This Strategic Benefit Services Legislative Brief provides a timeline of the implementation of key reform provisions that affect employers and individuals. Please read below for more information and contact Strategic Benefit Services with any questions about how you can prepare for any of the health care reform requirements.
Expanded Insurance Coverage
The health care reform law contains some provisions designed to provide improvements in access to health care coverage in 2010.- Extended Coverage for Young Adults. Group health plans and health insurance issuers offering group or individual health insurance coverage that provide dependent coverage of children must make coverage available for adult children up to age 26. There is no requirement to cover the child or spouse of a dependent child. This requirement applies to grandfathered and non-grandfathered plans. However, grandfathered plans need not cover adult children who are eligible for other employer-sponsored coverage, such as coverage through their own employer, until 2014.
The Reconciliation Act added a new tax provision related to health insurance coverage for these adult children. Effective March 30, 2010, amounts spent on medical care for an eligible adult child can generally be excluded from taxable income.
Note: A “grandfathered plan” is one in which an individual was enrolled on March 23, 2010, and to which there is no significant change to existing coverage. Many requirements of the new law do not apply to grandfathered plans and nothing in the law requires that individuals terminate coverage in which they were enrolled when the law was passed. A plan can still be a grandfathered plan even if family members or new employees are allowed to join.
- Access to Insurance for Uninsured Individuals with Pre-Existing Conditions. The health care reform law provided for the establishment of a temporary high risk health insurance pool program to provide health insurance coverage for certain uninsured individuals with pre-existing conditions. The program will end in 2014, when the health insurance exchanges are set to be operational.
- Identifying Affordable Coverage. As required, the Secretary of Health and Human Services (HHS) has established an Internet website through which residents of any state may identify affordable health insurance coverage options in that state. The website also includes information for small businesses about available coverage options, reinsurance for early retirees, small business tax credits, and other information of interest to small businesses. So-called “mini-med” or limited-benefit plans will be precluded from listing their policies on this website.
- Reinsurance for Covering Early Retirees. The new law established a temporary reinsurance program to provide reimbursement to participating employment-based plans for a portion of the cost of providing health insurance coverage to early retirees and their spouses, surviving spouses and dependents. This program is designed to end on Jan. 1, 2014, or earlier, if the $5 billion in funding is paid out.
- Due to the program's popularity, it closed to new applications effective May 5, 2011. In early December 2011, HHS announced that, because the program has already provided more than $4.5 billion in reimbursements, it will not accept reimbursement requests for claims incurred after Dec. 31, 2011.
For questions, contact SBS at (855) 882-9177 or email us at sbs@hanys.org.
