A presentation by the insurance brokerage of Brooker Insurance Agency on the Affordable Care Act 2010 and its effects and implementation, given to the British American Chamber of Commerce Ohio in October 2013. Reproduced and published by kind permission of Brooker Insurance Agency For more information, please visit www.baccohio.org

1. The Hitchhiker’s Guide to Obamacare
Jamie Debenham
October 25, 2013

2. AGENDA
• Individuals
• Small Employers
EE’s
< 50
• Large Employers
EE’s
> 50
• Q & A
Jamie Debenham
October 25, 2013

3. INDIVIDUALS
Federal Mandate:
All Citizens and Legal Residents must purchase
health insurance by January 1, 2014 or be subject
to a fine.
Jamie Debenham
October 25, 2013

4. INDIVIDUALS
Consequences for Non
Compliance
•
If individual health insurance NOT purchased by
January 1, 2014, fine imposed:
•
2014: $95 per adult/$47.50 per child, up to $285 for a family
or 1% of family income, whichever is greater.
•
2015: $325 per adult/$162.50 per child, up to $975 for a
family or 2% of family income, whichever is greater.
•
2016 and beyond: $695 per adult/$347.50 per child up to
$2,085 for a family or 2.5% of family income.
Jamie Debenham
October 25, 2013

5. INDIVIDUALS
Public Exchange (“Marketplace”)
•Subsidy
•
available to those who qualify
Family with income between 133%-400% of FPL (Federal
Poverty Level), will qualify for subsidy on a sliding scale basis.
Private Exchange
•
Offered through private insurance companies
•
•
More choices and coverage options available than public
exchange
Subsidy not available through private exchange
Jamie Debenham
October 25, 2013

6. INDIVIDUALS
Important Dates:
October 1, 2013 – Open Enrollment Starts
January 1, 2014 – Individual Mandate Effective
March 31, 2014 – Open Enrollment Closes
Jamie Debenham
October 25, 2013

7. SMALL EMPLOYERS
Under 50 FTE’s
Full-time Equivalents (FTE’s) – All full-time
employees and all part-time employees (including
seasonal employees) who are not
full-time employees are included in the calculation.
Jamie Debenham
October 25, 2013

8. SMALL EMPLOYERS
•Subject
to “Community Rating”
Beginning with Renewals after January 2014
•Cost
Control Strategy
Early Renewal prior to January 2014
Jamie Debenham
October 25, 2013

9. SMALL EMPLOYERS
Purchasing Options for
Small Group Health Insurance
Access to SHOP (Small Business Health Options
Program)
•
•
Full implementation of SHOP delayed until 2015
SHOP opens October 1st with limited offerings (for January 2014
Renewals)
Direct Purchase through Carriers
•
Subject to “Community Rating” with renewals after January
2014
Jamie Debenham
October 25, 2013

10. SMALL EMPLOYERS
Dependent Coverage Available Until Age 28
•Age 26 – Federal Mandate
•Age 28- State (Ohio) Mandate
* Note – coverage for dependents between ages 26 and 28
(Ohio mandate) will be different than for dependents ages up to
26 (Federal Mandate)
Jamie Debenham
October 25, 2013

11. SMALL EMPLOYERS
New Fees Associated with
Health Insurance Premiums
•
PCORI Fee (Patient Centered Outcomes Research
Institute)
2013
•
2018
$2.00 x Avg. Number of Employees
2013
2016
$63 Annual Fee Per Employee
($5.25 per Month per Employee)
Re-Insurance Fee
Market Share Fee
Based on Market Share of Insurer
Jamie Debenham
October 25, 2013

12. SMALL EMPLOYERS
Preventative Services Covered
at 100% *
*
Excludes “grandfathered”
plans until January 2014
Jamie Debenham
October 25, 2013

13. SMALL EMPLOYERS
Small Business Health Care Tax Credit is
Available to Certain Qualifying Businesses
•
Employer with < or = 25 Employees
•
Employer with < $50,000 average
Employee wage
Jamie Debenham
October 25, 2013

14. SMALL EMPLOYERS
SBC (Summary of Benefits
Coverage)
•Must
be given to each eligible Employee within
30 days of renewal or date of hire
Exchange Notice
•Must
be given to every Employee by October 1,
2013 or within 14 days of hire
Jamie Debenham
October 25, 2013

15. SMALL EMPLOYERS
Consequences of Non-Compliance
•
Individual Employees must seek coverage elsewhere or
pay penalty under Federal Individual Mandate
•
Currently no financial consequences at this time for
Employer who chooses to not offer health benefits to
employees (but may suffer retention consequences and
lose good employees)
Jamie Debenham
October 25, 2013

16. LARGE EMPLOYERS
Large Group = 50+ FTE’s
What is an FTE?
Full Time Equivalent – all full time Employees
plus all part-time employees (including seasonal
employees) are included in the calculation.
Jamie Debenham
October 25, 2013

17. LARGE EMPLOYERS
Federal Mandate: (Delayed Until
1/2015)
Large Group Plan offering:
•
Must Provide “Minimum Essential Coverage”
•
•
Minimum of 60% actuarial value
Must Be “Affordable”
•
Cannot charge more than 9.5% of Family Income
for Single Coverage Health Insurance
•
Safe Harbor - No more than 9.5% of Employee’s W-2 income must
go toward cost of single coverage Health Insurance
Jamie Debenham
October 25, 2013

18. LARGE EMPLOYERS
W-2 Reporting
Requirement
Beginning with the Calendar Year 2012 W-2 Forms,
Employers with more than 250 W-2 Filings for
proceeding year must report cost of the benefits
provided on each Employee’s W-2
Jamie Debenham
October 25, 2013

19. LARGE EMPLOYERS
Consequences of Non Compliance
If Employer Does Not Offer Health Insurance:
•
If Employee goes to Public Exchange and qualifies for federal
subsidy, a $2,000 fine per FTE is assessed (minus the
first 30 FTE’s)
•
Example: Company ABC with 100 FTE’s does not offer health
insurance. Employee X goes to Public Exchange and qualifies
for subsidy on health insurance purchased.
Fine levied is: $2,000 x (100-30) = $140,000
Jamie Debenham
October 25, 2013

20. LARGE EMPLOYERS
Consequences of Non Compliance
If Employer offers Health Insurance but Plan does not comply with
mandate standards of “Minimum Essential Coverage” or
“Affordable”:
•
If Employee goes to Public Exchange and qualifies for federal
subsidy, a $3,000 fine per FTE is assessed
•
Example: Company ABC with 100 FTE’s offers non-qualifying
health insurance. Ten Employees go to Public Exchange and
qualifies for Subsidies on health insurance purchased.
Fine levied is: $3,000 x (10) = $30,000
Jamie Debenham
October 25, 2013

21. LARGE EMPLOYERS
Important Dates
January 1, 2012
Employer must provide a SBC (Summary of Benefits
Coverage) to all Employees at renewal.
October 1, 2013
Employer must provide all Employees (and new hires) with
an electronic or printed copy of Marketplace Notice.
Jamie Debenham
October 25, 2013

22. Questions?
Jamie Debenham
October 25, 2013

23. Thank you!
Jamie Debenham
October 25, 2013