Healthcare Reform: Initial Enrollment Period

It's almost here!! Prepare for a mess.... Health Care Reform’s initial enrollment period is rapidly approaching October 1, 2013. For the everyday consumer this brings confusion, along with opportunity for some and concern for others. I have taken over Mosaic Employee Benefits, LLC to educate clients and their networks on the Patient Protection and Affordable Care Act (PPACA) relative to the unique planning strategies that have come about. Individuals and Small Businesses must note that PPACA does not make coverage "affordable" for everyone. Specifically, Milliman's report projects that individual premiums in Ohio will increase by as much as 55 to 85 percent in 2014 not including current medical trend, which has been an average increase of 7 to 8 percent nationwide each year. Moreover, some individuals may see their premiums increase by 90 to 130 percent depending on their current health status, while others may see decreases. Those in the small group market (employers with 2 to 50 employees) are projected to experience average increases of 5 to 15 percent in 2014, not including yearly medical trend increases. However, some small groups may see increases of up to 150 percent, while others may see decreases of 40 percent depending on the group's current age demographic and health status. Why the fluctuation in premiums? The guaranteed insurance law has solved the issue of an individual being declined for pre-existing conditions. Pre-existing conditions and gender no longer come into play. The cost will now rely on Age, Family Demographic, and Smoker Status. With new laws, an insurance carrier may not charge a 64 year old more than 3 times the premium of a 21 year old (new law community ratings 3:1 spread, current law 8:1 spread). The young and healthy will inherit the burden of the cost while individuals nearing or at age 64 with pre-existing conditions will most likely save premium dollars. How to plan? Failing to have an plan may prove to be costly. 1. Compliance – Two forms attached, offering insurance or not offering insurance. Employers must distribute the appropriate form to their employee’s by the October 1st, 2013 deadline. It is important to be able to track distribution. 2. Early Renewal Strategies – Most major medical insurance carriers are offering groups and individuals early renewal rates this December. Early renewal contracts extend the current plan participation, rates, and benefits thru December of 2014, delaying participation in a new exchange plan to 2015. **key for those with expected increases under new 2014 laws 3. Tax Credits – Businesses that have low income employees must be careful with affordable coverage laws. By providing group insurance and making it affordable (9.5% of income or less), you may hinder an employee’s chance of qualifying for assistance with individual plan premiums. 4. Individuals can now see their estimated premium cost for new “Metal Plans” on the health reform calculator for the state of Ohio: http://www.healthedeals.com/health-care-reform-calculator a. The below annual premiums reflect an individual making **$45,000 annually, nonsmoker (male or female - no longer matters come 2014 as all premium rates are unisex) i. 21 years old (no tax credit available at $45k income)–Bronze: $1,814 / Silver: $2,117 / Gold: $2,419 / Platinum: $2,721 ii. 31 years old (no tax credit available at $45k income)–Bronze: $2,505 / Silver: $2,922 / Gold: $3,340 / Platinum: $3,757 iii. 41 years old (no tax credit available at $45k income)–Bronze: $3,195 / Silver: $3,727 / Gold: $4,260 / Platinum: $4,792 iv. 51 years old ($171 projected annual tax credit at $45k income)-Bronze: $3,773 / Silver: $4,431 / Gold: $5,088 / Platinum: $5,745 v. 61 years old ($1,061 projected annual tax credit at $45k income)-Bronze: $3,673 / Silver $4,462 / Gold: $5,251 / Platinum $6,040 **Important: Only MAGI (modified adjusted gross income) is considered for subsidy qualification. Assets, as they stand now, will not be on the application for consideration.