3. Definitions of Acronyms
PPACA – Patient Protection and Affordable Care Act
CMS – Centers for Medicare & Medicaid Services
HHS – Department of Health & Human Services
MLR – Medical Loss Ratio
4. Review events of 2010
President signs the Patient Protection and Affordable
Care Act on March 23,2010.
First parts of PPACA goes into effect on September 23,
2010 for most fully insured plans or anniversary date of
health plan (Christian Church Health Care Benefit
Trust changes went into effect January 1, 2011.)
Mid – Term elections in November 2010
House control flips to Republican Majority
Senate still has Democratic Majority albeit much
smaller
5.
6. 2010
Expand coverage to dependents up to Age 26 regardless of
student or marriage status as long as they are not eligible
for other employer coverage
Eliminate pre-existing condition clause for dependents
under age 19
Eliminate lifetime maximums from health plans
Provide a $250 rebate to Medicare Part D participants who
reach the “Doughnut Hole”
Plans to decide on “grandfathering” status
Preventive health services – first dollar coverage
Small business tax credit (up to 35% of employer
contributions to provide health insurance for employees,
25% for non-profits)
7. 2011
Employers must report health care coverage costs on W-2
forms ( This has been deferred to 2012 W-2 by IRS).
Over the counter medicines no longer eligible for
reimbursement under an FSA, HRA or HSA without a
doctor’s prescription.
Increased taxes for withdrawals from HSAs for non
qualified medical expenses.
Require pharmaceutical manufacturers to provide a 50%
discount on brand-name drugs filled in the Medicare Part
D “Doughnut Hole”
Begin phasing-in federal subsidies for generic drugs filled
in the “Doughnut Hole”
8. 2012
1099 reporting limit lowered to $500
Comparative effectiveness fee $1 per participant
(increases to $2 per head 2013 – 2019)
Reduce Medicare payments that would otherwise be
made to hospitals by specified percentages to account
for preventable readmissions
Establish value-based programs for hospitals with the
aim to expand to home health, skilled nursing
facilities and outpatient surgery centers as well
9. 2013
Administrative simplification required – must adopt uniform
standards for electronic exchange of health information
Health FSA contributions capped at $2,500 (much like HSAs this
amount will be indexed for cost of living)
End of employer Medicare Part D subsidy tax
Begin phasing in federal subsidies for brand-name prescriptions
filled in the Medicare Part D coverage gap (to lower patient share
to 25% in 2020) in addition to the 50% manufacturer brand
name discount
Establish a national Medicare pilot program to develop and
evaluate paying a bundled payment for acute, inpatient hospital
services, physician services, outpatient hospital services, and
post acute care services for a care event
10. 2014
Pre-existing condition restrictions are eliminated for all
persons
Insurers cannot charge higher rates due to health status
No annual limits on amount of essential health benefits
coverage an individual may receive
Health insurance exchanges are to be created to offer
insurance to individuals and small employers (< 100
employees)
Multi-state plan option established – provides coverage
under nationwide health plans
Increase in small business tax credit as long as coverage
purchased through exchanges
11. 2014 continued
Individual/employer mandates are to begin
Individual mandate
Individuals who do not enroll in qualifying coverage
must pay a penalty
Health care tax credits for insurance purchased on
exchange by low income individuals (400% of FPL or
approx $44k in 2010)
Self – insured plans and insurers will be required to
report certain coverage – related information to
individual and IRS
12. 2014 Continued
Employer Mandate
Automatic enrollment for employers with 200 + full time
employees that offer at least one health plan benefit
Employees must be notified of exchanges & subsidies
No waiting periods > 90 days
Penalties for employers with 50 + full time employees
No coverage - $2000 for each FT employee over the first 30 if even
one employee receives tax credit; or
Unaffordable coverage - $3000 for each worker who actually receives
a tax credit because the employer plan cost more than 9.8% of
income
Free Choice Voucher – cost of employer plan >8% but <9.8% of
household income; employee gets tax-free voucher = cost of
employer contribution to buy coverage on exchange and keep the
savings (if any)
13. 2017 and 2018
2017
States may allow all employers of any size to offer
coverage through exchange (< 100 employee rule goes
away)
2018
Cadillac plan tax goes into effect
Tax on cost of coverage in excess of $27,500 family and $10,200
single
Dollar thresholds are indexed for inflation
Special provisions for employers with higher costs because of
age or gender demographics
14. CAVEATS
The 2012 election
Supreme Court will most likely have its say on
individual mandates/constitutional status of PPACA in
2012
Congress has yet to hold the line on a scheduled
Medicare provider reimbursement reduction
Ability of self-insured plans to qualify for subsidies
and state exchanges
More and more physicians are limiting and closing
their practices to Medicare eligible patients
