Wednesday, July 31, 2013

By Carrie Teegardin and Misty Williams
The Atlanta Journal-Constitution
Georgia Insurance Commissioner Ralph Hudgens has filed an “emergency request” with the Obama administration to delay approval of rates for individual health plans that he said will cost some consumers more than double what they are paying today.
“In complete contradiction to every promise made by the President with regard to the Patient Protection and Affordable Care Act, insurance companies in Georgia have filed rate plans increasing health insurance rates up to 198 percent for some individuals,” Hudgens said in a letter to Health and Human Services Secretary Kathleen Sebelius. He sent the letter Monday and released it publicly on Tuesday.
The state must approve or deny dozens of health plans to be sold on a new federally run insurance website, called an exchange, that is critical to the Affordable Care Act’s goal of insuring millions of Americans. The deadline to approve plans is Wednesday, but Hudgens is asking for a 30-day extension.
“I want to protect the consumers of the state of Georgia but when these things are going up, these prices are going up, I don’t want people to blame me,” Hudgens told the AJC. “I’m going to be up for re-election come 2014.”
Bill Custer, a Georgia State University health care expert who has reviewed the filings, said a 198 percent increase is nowhere near typical.
“The majority of Georgians with individual coverage will not see rate increases anywhere near that amount and many will see rate decreases,” Custer said.
The U.S. Health and Human Services Department is reviewing Georgia’s request, a spokeswoman said Tuesday.
“We are working closely with states to help them meet all deadlines and ensure that the marketplaces are ready for consumers to begin shopping on Oct. 1.,” she said in a statement.
Outside actuaries have reviewed the plans and rates filed in Georgia by the seven companies seeking to sell insurance on the exchange and found six of them to be appropriately priced. Hudgens would not identify the seventh company. Even so, Hudgens said that before he approves the rates he wants Sebelius to assess whether the prices are appropriate.
“I am really waiting for her to come back and tell me whether she thinks they are excessive,” said Hudgens, in an interview with The Atlanta Journal-Constitution.

Wednesday, July 24, 2013

Employer Mandate Delayed

Employer Mandate Delayed to 2015

The federal government announced on July 2, 2013 that it will delay implementation of the employer mandate penalties and reporting requirements until 2015. It also says it will simplify the reporting requirements.

This means:

  • Large employers (50 or more employees) will not pay any penalties in 2014 if they do not offer affordable coverage that meets minimum value as defined under the Affordable Care Act (ACA).
  • Large employers and insurers are not required to report coverage affordability and access details to the IRS in 2014, as previously expected under IRC 6055 and 6056. This reporting will be voluntary until 2015.

Of course, large employers who are already planning to offer coverage that is affordable and meets minimum value in 2014 may continue with their plans, without an obligation for federal reporting requirements.

Employers that had not yet finalized their plans for 2014 now have a choice. They may offer coverage that does not meet the minimum value and affordability requirements of the law, with no penalty. The government’s announcement does not change or delay other plan and benefit requirements that go into effect for 2014.

For small employers, nothing has changed since this requirement did not apply. Businesses with fewer than 50 full-time equivalent employees will still have access to the Small Business Health Options Program.

Tuesday, July 23, 2013

What is community rating and how will it affect rates?

July 17, 2013
Health care reform requires health insurance companies to offer coverage to all people and businesses. This is called guaranteed issue.
Along with guaranteed issue, health care reform requires health insurance companies to move to modified community rating for individuals and small businesses. This is the practice of charging premiums that aren’t based on the health history of the individual or business applying for coverage. Insurance companies must base rates on the cost of care for a group of people (a risk pool). By pooling a group of people together, healthy people help balance health care costs for people who aren’t healthy. The risk and cost is shared among everyone in the pool.
New laws for community rating
Health care reform has introduced new rules for community rating, which is why it’s called modified community rating. Insurance companies can’t base rates on any person’s health history. Instead, rates can be based on age, tobacco use*, family size and location. The law limits how much coverage can cost. The highest rate can’t be more than three times the lowest rate for a plan.

How it works
All Individual customers in a state will be in one risk pool and all Small Group customers will be in another risk pool. In addition:
  • States will be able to keep individual and small business risk pools separate.
  • Rates will be based on the health risk of the entire pool. Then those rates can vary based on age, tobacco use*, family size and location.
These laws prevent insurance companies from creating separate risk pools that charge higher or lower rates.
The impact to plans
Most of our health plans will change in 2014 to comply with health care reform. That may cause the rates of some of our plans to go up. We’ll work with you and your clients to find a health plan that meets their needs. We will offer 100% preventive coverage, results-driven health and wellness programs to small businesses, and integrated cost and quality tools to help members understand their costs.
Find out more about health care reform
To learn about other health care reform topics, checkout the timeline and FAQs on our health care reform website or visit our new health care reform area on our company website.
*Tobacco use may not affect the rates in some states.

This article applies to:
  • California, Wisconsin, Virginia, Ohio, Nevada, New Hampshire, Missouri, Kentucky, Indiana, Georgia, and Connecticut
  • Small Group and Individual (under 65)