50 or more employees- If do NOT offer coverage and employee receives premium tax credit, then pay $2,000 per full-time employee (excluding first 30) If do offer coverage and have at least one employee that receives premium tax credit, then have to pay lesser of $3,000 per employee receiving tax credit OR $2,000 per employee If offer coverage, must provide employees making below 400% of poverty a free choice voucher if their share of premium exceeds 8% of income, but less than 9.8% of income. Free Choice Voucher= No penaltiesEmployers >200 must automatically enroll employees into health insurance plans. Employees must opt out.
Carrot Patient Protection Stick and Affordable Care Act More People (ACA) CostsCreates Market Places Expanding Medicaid Individual Mandate (Exchange) BusinessSubsidies to Purchase Improving Medicaid Requirements Subsidies to small Increasing health Fees / Taxes businesses workforceChanges to insurance Politics of health Payment & Prevention
Topics Covered in the ACA• Health Insurance Exchanges • Medicaid• Tax Credits for Individuals • Medicare• Impact on Small Businesses • Workforce/Access to Care• Employer Requirements • Quality of Care• Private Insurance • Prevention• Individual Mandate • New Models of Care
Major Themes of the ACA• Expanding Health Insurance Coverage• Insurance Regulations• Focus on Prevention• New Models of Care• Increasing Quality
Health Insurance Exchanges• Like a Farmer’s Market for health insurance• Individuals and small businesses (<100)• Larger employers beginning in 2017• Creates four benefit plans, plus catastrophic plan• Guarantee issue and renewability• Rating rules (only for age, family size, and tobacco)
Benefit Design• Essential health benefit package includes: • Preventive care • Prescription drugs • Hospitalization • Maternity care • Emergency services • Mental health and substance abuse• Benefits features: • No cost-sharing for preventive care • No annual or lifetime dollar limits on coverage • Coverage for dependents up to age 26
Premium Subsidies to Individuals/Families Tax Credits: Maximum Percent of Income Paid for Premiums Income for a Family of Four Percent Paid for FPL Range From: To: Premiums100-133% of FPL $23,050 $29,327 2% of income133-150% of FPL $29,327 $33,075 3-4% of income150-200% of FPL $33,075 $44,100 4-6.3% of income200-250% of FPL $44,100 $55,125 6.3-8.05% of income250-300% of FPL $55,125 $66,150 8.05-9.5% of income300-400% of FPL $66,150 $88,200 9.5% of income
Example$44,100 -Annual income for family of four atx 6.3% 200% of poverty $2,778 – Family’s Share ($232/month)Bronze Plan $10,000Family’s Share - $ 2,778Premium Support $ 7,222
ExampleBronze Plan $10,000Family’s Share - $ 2,778Premium Support $ 7,222Gold Plan $12,000Family’s Share - $ 2,778Premium Support - $ 7,222Additional Family Share $ 2,000 Total Family Share for Gold Plan: $4,778 or $398/month
Small Business• No requirement that small employers must offer health insurance or pay a fine (<50 employees)• Sliding scale tax credits for small employers (<25 employees)• Access to the Exchange in 2014 and must use tax credit within the Exchange starting then
Employer Requirements• Employers with >50 employees • If do NOT offer coverage • If do offer coverage• If employer offers coverage, the employee’s share of premium must exceed 9.5% of income in order for them to be eligible for a tax credit in the Exchange• Employers with >200 employees• Report health coverage on W-2 forms (year delay for employers that file fewer than 250 W-2’s)
Changes to Private Insurance• No annual/lifetime limits• No rescinding coverage• No pre-existing condition exclusions• Rating rules• Guaranteed issue• Dependents up to 26• 80-85% of premium spent on medical services • (~$65 million in rebates in Missouri)
Individual Mandate• All individuals must have “qualifying” coverage• Those without coverage: • Will be required to pay a phased-in penalty: ○ $95 or 1% of taxable income in 2014, ○ $325 or 2.0% of taxable income in 2015, and ○ $695 or 2.5% of taxable income in 2016 (up to a maximum of three times that amount or $2,085)• Exemptions for financial hardship, religious objections, or 8% rule
Expansion of MO HealthNet• Expand Medicaid to 133% of FPL for non-Medicare individuals and families• Guaranteed benchmark benefit package• 100% federal funds at first, then step-down to 90%
• 90 percent of the currently uninsured have incomes below 400% of poverty.• 66% of the currently uninsured have incomes below 200% of poverty.
Source: The Missouri Medicaid Expansion: Good for All Missourians
BUDGET SUMMARY COST, SAVINGS & REVENUEGeneral Revenue Summary -- Dollars in Millions FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 Cost New Eligibles $0.0 $0.0 $0.0 ($30.1) ($69.3) ($86.6) ($117.6) ($143.3) Savings $31.0 $71.4 $82.3 $81.2 $78.9 $79.6 $78.4 $78.0 New Revenues $15.5 $53.6 $57.3 $61.8 $63.0 $65.0 $67.2 $69.6 Total Impact on GR $46.5 $125.0 $139.6 $112.9 $72.6 $58.0 $28.0 $4.3Source: Missouri Office of Administration
Arguments Against Expansion• The US and Missouri can’t afford this expansion• Medicaid is a broken system• Congress change the terms of the expansion• Affect on the state’s credit rating (AAA- Negative outlook)
Challenges• Medicaid Expansion • Will it happen?• Exchanges • What will they look like?• Access is still significant problem• Parity & cost-savings• Navigators • Who is going to assist with enrollment?
19 Declared State-based Exchange; 7 Planning forPartnership Exchange; 25 Default to Federal Exchange
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