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HEALTH CARE REFORMWhere Do We Go From Here?
November 15, 2016
AGENDA
WHERE DOES THE LAW STAND FOLLOWING THE ELECTION?
IN THE NEWS: WHAT TO EXPECT NEXT
2017 ACA HIGHLIGHTS: COST DRIVERS & NEW REGULATIONS
STRATEGIC CONSIDERATIONS & ACTION ITEMS
WHERE WE BEGAN…
2016 ELECTION …NOVEMBER 8, 2016
Government“NONE OF US ARE AS DUMB AS ALL OF US….”
2016 ELECTION RESULTSUNITED STATES HOUSE OF REPRESENTATIVES
ALL 435 Seats in the House of Representatives: Up for Election
GOP: Defending 247 Seats DEMS: Defending 188 Seats
Democrats: Needed 30 Seats to Take Control Competitive Districts: 66
Results:Republicans: 239 SeatsDemocrats: 192 SeatsNot Yet Determined: 4 Seats
2016 Pre-ElectionGOP: 234 SeatsDEMS: 201 Seats
2016 ELECTION RESULTSUNITED STATES SENATE
34 of the US Senate Seats: Up for Election
GOP: Defending 24 Seats DEMS: Defending 10 Seats
Democrats: Needed 4 Seats to Take Control in the SenateResults:
Republicans: 51 SeatsDemocrats: 46 SeatsIndependent: 2 SeatsUndecided: 1 Seat(LA: Run-Off Election on December 10)
2016 Pre-ElectionGOP: 54 SeatsDEMS: 44 SeatsINDP: 2 Seats
2016 ELECTION RESULTSUNITED STATES SENATE
COMPETITIVE RACES: 2016
FL: REPUBLICAN IL: DEMOCRAT IN: REPUBLICAN NH: DEMOCRAT NV: DEMOCRAT OH: REPUBLICAN PA: REPUBLICAN WI: REPUBLICAN
President Elect Trump’s Pledge to Repeal Obamacare in the First 100 days…
2018 SENATE RACES: 32 of the US Senate Seats:
Up for Election GOP: Defending 8 Seats DEMS: Defending 24 Seats
IN THE NEWS
The Patient Protection & Affordable Care Act
OBAMA ON OBAMACARE
“…The ACA is doing exactly what it was intended to do…”
President Obama 10.26.2016
Carriers Leave the Exchange
CHANGES TO THE PUBLIC EXCHANGE…
At Least One Carrier Exiting the Exchange…
1/3 of States Only Have One Provider Option
ADVERSE SELECTIONNot Enough Healthy Enrollees Signed Up to Counteract the Cost of Providing Care for OLDER, LESS HEALTHY ENROLLEES
INITIAL EXCHANGE PREMIUM RATESSet Lower Due to RISK CORRIDOR (Umbrella of Protection for Carriers) Provided by the Government for 3 years…
By 2018Carriers to Calculate Premiums Based on ACTUAL RISK POOLS instead of Estimated Enrollment
HEALTH INSURANCE CARRIERS LEAVING? IN A NUT SHELL…
MARKETPLACE ENROLLMENT BY METAL LEVEL BRONZE PLANS AS OF MARCH 31, 2016
Ohio 71,050
MARKETPLACE ENROLLMENT BRONZE LEVEL PLANS IN 2017
Premiums will Increase Across ALL Tiers for the 2017 Plan Year
On Average, Bronze Plans will Increase by about 21% = $311 for a Single 30-Year-Old Nonsmoker Compared to $258 in 2016
Average Deductible will Increase to Just Under $6,100
OBAMACARE … Craziest Thing in the World“The people who are getting killed on this deal
are small business people & individuals who make just a little too much to get any of these subsidies
because they’re not organized.They don’t have any bargaining power
with insurance companies so they’re getting whacked….”
Bill Clinton 10.04.2016
OBAMACARE … Craziest Thing in the World
“…So you've got this crazy system where all of a sudden 25 million
more people have health care and then the people who are out there busting it
-- sometimes 60 hours a week --wind up with their premiums doubled
and their coverage cut in half. It's the craziest thing in the world.”
Bill Clinton 10.04.2016
What to Expect Next?
RISING COSTS & STRATEGIES
VS.
NUMBER OF UNITS USED
COSTQUALITY ACCESS
WHAT DRIVES COSTS?
COST OF UNITS
RISKS…
OVERVIEWFEES, TAXES, COVERAGE EXPANSION
& COST PROJECTIONS
TRANSITIONAL REINSURANCE FEE
PCORI FEEPatient-Centered Outcomes Research Institute
Medical Device Manufacturers
Pharmaceutical Companies Health Insurers
2010 ----- ----- -----
2011 ----- $ 2.5 billion -----
2012 ----- 2.8 -----
2013 $ 1.8 billion 2.8 -----
2014 2.7 3.0 $ 8.0 billion
2015 2.8 3.0 11.3
2016 3.0 3.0 11.3
2017 3.1 4.0 13.9
2018 3.2 4.1 14.3
2019 3.4 2.8 *CADILLAC TAX
PREVENTIVE CARE EXPANSION
HEALTH INSURER FEE
CADILLAC TAX WHAT IS A HIGH-VALUE PLAN?
Bronze-level Plan with
High Utilization
May Trigger the Tax
Per Employee / Family Member
High-Value Plan: Higher-Cost Plan based on Plan Utilization & CLAIMS
Basis for Tax: 40% of the Difference Between the Total Cost of Health Benefits for an Employee in a Year and the Threshold Amount for that Year
Self-Only Coverage $10,200 Per Year ($850/Month)
Non Self-Only Coverage $27,500 Per Year ($2,292/Month)
“2018” THRESHOLDS
TO-BE REPEALED
POST-ELECTION
SUBSIDY ELIGIBILITY ILLUSTRATION
Federal Poverty Level Scale: 2016Persons in Household 100% 133 % 250% 400%
1 $11,880 $15,800 $29,700 $47,5202 $16,020 $21,307 $40,050 $64,0803 $20,160 $26,813 $50,400 $80,6404 $24,300 $32,319 $60,750 $97,2005 $28,440 $37,825 $71,100 $113,7606 $32,580 $43,331 $81,450 $130,3207 $36,730 $48,851 $91,825 $146,9208 $40,890 $54,384 $102,225 $163,560
For each Additional person, add: $4,160 $5,532 $10,400 $16,640
Premium Tax Credit EligibilityFederal Subsidies
Family Income % of FPL
Maximum Premium Cost % of Family income
for 2017
< 133 % 2.04 %
133 – 150 % 3.06 – 4.08 %
150 – 200 % 4.08 – 6.43 %
200 – 250 % 6.43 – 8.21 %
250 – 300 % 8.21 – 9.69 %
300 – 400 % 9.69 %
Based on Cost of Silver (70% Value) Plan
2016 REMINDERS & 2017 ANNOUNCEMENTS
2016 Regulatory Update
Date Regulation StatusJANUARY 4 DOL & HIPAA Audits INCREASINGMARCH 22 Summary of Benefits Coverage (SBC) FINAL REVISIONSMAY 16 EEOC Final Rules on Employer Wellness
Programs ADDITIONAL LIMITS ON INCENTIVES
MAY 18 Wage & Hour Division OVERTIME EXPANSION --NON-EXEMPT WORKERS
MAY 18 HHS Nondiscrimination Regulations(Section 1557)
TRANSGENDER INDIVIDUALS - COVERAGE
JULY 6 Subsidy Notice from Exchanges EMPLOYER APPEAL OPTIONS?
JULY 15 1094-C & 1095-C Final Forms & New Codes DEADLINES & PENALTIES
NOV 15 Transitional Reinsurance Fee FINAL YEAR FOR FILING…
REMINDER WHO RECEIVES WHICH IRS FORMS?
Who Reports? Who Receives Forms?Carrier Employer Employee IRS
Large Employer (> or = 50 EEs)Fully Insured
1095-B 1095-C 1095-B 1095-C
1095-B Carrier 1095-C Employer
Small Employer(<50 EEs)Fully Insured
1095-B None 1095-B 1095-B Carrier
Large Employer (> or = 50 EEs)Self-Funded
None 1095-C 1095-C 1095-C Employer
Small Employer (<50 EEs)Self-Funded
None 1095-B 1095-B 1095-B Employer
Penalty for Failure to File
Form 1095to IRS
$260 Per Return
Penalty for Failure to
Provide Form 1095 to
Individuals
$260Per Return
Cap on Total Amount of
Penalties for Failure(s) to File During a
Calendar Year
$3.1 Million
Intentional Disregard for Each Failure
$500 Per Return
NO CAP LIMIT
Failure to Electronically
File
$260 Per Return After the First 250
Forms
IRS DRAFT 1094-C & 1095-C PENALTY EXPOSURE
NEWER & FUTURE CONSIDERATIONS
COVERAGE FOR TRANSGENDERED INDIVIDUALS
ADOPTION ASSISTANCE
SURROGACY
COMPREHENSIVE INFERTILITY AND ADVANCED REPRODUCTIVE TECHNOLOGY (ART)
PARENTAL LEAVE & “PRIMARY CARE” / “SECONDARY CARE” LEAVE
STRATEGIC CONSIDERATIONSWhy is Obamacare NOT Working?
WHY IS OBAMACARE NOT WORKING?Insurance Is A Transfer Of Risk…
Guarantee Issue of Coverage & No Pre-Existing Condition Exclusions
Artificially Suppressed Pricing (Pricing Corridor, Reinsurance Fee, Insurer Fee)
Overregulation (Now Impacting Wellness)
Continual Cost-Shifting to Employer-Based Plans (Becoming Unaffordable for Employers & Employees)
Increasing High Deductible Health Plans (Unaffordable Bronze Plan)
WHY IS OBAMACARE NOT WORKING?Insurance Is A Transfer Of Risk…
NO Change in Fee-for-Service Payment Model (Increasing RX = Mental Health Needs = Increasing RX)
NO Standardization for Access Across State Lines (Essential Health Benefits)
NO Enforcement of Individual Mandate Penalty
NO Comprehensive Tort Reform(Continuation of Defensive Medicine)
NO Incentive for Improving Individual Health
POST-ELECTION What to Expect NEXT?
Repeal Bill -- VERY LIKELY Republicans Need to Tell their Constituents that they Repealed Obamacare –Even If Provisions Remain / Extensive Transition Windows
Reconciliation? Congressional Procedure for Tax & Spend Legislation Only (…Yet Used Broadly). Prevents Filibustering in the Senate
Transitional High Risk Pool?Coverage for Chronic Conditions
Tax Reform?Impact to the Tax Exemption for Employer-Sponsored Health Plans?Fairness in the Tax Code for Individual Health Plans
FIRST 100 DAYS OF PRESIDENT ELECT TRUMP'S ADMINISTRATION REPEAL & REPLACE OBAMACARE…ALL SPECULATION
ACA Provisions – Expected to WITHSTAND a Repeal Bill • Ban on Pre-existing Condition Coverage Exclusions• Adult Children Remaining on a Parent’s Plan until Age 26 • Lifetime Limits on Coverage • Medicaid Expansion
ACA Provisions – Expected to be Repealed OR Phased-Out • Federal Exchanges -- Phased-Out with a Power-Shift to States• Premium Tax Credits (Subsidies) – Phased-Out to Lower Thresholds• Health Insurance Tax – To be Repealed• Cadillac Tax – To be Repealed• Individual & Employer Coverage Mandate – To be Repealed• Essential Health Benefits – Fewer Requirements• Age Rating Bands -- Larger Premium Bands May be Permissible
TAKEAWAY: OBAMACARE
Who Pays for it?
Increase Access Through Medicaid = Failing Programs Intended to Provide Subsidized CareA
C
A YOU
