Health Reform FAQ’s

There are still many questions surrounding health reform. Over the next few months, as regulations regarding the implementation of each component become clear, we will communicate those dates and processes. Below is a compilation of some questions and answers regarding health reform, please email us with any questions you might have regarding the bill and we will post it to this list with the answer.

Pre-Existing Conditions – High Risk Pool

Q – Am I reading that adults who cannot get health coverage due to a pre-existing condition can join a high risk pool? How would they go about getting that done?

A – There is supposed to be a “state” high risk pool effective July 1st of this year. The individual wanting to join must not have had coverage for the previous 6 months due to a pre-existing condition. No details on the pool are available at this time.

Q – By removing preexisting clause can someone on a group policy shop around for individual coverage and a better rate or does that person with the preexisting condition have to go into the high risk pool? 

A – Yes, they can go into the high risk pool but by going off of the group plan they will lose the employer contribution. The high risk pool is only available from July 1, 2010 until Jan 1, 2014 (the same time pre-existing conditions go away and Exchanges begin). Also, to be eligible for the high risk pool the enrollee must be without coverage for the previous 6 months (or longer) and have a pre-existing condition.

Q – I have a current client that was asking about options for her, due to the new legislation since she has preexisting conditions? I was not sure how it applied. I thought it was not active until the year 2014. 

A – Pre-existing conditions will not be eliminated for adults until 2014. However, there will be a high risk pool as of July 1, 2010. The high risk pool is for individuals who have not had coverage for at least 6 months and have a pre-existing condition. No information on how to enroll in the high risk pool is available at this time.

Q – Pre-existing beginning 6/14/10 coverage will be available to individuals who have been uninsured for at least 6 months through high risk pool programs in every state. Does this mean if someone is on a portability plan they can now go on a regular plan, regular individual rates 6/14?

A – What they are talking about is the “high risk pool” that’s going to be available as of 7/1. This pool will either be operated by the State or if the State chooses, they may utilize the Federal high risk pool. But, the person must be 6 months bare. Recent clarification indicates that if an individual has health insurance (it appears of any kind) they cannot access the high risk pool. The belief is this includes a HIPAA portability product – so no, they would not have access.

Employers paying Individual Plans

Q – What impact is on the employers who pay for individual plans for their employees? Will they be penalized for not having a group plan or does this qualify?

A – There is no mandate that employers sponsor a group health plan.

However, if any of the employees go to the exchange AND receive a tax credit – yes, the employer will have a penalty. 

CLASS Act

Q – Any simple explanation of the CLASS act in the legislation?

A – CLASS is a voluntary long term care insurance program designed to assist participants to maintain home and community living arrangements. It is effective Jan 1, 2011.

There is no underwriting except based on age to determine premiums and eligibility for the program. Enrollment is automatic through the employer, if the employer offers the program. Employees must opt-out if they do not wish to enroll. Employees may opt out at anytime and qualified individuals who are eligible to enroll may do so at anytime. To be eligible, the participant must be 18 years or older, receive taxed wages or taxed self-employment income, and be actively employed.

Miscellaneous

Q – My understanding is that any child 26 or under is now able to be on their parent’s policy. Is this correct? What are the guidelines?

A – Right now most of the carriers have said if an adult child under age 26 is currently on the plan (either individual or group) they may stay on that plan until age 26. However, if an adult child has already aged off the plan, i.e. last year they graduated from college and were no longer eligible – there is no clarification that they must be allowed back onto their parents plan mid-year. They will be allowed to come back on during open enrollment however. The law does not go info effect until the first plan year after September 23, 2010; however, most of the carriers are implementing this provision immediately.  

Q – Do you know if the change to FSA accounts – Over the Counter Drugs – takes effect Jan. 1, 2011 or upon plan year following Jan. 1, 2011?

A – This is effective the first tax year following 2010 – so Jan 1, 2011.

Q – If an employer only changes their plan year and does nothing to plan design, will it impact their “grandfathered” status?

A – The legislation is silent on this situation. However, since there are no changes to plan design the presumption is that it would not impact their “grandfathered” status.

 Q – What is my responsibility as an employer regarding nursing mothers?

A- Effective immediately (March 23, 2010), employers must now provide nursing mothers reasonable unpaid break time to express milk, for a period of up to one year following a child’s birth.