Medium Sized Employers until 2016

WASHINGTON POST

The Obama administration announced Monday it would give medium-sized employers an extra year, until 2016, before they must offer health insurance to their full time workers.

Firms with at least 100 employees will have to start offering this coverage in 2015.

By offering an unexpected grace period to businesses with between 50 and 99 employees, administration officials are hoping to defuse another potential controversy involving the 2010 health-care law, which has become central to Republicans' campaign to make political gains in this year's midterm election.

Even the nation's largest employers got a significant concession: They can avoid a fine by offering coverage to 70% of their full-time employees in 2015 and 95% starting in 2016. Under an earlier proposal, employers with at least 50 employees would have been required to offer insurance, beginning 2015, to 95% of those who work 30 hours or more a week, along with their dependents.

The regulation finalized by the Treasury Department involves one of the biggest issues surrounding the Affordable Care Act: how the law's employer mandate plays out in practice. The mandate has enormous ramifications for how businesses classify their employees and how much these men and women work.

Initially, these requirements-which affect firms employing 72% of all Americans-were supposed to take effect this year, at the same time that most individuals faced a new obligation to obtain health insurance or risk a tax penalty. Last July, the administration announced it would delay the regulation for a year after many employers and some unions complained about the law's reporting requirements and classification system for workers.

A senior administration official, who briefed reports on the proposal on the condition of anonymity because the rule was not yet public, said the Treasury Department decided to allow medium-sized businesses more flexibility because they "need a little more time to adjust to providing coverage."

The coverage must encompass a core set of benefits and be affordable-which the law defines as premiums costing no more than 9.5% of an employee's income-and the employer must pay for the equivalent of 60% of the cost of coverage for workers but not their dependents.

Until now, the government had not defined exactly which workers should be considered full-time. Nor had it spelled out important details of the insurance benefits that employer-sponsored health plans must cover, given that they are not the same as the "essential benefits" required of health plans that are sold to individuals or small businesses through the federal insurance exchange.

"This final rule may seem like an obscure accounting matter, but it gets to the heart of whether and how employers hire new workers-and whether these workers will have the opportunity to transition from part-time to full-time or seasonal to permanent employment," Haile said. "This rule hits on a core question as to how employment is structured in the United States."

Administration officials said that organizations with a large number of volunteer employees-such as firefighters and first responders-would not have to provide coverage, along with those hiring seasonal employers who work six months or less in a given year.

Teachers will not be considered part-time just because they do not work for three months during the summer, officials added, while the status of adjunct faculty will be calculated on a formula where they would receive credit for 2 1/4 hours of service per week for each hour they spent teaching or in the classroom.

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Most Americans are unaware of the PPACA deadline

Another survey is out underscoring the ongoing confusion many are experiencing over the Patient Protection and Affordable Care Act while stressing the challenges the administration has in getting Americans signed up for coverage under the law. More than half of Americans (55%) still don't know that the deadline to sign up for health insurance under PPACA is March 31st, according to a Bankrate.com report released Monday. Confusion over the deadline was highest among the 18 to 29 age group, those who make less than $30,000 annually, and those without college degrees. About one in four Americans (24%) incorrectly think the deadline already passed on Jan 1st, and 11% think they have until Dec. 31st to sign up, a full nine months after the deadline. Though it's no secret Americans have been confused by the law's details, it's surprising so many aren''t sure of the deadline when those who miss it will pay a tax penalty under the law and be forced to wait until next year's open enrollment to get insurance - unless they experience a qualifying event such as marriage in the interim. In 2014, the penalty is $95 or 1% of a person's income, whichever is higher. That breaks down to if a person makes more than $9500 per year, their penalty could be higher-1% of their income for 2014. The penalty escalates in subsequent years. Further potentially hindering the law's success is the fact that many Americans aren't taking the deadline to sign up for Obamacare seriously. the survey found that 62% of Americans think the government will push the deadline back to a later date. "It's especially worrisome that young adults - who are the most likely to be uninsured - are the least informed abut the deadline and the most likely to think it will be moved" said Bankrate insurance analyst Doug Whiteman. "Obamacare's success hinges on young, healthy Americans signing up, so if they continue to procrastinate past the deadline, it could cause insurance premiums to increase." The survey also found that 33% of Americans feel more negative about PPACA than they did one year ago and only 12% feel more positive about it.

Narrow Networks, Lower Premiums

Narrow Networks, Lower Premiums: It’s no secret that the contours of health care in our country have been reshaped by the Affordable Care Act. And, whether or not you agree with that change might have a lot to do with where you fall along the political spectrum. But, while the kneejerk reaction may be to immediately focus on what’s gone wrong superficially, due consideration must be paid to what’s going on behind-the-scenes, and, more importantly, why something that looks bad on the surface, may in fact be good in the long-run. One such example is the concept of “narrow networks”. At first glance, the idea of placing limits on the doctors and hospitals available to health plan subscribers seems to fly in the face of one of the health care law’s stated promises. Rhetoric aside, however, upon further examination, experts have begun to make the case that less choice in a health plan typically leads to lower premiums. By only targeting providers that charge lower prices – without sacrificing proven outcomes – plans are able to bring down the costs of health care with no compromise to quality. Additionally, by limiting their networks, insurers gain the leverage they need to keep that focus on costs and quality. Though some believe that the ACA has caused this shift, there’s growing evidence that the law has only accelerated an existing trend – a trend, some put forth, that is characteristic of any well-functioning consumer market where a variety of choices with differing value propositions is made available at different price points.

ACA and employer shared responsibility

The Affordable Care Act requires that an employer with 50 or more full-time employees offer affordable and adequate health care coverage to its employees. For this purpose, full time means 30 hours or more per week on average, with the hours of employees working less than that aggregated into full-time equivalents. Employers that do not fulfill this obligation may be required to make a payment in lieu of meeting their responsibilities, which are described in what are called the employer shared responsibility provisions. An important question arises about how the hours of volunteer firefighters and other volunteer emergency responders should be taken into account in determining whether they are full-time employees and for counting toward the 50-employee threshold. Treasury is acting to ensure that emergency volunteer service is accorded appropriate treatment under the Affordable Care Act. Treasury and the IRS issued proposed regulations on the employer shared responsibility provisions (Section 4980H of the Tax Code) in December 2012 and invited public comments. Numerous comments were received from individuals and local fire and Emergency Medical Service departments that rely on volunteers. The comments generally suggested that the employer responsibility rules should not count volunteer hours of nominally compensated volunteer firefighters and emergency medical personnel in determining full-time employees (or full-time equivalents). In addition, Treasury heard from numerous members of Congress who expressed these same concerns on behalf of the volunteer emergency responders in their states and districts.

What happens if my income changes after I receive an Insurance Subsidy?

Question: If I'm unemployed a the beginning of the year and sign up for health insurance, I will probally get a subsidy because my income will be low. What happens when I get a job later in the year and start earning a good salary? Will I have to pay the money back? Answer: Yes, you may have to pay some of that money back, but the amount you'd owe will most likely be capped. Each individuals circumstances are different, but here's how it might work in a typical situation. When you apply for health insurance on the state's exchange, or marketplace or thru an independent agent, you will be asked about your income. If you're collecting $300 a week in unemployment benefits, you'd probably qualify for a premium credit and out of pocket subsidy. You can choose your credit paid directly to the Insurance Company which will reduce your monthly premiums. The government will send that amount directly to the insurer. Let's say that you land a job in July with a $60,000 annual salary, but it doesn't offer health insurance. At that point, you'd need to inform the marketplace about your change in circumstance. "The key is to reach out immediately when things change," says Brian Haile, senior vice president for tax policy at Jackson Hewitt Tax Service. At your new salary, you'd no longer qualify for a premium tax credit, and you'd have to pay the full premium. At tax time, the government will reconcile the amount that you received in tax credits against your income for the year, in our example, roughly $38,000 including six months of salary and six months of unemployment insurance. If the amount you received in tax credits is higher than it should have been based on your annual income, you'll have to pay back the difference. But under the law your liability is limited if your income is less than 400 percent of the federal poverty level. Someone like you with income between 300 and 400 percent of poverty ($34,470 to $45,960 in 2013) would be liable to repay no more than $1,250.

About Medicare Open Enrollment

Are you happy with your current Medicare Plan? If you are happy with your Meidicare plan, you do not need to take action during Medicare Open Enrollment. You do no have to sign up for Medicare each year, however, if you would like to make changes to your Medicare plan, Medicare Open Enrollment is the time to make those changes, Visit www.medicare.gov for more information about open enrollment. Know the differences between enrollment periods. Medicare's Open Enrollment period (October 15, 2013 to December 7, 2013) is different from the enrollment period for the Affordable Care Act, also known as "Obamacare". If you are enrolled in a Medicare plan, you do not need to take action during "Obamacare" enrollment (October 1, 2013 to March 31, 2014). It is illegal for a person to knowingly sell "Obamacare" plans to those on Medicare. If you're unsure, call for help If you have additional questions about the Medicare Enrollment Period, you call call me at (740) 654-4055.