1099-Misc and W-2 Changes
Employers will have to comply with 1099-MISC and W-2 changes over the next 3 years.
CLASS Act
A national, voluntary insurance program for purchasing community living assistance services and supports (CLASS program) will be established. Following a five-year vesting period, the program will provide individuals with functional limitations a cash benefit of not less than an average of $50 per day to purchase non-medical services and supports necessary to maintain community residence. The program is financed through voluntary payroll deductions: all working adults will be automatically enrolled in the program, unless they choose to opt-out. (Effective January 1, 2011)
Dependent Coverage
Children up to age 28 will be covered under state law.
Donut Hole Coverage Gap
The Medicare Part D Prescription Drug Benefit will change in order to limit seniors exposure to high prescription costs.
Employer Mandate
Some employers must offer health benefits or pay a penalty.
Grandfathered Coverage
If you like the plan that you are covered under, you may be able to keep it with some changes.
Health Insurance Exchange
In 2014, most individuals and small businesses will purchase insurance through an Exchange.
Individual Mandate
Most individuals must have insurance coverage.
Insurance Market Rules and Rating Changes
Insurance companies will face new rules for how it is sold and what insurance companies must cover.
Medicaid expansion
States will expand Medicaid to all individuals under age 65 (children, pregnant women, parents, and adults without dependent children) with incomes up to 133% FPL based on modified adjusted gross income (as under current law and in the House and Senate-passed bills undocumented immigrants are not eligible for Medicaid). All newly eligible adults will be guaranteed a benchmark benefit package that at least provides the essential health benefits. To finance the coverage for the newly eligible (those who were not previously eligible for a full benchmark benefit package or who were eligible for a capped program but were not enrolled), states will receive 100% federal funding for 2014 through 2016, 95% federal financing in 2017, 94% federal financing in 2018, 93% federal financing in 2019, and 90% federal financing for 2020 and subsequent years.
States that have already expanded eligibility to adults with incomes up to 100% FPL will receive a phased-in increase in the federal medical assistance percentage (FMAP) for non-pregnant childless adults so that by 2019 they receive the same federal financing as other states (93% in 2019 and 90% in 2020 and later). In addition, increase Medicaid payments in fee-for-service and managed care for primary care services provided by primary care doctors (family medicine, general internal medicine or pediatric medicine) to 100% of the Medicare payment rates for 2013 and 2014. States will receive 100% federal financing for the increased payment rates. (Effective January 1, 2014)
Medical Loss Ratio and Premium Rate Review
The new law requires health plans to report the proportion of premium dollars spent on clinical services, quality, and other costs and provide rebates to consumers for the amount of the premium spent on clinical services and quality that is less than 85% for plans in the large group market and 80% for plans in the individual and small group markets. (Requirement to report medical loss ratio effective plan year 2010; requirement to provide rebates effective January 1, 2011)
It also establishes a process for reviewing increases in health plan premiums and require plans to justify increases. Require states to report on trends in premium increases and recommend whether certain plan should be excluded from the Exchange based on unjustified premium increases. Provide grants to states to support efforts to review and approve premium increases. (Effective beginning plan year 2010)
Medical Malpractice
The law awards five-year demonstration grants to states to develop, implement, and evaluate alternatives to current tort litigations. Preference will be given to states that have developed alternatives in consultation with relevant stakeholders and that have proposals that are likely to enhance patient safety by reducing medical errors and adverse events and are likely to improve access to liability insurance. (Funding appropriated for five years beginning in fiscal year 2011)
Nutritional Information
Chain restaurants and food sold from vending machines will be required to disclose the nutritional content of each item. (Proposed regulations issued within one year of enactment)
Premium Subsidies
For individuals who buy their own insurance through the Health Insurance Exchange, the federal government will offer subsidies.
Small Business Tax Credits
The law provides small employers with less than 25 employees and average annual wages of less than $50,000 that purchase health insurance for employees with a tax credit. A more in-depth overview of the tax credit is available HERE.
Tax Changes
The law increased the threshold for the itemized deduction for unreimbursed medical expenses from 7.5% of adjusted gross income to 10% of adjusted gross income for regular tax purposes; waive the increase for individuals age 65 and older for tax years 2013 through 2016. (Effective January 1, 2013)
It also increases the Medicare Part A (hospital insurance) tax rate on wages by 0.9% (from 1.45% to 2.35%) on earnings over $200,000 for individual taxpayers and $250,000 for married couples filing jointly and impose a 3.8% tax on unearned income for higher-income taxpayers (thresholds are not indexed). (Effective January 1, 2013)
Starting in 2018, high-cost insurance plans may face additional taxes.
There is a new tax of 10% on the amount paid for indoor tanning services. (Effective July 1, 2010)
Drug Companies face new taxes in 2012, additional information is available here.
Temporary High Risk Pools
Individuals who cannot buy coverage now may have access to a high-risk pool.
It provide grants for up to five years to small employers that establish wellness programs. (Funds appropriated for five years beginning in fiscal year 2011) Technical assistance and other resources will be provided to evaluate employer-based wellness programs. A national worksite health policies and programs survey will be conducted to assess employer-based health policies and programs. (Conduct study within two years following enactment)
Employers will be able to offer employees rewards in the form of premium discounts, waivers of cost-sharing requirements, or benefits that would otherwise not be provided of up to 30% of the cost of coverage for participating in a wellness program and meeting certain health-related standards. Employers must offer an alternative standard for individuals for whom it is unreasonably difficult or inadvisable to meet the standard. The reward limit may be increased to 50% of the cost of coverage if deemed appropriate. (Effective January 1, 2014)