Presented by: Kevin Kuhlman
National Federation of Independent Business
• State Decision Update
• Small Employer Responsibilities
• Individual Mandate
• Individual and Small Business Exchanges
• “Affordable Coverage” – “Employee Firewall”
• Large Employer Responsibilities
• Question & Answer
http://www.nfib.com/business‐resources/healthcare
• Expand Medicaid up to 138% FPL?
• Maintain current eligibility levels
• Exchange development?
• State‐Based Exchange
• Federally‐Facilitated Exchange
• Federally‐Facilitated Partnership Exchange
• Essential Health Benefits selection?
• Select from limited menu of health plan options
• Default to largest small group market health plan
Employer – controlled group and affiliated service group aggregation rules.
Employee – NOT leased, NOT temporary employees, NOT independent
contractors.
Full‐time Employee – 30 hours/week (130 hours/month).
Full‐time Equivalent (FTE) Employees – total monthly part‐time hours/120. This
includes seasonal employees.
Seasonal Worker – reasonable, good faith determination for 2014.
Large business – 50 or more full‐time employees or full‐time equivalent
employees (FTEs) as of 2014.
Small business – fewer than 50 FTEs as of 2014.
Seasonal worker exception – business can remain “small” if >50 employees for
<120 days (or 4 calendar months) due to seasonal workers.
Small Non‐
Offering
Large Non‐
Offering
Small Offering Large Offering
• EMPLOYER MANDATE PENALTIES AND REPORTING REQUIREMENTS
HAVE BEEN DELAYED ONE YEAR UNTIL 2015
• SIZE DETERMINATION CALCULATIONS AND FULL‐TIME STATUS OF
EMPLOYEES WILL BE NECESSARY IN 2014
Your Business
• Small business – fewer than 50 FTEs
• NO requirement to offer health insurance to full‐time
employees or pay penalties
Your Employees
• Individual mandate requirements/expectations in 2014
• Individual Exchange eligibility and subsidies in 2014
• Notice of Coverage Options/Exchange Availability in 2013
http://www.dol.gov/ebsa/pdf/FLSAwithoutplans.pdf
• “Minimum essential coverage”
o Employer sponsored insurance (including
grandfathered health plan),
o Individual coverage,
o Government insurance ‐ Medicare, Medicaid
OR
• Penalty Tax
o Greater Amount
“Applicable” income
Flat amount
o Enforcement
Qualified Individuals –
Employees of non‐offering businesses or employees with“unaffordable” insurance coverage in 2014
• Cost‐sharing subsidies/tax credits modified adjusted gross household income 138‐400% FPL
• Purchased with after‐tax dollars
Qualified health plans –
• New plans will be based on metal levels that correspond to actuarial values
• Bronze, Silver, Gold, Platinum
• Must provide “minimum value”
Potential benefits –
more choices, less administrative costsCosts –
increased benefit mandates, Individual Exchange premium feeFederal Poverty Level
(FPL)
Income/Wages
Max Premium (%
of Income) 100%‐133% $11,490 ‐ $15,282 2%
150% $17,235 4%
200% $22,980 6.30%
250% $28,725 8.05%
300% $34,470 9.50%
400% $45,960 9.50%
• Premiums and Max Premium % based off Silver plan (70% actuarial value)
• Premiums paid with after tax dollars
Your Business
• NO requirement to offer health insurance to full‐time employees or pay penalties
• Reporting/Verification of employee coverage in 2015
• Voluntary disclosure of health insurance costs on employees’ W‐2 forms
• Temporary small business tax credit
Your Insurance
• All insurance market reforms in 2014
• EHB, deductible limits*, annual/lifetime cap elimination, dependent coverage up to age 26, minimum value (60% AV), maximum out‐of‐ pocket caps, no cost‐sharing for preventive services, etc.
• SHOP Exchange eligible in 2014
• Small Business Health Insurance Tax (HIT) in 2014
• Nondiscrimination requirements
• 90‐day waiting period limit in 2014
Your employees
• “Affordable” health insurance
• Notice of Coverage Options/Exchange Availability in 2013
Small Business Health Options Program
– marketplace for small businesses to shop for health insurance coverage for employees• Employee enrollment ‐ “all or none”
Qualified employer
– 2014 – businesses with up to 50 employees• 2016 – SHOP must open up to businesses with up to 100 employees
• 2017 – SHOP may open up to all size businesses
Small business health insurance tax credit
• Full credit eligibility ‐ <10 employees; average wages <$25,000/year
• Credit phases out – 25 employees; average wages <$50,000/year
• Employer must contribute at least 50% toward employees’ premiums http://www.nfib.com/advocacy/healthcare/credit‐calculator
Potential benefits
– lower administrative costs; more coverage options; more contributions arrangementsCosts
– SHOP Exchange premium fee; increased benefit mandates• Applies to offering employers (large and small)
• Employee’s taxable wages – Box 1 of W‐2 statement
• Lowest cost self‐only health insurance premium option
• Employee’s contribution to that premium
• “Affordable” coverage –
• Employee’s contribution to lowest cost, self‐only health insurance premium <9.5% employee’s taxable wages
• “Employee Firewall”
• Employee PROHIBITED from cost‐sharing subsidies/tax credits if coverage is affordable
• Employees with “unaffordable” insurance PERMITTED access to cost‐ sharing subsidies/tax credits in individual exchange
• Affordability definition does not apply to
dependent or family coverage
• Spouse/Dependent “Firewall” – Dependents and families WILL NOT have access to cost‐sharing subsidies/tax credits in individual exchange
• Employer‐sponsored insurance remains tax‐preferred
Coverage
Federal Poverty Level
(FPL)
Income/
Wages Firewall
Annual Premium
Employee Contribution
Employer Contribution
Employer Contribution
%
100% $11,490 9.5% $7,800 $1,092 $6,708 86%
200% $22,980 9.5% $7,800 $2,183 $5,617 72%
350% $40,215 9.5% $7,800 $3,820 $3,980 51%
401% $46,075 9.5% $7,800 $4,377 $3,423 44%
Self‐Only
Your Business
• Employer mandate determinations in 2014
• Reporting/Verification of employee health coverage in 2015
• Voluntary disclosure of health insurance costs on employees’ W‐2 forms (Mandatory for businesses with >250 W‐2s)
Your Insurance
• Fewer requirements than small employers in 2014
• Minimum value (60% AV), no annual/lifetime caps on benefits, no cost‐sharing for preventive services
• Nondiscrimination requirements (delayed)
• 90‐day waiting period limit in 2014
• Auto‐enrollment (>200 employees) – will not be required in 2014
Your Employees
• Look‐back measurement period to determine full‐time status (3‐12 mo.) in 2014
• Administrative period (1‐3 mo.)
• Stability period for offer/non‐offer (6‐12 mo.) in 2015
• “Affordable” health insurance ‐ $3,000 penalty per “unaffordable” employee in 2014
• Notice of Coverage Options/Exchange Availability in 2013 http://www.dol.gov/ebsa/pdf/FLSAwithplans.pdf
