Fraser Trebilcock teamed up with Lansing Regional Chamber of Commerce to present a free seminar to help employers keep up with changes related to Health Care Reform. This is the fourth presentation in the Business Education Series, titled "Navigating the ACA Marketplace: Guidance for Small Businesses and Individuals". Michael James, Senior Health Care and Business Attorney from Fraser Trebilcock, presented the keynote presentation.

1. NAVIGATING THE MARKETPLACE
Guidance for Small Businesses and Individuals
Michael P. James, JD, MBA, CSSGB
Phone: (517) 377-0823
(313) 237-7300
Email: mjames@fraserlawfirm.com
www.linkedin.com/in/MichaelJamesLaw
© 2013 Fraser Trebilcock
Davis & Dunlap, P.C.

2. HealthCare.gov

3. Navigating the Marketplace



Health Insurance Marketplace/Exchange Overview
What has Gone Wrong?
What is the Impact?
 Individual
Market
 Small Employers




Cancellation Notices
Shopping for Health Insurance
What does the Future Hold?
Strategy & Compliance

4. Health Insurance
Marketplaces

Health Insurance Marketplaces / Exchanges.



Open enrollment:
October 2013 ???
Plans go into effect: January 2014
Michigan has a federally-facilitated health insurance marketplace.

5. Health Insurance
Marketplaces
Marketplace Metals

ACA uses “Metal Levels” to
standardize insurance products
offered on exchange to individual
and small group markets.

Based on actuarial values.
 The percentage of total average
costs for covered benefits that a
plan will cover.
Platinum
88-92% AV
Gold
78-82% AV
Silver
68-72% AV
Bronze
58-62% AV

6. Health Insurance
Marketplaces
Essential Health Benefits
1)
2)
3)
4)
5)
Ambulatory Patient Services
Emergency Services
Hospitalization
Maternity and Newborn Care
Mental Health & Substance Use Disorder Services; Behavioral
Health Treatment
6) Prescription Drugs
7) Rehabilitative and Habilitative Services and Devices
8) Laboratory Services
9) Preventative Wellness Services and Chronic Disease
Management
10) Pediatric Services, Including Oral and Vision Care

7. Health Insurance
Marketplaces

8. Health Insurance
Marketplaces
How Does it Work?

9. Health Insurance
Marketplaces
How Does it Work? - What You See

10. Health Insurance
Marketplaces
How Does it Work? - What You See

11. Health Insurance
Marketplaces
How Does it Work? - Behind the Scenes

12. Health Insurance
Marketplaces
How Does it Work? - Enrollment

13. What is going on with the
Marketplace?

14. What is going on with the
Marketplace?








Software and Hardware Problems
Account Creation Errors
High User Volume Difficulties
Tax Credit Verification Errors
Security Risks
Improper Enrollment in Federal/State Health Care
Programs
Improper Data Transmission
Communication Errors throughout Marketplace

15. What is going on with the
Marketplace?

16. Impact of Delay

17. ACA Individual Health
Insurance Mandate

The individual health insurance mandate requires nearly all
Americans to purchase and maintain health insurance.

Qualified coverage evidenced through tax returns.

18. ACA Individual Health
Insurance Mandate

If an individual fails to have minimally essential coverage, he
or she will be required to pay an excise tax.
2014:
Penalty is $95 per adult and $47.50 per
child (up to $285 for a family) or 1.0% of
family income, whichever is greater.
2015:
Penalty is $325 per adult and $162.50
per child (up to $975 for a family) or
2.0% of family income, whichever is
greater.
2016 and Beyond:
Penalty is $695 per adult and $347.50 per
child (up to $2,085 for a family) or 2.5% of
family income, whichever is greater.

19. Impact of Delay on Individual
Health Insurance Mandate


Deadline for individuals to sign up for health insurance
before facing tax penalties extended to March 31, 2014.
Under ACA and tax regulations, individuals are required to
have health insurance coverage in place starting in 2014.

“Short Coverage Gaps” protects individual for not having coverage
up to 3 months.


Short Coverage Gap would have protected uninsured individual from
penalties until March 31, 2014.
In practice, an individual must sign up by the 15th of a given
month in order for health insurance to start the first day of the
next month.

Would have required insurance application by February 15, 2014 to
qualify for Short Coverage Gap protection.

20. Small Businesses
Under 50 FTEs



There is no insurance
requirement.
Employers do not have to
offer insurance.
However, if health insurance
offered, must meet Essential
Health Benefits and metals.

21. Small Business Health
Option Programs
Small Business Health Option Programs
(SHOP)

Open to all small businesses in 2014.





Must have 50 FTEs or less.
In 2014, employer chooses one insurance product for all employees.
In 2015, employer picks the metal level, employees choose the
insurance product.
In 2016, SHOP expands to businesses with up to 100 FTEs.
In 2017+, States have option to expand SHOP eligibility to large
groups.

22. Impact of Delay on
Small Businesses



Open enrollment originally pushed back from October 1, 2013 to
November 1, 2013.
Open enrollment for small businesses has been pushed back again
until the end of November 2013.
Impact:



Small businesses will only have the first half of December 2013 to
enroll in a health plan in order for coverage to begin January 1, 2014.
Small businesses will only have 2 weeks to evaluate SHOP health plans
and make a decision.
Critical for businesses with health plans terminating at the end of 2013.

23. Cancelled Health Plans

Affects individuals who buy health insurance directly
from carriers and some small businesses.
 Individuals
impacted in 2013.
 Small businesses impacted in 2013 and 2014.
 Census Bureau says about 4% of the population affected, or
11 Million consumers.

Health insurance plan in place this year won’t be sold
anymore.
 The
plan is no longer compliant.

24. Cancelled Health Plans
“If you like your health insurance plan, you can keep it.”

25. Cancelled Health Plans

What should you do if you received a cancellation
letter?
 Shop Around
 What
alternative plan is your carrier offering to replace the
cancelled coverage?
 What are other carriers offering?
 What products are available through the Marketplace?
 Tax
Credits
 For
small businesses and individuals to be eligible for tax credits,
insurance must be purchased through the Marketplace.

26. Shopping for
Health Insurance
Individual Premium Tax Credits
 1) Must purchase coverage through the Marketplace.
 2) Up to 400% of the federal poverty line:
$11,490 (100%) up to $45,960 (400%) for one individual.
 $15,510 (100%) up to $62,040 (400%) for a family of two.
 $23,550 (100%) up to $94,200 (400%) for a family of four.





3) You are not able to get affordable coverage through an
employer that provides minimum value.
4) You are not eligible for coverage through a government
program.
5) You file a joint tax return, if married.
6) You cannot be claimed as a dependent by another
person.

27. Shopping for
Health Insurance
Small Business Health Care Tax Credits

28. Shopping for
Health Insurance
Potential Tax Credits 2010 - 2013
Non-Profit
For-Profit
Up to 25% of employer
contribution to
employees’ health
insurance premium
Up to 35% of employer
contribution to
employees’ health
insurance premium

29. Shopping for
Health Insurance
Potential Tax Credits 2014 - 2016
Non-Profit
For-Profit
Up to 35% of employer
contribution to
employees’ health
insurance premium
Up to 50% of employer
contribution to
employees’ health
insurance premium

30. Shopping for
Health Insurance
Requirements

31. Shopping for
Health Insurance
Requirements
Maximum credit available to employers with 10 or
fewer FTEs and average annual wages of $25,000 or
less.

For each FTE above 10 FTEs, the credit is reduced by 1/15.

For each $1,000 above $25,000 in average wages, the credit
is reduced by 1/25.

32. What Does the Future Hold?



Sources say that Marketplace will not be ready by the
end of November.
We could see additional delays to SHOP and Individual
Mandate.
Private Health Insurance Exchanges are on the rise.
 Walgreens,

Sears, Darden Restaurants
Web-Broker Entities may play a larger role in public
marketplace
 Currently
only available in individual market in federal
marketplaces.

33. What Should You Do?




Develop a Strategy
Create a Compliance Plan
Monitor Changes in the Law
Form a Team of Trusted Advisors

34. Michael P. James, JD, MBA, CSSGB
Fraser Trebilcock
Health Care Reform
www.mihealthcarelaws.com
Fraser Trebilcock Davis & Dunlap, P.C.
One Woodward Avenue, Suite 1550
Detroit, Michigan 48226
www.fraserlawfirm.com
Phone: (313) 237-7300
Fax: (313) 961-1651
Phone: (517) 377-0823
(313) 237-7300
Email: mjames@fraserlawfirm.com
www.linkedin.com/in/MichaelJamesLaw
Fraser Trebilcock Davis & Dunlap, P.C.
124 W. Allegan Street, Suite 1000
Lansing, Michigan 48933
www.fraserlawfirm.com
Phone: (517) 482-5800
Fax: (517) 482-0887
© 2013 Fraser Trebilcock
Davis & Dunlap, P.C.