The Benefits of Having Disability Insurance

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Why pay for disability insurance if you’re not disabled, right? If you ask yourself that then you may not be aware that over 37 million Americans are classified as disabled, which is about 12 percent of the population. More than 50 percent of those disabled individuals are in their working years, which is 18-64 years old. These facts are from the most recent annual report given by the Council for Disability Awareness, which also states that one in four of today’s 20 years olds will become disabled before they retire. Still don’t think you should be paying for disability insurance?

When it comes to becoming disabled, accidents tend to not be the culprit. Back injuries, cancer, heart disease, arthritis, sciatica and other illnesses cause the majority of long-term absences. The other disappointing news is that most injuries are not work-related, and therefore cannot be covered by worker’s compensation. So, with more than 30 million Americans between the ages of 21 and 64 being disabled, according to the most recent U.S. Census, and 69 percent of workers in the private sector not having private long-term disability insurance, where do they turn when they become disabled? Social Security Disability Insurance.

Since most Americans don’t have enough emergency savings to last 34.6 months, which is the duration of the average long-term disability claim, most turn to Social Security Disability Insurance (SSDI). SSDI is nowhere near the coverage you need when you become disabled, and nowhere near what having long-term disability insurance can offer you. 1,130 dollars a month was the average monthly benefit paid by SSDI at the end of 2012, but it is hard to qualify for and can take a year or longer to get approved for benefits. SSDI is not dependable either, seeing as 65 percent of claim applications were denied in 2012, and 46 percent received less than 1,000 dollars a month. Long-term disability insurance is a way to protect yourself and your family should anything ever happen to you where you will miss a lengthy amount of time at work.

Taking a little bit off of your paycheck every month is worth knowing that should you become disabled that your family is taken care of, and you can take the time you need to recover instead of fighting with SSDI providers to receive benefits. Investing in long-term disability services is an investment into your family, and your well being. Call us today with any questions, and to get a quote 800.237.2333.

#tahbenefits, #insurance

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Ohio Ballot Issue 2 (follow-up)

                                                                   – Editorial –

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I’m still quite sure I do NOT have a complete handle on Ohio’s upcoming Ballot Issue 2, the “Ohio Drug Price Relief Act”.  There is so much misinformation and lobbying, it’s always difficult to know what’s really going on, and this issue, with so many dollars at stake, is no different.

As I mentioned before, on its face, if passed Issue 2 would prevent the State of Ohio – including state run programs such as Medicaid, the state employee health plans, and others – from paying more for prescription drugs than what is paid by the U.S. Veterans Administration.  This sounds pretty simple, and like a good deal for Ohio’s budget and therefore the Ohio taxpayer.  And in the short-run, I think this is true.  However, as was also said before, what seemed to be missing from the argument was an explanation of the reasons for those who are opposed to Issue 2.  Recently, more such explanations have come out, and so I thought it was only right to follow up my initial request for information with a sharing of what explanations had come to light.

Some of the prior groups that were mentioned as being opposed were Veterans organizations.  Since last month, I have read more about their concern that if more folks are tied to the ‘good deal’ the VA is receiving, one way to increase prices and make up for lost revenue for those who are new to the ‘good deal’ is to raise prices for everyone who is receiving the ‘good deal’.  This would mean the VA.  Okay, makes sense.

Another contingent opposed to Issue 2 were countless business organizations.  This too makes sense on a couple of different levels.  First, most businesses support competitive markets as opposed to anything that promotes or legislates artificial prices for a product.  Setting artificial prices runs counter to their beliefs while also opening the doors for price fixing in any other industry or sector of the economy.  By opposing Issue 2, this continues to allow the markets to operate as they naturally would.  Secondly, this group employs and insures many of the 7 million Ohioans who are covered on private insurance plans.  The cost shifting that would almost certainly occur from fixing prices for the state would ultimately come back to these employers in the way of higher costs.

But no matter what your position or concerns might be around price fixing or cost shifting, the most widely held reason for opposing Issue 2 lies in an unprecedented provision within the bill that would give sponsors of Issue 2 the right to intervene in the application of the law, and any resulting litigation would then have to be defended and paid for by the state.  Giving an organization legal influence with a law and then providing legal cover of any resulting action, no matter the cost, is, as mentioned before, unprecedented.  For this reason, as well as a lack of clarity on how the initiative would be implemented, many have lined up in opposition to the issue.

While I know there are probably other reasons for opposing the law that aren’t mentioned here, I’m sure there are also reasons for supporting the law which have also not been fully explained.  Clearly, prescription costs for all Ohioans is a major concern, whether VA, state governments, or private insurers and citizens are footing the bill.  But now knowing what we know, it’s our opinion that we’re in need of comprehensive reform when it comes to paying for our healthcare, not just targeted initiatives that imbalance the playing field and leave the state exposed to additional, and potentially very costly, financial risks.

#TAHbenefits, #issue2, #insurance, #health

Ohio Ballot Issue 2 – The Ohio Drug Price Relief Act

– Editorial –

shutterstock_525092596.jpgThis is difficult for me.  Normally I like to post articles and commentary on things I believe I understand that I think others might not quite as well, with the intent of educating some minds along the way.  Hopefully there is some educational value and it’s not just a self-centered ego booster.  But in either case – this issue puts me in a little different place.  Can somebody else please help me better understand Issue 2?

There is obviously something I’m missing.  On its face, if passed, Issue 2 would prevent the State of Ohio – including state run programs such as Medicaid, the state employee health plans, and others – from paying more for prescription drugs than what is paid by the U.S. Veterans Administration.  Sounds pretty simple, and like something that most folks other than PhRMA (the Pharmaceutical Research & Manufacturers of America) would support.  And in fact, supporters of Issue 2 include, among others, the  AIDS Healthcare Foundation, the Ohio Academy of Family Physicians, and National Nurses United, to name a few.

So who doesn’t want the State of Ohio to save money on prescription medication, and / or why do they say the ballot initiative is misleading?  It’s not hard to find the names – and there are MANY – who have signed on in opposition to Issue 2.  Some include:  the Ohio Nurses Association, Ohio State Medical Association, Ohio Hospital Association and other statewide medical associations too numerous to name.  Then there are the Chambers of Commerce – nearly all of them, The Buckeye Institute, Ohio Fire Chiefs Association, and virtually every War Veterans organization you can name.

In some instances I can understand the opposition.  PhRMA’s stance is pretty obvious – nobody wants to see price controls on their products.  The Veterans organizations – they might feel like they’re getting a pretty good deal right now, and if everyone hitches their wagon to the good deal they are getting, they are probably more subject to future price increases so pharmaceutical companies can get more from everyone.  But aside from a couple of organizations who have a real dog in the fight, I’m still not clear on specifically why the issue is so heavily opposed.

Opponent’s arguments against Issue 2 seem to consistently go something like this:

“Experienced experts agree:  the ballot proposal won’t lower health care costs for Ohioans or save money for taxpayers.  In fact, it could lead to increased costs for the majority of Ohioans, including seniors and veterans, while reducing patients’ access to needed medicines.”

Or,

“[The measure] would dramatically disrupt the system that serves those who depend on state programs for medicine, and the vague nature of the proposal will mean years of red tape and litigation, as public policy officials and impacted agencies struggle to figure out how it can be implemented.”

Okay…so where’s the rest of it?  How would it lead to increased costs?  Why would there be disruption?  Why would there be that much trouble trying to figure out how to implement it?  Just continue to do what you do and pay no more than VA prices for it.  I’m sure it’s not that simple, but I must admit – it also doesn’t sound that difficult.  From everything I’ve been able to read it sounds more like changing the prices on a menu, not changing the fool choices, ordering new ingredients and hiring an entirely new kitchen staff, which is more like what the opposition would lead you to believe.

Again, it’s clear I’m missing something. Personally, I’m against price-fixing.  I almost always favor a fair and open economic model to determine a price.  I also believe there would be cost shifting to the private market to make up for the lost revenue to the pharmaceutical companies – similar to what we see with lower Medicare and Medicaid reimbursement rates being subsidized by private insurance.  But those aren’t the reasons being given by the opposition – those are my reasons.   I just wish those opposed would stop giving us talking points and instead would explain why all these terrible things would happen.

Then I could go back to being the expert I think I am.

How far will we fall?

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Just last week Ohio fell victim to another insurance carrier leaving the individual ACA exchange market, Anthem Blue Cross / Blue Shield. In some respects, this is the same news that we’re hearing in states around the country so it may not seem too alarming. But what makes Anthem’s exit in Ohio (again, to be clear, this is individual ACA business only, NOT ‘grand mothered’ individual policies or any employer-sponsored group plans) different is that Anthem has been the largest writer of individual business in the state for decades, pre-ACA. Now, because of having to operate under the ACA requirements, the largest writer of individual business for decades has decided they’ve had enough.

For years, Ohio was considered to have one of the strongest insurance markets in the country. Although not everyone qualified for individual plans before the ACA because of health risks, carriers were required to offer HIPAA plans, policies that were issued on a guaranteed issue basis to individuals who were unable to obtain a policy in the standard market. Once the ACA came about, these HIPAA policies went away and all newly issued individual policies had ACA protections such as guaranteed issue, no exclusions for pre-existing conditions, and community rating, to name a few. While this all sounds well and good for the consumer – and to some extent it is – it has also created a market that is fraught with unknown risk and is therefore financially unfriendly to carriers, so in many cases, rather than losing millions upon millions of dollars, it’s just easier for them to pick up their ball and go home. To give you some idea, as recently as LAST YEAR, 2016, 17 health insurers offered individual plans in Ohio, and all 88 counties had at least 4 different carriers writing business. In 2017, one year later, only 11 insurers are writing individual business and over half of the 88 counties have only one or two carriers to choose from. Once Anthem pulls out in 2018, there will be 18 counties (approximately 10,500 people) that have NO insurance carrier offering individual policies. So how does this work – individuals have a mandate to buy coverage but there are no carriers who can afford to sell them? Does this seem like improved access?

While Anthem has publicly stated that it has struggled to reach this decision, it’s not hard to understand why they decided to finally pull the plug. The most obvious reason – only about 3% of Anthem’s revenue comes from the sale of Individual insurance. 3%! Anthem insurers 3.4 million people across the state in a variety of different plans, including small and large group plans. They don’t need to sit around wringing their hands waiting for the government to figure out how to prop up the wrecked individual market for 3% of their revenue! And remember, this is the company who has written the most individual coverage in the state for years.

According to the Ohio Department of Insurance, since 2013 premiums in the individual market in Ohio have increased 91%. Is this the ‘affordability’ part of the ACA? We’re reaching a very, very critical point. With all of the ACA restrictions it has become nearly impossible for insurance companies to turn a profit in the individual market, so instead of losing millions of dollars a year (think Aetna and UnitedHealthcare), they pull out. We have to get back to a system where insurance companies are able to monitor and account for risks, and to charge appropriate premiums for the risk they take on. We also need to create high risk pools for those who are unable to qualify for coverage in the standard market. Or better yet, how about letting those who are not able to qualify for a policy in the standard market buy-in to something like the state employee’s plan – a large risk pool that is able to absorb risk and that is already entirely subsidized with tax payer dollars? I don’t know, it doesn’t seem like it should be this difficult. But how far will we fall before we get serious and are willing to make the tough decisions in order to preserve some sense of a healthy insurance market?

#TAHBenefits, #health, #anthem

The American Health Care Act (AHCA)

shutterstock_216021430The US House of Representatives passed the American Health Care Act (AHCA) on May 4th which will now be sent over for consideration by the Senate. While deemed a victory by many who have wanted to repeal and replace the Affordable Care Act (ACA), it is important to understand what this bill actually proposes to do – or not do – in order to fully understand how it might impact employers and ultimately the benefit plans they offer to their workforce. Furthermore, it is also important to understand that this is just the beginning. It’s likely that the Senate will markup the House version to a great extent (if they don’t just end up writing a bill of their own) at which point committees would have to get involved to try and craft one bill incorporating the provisions of each independent bill.

While there are many parts of the ACA that are touched by the AHCA, specifically items such as Medicaid reform that are a study unto themselves, we wanted to focus on some of the areas where we believe the legislation, should it ultimately become law, would have a more direct impact on employees and employers. Here are some of those proposed changes:

  • Delay the “Cadillac Tax’ until 2025
  • Remove the limit on FSA contributions (ACA limited these contributions to $2,500 / year)
  • Restore the ability to use HSA funds to purchase over-the-counter drugs
  • Repeals the Small-business tax credit for the SHOP exchanges in 2020
  • Eliminate individual mandate penalty
  • Eliminate employer mandate penalty for Applicable Large Employers (ALE’s)
  • Allows plans to increase premiums by 30% for 12 months for anyone who has a lapse in coverage of more than 63 days
  • Broadens the age-rating requirements from 3:1 to 5:1, while also allowing states to apply for a waiver to the 5:1 standard (this would provide more variance in pricing between younger versus older individuals)
  • Repeals taxes on prescription drug manufacturers, medical device manufacturers and the health insurance tax imposed on insurance carriers

While the AHCA would do much more than just what’s listed here, these items all seem to be in-line with the attempt to remove unnecessary costs in the system and to fight back against the overall cost of insurance. When considering all of the changes that it might make, it is also important to understand a few provisions of the ACA would NOT be affected and would, therefore, remain in place should the AHCA be enacted:

  • Annual cost-sharing limits (currently $7,150 single / $14,300 family)
  • Requirement to cover pre-existing conditions
  • Coverage for adult children to age 26
  • Guaranteed availability and renewability of coverage (in the fully-insured market)

Unless and until the Senate and President Trump move forward with the AHCA, the ACA is still the law of the land. But passage of the AHCA by the House has certainly turned up the conversation about how to best try and fix our broken healthcare system.

#TAHbenefits,#business,#benefits, #AHCA

21st Century Cures Act – Impact on Small Employers

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On December 7, 2016 Congress passed the 21st Century Cures Act a complex piece of legislation addressing funding for disease research, changes to mental health systems, and regulations for pharmaceutical and medical device companies. Within the Act is a provision that presents a new mechanism, or rather exception, for small employers to fund employee health coverage with a “qualified small employer health reimbursement arrangement” (QSEHRA).

Though not specifically recognized in the Tax Code, a health reimbursement arrangement (HRA) is an IRS approved tax-advantaged arrangement (under general principles of Internal Revenue Code Sections 105 &106) funded solely by an employer to reimburse employees for their out of pocket medical expenses and individual insurance premiums. The HRA is tax exempt for the employee. However, in an effort to deter employers from canceling group health plans, forcing employees into the Individual Exchange (Marketplace), the Affordable Care Act (ACA) prohibited employers of any size from paying for an employee’s individual insurance premium, regardless of whether done via cash compensation or through premium reimbursement.

Employers without a group health plan, but using an HRA to finance individual premiums, are still sponsoring an “employer payment plan” subject to ACA market reforms. These payment plans failed to satisfy new regulations, such as the preventive services coverage mandate and the prohibition on annual limits for essential health benefits. Employers in violation could wind up with hefty excise taxes of $100/day per applicable employee.

The new Cures Act makes an exception for small employers under 50 full-time equivalent employees (therefor exempt from the employer mandate under the ACA), that allows the use of an HRA to fund individual insurance premiums under certain conditions:

  • HRA must be funded solely by the employer
  • Contributions are limited to $4,950/year for individual and $10,000/year for family coverage
  • Employee must have other minimum essential coverage to receive HRA contributions tax-free
  • HRA must be provided on same terms to all eligible employees (limited exceptions)
  • Employer cannot offer another group health plan
  • Employer must provide 90 days advance notice, And
  • Benefit amount must be reported on the W-2

Possible Repercussions
Uncertainties about the future of the nation’s health care system, notably the stabilization of the individual insurance market, remain with the recent release of The American Health Care Act by House Republicans on March 6, 2017. Yet we can consider potential repercussions of the Cures Act with the information we have today. We could see an adverse selection effect if employers with unhealthy, older populations choose to drop the group plan in favor of the HRA, thus further destabilizing the individual market. In the short-term HRA contributions may also interfere with subsidy eligibility in the Marketplace, potentially raising the cost of coverage for employees enrolled in an individual policy. However, we expect to see the repeal and replace strategy evolve as the debate on the proposed legislation continues. As it does, we will provide you with updates to help you better understand how you and your employees may be impacted.

At TAH Benefits, our goal is to be your primary resource for health care reform information. We appreciate your business, and welcome your questions and feedback.

What our crystal ball tells us on Repeal & Replace

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Mainstream news continues to cover the struggles of the Trump administration and the GOP to effectively repeal and replace the Affordable Care Act (ACA) with something that will create more solutions than problems. So we thought it might be fun to look at how repeal might take shape and, based on what we’re hearing and reading, try to predict how the reform of healthcare reform might unfold. We’ll address each topic separately and let you know what we predict and why.

  • Coverage Guarantees – Rules prohibiting insurers from denying coverage for pre-existing conditions are likely to remain as part of the new replacement strategy. The general public wants people to have access to care, and without these guarantees, there are some who will be left with few, if any, options.
  • Dependent Coverage to age 26 – This has also been a popular feature of the ACA and there’s no real opposition to it from any stakeholders, so it seems that this provision will remain intact in any replacement legislation.
  • Cadillac Tax – This is one item that Democrats and Republicans alike agree needs to go. The additional cost this will add to future premiums and the burden it will place on a wide swath of American workers makes it a near certainty to be part of the repeal legislation. However, it is likely that Republicans will replace the tax with a cap on the amount of premiums that can be excluded from income in order to preserve some of the revenues that the Cadillac tax is expected to generate.
  • Employer Mandate – Whether the employer mandate stays or goes is more of a toss-up. On one hand, large employers hate it because of the complicated and onerous reporting requirements that are imposed, and for large employers who do not offer coverage, the prospect of paying a fine isn’t so attractive either. On the other hand this is a large funding mechanism of tax revenue that Republicans know they will need in some way, shape or form, in order to advance their own programs for making coverage more affordable. In the end our bet is that the employer mandate will go away. One main reason is that Trump said it would go away, and in order to get support from the most conservative of Republicans, (and because it is one of the items that can actually be changed through the reconciliation process), we expect it will be repealed. A replacement for the funding this tax created will have to be found, however it’s our bet that many employers would likely be willing to pay some type of new tax in lieu of having to pay employees, payroll vendors and reporting companies to manage the whole process of reporting.
  • Medicaid expansion – Of the roughly 20 million people who gained coverage under the ACA, approximately ½ of those did so through the ACA’s expansion of Medicaid. Taking that coverage away from some of the most in-need is unlikely. Although the Federal government does fund Medicaid, Medicaid was always intended to be run by the individual states, for better or worse. The current talk seems to lean towards Medicaid being turned into a block grant program to the states that would then determine how best to run their individual state Medicaid programs. Some states may continue with expanded eligibility, others may not, but we expect that decision to be left to each state independently.
  • Individual subsidies – In their current form, individual premium and cost-sharing subsidies will go away. However, other programs to help provide funding assistance will likely have to replace the subsidies, otherwise many will be unable to afford coverage. For example, funding of Health Savings Accounts for individuals to help offset out-of-pocket costs, and creating high risk pools for less healthy risks – both are being strongly considered as part of a replacement plan – would require additional funds to come from somewhere in order to keep premiums and costs reasonable.
  • Individual Mandate – While Trump vowed to free people from the individual coverage mandate, doing so becomes a little tricky. With Supreme Court Justice John Roberts’ determination that the individual mandate was in fact a tax, it is eligible to be removed through the reconciliation process. However, the individual mandate came about as a trade off with insurance companies in order to get them to agree to guaranteed issue and coverage for pre-existing conditions – if they were going to agree to cover more claims and pre-existing conditions, then the insurance carriers needed to collect more money from those who were less likely to have claims. Given the popularity of these two provisions, we believe the individual mandate will remain in place in order to keep insurers in the game.
  • Risk-based underwriting – The absence of risk-based underwriting, which is currently prohibited in fully-insured plans under the ACA, causes healthy risks to pay substantially more than the risk they themselves represent, thereby making coverage unaffordable, or at least unattractive, to many. Moving back to a risk-based pricing strategy would be an effective way of bringing younger, healthy individuals back to the insurance market and would help in the collection of more premiums from healthy individuals to help subsidize the sick. And for those who are not able to qualify for a standard issue, risk-based premium policy, high risk pools mentioned above would be available as a way to purchase coverage.
  • Selling across state lines – many in the GOP have been clamoring for years about how an insurance company’s ability to sell across state lines would make markets much more competitive. And while often times more players means better competition, we’re not sure there is substantial savings to be had. Most of the differences in the price of a policy in Idaho versus a price in Manhattan has to do with the cost of care in a particular location. If someone living in Manhattan were to purchase a policy from Idaho, it doesn’t mean that the company in Idaho wouldn’t make a geographical adjustment to reflect the higher cost of care they would be paying in Manhattan, thereby driving up the price of the Idaho policy. Avoiding some of the state mandates for benefits might save some money, but overall most of the mandates are benefits people would choose to include in a policy anyway, so again there’s likely not a lot of savings to be had. That said, there’s no harm in allowing companies to sell across state lines, and since this has been a talking point of the GOP for many years and there seems to be very little opposition, we expect that it will be a part of replacement legislation.

We admit, our crystal ball is a little cloudy, but for what it’s worth this is some of what we anticipate in the coming year or so in the reform of the reform.

2016 ACA Reporting Reminder

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If you are either an applicable large employer (ALE) (i.e., employed more than 50 full-time “equivalent” employees in calendar year 2015) and/or are a self-funded plan sponsor required to report under new Affordable Care Act (ACA) annual reporting requirements under code Section 6055 or 6056 for the 2016 Benefit Year. Under these rules, certain employers must provide information to the IRS about the health plan coverage they offer (or do not offer) to their employees.

Reporting for the 2016 Benefit Year marks the second mandatory reporting season for impacted employers and plan sponsors. The Internal Revenue Service (IRS) recently released final 2016 forms and instructions for reporting under Internal Revenue Code (Code) Sections 6055 and 6056. Minor changes were made to the forms, including the addition of two new “Offer of Coverage” codes for use on Form 1095-C.

Please review the attached document for links to the final 2016 IRS forms and instructions. Forms 1094-B and 1095-B are used by entities reporting under Section 6055, including self-insured plan sponsors that are not applicable large employers (ALEs). Forms 1094-C and 1095-C are used by ALEs to report under Section 6056, as well as for combined Section 6055 and 6056 reporting by ALEs who sponsor self-insured plans.

Important Dates:

– January 31, 2017 – Individual statements for 2016 must be furnished to employees by Jan. 31, 2017.

– February 28, 2017 – IRS returns for 2016 must be filed by Feb. 28, 2017 (March 31, 2017, if filed electronically).

Our goal at TAH Benefits is to serve as your primary point of contact for guidance around ACA reporting. We have the tools and resources to help you keep track of all the information you need to report in order to make a good-faith effort.

We appreciate your business. Please let us know how we can help you with the 2016 reporting process.

Final Forms for ACA Reporting Released
The IRS has released final 2016 forms and instructions for ACA reporting under Code Sections 6055 and 6056. This ACA Compliance Bulletin provides an overview of the changes that were made.

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TAH Newsletter Fall 2016

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Now that we have pushed through the busy season of renewals for clients who took advantage of ‘transitional relief’ under the Affordable Care Act (ACA), we are getting ready for another busy holiday season that kicks off with open enrollment for both the senior and individual markets in October and November, respectively, as well as 2016 tracking and reporting for Applicable Large Employers (ALE’s) and self-funded groups. We are also gearing up for 2017 by making more compliance resources and HR materials readily available to clients with the rollout of MyWave Connect.

We are continuously working to make sure we are bringing you the information and support you need to continue offering benefits in the increasingly complex world of healthcare. Although many of the challenges are the same, we recognize that each situation and every organization is a little bit different. Please be sure to let us know what we can do to help you and your organization succeed.

Open Enrollment – Individual Market / Senior Market

Believe it or not, November 1st marks the 4th open enrollment season for the Health Insurance Marketplace formed under the ACA. The public exchange has been getting a lot of publicity lately with high projected cost increases coupled with a multitude of carriers pulling out of the exchanges in many regions across the country. Apparently it is tough to be profitable when you are in the risk management business and you are not allowed to know anything about the risk.

In Ohio we are poised for major changes to the individual market. The leading writer of individual coverage in the state since the passage of the ACA, Medical Mutual of Ohio, filed their 2017 program to only be available in 32 of Ohio’s 88 counties. Within those 32 counties, the choice of providers is significantly smaller than the PPO networks of the past. Other carriers such as Aetna, Humana and UnitedHealthcare have virtually pulled out of the individual market in Ohio altogether. Anthem continues to offer individual coverage, but like Medical Mutual, with a more limited choice of providers than their typical Blue Cross / Blue Shield network. A few other carriers will also participate, most of which are Medicaid HMO’s that operate in distinct regions of the state. Needless to say, the public exchanges are going to have to change drastically if they are ever going to survive as a viable long-term option.

In the senior market, very little has changed in recent years, and 2017 appears to be no different. We continue to work with Medicare eligible individuals to obtain supplemental coverage, Advantage plans, and Part D prescription drug plans. Open enrollment for Part D runs from October 15th through December 7th, so if you or someone you know is evaluating options for Part D, the clock is ticking.

Affordability – HRA’s and Opt-Out Payments

Affordability under the ACA was intended to be straightforward: If an employee was required to pay more than a stated percentage of their individual income for single coverage under their employer’s health plan, then the employee may be entitled to a premium subsidy on the individual exchange, and the employer may be subject to a monetary penalty. Simple enough. But since that time, the question of how to account for the value of the funding of a health plan, or what should be constituted as income, has received a great deal of guidance and instruction from HHS, the DOL, the Treasury Department, and the IRS.

IRS Notice 2015-87 provided guidance on top of guidance that had previously been released in IRS Notice 2013-54. In short, both of these notices dealt with the value of Health Reimbursement Arrangements (HRAs) and opt-out payments that could be received or forfeited by an individual based on whether they did or did not participate in an employer’s health plan. For example, if an employee was eligible to receive money from an employer in lieu of signing up for the health plan, then that amount of money has to be considered part of the cost of the plan if the employee chooses to sign up for the plan and forfeits the ‘opt-out’ funds.

Because so much rides on the determination of affordability, both for employees and employers, the bottom line is that if an employer offers HRA’s or opt out payments to their associates, it is important to do a little research and make sure that your affordability calculations are being determined properly.

MyWave Connect

As with everything, there is more to do and less time to do it. Our clients are stretched thin, doing more with less, and there’s less time to digest all of the information that is available and determine what is relevant. At least with respect to healthcare and HR, we are trying to do our part to simplify that task.

MyWave Connect (MWC) is a complimentary online HR portal we are providing to TAH Benefits clients that can deliver time-saving benefits and HR resources whenever you need them. When initially getting setup with MWC, you are able to tailor the portal content to address those topics that are most important to you. Literally thousands of documents and articles centered on employee wellness, education, HR forms and other employee communication pieces are at your fingertips.

Please be on the lookout for an activation email with instructions on how to log on and setup MyWave Connect. Once you have everything setup, we hope you will find the content valuable and beneficial.

TAH Newsletter Winter 2016

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Although we’re already 6 weeks into 2016, it feels as though we are just now able to put 2015 in the rearview mirror. January renewals are now up and running; ‘Grandmothered’ groups are 2 months into their new plan year; Medicare Part D enrollment came and went; individual open enrollment is now completed. As we look back, both 2014 and 2015 have been extremely busy but successful years for us, and we have you, our clients, to thank for that. Looking ahead to the remainder of 2016, we expect to continue to grow and evolve as the needs of clients do likewise.

I expect compliance to continue to occupy much of our conversations with you. The addition of Caroline Sanker in mid-2015 as our Compliance Advisor is one illustration of our increased capabilities as well as our commitment to providing the resources our clients need in order to navigate the new, ever-changing world of health insurance. Continuing to work with our ALE clients to ensure their accurate 1094 and 1095 reporting, and preparing all clients for potential DOL audits, will be our principal compliance objectives for the remainder of 2016.

2016 will also usher many new group products into the market, specifically in the small group segment in response to modified community rating. Level-premium self-funded products are still evolving and gaining traction, and MEWA’s (Multiple Employer Welfare Arrangements) are re-emerging from their storied history as a method of bundling groups together for the purchase of group insurance. Many of these products will use limited distribution channels, available only to select agents within a given market. We are pleased to be included on all of those select lists, which allows us to offer all of the product options and arrangements available to date. As those options continue to be developed, we will continue to evaluate them as possibilities, sharing the pros and cons of each with you, to determine the best approach to managing your plan.

We appreciate the working relationship we have with you and the trust you have placed in us. Please continue to let us know how we can assist you and help simplify your world in the coming year.

Anthem 2-50 Clients Small Group Verification

As part of the Affordable Care Act and the passage of the PACE Act in late 2015, the definition of what constitutes a small group versus a large group was finalized. Instead of increasing the number of full-time employees up to 100 as was originally called for in the ACA, states are allowed to continue using 50 employees as the cutoff between small group and large group. Ohio is one of the many states that has chosen to continue using 50 and below to define small groups, thereby leaving groups with over 50 employees to be experience rated and groups with 50 or fewer employees subject to modified community rating.

With these final regulations, the insurance carriers have each come out and defined what they will use to calculate ‘employees’. In the past most carriers used ‘full-time eligible’ for their counts, however since the passage of PACE, many companies are now using ‘total employees’ to determine a group’s small / large group status. In order to accurately make this determination, Anthem is requesting that all of their current small group clients provide the attached Attestation Statement to disclose whether or not the group had 50 or fewer total employees during the preceding calendar year. In order to make sure these are submitted prior to processing for the 2016 renewals, we are asking that all Anthem groups return these forms to us as soon as possible, but no later than May 1st. Please either email to Jill Davis at jdavis@tahbenefits.com, or via our toll-free fax at 888-284-1529.

UnitedHealthcare Early Renewal Verification Request

Barring further changes or delays, small groups who have taken advantage of ‘grandmothering’ – keeping what they had for another 2 years – are scheduled to move to adjusted community rating, beginning with renewals occurring after October 1, 2016. Many carriers have already moved most of their ‘grandmothered’ groups to an October 1, 2016 renewal date and now the same is being offered to UnitedHealthcare clients. Completing the attached Verification Form will allow small groups who are scheduled to renew after October 1, 2016 the opportunity to move their renewal date to October 1, 2016, thereby giving them the chance to ‘keep what they have’ for at least one more year before being forced into adjusted community rating under the ACA.

We are recommending that all small groups who are currently ‘grandmothered’ take advantage of this opportunity. To do so, please return the attached Verification Form to us prior to March 15th, either by email to Jill Davis at jdavis@tahbenefits.com, or via our toll-free fax at 888-284-1529.

Part D Disclosure to CMS

One of the commonly overlooked tasks that a group offering an employer-sponsored health plan fails to perform is the annual disclosure to CMS of the status of the group’s prescription coverage relative to Medicare Part D. While we provide the individual notices an employer can use to notify Medicare-eligible individuals of the group’s plan status relative to Medicare Part D, we are not able to register on-line with CMS to make the necessary reporting on behalf of the employer. The attached Legislative Brief explains the requirement in more detail and contains the link that is necessary in making the disclosure.

If there are further questions about this requirement or if you need additional assistance, please give us a call.

Jay Hazelbaker, President

TAH Newsletter Spring 2016

shutterstock_431846173CMS Data Match Questionnaires

Over the past couple of weeks we’ve noticed a huge up-tick in the number of data match requests clients have received from CMS. Why are they requesting the information and what do you need to do?

First off, understand that the data match requests are the result of a project carried out by CMS to enforce Medicare Secondary Payer rules. These rules essentially coordinate the payment of benefits between Medicare and employer-sponsored benefits when an individual has coverage through both their employer (or their spouse’s employer) and Medicare. In order to coordinate who is primary and who is secondary in terms of claim payment, Medicare is requesting information from employers because the rules determine who pays first based on group size and the number of employees. Once they have this information they can properly coordinate the payment of claims for those individuals.

In the past, these requests from CMS were relatively simple and straightforward. Today, the requests are now more detailed and most commonly sent and submitted electronically. As a result, we can no longer formally submit the request on a client’s behalf, however we can assist with the completion of the information in the request, or at a minimum, walk a client through the process of completing the information prior to submission.

The attached information sheet provides more detail as to the background of the CMS data match questionnaire, as well as ways to request a reporting extension and more. The main point we want to convey is that if you receive a request from CMS for this information, do NOT disregard it. The penalties for failing to respond can be substantial. We are able and willing to assist. Please contact us if you receive one of these requests or you have additional questions.

Sample Employer Notices for Employees Receiving Individual Subsidy

Recently, the Department of Health & Human Services released a sample notice (attached) that the federally facilitated marketplace will send to an employer when one of their employees has received a premium subsidy via the individual insurance marketplace. What this means to each employer differs based on whether or not they are considered an Applicable Large Employer (ALE) under the Affordable Care Act (ACA), and if so, whether they did or did not offer affordable, minimum value coverage for the year in question. The letter is nothing more than an informational notice to the employer, but employers should hang onto their copies for recordkeeping purposes in the event that penalties or the possibility of penalties are ever in question. Additionally, if an employer believes that an employee has received a subsidy in error, there are procedures they can follow to contest that employee’s subsidy determination. If you find yourself in this situation and need assistance or have general questions about the notice please let us know.

New Products – Old ideas with new applications

As we mentioned back in February, the natural offspring of the Affordable Care Act (ACA) is the development of new products, or the new application of existing products, to the changed world of benefits. There is a wide variety of ideas and approaches in the market, but the two of late that are getting a lot of talk are MEWA’s (Multiple Employer Welfare Arrangements) and models that utilize referenced-based pricing.

MEWA’s are not a new concept to the benefits world. As recently as a decade ago, MEWA’s were an attractive option to some employers because they provided a way to pool risk among various employer groups and they were not as heavily regulated as a typical insurance product. That lack of similar regulation and oversight helped provide a more cost-competitive product, but in the end it also served as the eventual downfall of nearly all MEWA’s, as almost all failed as a result of inadequate claims reserves and the inability, or fear of the inability, to pay claims. Today, because of their history, MEWA’s are heavily regulated by the Department of Insurance in Ohio, and as a result several have sprung up in response to healthcare reform and the stringent rating practices that are forced upon small groups (< 50 employees) under the ACA. Most notably, Anthem just released their MEWA product through the Southern Ohio Chamber Alliance (SOCA) for small groups effective May 1st (see attachment). Medical Mutual of Ohio is expected to have a product released within the year as well. Another MEWA product already on the market is limited to physician practices in Ohio through the Ohio State Medical Association (OSMA). These MEWA arrangements limit which agents have access to their plans, and in the case of all of these, we are fortunate to be one of those agencies.

Another approach that is somewhat new – at least to the Midwest but that has been gaining new traction across other parts of the country – is known as referenced-based pricing. Referenced-based pricing doesn’t necessarily involve a new type of insurance or a new funding arrangement for claims but rather is an approach of negotiating payment arrangements with providers for large claims outside of an established, pre-arranged provider contract. In essence, when a member anticipates a large medical service such as an inpatient stay or a surgery, referenced-based pricing models have intermediaries who contact providers directly in advance of a service and work to negotiate a fee that is usually based off of a percentage of what Medicare has contracted to pay. If the provider accepts the negotiated fee, then the services is performed at that location by that provider. If it is not accepted, then depending on the type of program, the member either has the option to pay the difference between what is charged and what is negotiated, or the intermediary may shop around for a provider who will accept the negotiated rate, in which case no balance billing issue occurs to the member. Because this “shopping” for healthcare is so different from what we are accustomed to, the market for plans using a referenced-based pricing model have been slow to emerge, but there are a few. Recently, CareWorks Comp, the largest workers comp administrator in the state, has partnered with a third-party administrator and four agents throughout the state (of which TAH Benefits is one) to offer a plan based on this concept. Because the approach is a departure from the current hands-off nature of health insurance, we expect it to take some time and additional refinement of the products before they will garner serious attention as an alternative to the current models. But with their ability to truly “bend the cost curve” by changing not how benefits are paid but instead the actual amount that is paid, as cost pressures continue to build these models are likely to offer viable alternatives in the future.