The USA healthcare market is the largest in the world followed by
Switzerland and Germany
• It consists of broad services offered by various hospitals, physicians, nursing homes,
diagnostic laboratories, pharmacies and supported by drugs, pharmaceuticals, chemicals, medical equipment, manufacturers and suppliers.
• Critical illness survival rates and access to pharmaceuticals and technology in the USA exceeds that of any other industrialized country
• However, the system is costly and the increasing cost of healthcare services and insurance premiums have rapidly increased in the last 30 years
• Many individual and employers have opted out of buying insurance plans
• Many others cannot afford insurance plans - not everyone uninsured is indigent or poor. • The system is flawed by its emphasis on catastrophic care and not preventative care,
fraud, abuse and waste of resources which adds to the cost of the healthcare system. • The system is completely private and each individual is responsible for their medical bills
and medical care.
Who pays…
Where it goes…
Healthcare Reform does not answer or address costs!
2014 – After its rollout, the PPACA has seen the number of uninsured decrease at its greatest rate
to 13.4 % or 32 million.
2013 – With the PPACA nearing, the number of uninsured rose to 18% or 43 million. 2012 – Total Number of Uninsured is 42 million or 17.5%.
2011 – Slightly decreased to 38 million or 16.1% of the population.
2010 – When the PPACA was enacted the number of uninsured had increased since the start of
President Obama’s administration from 35 million to about 39 million or 16.4% of the population.
*Healthcare inflation was reported at 2.32% in October of 2013.
What is PPACA, what does it aim to do & who does it
affect?
• The Patient Protection and Affordable Care Act was signed into law by President Barack Obama in March of 2010.
• It mandates that every individual must be covered by a healthcare plan by year 2014. A delay
has been imposed on the employer mandate until 2015.
• Individuals must purchase healthcare from a private company or “healthcare exchanges created by the states or the Federal Government in each of the 50 States.
• It does not obligate any employer to provide insurance, however it does place penalties on
employers that do not offer health plans to employees. It also places penalties on individuals that choose not to participate in a health plan offered by an employer via a tax penalty
administered by the IRS- This has become known as the “play or pay” rule.
What is PPACA, what does it aim to do & who does it
affect?
• The law makes both insurance plans, individual and group employer plans, subject to the
mandates.
• It permits self-funded plans with many exceptions more than 62% of all employers large and small have opted to go the self funded route.
• The law is enforced and administered by a collaboration of the Department of Labor, Health
and Human Services and the Internal Revenue Service. Further support falls under the responsibilities of state insurance commissioners.
• The law outlines the role of each of these entities in providing individual, small and large group
insurance coverage.
• The government will provide subsidies to those unable to afford health insurance via Expanded Medicaid or Healthcare Exchanges depending on income.
• The health policy must meet the definition of a group plan or a health issuer plan.
Short-term plans are not subject to PPACA regulations.
• The health product must meet the definition of group or individual health insurance coverage.
• Student health policies are subject to PPACA regulations & must comply.
• Every plan must include certain provisions that are phased in from 2010 to 2015. • Every plan must cover a scheme of basic benefits some with no limits or exclusions
that are known as “essential benefits”.
• Employers that do not provide group plans may opt to send their employees to
the healthcare exchanges and pay a tax for not participating – Employer Shared Responsibility Mandate ( over 100 employees in size)
• Applies to long term health plans, not short term health plans- short term health
plans are not to exceed one year.
If the plan is a group health plan or an individual health insurance
issuer offering individual or group health insurance coverage,
(includes HMO plans, Medicaid plans and Medicare HMO plans):
THE PPACA ROLLOUT
March 2010
Healthcare Reform Passes and will be implemented in phases to 2014.
September 2011
26 US States file a lawsuit against the federal
government claiming that the PPACA is
unconsDtuDonal.
June 2012
Supreme court rules that the law is consDtuDonal.
October 2013
Open enrollment begins for coverage taking effect in January 2014.
March 2014
• Minimum loss ratios by market of 80% or
85% (large vs. small employers) • Rate Review
• Guarantee Issue
• Guarantee renewability
• Policies cannot carry pre-existing conditions
• No discrimination on health status
• No discrimination of plan for highly
compensated employees vs. non highly compensated employees (executives vs. non executive)
ALL POLICIES ARE SUBJECT TO:
• Additional Taxation of certain types of
policies by 2018 for exceptionally rich benefits if not offered to everyone (some employers offer more than one plan and employees may choose)
• No lifetime maximums nor annual limits
• Coverage of preventative care without cost sharing
• Extension of adult dependent coverage
to age 26
• No pre existing condition
• Must provide “essential health” benefit
1. AMBULATORY SERVICES
• Primary care visit to treat an injury or illness. • Specialist visit.
• Other practitioner office visit (nurse, physician assistant).
• Outpatient facility fee.
• Outpatient surgery physician/surgical services. • Home health care services.
• Skilled nursing facility. • Hospice services.
4. EMERGENCY SERVICES
• Emergency room services.
• Emergency transportation/ambulance. • Urgent care centers or facilities.
3. HOSPITALIZATION
• Inpatient hospital services (e.g. hospital stay). • Inpatient physician and surgical services.
5. MATERNITY & NEWBORN CARE
• Prenatal and postnatal care.
• Delivery and all inpatient services for maternity care.
2. MENTAL HEALTH & SUBSTANCE USE DISORDER SERVICES
• Mental/behavioral health outpatient services. • Mental/behavioral health inpatient services. • Substance abuse disorder outpatient services. • Substance abuse disorder inpatient services.
10. PRESCRIPTION DRUGS
• Generic drugs.
• Preferred brand drugs. • Non-preferred brand drugs. • Specialty drugs.
6.REHABILITATIVE & HABILITATIVE SERVICES
• Outpatient physical therapy. • Outpatient speech therapy. • Outpatient occupational therapy. • Durable medical equipment.
• Rehabilitative Service Example: Speech therapy for • an adult who has suffered a stroke.
• Habilitative Service Example: Speech therapy for a non-verbal child with autism.
8. LABORATORY SERVICES
• Diagnostic tests (x-rays and lab work). • Imaging (CT/PET scans, MRIs).
9. PREVENTATIVE & WELLNESS SERVICES AND CHRONIC DISEASE MANAGEMENT
• Preventative care/screening/immunizations.
7. PEDIATRIC SERVICES
(INCLUDING ORAL & VISION CARE)
• Routine eye exam for children. • Eye glasses for children.
• Dental check-up for children.
The law defines a person subject to PPACA as an “applicable individual,”
and “applicable individuals” must maintain the minimum essential
coverage.
•
“
Applicable individuals” are defined as “any individual that is a citizen of the USA or an alien lawfully present in the USA”*• Penalties are imposed on individuals that do not maintain minimum essential coverage via a tax administered and collected by the Internal Revenue Service (IRS), some exceptions may apply to this requirement.
The following examples illustrate the penalty for a single individual and for a family of four. Penalty amounts are shown for 2014, 2015, and 2016:
•
2014: $95 per individual & $285 per family, or 1% of household income.
•
2015: $325 per individual & $975 per family, or 2% of household income.
•
2016: $695 per individual & $2,085 per family or 2.5% of household income.
PPACA does not:
• Regulate insurances or insurance companies though it places some controls and some regulations in order to enforce PPACA.
• Does not oversee the admittance of any insurance company into any state for the business of transacting insurance.
Foreign nationals entering the United States for the purpose of a work related
assignment for a foreign corporation domiciled in the country of origin of the expat or
a third country expat working for the same corporation may be subject to PPACA
depending on several situations having to do with:
ü Legal status of the employee
ü Filing Tax Status of the Employee
ü Social Security Tax being paid in the USA
• As of early this year, new rules allow foreign insurance providers to approve their “group health
plans” as ACA-compliant by following certain steps. This will protect the individual from penalties & taxes.
• Individual policies and student health plans may be approved following a separate process of
approval.
INPATS & THE PPACA
If the tax status, visa and conditions of employment
make the employee admitted alien or temporary admitted alien the individual may be subject to PPACA.
