer to Recoup Years of Health Insurance Inflation Expense Increases and move to more of a known, fixed cost benefits contribution.





Terminate the Group Health Plan, and encourage employees to purchase through a Private Exchange and payroll deduct premiums.

• Allows Employer to Compensate Employees in other ways that have less inflation.

• Fund a Retirement Plan for owner, employees

• Fund Voluntary Benefits like accident, life, disability, dental, vision that Employees can choose.

• Fund a pay increase for loyal employees (and owners)

Public & Pvt. ExchangesVs. Group Health


For Business Owners/ HR Profs: Can Exchanges Help My Business?


• Terminate health plan and encouraging employees to purchase through Exchange:

• Gets The Employer out of Health Benefits Administration nightmares and Reduces Red Tape / Compliance.

Public & Pvt. ExchangesVs. Group Health



Options For Companies That DO NOT Offer a Group Health Plan:

• Hold Employee Group Meeting and One on One sessions to counsel employees, qualify them for subsidies, and enroll in health insurance and other benefits.

• Explain how not offering group health plan can actually save employees money by qualifying for subsidy.

• Explain IRS penalties for no coverage.

• Use me to communicate for effective, compliant meetings.



For Business Owners/ HR Profs: Can Exchanges Help My Business?

Options For Companies That DO NOT Offer a Group Health Plan:

• Many businesses, especially smaller companies, are willing to contribute some fixed $$ amount per employee but cannot afford group health insurance.

• Many other employee benefits are fixed/low inflation and can be pre-taxed.

• Many employees and dependents are eligible for lower cost tax-subsidized health insurance that wouldn’t be if employer offered a group health plan.



For Business Owners/ HR Profs:Can Exchanges Help My Employees?

Options For Employees of Companies That DO Offer Group Health Plan:

• Enroll in company group health plan

• Enroll Self and Family in Insurance Exchange

• Exchange may cost less than employer plan, Employee gets IRS subsidy if employer’s plan costs employee more than 9.5% of monthly adjusted gross income.

• Change jobs, go to work for a company with no benefits so employee qualifies for insurance subsidy for self, family.



Can Exchanges Help My Business AND My Employees?

In Many Cases, Terminating the Group Health Plan and Helping Employees

Enroll in the Exchange is The Best and Most Affordable Option for Both the

Employer And the Employees!



How Can I Best Help My Business AND My Employees?

1. Time is Running Out: Have a ACA Benefits Game Plan in place by 9/1.

• What’s Best for Business

• What’s Best for Employees

2. Hold Employee Meetings to Communicate & Confirm SBC & Employee Exchange Options (Note: Even companies not offering Group Health Plans Should Do This.)

3. Stay Compliant!


Special Info for HR Professionals and Business Owners/CFOs


Small Businesses: New Reporting Requirements in 2015

SHOP Exchange (2015) for Small Businesses:

• New Reporting and Regulations for Small Group Health Plans.

• Notify Exchange (Feds) when covered employee is terminated to end coverage.

• Notify Exchange (Feds) when new employee is eligible for benefits or change in benefits.


Prepare for Your ERISA Audit*(Employee Retirement Investment Security Act)

• Every Employer (Except Churches & Governments) offering employee benefits are subject to ERISA law (Dept. of Labor.)

• Must inform employees and plan participants of their rights, coverage and entitlements “in plain English.”

• Insurance carriers don’t provide all necessary language, only new SBC document (by 10/1).

*Its only a matter of time…© 2013, Michael Chapman, TheMedicalInsuranceExchange.com. Reprints without prior authorization from author expressly prohibited.


• 75-90% of companies out of compliance.

• One out of three employers getting ERISA documentation request in 2013 from DOL now.

• The DOL intends to audit 75 percent of employers in Texas, 100% by 2017!

• Employer must inform employees and plan participants of their rights, coverage and entitlements “in plain English.”



• Employers has 7 days to respond with the 24 items requested or face a full-blown financial & benefit audit.

• Penalties from $100-$110/day per employee with three-year “look back” provision for ERISA language, up to $500,000 max.

• For companies subject to Form 5500 filing, there’s no statute of limitations and the government can look all the way back.

• 75-90% of companies out of compliance.

• Must inform employees and plan participants of their rights, coverage and entitlements “in plain English.”

• ERISA Wrap: Capture all of a company’s benefits in one SPD for all company benefits.



• Whomever processes the ERISA filing for the company is personally liable.

• Recommendation: Hire an ERISA Attorney or purchase an ERISA Wrap Product:

• Captures all of a company’s benefits in one compliant, timely SPD for all company benefits.


Can Exchanges Help Individuals and Families?

What To Do NOW

• Coverage for Now Until 12/31:

• “Unbundling” Strategy:

• COBRA Ins. > “unhealthy” family members.

• Individual Ins.> “healthy” family members

• Strongly consider short term plan to keep options open over next few months.

Public & Pvt. Exchanges



What To Do NOW

• Coverage for Now Until 12/31:

• “Unbundling” Strategy:

• COBRA Ins.: “unhealthy” family members.

• Individual Ins.: “healthy” family members

• Strongly consider short term plan to keep options open.

• Make Appointment NOW for 10/1-10/31 for 1/2014 Coverage.




What To Do 10/1-10/31

• Appointment:

• Consultation to discuss impact of new options for family members:

• Pre-ACA Individual plan by 12/1

• COBRA

• ACA Exchange Plan with/without tax subsidy.

• Non-ACA plan + Tax penalty




Rates and Plans Expected to be Available to Brokers and Agents by 9/20/13.

• Make an Appointment As Soon as Possible:

• Consultation to discuss impact of new options for family members:

• Pre-ACA Individual plan by 12/1

• COBRA

• ACA Exchange Plan with/without tax subsidy.

• Non-ACA plan + Tax penalty






• Evaluate “locking in” to a pre-ACA plan before year end

• vs. COBRA

• vs. an Exchange Plan & possible subsidy for 2014

• vs. paying tax penalty and non-ACA plan for 2014.





• Evaluate “locking in” to a pre-ACA plan before year end vs. COBRA vs. an Exchange Plan & possible subsidy for 2014 vs. paying tax penalty and non-ACA plan for 2014.

• Needed for Appointment:






• The time for denial, procrastination, political pontification is over…

• …ACA Open Enrollment is gonna happen!





• Stiff Consequences to Employers who don’t have a strategy and action plan:

• Tax Penalties• Business / Personal Compliance Audits and Penalties• Potentially Much Higher Expenses• Disgruntled / Financially-Damaged Employees





• Stiff Consequences to Individuals who don’t have a strategy and action plan:

• Tax Penalties• Potentially Much Higher Expenses• Potentially Harmful, Wrong Policy• Lost Opportunity to Get Affordable Coverage





• Stiff Consequences to Professionals In Transition Who Don’t Have a Strategy and Action Plan:

• Tax Penalties• Potentially Harmful, Wrong Policy• Lost Opportunity to Get Affordable Coverage• Loss of Traction in Job Search During 4th Quarter of 2013





• Every US citizen will have the option to enroll, many for the first time, in health insurance beginning October 1, 2013.

• There are not nearly enough certified, licensed, experienced brokers and agents who will be available to give advice.





• It costs no more to work with a full-time professional.

• It could cost you a lot more in time, tax penalties, and consequences of poor decisions if you don’t.

• Make an appointment as soon as possible to prepare.



Appointment Preparation:(you will need to share this info with anyone who assists you*)

• Names / Dates of Birth / Zip Code• Current Insurance Information• 1040, W-2 & current income info for

subsidy calculation to determine best strategy.


*(It is best to share your confidential info with a, licensed, experienced & trusted person.)

How Can You Help Me:• Help Me Help You:

• Make Appointment:• Help Me Help Others:

• Individuals/Families• Businesses

• Help Me Reach/Teach Others:• Public Speaking


How Can You Help Me:• Above All Else,


TAKE ACTION!

Then Pay It Forward!!!

Questions? Contact Mike Chapman

Visit/Make Appointment:@

(214)764-6315 office214-732-3691 cell

[email protected]


mailto:[email protected]


Economy & Finance

Ready or Not, Its Time for the Affordable Care Act (ACA) Open Enrollment