Care Bears and the Land of Health Care Reform (or) Federal Health Care Reform: What’s Next
Health Care Reform
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Transcript of Health Care Reform
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Health Care Reform
What Do We KnowSo Far?
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Health Care Reform
Actually There Were Two Legislative Acts
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Health Care Reform
Actually There Were Two Legislative Acts
Patient Protection and Affordable Care Act [HR 3590]
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Health Care Reform
Actually There Were Two Legislative Acts
Health Care & Education Reconciliation Act of 2010 [HR
4872]
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Health Care Reform
Formal Name: Patient Protection and Affordable Care Act
(PPACA)Passed: March 23, 2010
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Health Care Reform
Formal Name: Patient Protection and Affordable Care Act
(PPACA)Passed: March 23, 2010
Vote: For – 219; Against - 212
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Implementation
What will (or is expected to) happen and when
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Implementation
What will (or is expected to) happen and when
Immediately after signing
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Implementation
What will (or is expected to) happen and when
Immediately after signing
Dependent children up to age 26 are permitted to remain covered by their parent’s health insurance plan that includes dependent coverage. Became effective 03/30/2010.
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Implementation
What will (or is expected to) happen and when
Immediately after signing
Health insurers are barred from denying coverage to dependent children with pre-existing conditions
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Implementation
What will (or is expected to) happen and when
Immediately after signing
Children on Medicaid or CHIP Programs will remain covered until 2019
Adults on these programs will remain covered until 2014
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Implementation
What will (or is expected to) happen and when
Ten percent (10%) tanning tax went into effect on July 1, 2010. Tax will be paid by the customer. If not paid by customer, it will be paid by the provider.
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Implementation
What will (or is expected to) happen and when
Up to 35% tax credit for Eligible Small Employers (ESE) which offer health insurance coverage to employees
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Implementation
What will (or is expected to) happen and when
Up to 35% tax credit for Eligible Small Employers (ESE) which offer health insurance coverage to employees
ESE defined as one having no more than 25 FTE’s during tax year.
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Implementation
What will (or is expected to) happen and when
Up to 35% tax credit for Eligible Small Employers (ESE) which offer health insurance coverage to employees
ESE defined as one having no more than 25 FTE’s during tax year.
Average annual wages per FTE cannot exceed $50,000
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Implementation
What will (or is expected to) happen and when
Full amount (35%) credit goes to employers of 10 or fewer FTE’s for whom each FTE’s average wages are no more than $25,000.
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Implementation
What will (or is expected to) happen and when
Full amount (35%) credit goes to employers of 10 or fewer FTE’s for whom each FTE’s average wages are no more than $25,000.
Credit is reduced if average wages is between $25K and $50K.
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Implementation
What will (or is expected to) happen and when
Full amount (35%) credit goes to employers of 10 or fewer FTE’s for whom each FTE’s average wages are no more than $25,000.
Credit is reduced if average wages is between $25K and $50K.
Credit is available from 2010 through 2013.
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Implementation
What will (or is expected to) happen and when
Full amount (35%) credit goes to employers of 10 or fewer FTE’s for whom each FTE’s average wages are no more than $25,000.
Credit is reduced if average wages is between $25K and $50K.
Credit is available from 2010 through 2013.
Credit can be as much as 50% after 2013.
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Implementation
What will (or is expected to) happen and when
By June 30, 2010
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Implementation
What will (or is expected to) happen and when
By June 30, 2010
Individuals (other than dependent children) who cannot obtain healthcare coverage due to pre-existing conditions can purchase coverage through a special high-risk pool.
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Implementation
What will (or is expected to) happen and when
By June 30, 2010
Individuals (other than dependent children) who cannot obtain healthcare coverage due to pre-existing conditions can purchase coverage through a special high-risk pool.
In 2014 they can participate in state run exchanges.
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Implementation
What will (or is expected to) happen and when
By September 30, 2010
Medicare Part D (Prescription Drug Coverage) participants who have fallen into the “doughnut hole” will receive a $250 rebate
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Implementation
What will (or is expected to) happen and when
By September 30, 2010
Medicare Part D (Prescription Drug Coverage) participants who have fallen into the “doughnut hole” will receive a $250 rebate.
In 2010, “doughnut hole” starts at $2,830 and closes at $6,440 (Participant pays 100%)
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Implementation
What will (or is expected to) happen and when
By September 30, 2010
Medicare Part D (Prescription Drug Coverage) participants who have fallen into the “doughnut hole” will receive a $250 rebate.
In 2010, the TROOP (true out-of-pocketexpense) will be $4,550 = $310 + $630 + $3,610
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Implementation
What will (or is expected to) happen and when
By September 30, 2010
Medicare Part D (Prescription Drug Coverage) participants who have fallen into the “doughnut hole” will receive a $250 rebate.
The “doughnut hole” is expected to be completely closed by 2020.
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Implementation
What will (or is expected to) happen and when
By September 30, 2010
New insurance policies offered hereafter must exclude preventative care and screenings from annual deductibles and co-pays.
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Implementation
What will (or is expected to) happen and when
By September 30, 2010
Except for cases of fraud, there will be no lifetime coverage ceilings or limits.
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2011
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2011
“Doughnut hole” gap participants will get 50% discount on prescriptions while they are in the “hole”.
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2011
New voluntary long-term care plans will be made available for nursing home or in-home care.
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2011
Beginning of series of ten-year cuts to Medicare Advantage Programs (e.g., Humana).
Senior citizens covered by such plans can expect premium increases, reductions in coverage, or both.
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2011
Employers will be required to report the value of employee health insurance benefits on their W-2 Forms.
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2011
Employers will be required to report the value of employee health insurance benefits on their W-2 Forms.
First step to taxing employer provided health insurance??? Estimated at $297 billion per year.
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2011
FSA’s, HSA’s, and MSA’s can no longer reimburse participants for non-prescription drugs and medical supplies.
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2011
Small employers may qualify for “Simple” Cafeteria Plans whose non-discrimination provisions are not as strict as those of regular Section 125 Plans.
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2011
Small employers may qualify for “Simple” Cafeteria Plans whose non-discrimination provisions are not as strict as those of regular Section 125 Plans.
Still, however, must meet certain contribution and eligibility requirements.
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2011
Drug manufacturers will be assessed an annual fee of $2.5 billion.
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How big is a trillion?
Sen. Everett Dirksen (R-IL) – “A billion here, a billion there, and pretty soon you’re talking about real money”. June 1965
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How big is a trillion?
A million seconds is about 11 days
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How big is a trillion?
A million seconds is about 11 days
A billion seconds is about 31.7 years
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How big is a trillion?
A million seconds is about 11 days
A billion seconds is about 31.7 years
A trillion seconds is about 31,688 years
Equates to about $3,250 for every person in US
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2012
No major changes in health care provisions.
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2012
All businesses must issue Form 1099 to any individual who is paid $600 or more for not only services (current law) but also for the purchase of goods, property and other expenditures. New law expands to all entities (e.g., Corps, S-Corps, Partnerships, LLC, LLP, estates, trusts.
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2013
New Medicare tax on individuals making more than $200,000 per year, $125,000 or more for MFS, and MFJ making more than $250,000.
Tax rate will rise from 1.45% to 2.35%
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2013
New Medicare tax on individuals making more than $200,000 per year, $125,000 or more for MFS, and MFJ making more than $250,000.
Tax rate will rise from 1.45% to 2.35%.
Employer will NOT have to match the increase.
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2013
New Medicare Tax on unearned income (e.g., interest, dividends, rents, royalties, etc.) at rate of 3.8% on individuals with income $200K or more, MFS with income of $125K or more and MFJ of $250K or more.
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2013
Excise tax of 2.3% on sale of medical devices at first sale for use, except those related to hearing, vision, and purchase at retail for individual use.
It is not known yet whether such devices as heart pacemakers would be exempted!
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2013
Flex Spending Account (FSA) contributions are decreased from a maximum of $5,000 annually to max. of $2,500.
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2013
Threshold for itemizing medical expenses increases from 7.5% of Adjusted Gross Income (AGI) to 10% of AGI.
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2014
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2014
States create “insurance exchanges” where individuals without coverage or businesses seeking to cover employees can shop for healthcare coverage.
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2014
Insurance companies are barred from denying coverage to anyone who has a pre-existing condition (including pregnancy). Insurers will not be able to impose higher premiums on those with chronic illnesses.
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2014
Penalties imposed on those persons who do not have healthcare coverage. There are exceptions for low-income, those exempted for religious reasons, those living outside USA, incarcerated individuals and members of Indian Tribes.
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2014
Start at penalty of $95 (2014), $325 (2015), and $695 for (2016) for individuals, unless you can prove hardship. Thereafter the $695 will be adjusted annually for inflation. No penalty for those without insurance for three months or less during year.
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2014
A penalty may also be imposed on a percentage of income basis by comparing household income to annual income tax filing requirements.
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2014
A penalty may also be imposed on a percentage of income basis by comparing household income to annual income tax filing requirements.
1.0% for 20142.0% for 20152.5% for 2016 and later
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2013
Employers with more than 50 employees will be penalized for not providing health insurance.
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2013
Employers with more than 50 employees will be penalized for not providing health insurance.
First 30 employees are exempted.
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2014
Employers with more than 50 employees will be penalized for not providing health insurance.
First 30 employees are exempted.
Fine after exemption can be $2,000 per employee.
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2014
Refundable tax credit for those who buy individual health insurance for those who have income between 100% and 400% of FPL (currently about $22K)
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2014
Maximum premium that can be charged to low-income households:
3% of income to those at 133% of FPL.
9.5% of income to those at 400% of FPL.
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2016
Penalties for failure to have coverage increases from $95 to $695, or 2.5% of income, whichever is greater.
If you make more than $27,800, the 2.5% figure will be the larger.
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2018
40% surtax added for so called “Cadillac” plans
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Implementation
What will (or is expected to) happen and when
Beginning Calendar Year 2018
40% surtax added for so called “Cadillac” plansthat cost for singles for >$10,200, and families > $27,500
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