The Internal Revenue Service (IRS) has started giving more details about the help individuals are supposed to get when they buy minimum essential health coverage in 2014.
The IRS has described program details in a batch of Health Insurance Premium Tax Credit draft regulations set to appear in the Federal Register Aug. 17.
The proposed regulations, which would apply to taxable years ending after Dec. 31, 2013, would help implement sections 1311, 1312, 1401, 1411 and 1412 of the Patient Protection and Affordable Care Act of 2010 (PPACA). The PPACA sections are supposed to create a new, exchange-based health insurance distribution system and a refundable premium tax credit individuals and families can use to buy coverage from exchanges.
The IRS expects to hold a hearing on the draft regulations Nov. 17; outlines of topics to be discussed at the hearing are due Nov. 10.
The U.S. Department of Health and Human Services (HHS) released a second batch of draft regulations, concerning exchange eligibility determination procedures and employer exchange standards. Like the IRS draft regulations, the HHS regulations are set to appear in the Federal Register Aug. 17.
The HHS regulations describe the tasks an exchange would perform to help determine whether applicants were eligible for Medicaid, Children’s Health Insurance Program (CHIP) coverage, the tax credits aimed at moderate-income taxpayers, or other programs or subsidies.
Comments on the HHS draft regulations will be due 75 days after the Federal Register publication date.
Treasury Secretary Timothy Geithner says the proposed regulations bring the country a step closer to providing tens of millions of Americans with access to affordable health coverage.
PPACA opponents are trying to get the U.S. Supreme Court to strike down the act, and opponents are continuing to try to persuade Congress to repeal part or all of the act.
If act provisions take effect as written and work as drafters expect, new “affordable insurance exchanges” are supposed to start selling standardized health plans to individuals starting in 2014, and Small Business Health Options Program (SHOP) exchanges are supposed to start making subsidized coverage available to small employers that same year. States could choose to combine the individual and small group exchanges or set up separate exchange systems.
PPACA would require many individuals to have health coverage or else pay a penalty.
Most people who were in the United States legally and had incomes under 100% of the federal poverty level (FPL) would get free coverage from Medicaid or another government program.
To get the new refundable tax credit, a taxpayer would have to have an annual household income between 100% and 400% of the federal poverty level.
Taxpayers could get religious exemptions from the “personal responsibility” coverage ownership requirements, and they also could get exemptions from coverage ownership requirements if they could show that the cost of paying for the minimum required level of coverage would exceed 8% of their income.
Federal agencies released earlier batches of exchange program guidance and draft regulations in August 2010, November 2010, March 2011 and July 2011.
HHS officials note in the preamble to their draft regulations that they still plan to draft additional regulations concerning essential health benefits, actuarial value and other benefit design standards; quality standards for exchanges and the carriers that sell coverage through exchanges; and the process exchanges would use to certify that individuals were exempt from insurance ownership requirements.
THE HHS DRAFT REGULATIONS
The HHS draft regulations focus mainly on the process an exchange would have to use to bring taxpayers on board.
HHS calls for exchanges to use “Medicaid modified adjusted gross income” in eligibility matters.