Health Care Reform Has Passed. Now what?

We all know by now that health care reform has passed and is now law.  What we may not know however, is what it all means.  Here is a quick overview of what is going to happen and when:

Effective Immediately:
•Small business tax credits are effective immediately to help pay for insurance premiums. (Retroactive back to 1/1/10)
•Secretary of HHS shall award grants to states to create government‐operated “Ombudsman”
who “will assist consumers with filing complaints and appeals, educate consumers on their rights and responsibilities, and collect, track, and quantify consumer problems and inquiries.”

Effective within 90 days of enactment:
•Re‐insurance for employer‐sponsored Early Retiree Health Benefit Plans (program to be determined by Secretary of HHS).
•Carriers cannot require a designated primary care provider.
•Indoor Tanning Services Tax
•Internet websites: “Requires the Secretary of HHS to establish an Internet website through which residents of any State may identify affordable health insurance coverage options in that State. The website will also include information for small businesses aboutavailable coverage options, reinsurance for early retirees, small business tax credits, and other information of interest to small businesses.”
Effective within six months after enactment:
•Elimination of pre‐existing condition limitations for children
•Children covered until age 26
•Eliminating Lifetime Limits on benefits
•Regulating Use of Annual Limits (defined by the Secretary of HHS).
•“Free Preventive Benefits” ‐must provide 1stdollar coverage for preventive services (no cost‐sharing).
•Prohibits rescissions: carriers cannot cancel coverage

Effective January 2011:
•Minimum medical claim loss ratio (Small group plans 80%/Large group plans 85%)
•Carriers must rebate excess premium to consumers (above the allowed loss ratios)
•Employers must report the value of health benefits on the employee’s W‐2
•Flexible Spending Accounts –over the counter medicines are no longer covered (unless prescribed by physician).
•HSA’s: penalty for non‐qualified expenses increased from 10% to 20%
•New voluntary government‐operated long term insurance plan financed by payroll deductions –THIS IS AUTOMATIC ENROLLMENT


2012
•Hospital payments must be linked to outcome (defined by Secretary of HHS)
•“Directs the Secretary of HHS to develop and implement a budget‐neutral payment system that will adjust provider payments based on the quality and cost of the care they deliver.”
•“Requires the Secretary of HHS to establish and update annually a national strategy to improve the delivery of health care services, patient health outcomes, and population health. “
2013
•Carriers must adopt standard administrative rules/procedures (determined by Secretary of HHS)
•Limit flexible spending accounts to $2,500/yr (indexed by CPI thereafter)
•Hospital Tax (0.9% to 3.8% of income) on high income wage earners (>$200,000 individuals, >$250,000 couples)
•Medicare tax will applies to capital gains, dividends, interest, and other unearned income.
•Simplified and standardized summary of benefits for plan comparisons (as determined by Secretary of HHS).
•Elimination of Employer Part D Subsidy.

2014
•Limits small group deductibles to $2,000 individual / $4,000 family (can have coinsurance after the deductible)
•Limit eligibility waiting periods to 90 days
•Limit maximum out‐of‐pocket based on income as it relates to the Federal Poverty Line.
•Health Insurance Reforms: guarantee issue, no pre‐existing condition limitations, community rating
•“Premiums can vary only on age (no more than 3:1), geography, family size, and tobacco use. “
•Elimination of all limits on benefits, and Secretary of HHS shall determine “standard benefits”.
•Individual Mandate –all individuals must be covered.
•Non‐compliance penalty: 2014‐$95 / 2015‐$325 / 2016‐$695 or 2.5% of income.
•Employers with over 50 employees are subject to $2,000/ee tax penalties
•Insurance Exchanges will created for small business health insurance
•Income‐based Individual Premium Subsidies •Small Group Tax Credits –second phase takes affect
•New rules for wellness programs will be introduced (certain rules to be determined by Secretary of HHS).

2018
•Excise Tax on High‐Cost Plans