health care reform updates presented by barb gerken, legislative co-chair

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Health Care Reform Updates Presented by Barb Gerken, Legislative Co-Chair

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Health Care Reform Updates Presented by Barb Gerken, Legislative Co-Chair. Medical Loss Ratio – Recent Activity. HR 1206: “Broker Bill” Introduced by Representatives Rogers and Barrow Legislation to “pass” producer commissions “through” the MLR calculation - PowerPoint PPT Presentation

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Page 1: Health Care Reform Updates Presented by Barb Gerken, Legislative Co-Chair

Health Care Reform Updates

Presented by Barb Gerken, Legislative Co-Chair

Page 2: Health Care Reform Updates Presented by Barb Gerken, Legislative Co-Chair

Medical Loss Ratio – Recent Activity

HR 1206: “Broker Bill”

Introduced by Representatives Rogers and Barrow

Legislation to “pass” producer commissions “through” the

MLR calculation

Ensures agents/brokers are not adversely impacted by the

regulations

Over 170 co-sponsors

Page 3: Health Care Reform Updates Presented by Barb Gerken, Legislative Co-Chair

Medical Loss Ratio – Recent Activity (cont.)

S 2068: Senate version of Broker Bill

“The Access to Independent Health Insurance Advisors Act of

2012”

Introduced in the Senate by Mary Landrieu, Johnny Iakson,

Ben Nelson and Lisa Murkowski

Excludes the independent health insurance producer

compensation from the MLR calculations

Page 4: Health Care Reform Updates Presented by Barb Gerken, Legislative Co-Chair

Medical Loss Ratio – Recent Activity (cont.)

S 2068: Senate version of Broker Bill

Will not be identical to HR 1206 but will include improvements

Congressman Rogers and Barrow have given their support of

the revised version

Page 5: Health Care Reform Updates Presented by Barb Gerken, Legislative Co-Chair

W2 Reporting

Additional interim guidance released by IRS on January 3,

2012

Confirms that employers filing less than 250 W-2s are not

subject to requirement

Indicates that specialty coverage, if included in medical

benefits, must be reported

does not impact employees’ taxable wages

Page 6: Health Care Reform Updates Presented by Barb Gerken, Legislative Co-Chair

W2 Reporting (cont.)

Section 6051(a) was added to the US Tax Code through

PPACA

Required for 2012 W-2 Forms

Employer must report the aggregate cost of applicable

employer-sponsored coverage

Page 7: Health Care Reform Updates Presented by Barb Gerken, Legislative Co-Chair

W2 Reporting (cont.)

Applicable coverage = coverage under any group health

plan made available to the employee by an employer

which is excludable from the employee’s gross income.

Page 8: Health Care Reform Updates Presented by Barb Gerken, Legislative Co-Chair

W2 Reporting (cont.)

Doesn’t include coverage for: On-site medical clinics Long-term care Dental and vision plans independent of the medical plan Accident only coverage or disability coverage General liability insurance and automobile liability insurance Worker’s compensation Automobile medical payment insurance Credit-only insurance Coverage only for a specified disease or illness Hospital indemnity or other fixed indemnity insurance

Page 9: Health Care Reform Updates Presented by Barb Gerken, Legislative Co-Chair

W2 Reporting (cont.)

Not required of employers filing less than 250 W-2

Forms

Does not apply to Archer MSA or health savings account

contributions

Does not apply to the amount of any salary reduction

contributions to a health flexible spending arrangement

Page 10: Health Care Reform Updates Presented by Barb Gerken, Legislative Co-Chair

W2 Reporting (cont.)

Cost is reported on Form W-2 in Box 12, using code DD

Employer may apply any reasonable method of reporting

cost of coverage for terminated employee

Should include costs for employee and any dependent

covered under group plan

COBRA costs are included

Page 11: Health Care Reform Updates Presented by Barb Gerken, Legislative Co-Chair

Essential Benefits Bulletin

States would choose one of the following benchmark plans

one of three largest small group plans in the state

one of three largest state employee health plans

one of the three largest federal employee health plan options

largest HMO plan offered in the state’s commercial market

Page 12: Health Care Reform Updates Presented by Barb Gerken, Legislative Co-Chair

Essential Benefits Bulletin (cont.)

PPACA requires that Essential Health Benefits include items and services in the following 10 categories

Ambulatory patient services Prescription Drugs

Emergency Services Rehabilitative and habilitative services and devices

Hospitalization Laboratory services

Maternity and newborn care Preventive and wellness services and chronic disease management

Mental Health and Substance Use Disorder Services, including behavioral health treatment

Pediatric services, including oral and vision care

Page 13: Health Care Reform Updates Presented by Barb Gerken, Legislative Co-Chair

Supreme Court Hearings

Arguments are scheduled for 3 days beginning March 26

Court has scheduled 6 hours of arguments (norm is 1 hour)

Decision is expected in June, 2012

Page 14: Health Care Reform Updates Presented by Barb Gerken, Legislative Co-Chair

Supreme Court Hearings (cont.)

Monday - is court action premature

Tuesday - is minimum coverage requirement provisions legal

Wednesday – can rest of law can take effect without individual insurance mandate

Page 15: Health Care Reform Updates Presented by Barb Gerken, Legislative Co-Chair

Coverage Summaries and Material Modification Notice

General Requirements:

Group Market – health insurer is required to create and deliver summary of coverage and benefits to consumers shopping for coverage.

Must be delivered ASAP but no later than 7 days after request.

For individual, insurer’s compliance with web portal requirements satisfies the obligation

Page 16: Health Care Reform Updates Presented by Barb Gerken, Legislative Co-Chair

Coverage Summaries and Material Modification Notice (cont.)

General Requirements (cont.):

Summary can be up to four pages front and back

Electronic delivery is permitted. Different rules apply for individual, fully insured or ASO group

Trumps state laws that require insurers to provide less information

Page 17: Health Care Reform Updates Presented by Barb Gerken, Legislative Co-Chair

Coverage Summaries and Material Modification Notice (cont.)

Notice of Proposed Rulemaking released on August 17, 2011

Originally to be effective on March 23, 2012

Updated Regulations released February 10, 2012

New effective date of September 23, 2012

Page 18: Health Care Reform Updates Presented by Barb Gerken, Legislative Co-Chair

Coverage Summaries and Material Modification Notice (cont.)

Applies to both grandfathered and nongrandfathered plans

Applies to both fully insured and self insured plans

No-carve out available for large group market

For ASO plans, duty to issue a summary will be both the plan sponsor and its plan administrator

Page 19: Health Care Reform Updates Presented by Barb Gerken, Legislative Co-Chair

Coverage Summaries and Material Modification Notice (cont.)

No longer require premium information

Reduces number of coverage examples

Diabetes – well controlled

Maternity – normal delivery

Requires a statement of meeting minimum essential coverage

Requires statement of meeting actuarial value

Page 20: Health Care Reform Updates Presented by Barb Gerken, Legislative Co-Chair

Coverage Summaries and Material Modification Notice (cont.)

No longer need to be delivered as stand alone document for group coverage

can be included in SPD – must be intact and prominent

Must be stand alone for individual

No longer required to be printed in color

Standard template is required for first year use best efforts to display not standard benefits

Page 21: Health Care Reform Updates Presented by Barb Gerken, Legislative Co-Chair

Coverage Summaries and Material Modification Notice (cont.)

Must be provided in culturally and linguistically appropriate manner

If 10% or more of population in claimants county are literate in only the same non-English language

Determined by the American Community Survey data

Currently 255 U.S. Counties meet threshold78 in Puerto Rico

Page 22: Health Care Reform Updates Presented by Barb Gerken, Legislative Co-Chair

Coverage Summaries and Material Modification Notice (cont.)

Must use 12 point font

Must customize all identifiable company information throughout document (websites, phone numbers)

Page 23: Health Care Reform Updates Presented by Barb Gerken, Legislative Co-Chair

Coverage Summaries and Material Modification Notice (cont.)

Requires plan sponsors or issuers to provide 60 days advance notice to enrollees when making material modifications to the plan.

Plan issuers or sponsors who willfully fail to provide timely notice will be subject to a fine of $1,000 per enrollee

Page 24: Health Care Reform Updates Presented by Barb Gerken, Legislative Co-Chair

Coverage Summaries and Material Modification Notice (cont.)

The 60-day Notice of Material Modification does not apply to renewal of coverage.

Duty can be satisfied by providing either a separate notice describing material modification or an updated coverage summary.

Page 25: Health Care Reform Updates Presented by Barb Gerken, Legislative Co-Chair

Coverage Summaries and Material Modification Notice (cont.)

Page 26: Health Care Reform Updates Presented by Barb Gerken, Legislative Co-Chair

Questions