A peek inside the 2021 healthcare reform plan

Healthcare Reform

Health insurance in coloradoTaking a look at the nation’s healthcare agenda for 2021 

New healthcare plans are underway as we inch into completing the first quarter of 2021. An executive order was recently signed that will direct the federal government to open a special enrollment period from February 15 to May 15 for Affordable Care Act (ACA) exchanges that serve 36 states.

 According to Forbes, this measure is designed to boost coverage for people who are uninsured. The goal of the upcoming healthcare agenda is to improve people’s access to health insurance.

 The key pillars of the 2021 healthcare agenda include:

  • Fortifying the ACA, which includes augmenting the law with a public option;

  • Expanding ACA for lower-income Americans in non-Medicaid expansion states;

  • Introducing legislation on Medicare for More;

  • Revitalizing public health.

 More details about efforts to support the ACA can be found here.

Why the ACA is still significant to us, and why it’s still under attack today.

On March 23, 2010, the Affordable Care Act was signed into law, allowing over 100 million people to not have to worry that an insurance company will deny coverage or charge higher premiums just because they have a pre-existing condition – whether cancer or diabetes or heart disease or a mental health challenge.

 While over the last decade, the Affordable Care Act has been under relentless attack for various reasons, efforts are being made to protect the Affordable Care Act from these continued attacks in the following ways:

  • Fortifying the ACA, which includes augmenting the law with a public option.

 Instead of starting from scratch and getting rid of private insurance, the plan is to build on the Affordable Care Act by giving Americans more choice, reducing health care costs, and making our health care system less complex to navigate

  • Expanding ACA for lower-income Americans in non-Medicaid expansion states.

 The prospect that health protections could extend to millions of uninsured Americans is being raised. As the Covid-19 pandemic saps state budgets and strains safety nets, the opportunity arises. The goal is to break the Medicaid deadlock in the 12 states that have rejected federal funding made available by the Affordable Care Act.

 While this is not an overnight procedure, there are significant opportunities for the remaining states to embrace the Medicaid expansion.

 Key to these potential compromises will likely be federal sign off on conservative versions of Medicaid expansion, such as limits on who qualifies for the program or more federal funding.

 Read more about the efforts that are being made to expand Medicaid here.

  • Introducing legislation on Medicare for More.

 Unlike the Medicare for All approach that would abolish private health insurance and provide universal access to all Americans, regardless of age, Medicare for More builds incrementally on the existing framework of both Medicare and the Affordable Care Act (ACA), and aims to close current gaps in access to healthcare insurance.

 This version of Medicare for More is narrower, as it would permit people aged 60 to 64 to enroll in Medicare. Premium and cost-sharing subsidies would be offered to lower-income beneficiaries. As a result, approximately 20 million more Americans would be eligible for Medicare. Enrolling in Medicare would be voluntary. Employers would be prohibited from dropping newly Medicare-eligible persons from their plans.

 There is an increased likelihood for a pragmatic approach that combines Medicare for More, introduction of a public option, and reinforcement of the Affordable Care Act (ACA).

Learn more about the Medicare approach here.

  • Revitalizing public health.

 In January, the National Strategy for the COVID-19 Response and Pandemic Preparedness was released. The plan builds on the previously announced vaccine distribution plan and the American Rescue Plan, and is organized across seven goals, namely, efforts to get the pandemic under control so Americans can inch into a safer future moving forward.

 Some of those goals are listed below:

  1. Mount a safe, effective, and comprehensive vaccination campaign;

  2. Mitigate spread through expanding masking, testing, treatments, data, healthcare workforce, and clear public health standards;

  3. Safely reopen schools, businesses, and travel while protecting workers;

 For a more comprehensive list on the plan to revitalize public health, read here.

Healthcare Reform: Employer Responsibility

As the fully implemented Healthcare Reform provisions go into effect on January 2014, employer responsibility becomes a national issue. Although there are some pieces of Healthcare Reform that have already started to change, the brunt of the law and its implications are waiting in the wings.

Large groups and their employers play a major role in the effectiveness of the law. While most large group employers do offer health insurance options, they must keep in mind that non-compliance with the law is not an option. If they do not comply, stiff penalties will result. Large group employers now carry a certain amount of employer responsibility that has never been an issue.

Additionally, employers of large groups will now have to report their health care coverage compliance to the IRS, ensure all employees are notified about health care exchanges available, and run the risk of getting into serious trouble if they completely ignore the law. Employer responsibility is no longer a choice, but a requirement that all employers of large groups must adhere to.

For more information on employer responsibility and how your large group organization must comply with the laws, contact Bernardini & Donovan Insurance Services.


Controlling the “Play or Pay Penalty” Under Healthcare Reform

When preparing to comply with the new Healthcare Reform law, large employers should recognize the implications of non-compliance as it relates to the play or pay penalty. If your organization has over fifty full-time employees and they were there in the preceding year, you must offer an adequate health care insurance option to them or pay penalties. What does this mean?

It means that if you are a large corporation, your penalties will be assessed based on the recorded number of full-time employees. The pay or play penalty can be calculated in a variety of ways. If you have a number of subsidiaries, your calculations would be different than that of a company with just one major corporation and all of the full-time employees working under that entity. This penalty applies to the corporation or entity that failed to provide “affordable” coverage, which is the main stipulation of the law. If your corporation offers this coverage, then you are in compliance and will not face these penalties.

For more detailed information on the pay to play penalties and how it could affect your organization, contact Bernardini & Donovan Insurance Services.


How the Play or Pay Penalty Works

One of the upcoming changes included in the healthcare reform bill is what is known as the Play or Pay penalty. It’s aimed at larger businesses with a certain amount of employees, and it is not exactly straightforward. An employer can offer health insurance , but, it must be “affordable”.  The idea behind the penalty is to offset the cost of insurance for each employee that uses the public health care plans.

The specifics for the Play or Pay penalty are as follows:

  • An employer that has 50 full-time or full-time equivalent employees (IE 100 part-time employees) must offer what is known as “affordable” coverage to all qualifying employees.
  • When an employer does not offer health insurance to all employees, an annual tax of $2,000 for each full-time employee if one employee gets federally-subsidized coverage.
  • In the case an employer does not offer “affordable”  coverage to full-time employees, and one employee gets coverage through the exchange, the      employer must pay an annual tax of $3,000 per subsidized employee who gets coverage through the exchange.

For all of these rules, the first 30 full-time employees are exempt from the penalties.

If you are in the Redlands area, or throughout California, contact Bernardini & Donovan Insurance Services for more information about how the penalties can affect your company.


Healthcare Reform: How does it affect large groups?

The new Healthcare Reform policies will affect everyone in different ways. Large and small business owners will definitely be affected, as well as health care organizations. As a large group employer, which is an organization that have over 50 full-time employees, you may already offer an insurance option to your employees. If you don’t, you will definitely be required to as the full policy goes into effect January 2014. What does this mean?

If you do not comply with federal regulations and provide an adequate health insurance option, you will pay stiff penalties. You have to offer it to at least ninety-five percent of your employees and prove it, even if they choose to opt out of the program.  Make sure to keep proper documentation. If you don’t currently offer an adequate health insurance plan for your employees, now is the time to start looking for one. It may save you a lot of time and money in the long run.

For more information on insurance options and the law, contact Bernardini & Donovan Insurance Services.


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