A few months ago, we joined with Aflac Inc. (NYSE:AFL) to organize a webinar on the possible effects of the Patient Protection and Affordable Care Act (PPACA) on our readers.
Webinar attendees submitted 44 questions about topics more substantive than “How do I find a recording of the webinar?” (The answer to that question. Please click here.)
We’ve published four batches of answers to the questions; this is the fifth and last batch, including answers to questions about matters such as how PPACA will affect the small-group market in Hawaii and what producer commissions might look like.
Of course: We’re doing this mainly to spark conversation, not to create a substitute for careful discussions with skilled, experienced advisors.
Please mull these questions and answers over with your own advisors and tell us in the comment sections if you’ve come up with better answers. The audience is listening.
1. How will Obama care affect states that already have been requiring employers to provide health care for their employees, like Hawaii?
Even in states with existing employer coverage mandates and incentives, PPACA will lead to changes.
The Hawaii Health Connector, Hawaii’s PPACA exchange, notes in a guide for employers that the employer coverage mandate that has been effect in Hawaii since 1974 is much stricter than the PPACA mandate.
PPACA will simply impose penalties on employers with more than 50 full-time, year-round workers that fail to provide a minimum level of health benefits.
Hawaii already requires any employer with at least one employee to provide health benefits.
The state employer mandate will continue to apply after PPACA takes effect, officials say.
But any part-time workers who are not eligible for their employers’ group benefits will be able to get individual coverage through the individual health insurance exchange, officials say.
The maximum PPACA tax credit for qualifying small Hawaii employers that provide health benefits will increase to 50 percent in 2014, from 35 percent this year.
2. What happens to groups under 50 that are grandfathered? How does this reform affect them?
PPACA already has eliminated lifetime limits on essential health benefits for small groups, eliminated pre-existing condition coverage limitations for children under age 19, and started applying the minimum medical loss ratio (MLR) rules to small-group plans.
Starting in 2014, grandfathered small-group plans will have to phase out annual coverage limits on essential health benefits; eliminate all pre-existing coverage limitations; and limit any benefit waiting periods to no more than 90 days.
Grandfathered small-group plans will not have to get rid of deductibles and co-payments for preventive care, and they will not have to meet the same emergency services coverage, claim review, benefits package and cost-sharing rules that non-grandfathered small-group plans will have to meet.
3. Why doesn’t the calculator just use the employee-only income to determine penalties? Isn’t that the new safe harbor rule?!