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Tuesday, December 14, 2010

Federal Judge in Virginia calls reform: "unconstitutional"


ABC World News (12/13, story 3, 2:30, Sawyer) referred to a "major legal blow" to "the historic healthcare reform law." ABC (Tapper) noted that "the healthcare bill that...Obama signed into law in March requires that every American who can afford it buys health insurance," and on Monday "Hudson...called that requirement 'unconstitutional.' What's called an individual mandate, he said, 'exceeds the constitutional boundaries of Congressional power."
The CBS Evening News (12/13, story 4, 2:25, Crawford) reported, "The White House hailed it as a once-in-a-generation reform," but "in a 42-page ruling Monday, a Federal judge in Virginia had another word for the landmark health care legislation: unconstitutional." NBC Nightly News (12/13, story 4, 1:35, Williams) called the ruling "a pointed reminder that the battle over healthcare is far from over." NBC (P. Williams) added that "while this doesn't stop the law for now, it does tee up a mammoth legal battle to come." The judge "endorsed the claim made by conservatives and Tea Party groups nationwide, that Congress did not have the power to pass the Obama health care law. It's a victory for the state of Virginia, which argued that the heart of the law requiring everyone to buy insurance was unconstitutional."

Thursday, October 28, 2010

Why Buy or Review Life Insurance?

As a life agent I assist people in making educated decisions primarily on their options in health insurance. At this time I am doing this only in the State of CA, and have been now for 15 years. In this amount of time, with my focus on health insurance I have been forced to understand the importance and significance of sharing the need for life insurance with my clients. Life insurance is not something people like to talk about, health insurance is the insurance needed to help you get better, but life insurance is final. It is to take care of the family and or business in the loss of life. Life insurance is something people put off buying. How, then I wonder does one know the perfect time to talk about and purchase life insurance. How long can one "put it off"?

This week alone in our community 3 lives have been lost and one hangs on by life support. The ages? 21, 47, and 49. The one on life support-17.

Have you ever gone to a funeral home to prepare for taking care of a loved one? I just had my first experience. The cost of the funeral home and their arrangements is talked about within 15 minutes of sitting down and talking with a consultant, or counselor. Then, you move into decisions like burial, casket, cremation, etc. Let's say you decide casket, now you must decide wood or stainless steel. Now, they show you options and the range from $595 all the way to over $15,000.00. What if you decide cremation? What Urn do you want to purchase. The picture I am painting for you is real. These are real decisions you are asked to make and they need to be made usually right then and there! There is no time to go home and think about it, if there is at most it would be a day or two. Death is final. Death doesn't announce it's timing nor does it make it easy to make these decisions. Denial, pain, numbness, these are what your family is going through, and the financial requirements for most becomes a huge burden.

What can you do and when should you do it? You can have your agent review your life insurance policies today and make sure they are sufficient and able to meet the needs of the family. You can meet with an agent TODAY who will help you determine the right policy for your needs.

You can call me! For California residents my number is toll free 1-866-685-0397 or email me at

It is heavy on my heart now that I have helped a family through this process and although I knew these costs and needs were real it was not as real to me as it is today having experienced it. I have a new passion for this part of my business and I am determined to help as many people as possible, walk down this road now before it is too late.

If you are uncomfortable now talking about life insurance, or you think you may not be able to afford it, then think how uncomfortable it will be for your loved ones when they are faced with it and find themselves with NO FINANCIAL protection. Take pain and sadness and add financial burden and stress to any one person and the equation can be toxic.

Get your financial house in order. Be prepared. Walk though these decisions now as a way to provide love, peace and comfort to your family in their most desperate time of need.

Call today! Needs can be determined, quotes for A+ rated companies can be offered and application can be taken right over the phone. A policy can be issued in as little as 14 days!

Hayley Friedman
Life Agent, California Department of Insurance License #0B88844
Chuck Huggins Insurance Services
Toll Free 1-866-685-0397

W2 Tax Reporting Postponed Until 2011 Tax Year

On March 23, 2010, the Patient Protection and Affordable Care Act and Health Care and Educational Reconciliation Act of 2010 were signed into law.

A result of this new law would require employers to report the cost of health care on employees W2's. This has now been delayed until tax year 2011.

Midterm elections can have a huge impact on how this PPACA actually plays out and is implemented. One can speculate, but to move forward the important thing to consider and decide is how your vote in this election can impact this law and understanding you can make a difference! So, get out and vote for freedom and choice, keep America on the cutting age and allow for the industry to be guided by the people, not the government!

-Hayley Friedman. Agent Chuck Huggins Insurance Services

Monday, October 25, 2010

Patient Protection and Affordable Care Act 2010

The basic law has been posted and now we begin to see how carriers, attorneys, and consumer advocate groups interpret the law. Ultimately, when a law is posted, it takes time to actually morph into how it will be set into practice. Once the dust settles we can bet it will look very different from what it does today. At this time we know revisions are being written and submitted from both sides of the political parties to ensure the people they represent are satisfied.

We recommend our clients to stay up on what is being proposed, educate themselves on ALL consequences of their yes on no vote, as each client will be directly affected by what becomes usual and customary of the final pruning of the PPACA.

If you have questions please feel free to ask us! We are here to help you understand the course of the journey we are on and allow you the ability to change it when and where necessary.

Hayley Friedman, Agent
Chuck Huggins Insurance Services

Saturday, September 25, 2010

Understanding Health Care Reform -Consumer Advocate Report

Click on this link for a good presentation of changes that will affect the American Consumer.

AB 1602 abd SB 900 California Exchanges-Hurtful to Califonians or Helpful?

"Much has been written about how signing AB 1602 and SB 900 could be an an important part of Governor Schwarzenegger’s his legacy. Much has been written about how vetoing the exchange bills would reflect far better on the Governor’s service. Given his desire to fix what he frequently called “California’s broken health care system” the Governor no doubt would like to sign the legislation. And there’s nothing inherently wrong in giving the exchange board the ability to negotiate with carriers on behalf of those enrolling for coverage through the exchange. But those powers must be delegated in an appropriate way with an eye enhancing choice and innovation. AB 1602 and SB 900 fail to accomplish this.
All states need to be moving forward with creating their exchanges soon. It will take time to establish these operations, staff them and get them ready for business. However, lawmakers should also take the time necessary to get the legislation right. California lawmakers, in accepting last minute changes without public hearings, failed to do so. Starting over in January will still give them plenty of time to develop an exchange for the nation’s largest state that not only accomplishes the goals of such exchanges, but does so in a way that will nurture innovation over time." -Alan Katz Blog

Thursday, September 16, 2010

Taylor-D Miss.- signs bill to repeal Healthcare Reform

According to Politico (9/16, Sherman), Taylor, who is a Blue Dog Democrat, "underscores how unpopular the legislation is in some conservative districts held by Democrats -- although he voted against the bill. Taylor, though, has bucked trends for years, holding onto the Gulf Coast seat since 1989." The Hill (9/16, Lillis) also reports the story in its Healthwatch blog.
Dems Who Voted Against Healthcare Law Escape Retribution. Politico (9/15, Isenstadt) reports, "After 34 House Democrats voted against the health care bill in March, liberal groups and their allies in the labor movement vowed to exact revenge. The threats ranged from crippling primary election challenges to a withdrawal of support for some of the offending lawmakers," and "in a few cases, activists even went so far as to say they would run third-party candidates against the Democrats in November." But, Politico notes that "five months later, the group of 34 has emerged from primary season not much worse for the wear. Every one of the 30 lawmakers who voted against the health care bill and is seeking another term won re-nomination."

Wednesday, September 15, 2010

California and Healthcare Reform

Sacramento Bee: Schwarzenegger Should Sign Bills To Create California Insurance Exchange.

The Sacramento Bee (9/9, 16A) editorialized, "When Gov. Arnold Schwarzenegger returns Sept. 15 from a six-day trade mission in Asia, he'll have 700 or so bills to sign or veto," which is "why, before he leaves today, he should sign two bills laying the groundwork for California's health insurance exchange -- the major piece of the national health reform legislation signed by President Barack Obama on March 23." The Bee added, "Under the two bills passed by the Legislature, Californians would get standardized information about insurance they can make informed choices." The paper concluded, "Many Californians would be eligible, based on their income, for a federal premium subsidy to help them purchase coverage through the health benefits exchange," and "California should not leave those federal dollars on the table."

Monday, September 13, 2010

Healthcare Reform Opponents are Heard Today In Florida Hearing-May Set Tone For Us All

Healthcare Reform Opponents Pin Hopes On Florida Hearing.

The Los Angeles Times (9/13, Savage) reports, "The conservative counterattack on President Obama's overhaul of health insurance will take center stage in the courts this week when Republican state attorneys general and a leading small-business group urge a federal judge in Florida to strike down the law before it can take effect. They contend Congress does not have the power under the Constitution to require all Americans to have health insurance." Initially, the lawsuit appeared "to be a long shot," and "legal experts on the left and right said that, since the late 1930s, the Supreme Court has said Congress has broad power to regulate all aspects of the economy." Yet, "on the eve of the court hearing in Florida, some defenders of the law acknowledge that they are less confident that a judge will toss out the lawsuit entirely."
The Wall Street Journal (9/13, Jones, subscription required) reports that the Florida suit against the healthcare law was filed by two Washington, DC attorneys, David Rivkin and Lee Casey, and although it is only one of several such lawsuits, the case has garnered much attention because it was filed on behalf of 20 state AGs and other groups. These attorneys argue that the law is unconstitutional, and that the government has overstepped its authority in attempting to compel individuals to purchase health insurance. Some legal experts, however, contend that the states lack standing, and that the suit will be thrown out.

Monday, August 30, 2010

Will California be the first State With Exchanges?

California Lawmakers Approve Legislation To Create Health Insurance Exchange.

The Wall Street Journal (8/26, Mathews, subscription required) reports that California lawmakers have passed legislation which allows the creation of a health insurance exchange, or a marketplace, through which millions of residents can purchase coverage. If Gov. Arnold Schwarzenegger (R) signs the legislation, as he is expected to, California would be the first state to implement the exchanges which are required by the healthcare law to be operational by 2014. The Journal says that increasing health premium costs spurred the lawmakers to take this action, and notes that, according to experts, about 8.3 million Californians could use this exchange, making it the largest one created by a state.

Tuesday, August 24, 2010

Individual Health Plans: Rates and Increases

California Senate Approves Bill To Limit Insurance Premium Hikes To Once Yearly.

The AP (8/24) reports, California health insurance providers "would be prohibited from raising their rates more than once a year under" a bill (AB 2042) the state Senate approved yesterday in a 21-13 vote. The bill, which now moves to the Assembly, would "apply to individual healthcare policies, not group plans." Supporters say that the bill would "provide Californians with greater predictability when it comes to their health insurance." Opponents, who include "some of the state's largest health insurers," say breaking up fee increases "throughout the year reduces the financial burden on consumers." If approved, the legislation "would take effect in January."

Wednesday, August 11, 2010

White House Claims About Medicare-"Illusory"?

The Oklahoman (8/11), commenting on Medicare trustees' annual report last week, editorializes that White House "claims" that the report proves "healthcare reform will save money and make Medicare stronger" are "illusory." The paper says that Medicare's chief actuary, Richard Foster, "who deals with the real world," as opposed to the "one inside Washington's Beltway," wrote that "near term, Obamacare relies on 'unsustainable' reductions in reimbursements to healthcare providers." Long-term, "basic assumptions collapse because reductions in price rates for most service categories probably won't be 'viable.'"
ChiTribune: Medicare Projections Are A "Fiscal Fantasyland." The Chicago Tribune (8/11) editorializes that Medicare's "trustees released a new report last week that said...Medicare had 12 more years to live. That is, the Medicare hospital trust fund would run out of money in 2029 instead of 2017," and "Treasury Secretary Tim Geithner declared that 'the outlook for Medicare has improved substantially because of program changes' made by the new law." But, the Tribune calls the projections a "fiscal fantasyland," and says that the "trustees are required by law to appraise Medicare based on certain assumptions." Meanwhile, Medicare's chief actuary, Richard Foster, has said that "those assumptions...'do not represent a reasonable expectation for actual program operations in either the short range...or the long range."

Tuesday, August 10, 2010

Premiums Will Go Up with Healthcare Reform!

You can't expect anyone to offer anything for FREE, SOMEONE PAYS FOR IT! Here's report from SFC:

The San Francisco Chronicle (8/9, Colliver) reports, "Employers and consumers sorting through their health insurance options may see a bump in their rates next year to account for the potential impact of some of the early elements of the federal health overhaul law, according to some health experts." The provisions which will take effect this year include ones that "require health plans to cover adult children until age 26, extend coverage to children with pre-existing conditions, end maximum lifetime spending limits, and end the practice of retroactively canceling a member's coverage for any reason other than fraud." Still, "health policy watchers say it's tough to know whether these reforms will have much impact on costs, which routinely outpace increases in wages and inflation."

Monday, August 9, 2010

Medicare Solvency Report Found Too Optimistic

Kaiser Health News /The Fiscal Times (8/6, Andrews) noted that in a new report, Medicare "trustees predicted that the new healthcare law could generate so much better productivity that the Medicare trust fund would stay solvent until 2029 -- 12 years longer than predicted just one year ago," yet the "new estimates offer few clues about where that new efficiency will come from. They are simply based on the fact that the new healthcare law requires that Medicare payments to hospitals and doctors will be adjusted to reflect higher productivity." In fact, HHS Secretary Kathleen Sebelius acknowledged, "The report shows that we have work left to do. ... To achieve the gains projected in this report, we must continue to work hard with our partners across the country to implement the reforms in the Affordable Care Act effectively and on time."
Similarly, CQ HealthBeat (8/7, Reichard, subscription required) reported, "If Thursday's report by the Medicare board of trustees on the program's financial outlook seemed too optimistic, a presentation Friday by Centers for Medicare and Medicaid Services (CMS) Chief Actuary Richard Foster offered what may be a more realistic assessment." Notably, the "trustees said Thursday that about $575 billion over 10 years in Medicare savings generated by the healthcare overhaul would improve its financial outlook and help extend the solvency of the Medicare hospital trust fund from 2017 to 2029." Yet, "Foster told a forum sponsored by the American Enterprise Institute (AEI) that none of the experts with whom he has consulted think that the modest yearly payment increases the law provides for hospitals and other providers are realistic."

Friday, August 6, 2010

Administration Reports Reform Good for Medicare-many have strong Doubts!

Several reports on a news conference about how the healthcare reform law will improve Medicare's long-term finances, including articles from the AP and USA Today, offer a distinctly skeptical view of the Administration's projections. None of the network newscasts mentioned the press conference, which featured Treasury Secretary Timothy Geithner and HHS Secretary Kathleen Sebelius.
USA Today (8/6, Wolf), in an article titled, "Medicare Savings Projections In Dispute," says, "Republican critics and even the program's chief actuary say the new prognosis is too rosy. ... 'If you steal over a half-trillion dollars from Medicare to fund another unsustainable entitlement, Medicare won't be better off,' said Sen. Orrin Hatch (R-UT)." Richard Foster, chief actuary for CMS, said, "The financial projections shown in this report for Medicare do not represent a reasonable expectation for actual program operations. ... The recession adds a significant further element of uncertainty to the trust fund projections."
The AP (8/6, Ohlemacher, Alonso-Zaldivar) titles its article, "Medicare Fund Will Last Extra 12 Years – Maybe," and says the "annual backers of the new healthcare law evidence of a positive impact on government entitlement programs, but it also undercuts the findings with a host of caveats." The AP says that Foster's statement "amounted to a dissenting opinion."
The Wall Street Journal (8/6, McKinnon, subscription required), in an article titled, "Bullish Medicare Projection Doubted," quotes Sen. Judd Gregg (R-NH) as saying, "Instead of focusing on the future dates when the trust funds become insolvent-thus deluding itself that the problem is years away -- the Democratic Congress needs to understand that from a cash flow standpoint, the crisis is upon our doorstep."
The New York Times (8/6, Calmes) is not as skeptical of the Administration's findings as other outlets. The Times reports, "Medicare's hospital insurance trust fund should remain solvent until 2029," and "the long-term, 75-year shortfall for the hospital fund also is reduced, as are the projected costs of the separate Medicare Supplementary Insurance program. But both parts of the Medicare system will require additional reforms to be financially sustainable, the trustees say." Bloomberg News (8/6, Armstrong) and Reuters (8/6, Felsenthal, Somerville) also cover the story.

Tuesday, August 3, 2010

Opponents of Reform Turning to The Courts

White House Likens Lawsuits To Challenges To Civil Rights, Voting Rights Acts. The Hill's Michael O'Brien (8/3), in a blog entry, notes that Stephanie Cutter, "an assistant to President Obama who was brought on board at the White House in part to help sell the signature domestic initiative, dismissed" the ruling. Writing on the White House's official blog, Cutter said, "Having failed in the legislative arena, opponents of reform are now turning to the courts in an attempt to overturn the work of the democratically elected branches of government. This is nothing new. ... We saw this with the Social Security Act, the Civil Rights Act, and the Voting Rights Act -- constitutional challenges were brought to all three of these monumental pieces of legislation, and all of those challenges failed. So too will the challenge to health reform."
In an editorial, the Wall Street Journal (8/3, subscription required) argues that the healthcare law is unconstitutional, and derides Cutter's statement as an attempt to intimidate opponents.

Why do Healthcare cost continue to rise?

Did you know: Technology is a key driver of health spending?
No doubt, modern medicine is amazing and helps save lives. As better tests and more expensive equipment and pharmaceuticals emerge and become proven treatment options for many, we can expect to see an increase in the use of these services. As a key driver in health spending, technological advances are accounting for an estimated one-half to two-thirds of spending growth, according to Sarah Goodell and Paul Ginsburg in their publication High and Rising Health Care Costs: Demystifying U.S. Health Care Spending.

Monday, July 19, 2010

Medicare Scams Busted!

Ninety-Four Arrested Over Medicare Scams Totaling $251 Million.

ABC World News (7/16, story 6, 2:05, Muir) reported on "hundreds of raids carried out this country" on Friday "in what's being called the biggest Medicare fraud bust in history. Doctors and nurses billing the American taxpayer for procedures that never happened, and clinics that don't even exist."
The CBS Evening News (7/16, story 3, 2:00, Couric) noted that "one way the government plans to pay for healthcare reform is by cracking down on Medicare fraud. ... Dozens of people have been arrested including doctors, patients, and clinic owners accused of scamming Medicare out of hundreds of millions of dollars."
The AP (7/17, Kennedy, Hays) reported, "Authorities said busts carried out this week in Miami, New York City, Detroit, Houston, and Baton Rouge, La., were the largest Medicare fraud takedown in history." The move also was "part of a massive overhaul in the way federal officials are preventing and prosecuting the crimes."
The Washington Post (7/18, Markon) noted, "The arrests came as Attorney General Eric H. Holder, Jr. and Health and Human Services Secretary Kathleen Sebelius held the first in a series of regional 'summits' on healthcare fraud prevention in Miami. The high-level attention marked the latest step in crackdown on fraud that the Obama administration has said is a key part of its agenda on healthcare reform."
The Miami Herald (7/17, Hiaasen) pointed out, "Experts say Medicare fraud in South Florida costs US taxpayers between $3 billion and $4 billion annually. It's predictable that Miami-Dade, Broward and Palm Beach counties would be the hotbed, and also the venue for one of every three federal healthcare fraud prosecutions." (7/16) reported, "The defendants are charged with conspiring to submit over $280 million in false claims to the federal healthcare program designed to aid the elderly." Sebelius said, "Today's arrests send a strong message that attempts to defraud Medicare will not be tolerated." According to the report, "charges include filing fraudulent claims for HIV/infusion services, home healthcare, physical therapy and durable medical equipment."
The New York Daily News (7/17, Marzulli) reported, "The feds busted a Medicare mill in Brooklyn where the elderly gathered in a 'kickback room' to collect payoffs under a Cold War-era poster warning them to keep their mouths shut." Brooklyn US Attorney Loretta Lynch said yesterday "that 15 people were arrested -- including an 82-year-old woman. Seven others are being sought in the $78 million scheme." The Wall Street Journal (7/17, Benoit, subscription required) and CQ HealthBeat (7/17, Adams, subscription required) also covered the story.

Wednesday, July 7, 2010

Senior Rebate Checks for Medication

The Modesto Bee -Jun. 28: Seniors who regularly take expensive medications are starting to receive $250 checks from the federal government in one of the first tangible benefits of national health care reform.The Medicare prescription drug rebate checks are part of the health care law signed by President Barack Obama in March. The package of benefits, consumer protections and insurance reforms promises major changes to health care in the next 10 years.
Seniors in Stanislaus County have received some of the 80,000 Medicare prescription drug rebates mailed thus far. There is no need for seniors to apply for the rebates. The patient's drug plan notifies Medicare when his or her drug costs exceed $2,830 for the year and the check goes out, said Frank Dotson, director of the county's Health Insurance Counseling and Advocacy Program."They don't need to do anything," Dotson said. "And they don't need to report the rebate if they feel it will affect their eligibility for any other benefits they have."Look out for scam artistsSeniors should beware of scam artists purporting to help them apply for or spend the rebate checks, he added. More than 380,000 Californians struggle with the coverage gap in Medicare prescription plans. It starts when their drug costs reach $2,830 and then they are expected to pay full price for drugs until out-of-pocket expenses total $4,550 for the year.Dotson said many Medicare recipients with limited incomes are not taking advantage of a prescription-drug subsidy program that predated health care reform.The benefit eliminates annual deductibles and the coverage gap, and sharply reduces co-payments for seniors with income of $1,354 a month and less than $12,510 in assets. For couples, the eligibility ceiling is income of $1,821 a month and $25,010 in assets.

Thursday, July 1, 2010

Rate Increases are Studied Before Approval

The Los Angeles Times (7/1, Helfand) reports, "Embattled health insurer Anthem Blue Cross is reviving its plan to raise rates for tens of thousands of California policyholders, some of whom could see their premiums rise as much as 20%." The state's "largest for-profit insurer submitted new rates Wednesday amid pressure to scale back increases of as much as 39% that had provoked fury from consumers, lawmakers and even President Obama." Meanwhile, "California Insurance Commissioner Steve Poizner has hired an actuary to study rate filings submitted by Anthem, Aetna, Inc. and Blue Shield of California. Poizner announced Wednesday that he was making the filings public on the insurance department's website," and "a fourth insurer, Health Net, Inc., also will undergo additional scrutiny once it files new rates."
The San Francisco Chronicle (7/1, Colliver) notes that the proposed rates "would raise health premiums by an average of 14 percent, and as much as 20 percent, for thousands of California consumers."

Tuesday, June 29, 2010

High-Risk Pools in CA to Obtain Federal Subsidies

In a NAHU Briefing update to agents on Health Care Reform I have noted that the High Risk Pool for CA will now have federal subsidies to help those who have been declined for health plans the opportunity to afford and enroll in the High-Risk plans though the State.

"California Lawmakers Approve Bills To Create High-Risk Pools.
The AP (6/29, Bussewitz) reports, "The California Legislature has narrowly passed two bills that will enable the state to obtain $761 million in federal subsidies to help thousands of uninsured Californians to obtain health insurance." Notably, the "bills enact federal health care reform changes and would create a high-risk pool for people who have been denied health insurance because they have pre-existing medical conditions."

Tuesday, June 15, 2010

Small Group Employers and Health Care Reform Updates

The Washington Post (6/15, Hilzenrath, Aizenman) reports, "If you like your health plan, you can keep it. That's what President Obama promised during the long months of debate over health-care reform," and the new rules issued on Monday are meant "to fulfill that promise." The Post adds, "The administration estimates that many plans will end up changing, prompting Republicans to accuse the president of breaking his word."
According to the AP (6/15, Alonso-Zaldivar), "The Obama administration had a message Monday for employers who want to keep federal bureaucrats from rewriting the rules for their company medical plans: Don't jack up costs for workers, and you won't have to worry about interference from the new health care law." HHS Secretary Kathleen Sebelius, who made the announcement, said, "What we don't want is a massive shift of costs to employees." The AP points out that this "new regulation that spells out how health plans that predate the health overhaul law can avoid its full impact."
For instance, the "regulations empower the administration to revoke the so-called grandfather status of businesses that shift 'significant' new burdens onto employees -- a considerable penalty that would subject those plans to all the consumer protections in the Democrats' new healthcare reform law," The Hill (6/15, Lillis) notes. Under these new rules, Sebelius said, "employers can make 'routine and modest' adjustments to their premium, deductible and co-pay requirements," although "'significant' cost hikes or benefit cuts would cost them their exempted status. The goal is to ensure that grandfathered plans 'don't use this additional flexibility to take advantage of their customers,'" she added.
Kaiser Health News (6/15, Galewitz, Carey) reports, "Business groups gave mixed reviews Monday to new Obama administration rules limiting how much employers and insurers can change their health insurance plans -- while remaining exempt from potentially costly new consumer protections." Notably, "consumer groups praised the regulations, saying the rules would ensure that millions of Americans receive the full benefits of the new health-overhaul law." In contrast, "business groups that opposed the enactment of the health overhaul law denounced the regulation." Randel K. Johnson, a senior vice president at the U.S. Chamber of Commerce, stated, "Once grandfathered status is lost, employers will be forced to follow a number of expensive new insurance rules -- which will increase costs for employers and employees, threatening the coverage Americans currently have."
Reuters (6/15, Charles) notes that investors and analysts are paying close attention to these new rules, as well as to the others being issued as health reform is being implemented, in order to determine their impact on the health insurance industry. The USA Today (6/15, Kiely) "The Oval" blog also covers the story.

Tuesday, June 8, 2010

Federal Government Cutting Funds to Medicare Program

The States are all reporting in and on the record as saying that cuts to medicare funding will help cause an unfavorable chain of events! Here is what Senate Majority Leader is doing about it:

Reid Working To Restore Medicaid Funds In "Extenders" Bill. CQ Today (6/8, Rubin, subscription required) reports, "Senate Majority Leader Harry Reid wants to undo a cut in aid to states that the House made to a tax and benefits bill that the Senate is scheduled to consider this week." Notably, "the House passed the bill (HR 4213) last month after paring it to satisfy members concerned about its cost. Reid, D-Nev., said Monday that he wants to put back billions of dollars of funding designed to help states cope with higher Medicaid costs during the recession." This "bill would also revive expired tax breaks, extend expanded unemployment insurance through Nov. 30 and prevent a scheduled payment cut to doctors under Medicare through 2011."

Friday, May 28, 2010

Patient Lifestyles increase Health Care Services Usage and In Turn Drive Costs Up

 Patient lifestyles — Increasing numbers of patients who are challenged by obesity, smoking, drug abuse, poor nutrition and physical inactivity contribute to an increase in the use of, and therefore the cost of, health care services.8 These preventable risk factors9 can also contribute to chronic diseases, which account for 75% of the money spent on health care in the U.S. each year.10
 Obesity — The percentage of obese adults now exceeds the percentage of healthy weight adults.
 Tobacco use — One in five adults smoke.
 Sedentary lifestyle — Less than one-third of adults report getting regular exercise.
 Poor nutrition — One in six adults has high cholesterol

-Anthem Blue Cross

Friday, May 21, 2010


Congress Agrees To Extend Jobless Benefits, Delay Medicare Payment Cuts.

The AP (5/21, Ohlemacher) reports, "Lawmakers have agreed on legislation to extend expanded jobless benefits for the long-term unemployed through the end of the year. Laid-off workers would also continue to get subsidies to buy health insurance through the COBRA program." The measure "would be paid for, in part, by tax increases on investment managers and some US-based multinational companies." The AP explains that "lawmakers had been negotiating a provision that would spare doctors from a scheduled 21 percent cut in Medicare payments. They agreed to delay the cuts until 2014, when they will have to address the issue again." The AP notes, "The House could vote on the bill as early as Friday, with the Senate voting next week."

Tuesday, May 11, 2010

Rules released for Adult Children On Parent's Plan

The New York Times -May. 11: Washington -

The White House issued rules on Monday allowing young adults to remain covered by their parents' health insurance policies up to age 26.The promise of such coverage has attracted great interest. Employers and insurers say they have been flooded with inquiries.Under the rules, an employer-sponsored health plan or a company selling individual insurance policies must offer coverage to subscribers' children up to the age of 26, regardless of whether a child lives with his or her parents, attends college, is a dependent for income-tax purposes or receives financial support from the parents.

Coverage is to be available to married and unmarried children alike.Kathleen Sebelius, the secretary of health and human services, estimated that 1.2 million people would gain coverage because of the new requirement.The health department estimated that the average cost to cover each new enrollee would be $3,380 in 2011, $3,500 in 2012 and $3,690 in 2013.The cost will be borne by all families with employer-sponsored insurance, with family premiums expected to rise by about 1 percent, the government said.

The rules generally take effect for insurance plan-years that begin on or after Sept. 23 this year.However, the rules allow an exception for employer-sponsored health plans that were in existence on March 23, when President Obama signed the health care bill. In general, such health plans can exclude adult children of workers until 2014 if the children have access to insurance through another employer-sponsored health plan. That might occur, for example, if a 24-year-old child is working for a business that offers health benefits to employees.

Many insurance companies have voluntarily agreed to provide dependent coverage immediately, without waiting for the requirement to take effect in September 2010 or in January 2011, when many companies renew their coverage.

On Monday, the White House urged employers to follow the example of insurance companies and extend coverage to their employees' adult children up to age 26 immediately.Under the rules, insurers and employers must provide young adults with a 30-day opportunity to enroll in their parents' coverage. Terms of coverage cannot vary based on the age of young adults under 26. Thus, the White House said, an insurer violates the law if it imposes a surcharge on premiums for children 19 to 25.

The administration offered another example, involving a company that covers employees' children up to age 19, or up to 23 if the children are full-time students. If a worker's child lost coverage on turning 23, the company must notify the worker that the child is again eligible for coverage starting Jan. 1, 2011.Aaron B. Smith, executive director of Young Invincibles, an organization for people 18 to 34, welcomed the new rules, saying they would help secure affordable coverage for college graduates and other young adults looking for jobs.But James P. Gelfand, director of health policy at the United States Chamber of Commerce, said: 'Regulatory agencies may have stretched their authority in writing these rules.

Adult children can live 2,000 miles away from their parents, be married and not have spoken to Mom and Dad in a year, and they could still be added to the parents' employer-sponsored health plan just like any other child.'Douglas H. Shulman, the commissioner of internal revenue, said that coverage provided to an employee's adult children would generally be tax-free to the employee.

Saturday, May 1, 2010

Tax Credit for Small Business

"New for 2010: Tax credit for small businesses

Good news for small businesses: The IRS recently released materials for those wishing to claim the small business health care tax credit for 2010. A provision of the Patient Protection and Affordable Care Act (PPACA), this tax credit is designed to encourage small businesses to offer health care coverage for the first time or enable them to maintain the coverage they already have. It will likely provide assistance to about four million small businesses.

If your business qualifies, this tax credit could be a significant benefit for your company. In 2010, the maximum credit is 35% of employer-paid premiums; for tax-exempt organizations, the maximum is 25% of employer-paid premiums. In 2014, the maximum increases to 50% of employer-paid premiums; for tax-exempt organizations, it increases to 35% of employer-paid premiums. To qualify for the credit, your company must not employ more than 25 employees and the average annual compensation of those employees cannot exceed $50,000.

Here's a look at how a business with 10 employees could benefit:
Wages: $250,000 total, or $25,000 per worker
Employee health care costs: $70,000
2010 Tax Credit: $24,500 (35% credit)
2014 Tax Credit: $35,000 (50% credit)
For more examples, click here.

While there is no formal guidance yet, the IRS has provided educational resources for small businesses wishing to claim the credit this year. Click here to see the following information:
Eligibility rules
Amount of credit
Three simple steps to determine a small group's eligibility
More tax credit scenarios
You can expect more health care reform updates like this one throughout the year. We're eager to get information out to you as soon as possible, so your business can get the most from the new legislation. As always, please contact your agent or account representative with questions or for more information." -Anthem Blue Cross Health Care Reform Update April 2010

This content is provided solely for informational purposes: it is not intended as and does not constitute legal advice. The information contained herein should not be relied upon or used as a substitute for consultation with legal, accounting, tax and/or other professional advisers.

Anthem Blue Cross offers dependent coverage extension ahead of the provision date!

To help these dependents, we're working in collaboration with the US Department of Health and Human Services and state regulators to allow young men and women to remain on their parents' policies even before this health care reform provision takes effect. Beginning June 1, we will continue to provide health benefits to dependents who - because of their age, student status or other factors - would lose coverage during the gap period between June 1, 2010, and the September 23, 2010, effective date. This extension of coverage will not be retroactive; however, dependents that aged out before June 1, 2010, can be added back onto a parent's policy during your group's next open enrollment period on or after September 23 in accordance with the new law.

~Anthem Blue Cross Health Care Reform Update April 2010

Thursday, April 29, 2010

NAHU News April 29

Federal High-Risk Pool Will Exclude Those Who Already Have Insurance.

USA Today (4/29, Young) reports, "About 200,000 Americans whose illnesses have kept them from getting regular health insurance will not be allowed to enroll this summer in a new lower cost federal program for people like them because they already buy pricey state-run plans." USA Today adds, "The nation's new health law creates a far cheaper insurance program opening July 1 for people with pre-existing medical conditions. To qualify, a person can't have had health coverage for six months." As a result, "it excludes people already enrolled in 35 state high-risk pools offering insurance of last resort. The state pools charge high help cover costs." HHS spokeswoman Jenny Backus "said the federal pools are a temporary fix to help uninsured people with pre-existing conditions get coverage until 2014."
Op-Ed: States' Decisions About High-Risk Pool Could Prove Early Test Of New Health Law. Grace-Marie Turner, president of the Galen Institute, writes in a Wall Street Journal (4/29, subscription required) op-ed that Friday is the deadline for states to notify HHS if they intend to participate in the federal high-risk pool for people with pre-existing conditions. The program is a temporary measure until insurers can no longer deny coverage to those people, as provided in the healthcare law. To date, Nebraska and Georgia have said that they will not participate. Georgia's insurance commissioner John W. Oxendine wrote HHS Secretary Kathleen Sebelius, saying that he believes the program would "ultimately become the financial responsibility of Georgians in the form of an unfunded mandate." Turner says that if more states decide to opt out of the federal high-risk pool, this could put pressure the Administration to increase funding for state programs.

Health Action Network

Health Care Reform WellPoint to Cover Young Adults Before the Law Requires: WellPoint, along with several other health insurance companies, announced on Monday that its affiliated health plans will take steps to prevent a gap in coverage that could leave many young Americans uninsured. WellPoint, UnitedHealthcare, Humana, Kaiser Permanente, and Aetna said they will initiate a provision of the new health care law ahead of schedule. The new health care law will extend the dependent age for coverage to 26 for plan years beginning September 23, 2010. As a proactive measure to assist its members, beginning on June 1, WellPoint's affiliated health plans will allow young adults to remain on their parents' policies even before this health care reform provision takes effect.
Coverage Gap for Members of Congress Resolved: White House officials announced this week that a problem with particular language in the new health care reform law has been resolved, closing the coverage gap for members of Congress and their staff. Lawmakers and staff had expressed concern that they would be forced out of their current health care coverage under the Federal Employees Health Benefits Program prior to the creation of state-run exchanges in 2014.

Wednesday, April 21, 2010


Small Business Health Care Tax Credit: Frequently Asked Questions

The new health reform law gives a tax credit to certain small employers that provide health care coverage to their employees, effective with tax years beginning in 2010. The following questions and answers provide information on the credit as it applies for 2010-2013, including information on transition relief for 2010. An enhanced version of the credit will be effective beginning in 2014. The new law, the Patient Protection and Affordable Care Act, was passed by Congress and was signed by President Obama on March 23, 2010.
Employers Eligible for the Credit
1. Which employers are eligible for the small employer health care tax credit?
A. Small employers that provide health care coverage to their employees and that meet certain requirements (“qualified employers”) generally are eligible for a Federal income tax credit for health insurance premiums they pay for certain employees. In order to be a qualified employer, (1) the employer must have fewer than 25 full-time equivalent employees (“FTEs”) for the tax year, (2) the average annual wages of its employees for the year must be less than $50,000 per FTE, and (3) the employer must pay the premiums under a “qualifying arrangement” described in Q/A-3. See Q/A-9 through 15 for further information on calculating FTEs and average annual wages and see Q/A-22 for information on anticipated transition relief for tax years beginning in 2010 with respect to the requirements for a qualifying arrangement.
2. Can a tax-exempt organization be a qualified employer?
A. Yes. The same definition of qualified employer applies to an organization described in Code section 501(c) that is exempt from tax under Code section 501(a). However, special rules apply in calculating the credit for a tax-exempt qualified employer. A governmental employer is not a qualified employer unless it is an organization described in Code section 501(c) that is exempt from tax under Code section 501(a). See Q/A-6.
Calculation of the Credit
3. What expenses are counted in calculating the credit?
A. Only premiums paid by the employer under an arrangement meeting certain requirements (a “qualifying arrangement”) are counted in calculating the credit. Under a qualifying arrangement, the employer pays premiums for each employee enrolled in health care coverage offered by the employer in an amount equal to a uniform percentage (not less than 50 percent) of the premium cost of the coverage. See Q/A-22 for information on transition relief for tax years beginning in 2010 with respect to the requirements for a qualifying arrangement.
If an employer pays only a portion of the premiums for the coverage provided to employees under the arrangement (with employees paying the rest), the amount of premiums counted in calculating the credit is only the portion paid by the employer. For example, if an employer pays 80 percent of the premiums for employees’ coverage (with employees paying the other 20 percent), the 80 percent premium amount paid by the employer counts in calculating the credit. For purposes of the credit (including the 50-percent requirement), any premium paid pursuant to a salary reduction arrangement under a section 125 cafeteria plan is not treated as paid by the employer.
In addition, the amount of an employer’s premium payments that counts for purposes of the credit is capped by the premium payments the employer would have made under the same arrangement if the average premium for the small group market in the State (or an area within the State) in which the employer offers coverage were substituted for the actual premium. If the employer pays only a portion of the premium for the coverage provided to employees (for example, under the terms of the plan the employer pays 80 percent of the premiums and the employees pay the other 20 percent), the premium amount that counts for purposes of the credit is the same portion (80 percent in the example) of the premiums that would have been paid for the coverage if the average premium for the small group market in the State were substituted for the actual premium.
4. What is the average premium for the small group market in a State (or an area within the State)?
A. The average premium for the small group market in a State (or an area within the State) will be determined by the Department of Health and Human Services (HHS) and published by the IRS. Publication of the average premium for the small group market on a State-by-State basis is expected to be posted on the IRS website by the end of April.
5. What is the maximum credit for a qualified employer (other than a tax-exempt employer)?
A. For tax years beginning in 2010 through 2013, the maximum credit is 35 percent of the employer’s premium expenses that count towards the credit, as described in Q/A-3.
Example. For the 2010 tax year, a qualified employer has 9 FTEs with average annual wages of $23,000 per FTE. The employer pays $72,000 in health care premiums for those employees (which does not exceed the average premium for the small group market in the employer's State) and otherwise meets the requirements for the credit. The credit for 2010 equals $25,200 (35% x $72,000).
6. What is the maximum credit for a tax-exempt qualified employer?
A. For tax years beginning in 2010 through 2013, the maximum credit for a tax-exempt qualified employer is 25 percent of the employer’s premium expenses that count towards the credit, as described in Q/A-3. However, the amount of the credit cannot exceed the total amount of income and Medicare (i.e., Hospital Insurance) tax the employer is required to withhold from employees’ wages for the year and the employer share of Medicare tax on employees’ wages.
Example. For the 2010 tax year, a qualified tax-exempt employer has 10 FTEs with average annual wages of $21,000 per FTE. The employer pays $80,000 in health care premiums for those employees (which does not exceed the average premium for the small group market in the employer's State) and otherwise meets the requirements for the credit. The total amount of the employer’s income tax and Medicare tax withholding plus the employer’s share of the Medicare tax equals $30,000 in 2010. The credit is calculated as follows:
(1) Initial amount of credit determined before any reduction: (25% x $80,000) = $20,000(2) Employer’s withholding and Medicare taxes: $30,000(3) Total 2010 tax credit is $20,000 (the lesser of $20,000 and $30,000).
7. How is the credit reduced if the number of FTEs exceeds 10 or average annual wages exceed $25,000?
A. If the number of FTEs exceeds 10 or if average annual wages exceed $25,000, the amount of the credit is reduced as follows (but not below zero). If the number of FTEs exceeds 10, the reduction is determined by multiplying the otherwise applicable credit amount by a fraction, the numerator of which is the number of FTEs in excess of 10 and the denominator of which is 15. If average annual wages exceed $25,000, the reduction is determined by multiplying the otherwise applicable credit amount by a fraction, the numerator of which is the amount by which average annual wages exceed $25,000 and the denominator of which is $25,000. In both cases, the result of the calculation is subtracted from the otherwise applicable credit to determine the credit to which the employer is entitled. For an employer with both more than 10 FTEs and average annual wages exceeding $25,000, the reduction is the sum of the amount of the two reductions. This sum may reduce the credit to zero for some employers with fewer than 25 FTEs and average annual wages of less than $50,000.
Example. For the 2010 tax year, a qualified employer has 12 FTEs and average annual wages of $30,000. The employer pays $96,000 in health care premiums for those employees (which does not exceed the average premium for the small group market in the employer's State) and otherwise meets the requirements for the credit.
The credit is calculated as follows:
(1) Initial amount of credit determined before any reduction: (35% x $96,000) = $33,600 (2) Credit reduction for FTEs in excess of 10: ($33,600 x 2/15) = $4,480(3) Credit reduction for average annual wages in excess of $25,000: ($33,600 x $5,000/$25,000) = $6,720(4) Total credit reduction: ($4,480 + $6,720) = $11,200(5) Total 2010 tax credit: ($33,600 – $11,200) = $22,400.
8. Can premiums paid by the employer in 2010, but before the new health reform legislation was enacted, be counted in calculating the credit?
A. Yes. In computing the credit for a tax year beginning in 2010, employers may count all premiums described in Q/A-3 for that tax year.
Determining FTEs and Average Annual Wages
9. How is the number of FTEs determined for purposes of the credit?
A. The number of an employer’s FTEs is determined by dividing (1) the total hours for which the employer pays wages to employees during the year (but not more than 2,080 hours for any employee) by (2) 2,080. The result, if not a whole number, is then rounded to the next lowest whole number. See Q/A-12 through 14 for information on which employees are not counted for purposes of determining FTEs.
Example. For the 2010 tax year, an employer pays 5 employees wages for 2,080 hours each, 3 employees wages for 1,040 hours each, and 1 employee wages for 2,300 hours.
The employer’s FTEs would be calculated as follows:
(1) Total hours not exceeding 2,080 per employee is the sum of:
a. 10,400 hours for the 5 employees paid for 2,080 hours each (5 x 2,080)b. 3,120 hours for the 3 employees paid for 1,040 hours each (3 x 1,040)c. 2,080 hours for the 1 employee paid for 2,300 hours (lesser of 2,300 and 2,080)
These add up to 15,600 hours
(2) FTEs: 7 (15,600 divided by 2,080 = 7.5, rounded to the next lowest whole number) 10. How is the amount of average annual wages determined?
A. The amount of average annual wages is determined by first dividing (1) the total wages paid by the employer to employees during the employer’s tax year by (2) the number of the employer’s FTEs for the year. The result is then rounded down to the nearest $1,000 (if not otherwise a multiple of $1,000). For this purpose, wages means wages as defined for FICA purposes (without regard to the wage base limitation). See Q/A-12 through 14 for information on which employees are not counted as employees for purposes of determining the amount of average annual wages. Example. For the 2010 tax year, an employer pays $224,000 in wages and has 10 FTEs.
The employer’s average annual wages would be: $22,000 ($224,000 divided by 10 = $22,400, rounded down to the nearest $1,000)
11. Can an employer with 25 or more employees qualify for the credit if some of its employees are part-time?
A. Yes. Because the limitation on the number of employees is based on FTEs, an employer with 25 or more employees could qualify for the credit if some of its employees work part-time. For example, an employer with 46 half-time employees (meaning they are paid wages for 1,040 hours) has 23 FTEs and therefore may qualify for the credit.
12. Are seasonal workers counted in determining the number of FTEs and the amount of average annual wages?
A. Generally, no. Seasonal workers are disregarded in determining FTEs and average annual wages unless the seasonal worker works for the employer on more than 120 days during the tax year.
13. If an owner of a business also provides services to it, does the owner count as an employee?
A. Generally, no. A sole proprietor, a partner in a partnership, a shareholder owning more than two percent of an S corporation, and any owner of more than five percent of other businesses are not considered employees for purposes of the credit. Thus, the wages or hours of these business owners and partners are not counted in determining either the number of FTEs or the amount of average annual wages, and premiums paid on their behalf are not counted in determining the amount of the credit.
14. Do family members of a business owner who work for the business count as employees?
A. Generally, no. A family member of any of the business owners or partners listed in Q/A-13, or a member of such a business owner’s or partner’s household, is not considered an employee for purposes of the credit. Thus, neither their wages nor their hours are counted in determining the number of FTEs or the amount of average annual wages, and premiums paid on their behalf are not counted in determining the amount of the credit. For this purpose, a family member is defined as a child (or descendant of a child); a sibling or step-sibling; a parent (or ancestor of a parent); a step-parent; a niece or nephew; an aunt or uncle; or a son-in-law, daughter- in-law, father-in-law, mother-in-law, brother-in-law or sister-in-law.
15. How is eligibility for the credit determined if the employer is a member of a controlled group or an affiliated service group?
A. Members of a controlled group (e.g., businesses with the same owners) or an affiliated service group (e.g., related businesses of which one performs services for the other) are treated as a single employer for purposes of the credit. Thus, for example, all employees of the controlled group or affiliated service group, and all wages paid to employees by the controlled group or affiliated service group, are counted in determining whether any member of the controlled group or affiliated service group is a qualified employer. Rules for determining whether an employer is a member of a controlled group or an affiliated service group are provided under Code section 414(b), (c), (m), and (o).
How to Claim the Credit
16. How does an employer claim the credit?
A. The credit is claimed on the employer’s annual income tax return. For a tax-exempt employer, the IRS will provide further information on how to claim the credit.
17. Can an employer (other than a tax-exempt employer) claim the credit if it has no taxable income for the year?
A. Generally, no. Except in the case of a tax-exempt employer, the credit for a year offsets only an employer’s actual income tax liability (or alternative minimum tax liability) for the year. However, as a general business credit, an unused credit amount can generally be carried back one year and carried forward 20 years. Because an unused credit amount cannot be carried back to a year before the effective date of the credit, though, an unused credit amount for 2010 can only be carried forward.
18. Can a tax-exempt employer claim the credit if it has no taxable income for the year?
A. Yes. For a tax-exempt employer, the credit is a refundable credit, so that even if the employer has no taxable income, the employer may receive a refund (so long as it does not exceed the income tax withholding and Medicare tax liability, as discussed in Q/A-6).
19. Can the credit be reflected in determining estimated tax payments for a year?
A. Yes. The credit can be reflected in determining estimated tax payments for the year to which the credit applies in accordance with regular estimated tax rules.
20. Does taking the credit affect an employer’s deduction for health insurance premiums?
A. Yes. In determining the employer’s deduction for health insurance premiums, the amount of premiums that can be deducted is reduced by the amount of the credit.
21. May an employer reduce employment tax payments (i.e., withheld income tax, social security tax, and Medicare tax) during the year in anticipation of the credit?
A. No. The credit applies against income tax, not employment taxes.
Anticipated Transition Relief for Tax Years Beginning in 2010
22. Is it expected that any transition relief will be provided for tax years beginning in 2010 to make it easier for taxpayers to meet the requirements for a qualifying arrangement?
A. Yes. The IRS and Treasury intend to issue guidance that will provide that, for tax years beginning in 2010, the following transition relief applies with respect to the requirements for a qualifying arrangement described in Q/A-3:
(a) An employer that pays at least 50% of the premium for each employee enrolled in coverage offered to employees by the employer will not fail to maintain a qualifying arrangement merely because the employer does not pay a uniform percentage of the premium for each such employee. Accordingly, if the employer otherwise satisfies the requirements for the credit described above, it will qualify for the credit even though the percentage of the premium it pays is not uniform for all such employees.
(b) The requirement that the employer pay at least 50% of the premium for an employee applies to the premium for single (employee-only) coverage for the employee. Therefore, if the employee is receiving single coverage, the employer satisfies the 50% requirement with respect to the employee if it pays at least 50% of the premium for that coverage. If the employee is receiving coverage that is more expensive than single coverage (such as family or self-plus-one coverage), the employer satisfies the 50% requirement with respect to the employee if the employer pays an amount of the premium for such coverage that is no less than 50% of the premium for single coverage for that employee (even if it is less than 50% of the premium for the coverage the employee is actually receiving).

Page Last Reviewed or Updated: April 19, 2010
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Saturday, April 17, 2010

Anthem Updates the Agents on Reform 2010

New for 2010: Tax Credit for Small Groups

The IRS recently released materials for those wishing to claim the small business health care tax credit for 2010. A provision of the Patient Protection and Affordable Care Act (PPACA), this tax credit is designed to encourage small groups to offer health care coverage for the first time or enable them to maintain the coverage they already have. It will likely provide assistance to about four million small businesses.
This tax credit can be significant for a qualifying small group. In 2010, the maximum credit is 35% of employer-paid premiums; for tax-exempt organizations, the maximum is 25% of employer-paid premiums. In 2014, the maximum increases to 50% of employer-paid premiums; for tax-exempt organizations, it increases to 35% of employer-paid premiums. In order to qualify for the credit, the employer must not employ more than 25 employees and the average annual compensation of those employees must not exceed $40,000.
Here's a look at how a company with 10 employees could benefit:
Employees: 10
Wages: $250,000 or $25,000 per worker
Employer Health Care Costs: $70,000
2010 tax credit: $24,500 (35% credit) 2014 tax credit: $35,000 (50% credit)
For more examples, click here.
While there is no formal guidance yet, the IRS has provided educational resources for small businesses wishing to claim the credit this year. Click here to see the following information:
Eligibility rules
Amount of credit
Three simple step to determine a small group's eligibility
More tax credit scenarios
You can expect more health care reform updates like this one throughout the year. We're eager to get information out to you as soon as possible, so you can help your clients get the most from the new legislation. As always, please contact your sales representative with questions or for more informatio

Wednesday, April 14, 2010

Headline News for Insurance Agents from NAHU

Proposed House Bill Would Double Penalties For Medicare Fraud.

The AP (4/14, Kennedy) reports, "Medicare fraud suspects would face longer prison sentences under a US House bill proposed Tuesday that also advocates biotechnology such as fingerprint scanning to ensure patients are getting the goods the government is billed for." Law enforcement officials "have warned Medicare fraud, an estimated $60 billion annual crime, is now more lucrative than dealing drugs. Until now the penalties have been far less severe." But, the "Medicare Fraud Enforcement and Prevention Act will double prison sentences from 5 to 10 years and fines from $25,000 to $50,000 for Medicare fraud-related crimes," and "create a new crime for illegally distributing patients' Medicare or Medicaid IDs or billing information, which would carry a maximum 3-year sentence."
The Palm Beach Post (FL) (4/14, Lantigua) reports, "In the heart of the Medicare fraud capital of the nation, two South Florida members of Congress declared war Tuesday. Representatives Ileana Ros-Lehtinen (R-Miami) and Ron Klein (D-Boca Raton) said they are presenting bi-partisan legislation aimed at criminals who steal billions of dollars from Medicare every year." Data show that "in South Florida alone, $952 million in false Medicare claims were filed last year by clinic owners, medical equipment vendors and medical personnel, almost all in Miami-Dade."
The South Florida Business Journal (4/14, Bandell) calls the bill "one of the first bipartisan efforts since the divisive passage of federal health care reform," and says that "there has been an increase in fraud, despite the efforts of a federal health care fraud task force, which has prosecuted more than 800 people and identified more than $2.5 billion in fraudulent claims since it started in 2006." Under the bill, HHS "would be required to provide law enforcement officials with real-time access to Medicare data, and immediately alert them to suspicious activity." The measure "would require the Government Accountability review the performance of the contractors who handle Medicare's billing system."

Monday, April 12, 2010

Simplified Timeline of Healthcare Reform Implementation

Agent Update from Carrier

Agent update

When do the Changes Affect me?

Many of the major changes in the legislation don’t go into effect until 2014. Those include:* Federal subsidies to help people buy coverage.* An end to insurers rejecting adult applicants with pre-existing medical conditions.* The requirement that nearly all Americans carry coverage.But some changes affecting insurance policies will come more quickly. Unless otherwise noted, these changes become effective on policies on the first renewal date after Sept. 23. For those with job-based coverage, that may mean a Jan. 1 date, or even later in 2011. They include:* No More Lifetime Limits on Coverage: Insurers and employers can no longer cap the amount spent on essential medical care over a person’s lifetime. Such limits are used to help hold down premiums and are more common in policies purchased by individuals. But about 16 percent of workers receiving insurance through an employer currently have a plan that caps coverage at between $1 million and $2 million, while 43 percent of covered workers have caps of $2 million or more, according to an employer survey by the Kaiser Family Foundation. The law bars the practice on all existing and new policies, according to analyses by insurers and employer groups. * New Restrictions on Annual Limits: Some insurance plans set annual dollar limits on coverage. Such practices will be prohibited for “essential benefits” for all new policies and for existing policies offered by employers. Existing policies in the non-group market will not be held to this standard. Specifics of the restrictions and the definition of “essential benefits” are yet to be developed by HHS. * Insurers Can’t Cancel Retroactively: Until now, insurers have been able to retroactively cancel policies, citing missing or incorrect information on applications for coverage, a practice that left some policyholders owing tens of thousands of dollars. The industry says such cancellations are necessary to combat fraud, but critics say they are improperly used to rid insurers of patients with costly illnesses. The new law bars the practice for all new and existing policies, except in cases of outright fraud. * Kids Can Join Your Plan: Young adults up to age 26 can join or remain or remain on a parent’s policy, so long as they aren’t eligible for coverage under their own employer’s policy. Some questions remain and may be answered by regulations now being drawn up by HHS. Insurers and employers are also barred from rejecting children under 19 with pre-existing medical problems or excluding coverage for those conditions. * Insurers Must Detail Spending, Face Rebates: This year, insurers must report how much revenue they spend on direct medical care versus administrative costs, which include such things as new equipment, disease management, executive salaries and profits. The HHS secretary must define what are considered administrative costs. Next year, if insurers fail to spend at least 80 percent of revenue (85 percent in large employer plans) on medical care, they must issue rebates to consumers and employers. Many large group insurers already meet those standards; a bigger impact could come in policies in the individual market. * Premium increases must be reported: Insurers must report their premium increases to the HHS secretary and provide justification for the increases. The rules apply to all new and existing policies, except self-insured employer plans. * Employers face new rules, rebates, costs: All new policies offered by employers must include both an internal and external appeals process so workers can contest coverage and other benefit decisions. The definition of a “new plan,” isn’t clear. It’s possible it could include an employer who switches insurance carriers. HHS is expected to define that in regulations.Employers that offer drug coverage to retirees will lose the ability to deduct a 28 percent federal subsidy in 2013, but must report the effects on financial statements this year. Some employers may drop or reduce such coverage for retirees as a result. Conversely, employers that cover early retirees’ medical costs will be able to apply for reimbursement of 80 percent of some expensive medical claims.Reprinted with permission from You can view the entire Kaiser Daily Health Policy Report, search the archives, and sign up for email delivery at The Kaiser Daily Health Policy Report is published for, a free service of The Henry J. Kaiser Family Foundation. © 2005 Advisory Board Company and Kaiser Family Foundation. All rights reserved.

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Kaiser Headline News

Kaiser Health News - Apr. 6: Consumers and employers who provide health insurance are scrambling to understand what will change in their premiums and benefits once provisions of the recently passed law go into effect.Unlike state insurance laws, which mostly affect policies individually purchased or offered through small and mid-sized businesses, the new federal legislation applies more broadly to nearly all types of private plans, say insurers and employer benefit experts. That includes policies offered by large self-insured employers, through whom about half of the nation’s covered workers get their insurance. Some new rules such as barring insurers from rejecting children with medical conditions or from canceling policies retroactively are aimed at problems that mainly affect the 17 million people who buy their own insurance in the so-called non-group market.But even the approximately 175 million Americans who get group coverage through their jobs will see changes.
It will be up to the HHS secretary, for example:* To define the breadth of coverage in an "essential benefits package." * To determine how insurers will calculate how much they spend on direct medical care, a key point because insurers who don’t meet specific spending benchmarks must issue rebates to consumers.An HHS spokesman would not provide any details on when regulations will be issued. But, with some provisions set to go into effect by the end of September, pressure is on to move quickly.Among the unknowns is the effect on premiums in the next couple of years. New taxes on drug companies, device makers and insurers don’t begin until at least 2012. But when they do, many economists expect that the increases will be passed along to employers and consumers. Barring insurers from setting lifetime coverage limits may also put upward pressure on premiums.Over time, however, the Congressional Budget Office has estimated that some of the new rules – such as the creation of an online marketplace for insurance purchases – could result in savings that may slow premium growth for some types of coverage.By 2016, when the law is expected to be fully implemented, the CBO estimated that large employers would not be paying more in premiums than they would have done without the new law. That same year, small employers and their workers might see a slight decrease in premiums or up to a 1 percent increase, the CBO said. Individuals could see premium increases of 10 percent to 13 percent, mainly because the coverage purchased would be more comprehensive than what is often purchased in today’s market. For about half of the people buying their own coverage, those increases would be offset by federal subsidies, the CBO said.

Wednesday, April 7, 2010

Your HDHP and HSA in Tax Year 2010

If you have a plan that qualifies to open up a Health Savings Account and have not yet done so- then what are you waiting for? The design of the plans allows for consumers to deposit money into the savings account TAX FREE when used for qualified services! Check the website for the list of qualified medical expenses for the tax year in question. Because the contributions and determination of a qualified service is designated and regulated by the IRS, we advise and recommend all consumers to refer to their CPA's and to the website for all tax related questions. We are not tax advisers. We do however enroll our clients on HDHP's(High Deductible Health Plans) that qualify for these type of accounts and for Tax Year 2010 the following increases to contributions and deductibles are listed here as found on the IRS website.

  • Tax Year 2010 Individual contribution to a HSA is; $3050, and for a family account the amount is; $6150. (As you can see from prior post the contributions have increased this Tax year by $50 for an individual and $200 for a family.)

Qualified HDHP for Tax Year 2010 have the following minimum and maximum deductibles:

  • Individual minimum deductible is; $1200 and the maximum deductible is; $5950
  • Family minimum deductible is; $2400 and the maximum deductible is; $11,900

For those over the age of 55 you are able to make additional "catch up" contributions, please ask your tax advisor about this opportunity!

Deadline for HSA Contributions for 2009 : April 15, 2010

For tax year 2009 contributions to your HSA account can be made all the way up to April 15, 2010.
  • The maximum contributions for an individual account in 2009 is; $3000
  • and for a 2 party or more account referred to as a family account in 2009 is; $5950.

HSA's are Health Savings Accounts that can be opened at a bank when you have a Qualified Health Insurance Plan in place. These plans are referred to as HDHP (High Deductible Health Plans)and in order to qualify they must meet the following minimum and maximum deductible in Tax Year 2009:

  • for a individual plan the deductible is a minimum of $1150 with a maximum deductible of $5800.
  • for a family plan the deductible is a minimum of $2300 with a maximum deductible of $11,600.

These figures reflect TAX YEAR 2009.


Tuesday, April 6, 2010

HHS Secretary Sebelius Speaks on Health Insurance Reform Law

HHS Secretary Kathleen Sebelius is speaking about how the new health insurance reform law will give Americans more benefits and choices, leading to greater security for you and your family.
Watch the speech click on the NPC Event videos under Kathleen Sebelius on the lower left side of webpage.

What happens this year for my family?

This year, allows young adults to stay on their parents’ health care plan until age 26. (This applies
to all plans in the individual market, all new employer plans, and existing employer plans if the
young adult is not eligible for employer coverage on his or her own. Beginning in 2014, children
up to age 26 can stay on their parent’s employer plan even if they have an offer of coverage through
their employer.) This will help cover the one in three young adults who are uninsured.

This year, prohibits insurance companies from denying children coverage based on pre-existing
conditions. Going forward, the Act will prohibit insurance companies from denying coverage to all
individuals. The Act will also end discrimination that charges beneficiaries more if they are sick
and limit the amount an insurance company can increase an individual’s premium simply due to
their age.

This year, requires new plans to cover prevention and wellness benefits at no charge to American
families by exempting these benefits from deductibles and other cost-sharing requirements.


Health Care Reform & The Small Business Owner

Health care reform as envisioned in current draft legislation would reduce the current burdens on small firms and their workers.

  • Tax credits for small businesses. For the 2010 tax year up until the 2013 tax year, the credit will gradually be phased in. Businesses with fewer than 26 employees and average annual wages under $50,000 will eventually be eligible for credit in an amount up to 50% of nonelective contributions that the business makes, on behalf of its employees, for insurance premiums. Here's the good news for tax exempt nonprofit organizations: They would get a 35% credit against payroll taxes!

  • Premium Cost Eligibility. To avoid an incentive to choose a high-cost plan, an employer’s eligible contribution is limited to the average cost of health insurance in that state.

  • Employers with ten or fewer employees and average wages below $25,000 fair very well with the new reform. They will benefit from a 100% credit. Leased employees will be counted as employees, however 2% S corporation shareholders will not be included in the definition of employee.

  • New reporting requirements. If an employer self-insures its employees, the employer must report certain information, including details on each individual obtaining the coverage, their coverage dates and various other information. These reporting requirements will become effective after 2013.

  • Starting in January 2011, employers will be required to disclose, on each employee's Form W2, the value of the individual employee's health insurance coverage, sponsored by the employer.

reference sources: ,

What will happen to Illegal Immigrants?

Associated Press - Apr. 4: Fresno, Calif. - Paula Medrano shifts uncomfortably on the doctor's examination table, holding out a wrist inflamed and swollen by arthritis. The 78-year-old has no health insurance, lives below the federal poverty level, and can't pay for the medication she needs.Just days before her appointment, President Barack Obama signed, with much fanfare, a historic bill to extend health care access to 32 million currently uninsured people. But Medrano and her daughter, Juana Aguirre, barely paid attention."It's a great thing, but it's not for us," said Aguirre. Medrano is an undocumented immigrant one of the 7 million uninsured people living in the United States who were explicitly excluded from the legislation, according to estimates by the Congressional Budget Office.The question of whether to extend coverage to illegal immigrants was so politically contentious that, under the approved legislation, they will not even be able to buy health insurance in the newly created purchasing pools called exchanges if they pay entirely out of their own pocket.Proponents of reducing immigration believe that allowing illegal immigrants access to health care is an incentive for them to come, and an unfair tax burden on Americans.Although the approved legislation explicitly excludes undocumented immigrants from participating in the exchanges, there is no foolproof way of verifying their documentation to keep them out, said Yeh Ling-Ling, executive director of Alliance for a Sustainable USA.They will also continue to have access to emergency medical assistance. "It is not fair on struggling Americans," said Yeh. What is clear is that as the ranks of the uninsured diminish, immigrants like Medrano will continue to patch together health care as they can at health centers such as Fresno's Clinica Sierra Vista, at hospital emergency rooms, or through programs like Healthy San Francisco, which offers universal health care to all who live in the city."We have to be very creative not asking for labs unless it's really essential, working with generics, working with drug companies, giving them samples," said Juan Carlos Ruvalcaba, the doctor seeing Medrano at Clinica, which charges on a sliding scale of $40 to $70, depending on the patient's ability to pay.Once an undocumented immigrant himself, Ruvalcaba was able to become a citizen and attend medical school because of an amnesty program in 1986. He remains committed to serving all patients, no matter their insurance or immigration status, but there is only so much he can do, he said.He was able to give Medrano the drugs she needed, but he asked, "What happens when they need a specialist? What if they end up in the emergency room, and end up with a big bill?"Some who work with this population are afraid that with the focus shifting onto providing care for the newly insured, those shut out of the system will be forgotten, left to fend for themselves with even fewer resources."It may make things worse — if you say 32 million are covered, there may be less done for these large groups who are here, who are working, who are such a large part of our agriculture industry," said Norma Forbes, executive director of Fresno Healthy Communities Access Partners, a nonprofit network of eleven health care organizations in California's rural Central Valley.Illegal immigrant won't be the only uninsured left: about 16 million Americans are estimated to remain outside the health care system even after access is expanded over the next few years, according to the Congressional Budget Office.This includes those who opt out, who don't know how to enroll, or who are exempted from the health insurance requirement because they can't afford the premiums, even with a subsidy.For these patients, there will indeed be fewer options as doctors, hospitals and other providers increase their caseload to take in new patients bearing insurance, said Dan Hawkins, who is charged with policy and research at the National Association of Community Health Centers."There will be greater concentration of care for the uninsured in fewer places," Hawkins said. Community health centers, the lynchpin of the safety net system now caring for the medically underserved, whether they are immigrants or citizens, will remain one of the places where people like Medrano will be able to see a doctor at an affordable cost.Federally qualified clinics got a substantial funding boost through the health reform package. They will get $11 billion in new funding over the next five years, which will allow them to double the number of patients they see, from 20 million a year now to 40 million people a year by 2015.Most of these new patients will come bearing new insurance cards, or be part of the larger pool qualifying for Medicaid. But among them will be illegal immigrants, said Hawkins."Health centers will continue to be open to everyone regardless of their ability to pay, undocumented immigrants and everyone else," he said. "We don't know how many of the uninsured we serve right now are undocumented. But we do know a health center is a better, and less expensive, place for them to get that care."