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Today, employers can begin submitting applications for the Early Retiree Reinsurance Program. Created by the Affordable Care Act, this program provides $5 billion in financial assistance to employers, unions and state and local governments to help them maintain coverage for early retirees age 55 and older who are not yet eligible for Medicare. The program will reimburse up to 80% of claims incurred between $15,000 and $90,000 for each eligible member. The reimbursement is on a first come / first serve basis and once the $5 billion is depleted the program will end. If funds are not depleted on January 1, 2014 the program will end at that time.
To view the press release click here: http://www.hhs.gov/news/press/2010pres/06/20100629a.html
To view the fact sheet click here: http://www.healthreform.gov/newsroom/early_retiree_reinsurance_program.html
To view FAQ's, download the application and for additional information click here: http://www.hhs.gov/ociio/regulations/index.html#early_retiree
Tuesday, June 29, 2010
Friday, June 25, 2010
COBRA Subsidy Extension Receives Another Setback
WASHINGTON—Senate Democratic leaders on Thursday failed once again to win enough support to stop debate and bring to a floor vote a tax extenders bill, delivering another blow to backers on extending federal COBRA premium subsidies.
To read the full story click here:
http://www.businessinsurance.com/apps/pbcs.dll/article?AID=/20100625/NEWS/100629937
To read the full story click here:
http://www.businessinsurance.com/apps/pbcs.dll/article?AID=/20100625/NEWS/100629937
Tuesday, June 22, 2010
President Obama Lays Out "New Patient Bill of Rights"
Today, the Departments of Health and Human Services (HHS), Labor, and Treasury issued regulations to implement a new Patient’s Bill of Rights under the Affordable Care Act – which they say will help children (and eventually all Americans) with pre-existing conditions gain coverage and keep it, protect all Americans’ choice of doctors and end lifetime limits on the care consumers may receive.
Employers shouldn't fear that these items are a new revelation of health care regulations. They are simply a packaging of items that were already laid out in the reform legislation. For additional details click http://www.healthreform.gov/newsroom/new_patients_bill_of_rights.html
Employers shouldn't fear that these items are a new revelation of health care regulations. They are simply a packaging of items that were already laid out in the reform legislation. For additional details click http://www.healthreform.gov/newsroom/new_patients_bill_of_rights.html
Monday, June 14, 2010
HHS Issues Regulations on Grandfathering
The HHS just released interim final rules regarding the "Grandfather" status of plans that were in effect on 3/23/10:
Grandfathered health plans will be able to make routine changes to their policies and maintain their status. These routine changes include cost adjustments to keep pace with medical inflation, adding new benefits, making modest adjustments to existing benefits, voluntarily adopting new consumer protections under the new law, or making changes to comply with State or other Federal laws. Premium changes are not taken into account when determining whether or not a plan is grandfathered.
Plans will lose their grandfathered status if they choose to make significant changes that reduce benefits or increase costs to consumers.
Compared to their polices in effect on March 23, 2010, grandfathered plans:
-Cannot Significantly Cut or Reduce Benefits. For example, if a plan decides to no longer cover care for people with diabetes, cystic fibrosis or HIV/AIDS.
-Cannot Raise Co-Insurance Charges. Typically, co-insurance requires a patient to pay a fixed percentage of a charge (for example, 20% of a hospital bill). Grandfathered plans cannot increase this percentage.
-Cannot Significantly Raise Co-Payment Charges. Frequently, plans require patients to pay a fixed-dollar amount for doctor’s office visits and other services. Compared with the copayments in effect on March 23, 2010, grandfathered plans will be able to increase those co-pays by no more than the greater of $5 (adjusted annually for medical inflation) or a percentage equal to medical inflation plus 15 percentage points. For example, if a plan raises its copayment from $30 to $50 over the next 2 years, it will lose its grandfathered status.
-Cannot Significantly Raise Deductibles. Many plans require patients to pay the first bills they receive each year (for example, the first $500, $1,000, or $1,500 a year). Compared with the deductible required as of March 23, 2010, grandfathered plans can only increase these deductibles by a percentage equal to medical inflation plus 15 percentage points. In recent years, medical costs have risen an average of 4-to-5% so this formula would allow deductibles to go up, for example, by 19-20% between 2010 and 2011, or by 23-25% between 2010 and 2012. For a family with a $1,000 annual deductible, this would mean if they had a hike of $190 or $200 from 2010 to 2011, their plan could then increase the deductible again by another $50 the following year.
-Cannot Significantly Lower Employer Contributions. Many employers pay a portion of their employees’ premium for insurance and this is usually deducted from their paychecks. Grandfathered plans cannot decrease the percent of premiums the employer pays by more than 5 percentage points (for example, decrease their own share and increase the workers’ share of premium from 15% to 25%).
-Cannot Add or Tighten an Annual Limit on What the Insurer Pays. Some insurers cap the amount that they will pay for covered services each year. If they want to retain their status as grandfathered plans, plans cannot tighten any annual dollar limit in place as of March 23, 2010. Moreover, plans that do not have an annual dollar limit cannot add a new one unless they are replacing a lifetime dollar limit with an annual dollar limit that is at least as high as the lifetime limit (which is more protective of high-cost enrollees).
-Cannot Change Insurance Companies. If an employer decides to buy insurance for its workers from a different insurance company, this new insurer will not be considered a grandfathered plan. This does not apply when employers that provide their own insurance to their workers switch plan administrators or to collective bargaining agreements.
Secretary Sebelius is holding a press conference today and more guidance should follow.
Grandfathered health plans will be able to make routine changes to their policies and maintain their status. These routine changes include cost adjustments to keep pace with medical inflation, adding new benefits, making modest adjustments to existing benefits, voluntarily adopting new consumer protections under the new law, or making changes to comply with State or other Federal laws. Premium changes are not taken into account when determining whether or not a plan is grandfathered.
Plans will lose their grandfathered status if they choose to make significant changes that reduce benefits or increase costs to consumers.
Compared to their polices in effect on March 23, 2010, grandfathered plans:
-Cannot Significantly Cut or Reduce Benefits. For example, if a plan decides to no longer cover care for people with diabetes, cystic fibrosis or HIV/AIDS.
-Cannot Raise Co-Insurance Charges. Typically, co-insurance requires a patient to pay a fixed percentage of a charge (for example, 20% of a hospital bill). Grandfathered plans cannot increase this percentage.
-Cannot Significantly Raise Co-Payment Charges. Frequently, plans require patients to pay a fixed-dollar amount for doctor’s office visits and other services. Compared with the copayments in effect on March 23, 2010, grandfathered plans will be able to increase those co-pays by no more than the greater of $5 (adjusted annually for medical inflation) or a percentage equal to medical inflation plus 15 percentage points. For example, if a plan raises its copayment from $30 to $50 over the next 2 years, it will lose its grandfathered status.
-Cannot Significantly Raise Deductibles. Many plans require patients to pay the first bills they receive each year (for example, the first $500, $1,000, or $1,500 a year). Compared with the deductible required as of March 23, 2010, grandfathered plans can only increase these deductibles by a percentage equal to medical inflation plus 15 percentage points. In recent years, medical costs have risen an average of 4-to-5% so this formula would allow deductibles to go up, for example, by 19-20% between 2010 and 2011, or by 23-25% between 2010 and 2012. For a family with a $1,000 annual deductible, this would mean if they had a hike of $190 or $200 from 2010 to 2011, their plan could then increase the deductible again by another $50 the following year.
-Cannot Significantly Lower Employer Contributions. Many employers pay a portion of their employees’ premium for insurance and this is usually deducted from their paychecks. Grandfathered plans cannot decrease the percent of premiums the employer pays by more than 5 percentage points (for example, decrease their own share and increase the workers’ share of premium from 15% to 25%).
-Cannot Add or Tighten an Annual Limit on What the Insurer Pays. Some insurers cap the amount that they will pay for covered services each year. If they want to retain their status as grandfathered plans, plans cannot tighten any annual dollar limit in place as of March 23, 2010. Moreover, plans that do not have an annual dollar limit cannot add a new one unless they are replacing a lifetime dollar limit with an annual dollar limit that is at least as high as the lifetime limit (which is more protective of high-cost enrollees).
-Cannot Change Insurance Companies. If an employer decides to buy insurance for its workers from a different insurance company, this new insurer will not be considered a grandfathered plan. This does not apply when employers that provide their own insurance to their workers switch plan administrators or to collective bargaining agreements.
Secretary Sebelius is holding a press conference today and more guidance should follow.
Friday, June 11, 2010
HHS Issues Guidance on Early Retiree Reinsurance Program
The Department of Health and Human Services has issued guidance and a draft application for the Early Retiree Reinsurance Program.
About the program:
The Congress appropriated funding of $5 billion for the temporary program, which is effective June 1, 2010, under interim final rules published by the Department on May 4, 2010. The program ends no later than January 1, 2014. The program provides reimbursement to participating employment-based plans for a portion of the cost of health benefits for early retirees and their spouses, surviving spouses and dependents. The Secretary will reimburse plans for certain claims between $15,000 and $90,000 (with those amounts being indexed for plan years starting on or after October 1, 2011). The purpose of the reimbursement is to make health benefits more affordable for plan participants and sponsors so that health benefits are accessible to more Americans than they would otherwise be without this program.
In addition to the regulation and information about the program, HHS has released a Draft Application to participate in the Early Retiree Reinsurance Program as well as instructions for completing the Application and frequently asked questions related to the application process. The Official Application, with the address to which it should be submitted, will be posted later in June. As directed in the Early Retiree Reinsurance interim final rule, (see ERRP regulation at 45 C.F.R. §149.40), a plan sponsor interested in applying for the program must submit one application per plan, and identify the plan year cycle for which the sponsor is applying. Applications will begin being accepted no later than June 30, 2010.
To access the links for the guidance and applications documents click here: http://www.hhs.gov/ociio/regulations/index.html
About the program:
The Congress appropriated funding of $5 billion for the temporary program, which is effective June 1, 2010, under interim final rules published by the Department on May 4, 2010. The program ends no later than January 1, 2014. The program provides reimbursement to participating employment-based plans for a portion of the cost of health benefits for early retirees and their spouses, surviving spouses and dependents. The Secretary will reimburse plans for certain claims between $15,000 and $90,000 (with those amounts being indexed for plan years starting on or after October 1, 2011). The purpose of the reimbursement is to make health benefits more affordable for plan participants and sponsors so that health benefits are accessible to more Americans than they would otherwise be without this program.
In addition to the regulation and information about the program, HHS has released a Draft Application to participate in the Early Retiree Reinsurance Program as well as instructions for completing the Application and frequently asked questions related to the application process. The Official Application, with the address to which it should be submitted, will be posted later in June. As directed in the Early Retiree Reinsurance interim final rule, (see ERRP regulation at 45 C.F.R. §149.40), a plan sponsor interested in applying for the program must submit one application per plan, and identify the plan year cycle for which the sponsor is applying. Applications will begin being accepted no later than June 30, 2010.
To access the links for the guidance and applications documents click here: http://www.hhs.gov/ociio/regulations/index.html
Tuesday, June 8, 2010
Revamped Tax Bill Omits Extenstion of COBRA Subsidy
UPDATE: An amendmendment to this bill was proposed by Sen. Robert Casey, D-PA on Wednesday, June 9 and would extend eligibility for the subsidy through Nov. 30, 2010.
It appears that eligibility for the 15 month, 65% COBRA subsidy will end on May 31, 2010. Legislators who are becoming more and more leery of approving measures that would deepen the federal deficit did not mention the subsidy in the most recent version of H.R. 4213.
The Senate version of the bill originally proposed that eligibility be extended to employees laid off through the end of 2010. The House subsequently removed that from the bill before passing and sending it back to the Senate. The projected cost of extending the subsidy was $8 billion.
To read the Business Insurance article on this item click here:
http://www.businessinsurance.com/article/20100608/NEWS/100609919
It appears that eligibility for the 15 month, 65% COBRA subsidy will end on May 31, 2010. Legislators who are becoming more and more leery of approving measures that would deepen the federal deficit did not mention the subsidy in the most recent version of H.R. 4213.
The Senate version of the bill originally proposed that eligibility be extended to employees laid off through the end of 2010. The House subsequently removed that from the bill before passing and sending it back to the Senate. The projected cost of extending the subsidy was $8 billion.
To read the Business Insurance article on this item click here:
http://www.businessinsurance.com/article/20100608/NEWS/100609919
Friday, June 4, 2010
United CEO Confident Companies Will Maintain Healthplans
NEW YORK (Bloomberg)—UnitedHealth Group Inc., the biggest U.S. health insurer by sales, expects companies to keep offering benefits rather than force a migration of workers to the online exchanges created by the U.S. health care law, CEO Stephen Hemsley said at a conference Friday.
Under the law passed in March, companies still face costs for employees’ coverage even if they buy it through the exchanges. Keeping their own plans will give employers the best chance of controlling medical expenses, Mr. Hemsley said in a presentation at the investor conference in New York on Friday. He cited studies by the Congressional Budget Office, which said in December that 134 million people working at companies with 50 or more employees will still get benefits in 2016.
“We don’t expect, nor would anyone else who’s modeling this actually expect, that kind of migration” into the exchanges, Mr. Hemsley said. Businesses “have thought about the fact that they can manage their costs more effectively.”
©2010 Bloomberg News
To view the article in its entirety click here: http://www.businessinsurance.com/article/20100604/NEWS/100609949
Under the law passed in March, companies still face costs for employees’ coverage even if they buy it through the exchanges. Keeping their own plans will give employers the best chance of controlling medical expenses, Mr. Hemsley said in a presentation at the investor conference in New York on Friday. He cited studies by the Congressional Budget Office, which said in December that 134 million people working at companies with 50 or more employees will still get benefits in 2016.
“We don’t expect, nor would anyone else who’s modeling this actually expect, that kind of migration” into the exchanges, Mr. Hemsley said. Businesses “have thought about the fact that they can manage their costs more effectively.”
©2010 Bloomberg News
To view the article in its entirety click here: http://www.businessinsurance.com/article/20100604/NEWS/100609949
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