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As a courtesy of the Michigan Business & Professional Association and the Michigan Food & Beverage Association, and working with our partner, Larry Grudzien, we’re pleased to offer you access to a FREE HSA Guide.
The guide explains every aspect of HSAs in fifty questions and answers format. It also includes the NEW 2014 contribution and coverage amounts and the required changes under health care reform.
To download the guide Click Here.
By Bonnie Bochniak
MBPA Government Relations
The Michigan Business and Professional Association (MBPA) strongly opposed State House and Senate approved legislation, Senate Bill 335, which is now headed to Governor Snyder to sign into law that extends the Health Insurance Claims Assessment (HICA) Act. Senate Bill 335 extends the life of a 1 percent tax on all paid health claims for employees, which is used to meet federal match requirements to fund Michigan’s Medicaid program.
Background:
The Health Insurance Claims Assessment (HICA) Act was enacted during 2011 and took effect on January 1, 2012. The HICA replaced the Use Tax that had been applied to Medicaid managed care organizations. Revenue from the HICA is used to support the State’s Medicaid program.
The HICA rate was set at 1.0% of all paid health claims. There are exceptions: Federal government programs such as Medicare, Veterans Administration health care services, and fee-for-service Medicaid are not subject to the HICA, as the State cannot tax the Federal government. Similarly, out-of-pocket costs are not subject to the HICA. There is also a lower rate of 0.1% for a very limited number of small health insurers.
Due to concerns that the HICA could raise more than the $400.0 million in revenue that was projected, a system of credits was created. If revenue in any year exceeds $400.0 million as adjusted by medical inflation, each carrier, and third party administrator (for self-funded plans), will receive a proportional credit against the subsequent year’s HICA assessment.
Since the inception of the assessment, the funds collected from the HICA tax did not meet revenue expectations, thus extending the life of the tax was pursued to help fund Michigan’s Medicaid program, despite much opposition from the business community. The new legislation amends the HICA Act to delay the Act’s sunset from January 1, 2014, to January 1, 2018.
We will continue to keep you up to date. As always, please contact our Government Relations team with any questions. By phone: 888-277-6464 or by email: bbochniak@michbusiness.org we value your feedback.
The Patient Protection and Affordable Care Act (PPACA) is tasked with eliminating or at least lessening the gap between what older consumers pay for health care compared to what a younger consumer would pay for their individual health care coverage. Inside the new health insurance exchange program, it can create newfound gaps in the rate of what coverage costs for an older enrollees and newer enrollees in some small-group health plans. Employers will have options to help lessen that burden.
As a refresher, PPACA mandates that the U. S. Department of Health and Human Services (HHS) and states set up a system of exchanges, or web portals, that are health insurance marketplaces for individuals and small groups by October 1st of this year. PPACA requires that all exchange plans must cover standardized “essential health benefits” (EHB), and will also require that all plans sold through an exchange fit into one of four “metal levels” based on the percentage of the actuarial value of the EHB package that the plan covers.
“Bronze level” plans must cover about 60 percent of the actuarial value of the EHB package, “silver level” must cover 70 percent, 80 percent coverage for gold plans, and about 90 percent for the top line platinum plans. HHS will enforce SHOP exchanges to give employers the option of letting employees choose from a coverage menu that includes all exchange plans offered at a given “metal level”.
PPACA is limiting the maximum ratio between the price difference for the oldest enrollee and the youngest enrollee to 3 to 1, as compared to the current average ratio 5 to 1. As employers are choosing between different “metal” plans, they will have to decide whether to use a composite rate system, a list bill system, a combination of those systems, or some variation on the composite rate or list bill approach.
In a plan that uses a composite rate system, all employees in a group pay the same rate, regardless of age. The main factor leading to all employees paying different rates is family size. In a plan that uses a list bill system, employees would pay age-specific rates that were calculated individually, using age, geography and tobacco use. Today employers using list billing are able to choose between paying a fixed amount per worker or a fixed percentage of premiums. Current PPACA regulations would no longer allow employers to pay that fixed amount per employee.
Now is the time to look at your employees and/or clients group and help guide them in the direction that best suits their bottom line. Composite premiums tend to be standard in most states, but are not a one size fits all system.
We will continue to keep you up to date as more developments arise. As always, please contact our Government Relations team with any questions. By phone: 888-277-6464 or by email: bbochniak@michbusiness.org we value your feedback.
ACA Compliant Summary Plan Descriptions (SPDs)
Need to change your client’s plan year? Some carriers are allowing plan year changes to assist your clients to prepare for ACA. MBPA has complimentary ACA Compliant Summary Plan Description (SPD) services for members. All dues paying members can receive a complimentary SPD as part of their membership benefits with the MBPA. Many agents are telling us they need to update all of their clients’ SPDs to ensure they are in alignment with ACA changes. Please ensure all your health benefit clients have SPDs with the MBPA. The MBPA can handle all your clients’ needs at one time. For more information Email: lbennett@michbusiness.org or call 888-277-6464 with your SPD requests.
NOTE: Effective June 1st 2013 SPDs and Section 125s will only be available to members of the Association.
Advantages of the MBPA SPDs:
A Reminder: Outsource Your Blues Enrollment Changes to MBPA
As agents have more work and less time, they are relying more upon the MBPA service team for timely and accurate BCBSM/BCN enrollment changes. If you have not considered outsourcing your Blues enrollment changes to us, now is the time. The MBPA team has accurate and timely changes and personal service for you and your team members. To learn more email msnip@michbusiness.org or call Tina at 888-277-6464 with your enrollment needs.
On March 21, the Michigan Department of Insurance and Financial Service (DIFS) issued an Insurance Bulletin with key information regarding requirements that apply on and off the Marketplace for individual and small group plans issued or renewed on or after January 1, 2014.
Small group definition
Agents, DIFS defines small employer as an employer with 1 to 50 full-time equivalent employees, using the counting method defined in the Affordable Care Act’s employer mandate provisions.
Under the full-time equivalent counting method, the determination of whether an employer is a small employer requires the following calculation, with respect to the preceding calendar year:
Network adequacy and essential community providers (ECPs)
Network adequacy requirements will apply to business on and off the Marketplace. Network adequacy standards apply to all essential health benefit categories, including pediatric dental, pediatric vision and prescription drug benefits. All plans in the individual and small group markets will be reviewed to ensure that their provider networks are adequate at the time of the initial filing, and annually thereafter. All QHPs offered on the Exchange will also be reviewed to ensure the network contains a sufficient number and geographic distribution of Essential Community Providers to ensure reasonable and timely access to providers for low income, medically underserved individuals within the QHP’s service area.
Rating
The State of Michigan did not exercise any of its discretion except with respect to geographical rating areas. Rating includes:
Geographic rating areas
DIFS is establishing 16 prescribed geographic rating areas that all carriers must use in the individual and small group markets. CCIIO has approved the rating areas without change. The Insurance Bulletin includes a map of the geographic rating areas.
Requirements that apply only to Marketplace products
Where can I find more information?
More information can be found online in the Insurance Bulletin.
The MBPA can provide you with state-of-the-art COBRA administration for as little as $25 per month through BASIC, a Michigan-based award winning company that provides HR Solutions for businesses. Best of all, the Associations’ COBRA Administration program is open to all members. Our COBRA Administration program with BASIC reduces risk and frees up valuable resources, allowing you more time to focus on your business operations. With BASIC COBRA, you can rest assured knowing that your COBRA administration is being handled accurately and consistently by experts.
If you have questions or need assistance, please contact our Membership Services Team at: 1-888-277-6464.
IRS has just issued Revenue Procedure 2013-25, which provides the 2014 cost-of-living contribution and coverage adjustments for HSAs, as required under Code Section 223(g). Most contribution limits and the out-of-pocket amounts have been increased for 2014. The deductible amount limits have not changed.
HSA Contribution Amounts
2013 - 2014 Coverage Levels
Individual $3,250 – $3,300
Family $6,450 - $6,550
Catch-Up $1,000 $1,000 Catch-up
Maximum Out-Of-Pocket Amounts for HDHP
2013 - 2014 Coverage Levels
$6,250 $6,350 Individual
$12,500 $12,700 Family
Minimum Deductible Amount Limits for HDHP
2013 - 2014 Coverage Levels
$1,250 $1,250 Individual
$2,500 $2,500 Family
For a copy of Revenue Procedure 2013-25, please click on the following link: http://www.irs.gov/pub/irs-drop/rp-13-25.pdf
NAHU’s new professional development course on the Patient Protection and Affordable Care Act (PPACA) has been approved in all 50 states. This is the first course of its kind to be approved in every state. Health insurance professionals who complete the online course will receive between nine and fifteen education credits from their state department of insurance.
“This course is a unique and necessary way for licensed agents and brokers to receive an overview of all regulations in PPACA and keep up with further regulations as they are issued,” said NAHU CEO Janet Trautwein. “By taking this course, dedicated professionals will learn what is needed to comply with the new law and how the market is likely to change over the next few years. Furthermore, they will be able to advise American families and businesses in planning for the future.”
Here are a few student benefits:
Complete course instruction will be delivered through NAHU’s Online Learning Institute (OLI) and followed by a final exam, which is required to obtain certification and continuing education (CE) credits.
To enroll in this course, visit NAHU’s PPACA certification course webpage for more information.
Wondering how health care reform is going to affect your clients business? The Michigan Business & Professional Association (MBPA) has created two new health care compliance tools for you to use. These services are complimentary for all Associations members:
NEW MBPA Employee Calculator: Who is a “large employer” under the Affordable Care Act?
A new MBPA Agent tool helps you determine whether your client is a “large employer” under the Affordable Care Act (ACA). A large employer has 50 or more full-time equivalent employees and is subject to specific health reform requirements. This includes the choice of offering employees affordable, minimum health insurance or potentially paying a tax penalty.
Determining your client’s employee count sounds easy. But, keep in mind there are three steps:
STEP 1: Determine whether your clients are a “large employer” by examining the number of full time employees (FTE’s) and part-time employee hours – CLICK HERE for MBPA’s new tool to guide you on this issue.
STEP 2: If your clients are a “large employer,” decide whether to offer insurance to employees and determine if that coverage is affordable and meets minimum levels; and
STEP 3: If your clients are subject to the penalty, determine which employees must pay a tax penalty for and the cost.
Agents a NEW Health Care Reform Business Checklist Available to You and Your Clients!
The 2010 Affordable Care Act (ACA) draws a line in the sand between small and large businesses, defining small businesses as those with fewer than 50 employees. This has led many Michigan businesses whose employee count hover around 50 to evaluate how the ACA impacts their hiring and health benefit decisions. This checklist helps to inform Michigan businesses of ACA implications based on their business size; it also aims to assist you. Combined with the MBPA’s new FTE calculator and checklist this information will give you the benchmark you need to make important decisions related to health care reforms new mandates.
To access the Health Care Reform Business Checklist CLICK HERE
Important Reminders:
The Michigan Business & Professional Association also has the following compliance tools and valuable resources available for all members –
On March 1 the Department of Health and Human Services (HHS) released a new proposed rule that would postpone employee choice (allowing SHOP employers to offer multiple qualified health plan options for employees to choose from) and the premium aggregator in the Small Business Health Options Program (SHOP) until 2015. The premium aggregator is a tool that consolidates billing for employers who have employees enrolled in multiple QHPs.
The proposed rule also revises triggering events and special enrollment periods for qualified employees and their dependents. These changes are intended to help issuers prepare and price qualified health plans (QHPs) for an employee choice environment, and to make the systems and operational changes required for SHOP enrollment and premium aggregation.
Comments are due April 1, 2013
Why delay employee choice?
The Centers for Medicare and Medicaid Services* (CMS) is proposing that employers only be allowed to enroll in one QHP in 2014. In addition, state SHOPs would not have to offer employee choice next year. This policy is intended to provide health plan issuers with additional time to prepare for an employee choice model and to stabilize the small group market in 2014.
Why postpone premium aggregation until 2015?
The premium aggregation function for the SHOP was designed to assist employers whose employees were enrolled in multiple QHPs. Because this function will not be necessary in 2014 for SHOPs that delay implementation of the employee choice model, CMS is also proposing that the premium aggregation function be optional for plan years beginning before January 1, 2015.
What are the special enrollment period proposed changes?
CMS previously established that a special enrollment period is 60 days from the date of the triggering event for the Marketplace and SHOP.
CMS now proposes to amend the special enrollment period for the SHOP to 30 days for most applicable triggering events, so that it aligns with the special enrollment periods for the group market established by the Health Insurance Portability and Accountability Act of 1996* (HIPAA).
To further align the SHOP provisions with HIPAA, CMS also proposes that if an employee or dependent becomes eligible for premium assistance under Medicaid or the Children’s Health Insurance Program (CHIP) or loses eligibility for Medicaid or CHIP, this would be a triggering event, and the employee or dependent would have a 60-day special enrollment period to select a QHP. This triggering event had previously been inadvertently omitted from the regulations.
CMS is also proposing to change special enrollment periods to clarify that a dependent of a qualified employee is not eligible for a special election period if the employer does not offer coverage to dependents.
