Learn how the Affordable Care Act will impact the future of health care for small businesses! Specifically, this presentation expores the future of insurance market reforms, small business tax credits and state health exchanges.
Presentation by:
Cindy Gillespie, Senior Managing Director, Washington, McKenna Long & Aldridge
Jandel Allen-Davis, MD, Vice President of Government and External Relations, Kaiser Permanente
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The Future of Health Care for Your Small Business
1. The Future of Health Care
for Small Businesses
Jandel Allen-Davis, MD, Vice President—Government and External Relations
2. McKenna Long & Aldridge LLP
Senior Managing Director
CINDY GILLESPIE
3. Agenda
2014: What happens for your employees?
2014: What are your options as a small business?
The Question: How do you choose among those options?
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4. 2014: Your employees
* Assumes CO opts in to Medicaid expansion
** Tax-filing threshold
*** 138% FPL – Household MAGI
4 **** 400% FPL – Household MAGI
5. 2014: Different options for different size businesses…
Offer affordable insurance
More than 50 FTEs –
Employer Mandate
Don’t offer and pay penalty
Offer insurance
Less than 50 FTEs – “SHOP” for insurance in small employer
No Employer Mandate health options exchange
Don’t offer
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6. Three Key Pieces to the Penalty
What businesses are subject to the penalty?
– Those with 50 or more FTEs (or equivalents)
An FTE works 30 or more hours a week
What kind of insurance must be offered to avoid a penalty?
– Minimum Essential Coverage
– Grandfathered plan
How much must the employer contribute?
– Must be “affordable” for the employee
Safe harbor:
– Lowest cost self-only plan is less than 9.5% of employee’s W-2 wage
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7. Option for Employers with Less than 50 FTEs: Shopping
in COHBE’s Small Employer Health Options Program
Registers On-Line or via
Call Center; provides info Determines Level of May Choose Defined
on the group Employee Choice Contribution
Employer
Goes on-line; provides
Comparison shops, SHOP Payroll and
individual info: Age,
Insurer
premium calculator, other HR Services
Residence, Tobacco
selects & enrolls in plan
use
Employees
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10. Key Dates to Remember
Election Day 2012
November 16, 2012: States submit Exchange Blueprints
January 1, 2013: States receive “go”/ “no go” from federal government
October 2013: Open Enrollment begins
January 1, 2014: Exchanges “go live”
Decision time for small businesses is approaching rapidly…
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18. Thank you! Questions?
“Let’s talk about getting people
healthy. That’s something we can
all agree on.”
— Donna Lynne, DrPH, President,
Kaiser Foundation Health Plan of Colorado
18 September 19, 2012
Editor's Notes
KP, June 2012, A Survey of Colorado Small Business Owners About Health Insurance and the Availability of Insurance Through the Colorado Health Insurance Exchange
Prevention Care when you’re healthy helps decrease overall health costs and keep your employees engaged and on the job. A large portion of health care reform focuses on prevention by expanding access to preventive care visits at no additional cost to you or your employees. Quality of care Physicians will be paid based on value rather than volume. The law is designed not just to control health care costs, but also to improve quality of care. The new law provides incentives for physicians to join together to form “Accountable Care Organizations” where doctors can better coordinate patient care and improve the quality, help prevent disease and illness, and reduce unnecessary procedures, tests or hospital admissions. Guarantee Issue Now no longer will you have to worry about a pre-existing condition limiting or denying you health coverage. Health plans must permit you to enroll regardless of health status, age, gender, or other factors that might predict the use of health services. In the individual and small group market, it eliminates the ability of insurance companies to charge higher rates due to gender or health status. Cost transparency Due to the rising costs of health care, many companies have shifted a portion of their premium dollars to employees through deductible plans. This change has put much more responsibility on consumers to understand the true costs of care. In conjunction, the law puts much more accountability for costs on the providers. Many provisions of the law limit the ways in which insurance companies spend your premium dollars and require that they justify any premium increase greater than 10%.
Flexibility and choice in the exchange—employers may offer: A single plan for all employees. A set of plans from a single carrier. All plans within a single metal tier, allowing employees to choose their carrier and subsequently their own doctor Any plan that is offered in two adjacent metal tiers (bronze, silver, for example) Easily compare plan offerings The exchanges will allow you to compare plans more easily than ever – much like you do when booking travel. And as with travel, you will need to make some compromises. You know that with airfare a nonstop flight can be more expensive and that 1-stop flight isn’t as convenient. Health care decisions will now be very similar to the consumer shopping experience. Metal tiers: The metal tiers of plans sold through the exchange – bronze, silver, gold and platinum – represent actuarial value, or what percentage of a covered benefit is paid. For bronze it is 60 percent, silver is 70 percent, gold is 80 percent and platinum is 90 percent
Small business tax credit To qualify, an employer must: Have low-wage workers (less than $50k average annual salary) Pay at least 50% of employees’ premium. Employ no more than 25 full-time equivalent employees. Through 2013, the credit equals 35 percent of the employer contribution (25 percent for nonprofits). Beginning January 1, 2014 the credit rises to 50 percent (35 percent for nonprofits). Only the amount actually contributed by an employer counts toward the tax credit. The amount of employer premium payments that qualify for the credit is capped at the average small-employer premium for the state in which the employer is located. The average small-group-market premium for each state will be calculated by the United States Department of Health and Human Services.
Quote from the Denver Metro Chamber of Commerce breakfast a few days after the Supreme Court ruling on the ACA