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Showing posts from February, 2013

ObamaCare 'Glitch" Affects Dependents and Employers

According to recent information, a situation with regard to employer coverage under the ACA (ObamaCare) may create severe hardship for dependents of employees participating in group health coverage plans through their jobs.

The way the bill was written (apparently the government can't fix it, either), a family offered health coverage through an employer plan who might otherwise be subsidy-eligible in the individual exchange would be prohibited from receiving that subsidy to buy there because the employer's plan meets the definition of 'affordable coverage'.  Here's where it gets sticky..............

Defined as affordable coverage in this situation means that the health premium for the employer plan does not exceed 9.5% of the family's income.  But that's not all...................

The 9.5% is keyed to the self-only coverage premium available to the worker, not his or her family. 

Generally employers will subsidize a portion of the employees health premium (in C…

California PCIP To Suspend New Enrollments March 2, 2013

Following on the HHS directive closing new enrollments in federal PCIP 2/16, the California PCIP has announced that it will suspend further enrollments in the CA PCIP effective march 2, 2013.

This new enrollment suspension comes 9 months earlier than anticipated when the program was set up in 2010.  It was schedule to enroll through December, 2013.

CA PCIP enrolled the most of any state.  PCIP in total enrolled 135,000 nationally of which approximately 100,000 remain enrolled.  Cost for PCIP was $5 Billion.  Average cost per enrollee in the PCIP ran around $37,000 in benefits on a very small premium.

CA PCIP applicants after March 2 will be denied enrollment in PCIP and vetted for eligibility for the MRMIP (CA Major Risk Program).


PCIP Shutting Down New Enrollments Early

The PCIP (Pre-Existing Condition Insurance Program) will be closing new enrollments.

As directed by HHS yesterday, the federal PCIP will cease accepting new enrollments today (Saturday) for enrollment in the PCIP.  States have been directed to curtail enrollments as well for those states (like California) which run a state-based PCIP.  Many states are scheduled to cease new enrollments on march 2, 2013.

Update: California PCIP will close for new enrollments on Saturday, March 2, 2013.  See my blog post regarding California PCIP closing.

The PCIP program was established in 2010 under ObamaCare to provide a temporary high risk pool for approximately 400,000 individuals nationally over the 4-year scheduled run.  It never enrolled more than 135,000 with approximately 100,000 still on the rolls.  

Even with that low mark, PCIP has run out of money and only has enough money left in the system to provide care for exi…

Final California Health Benefits Exchange Plans Released

The California Health Benefits Exchange (Covered California) has released the final standard health benefit designs for 2014.  

Designs include two Platinum plans, two Gold plans, 5 standard Silver plans (3 Individual and 2 SHOP small group exchange), six Silver low-income plans, two Bronze plans and one Catastrophic plan.

HSA -compatible plans are available in the Silver and Bronze tier, one plan each tier.

Now we wait for the insurance carriers to design their versions of these standard designs for placement in the California Health Benefits Exchange.  All insurance carriers may not participate in in the exchange nor will they necessarily provide exchange health plans at each metal tier.

Also a reminder that insurance carriers will be selling metal tier plans outside of the CA exchange and those plans will not be quoting on the exchange web site.

Final Standard CA HBEX plans


HR 544 And Health Premium Rates (Update) Liberty Act

In my previous blog regarding the "Liberty Act" HR 544 seeks to increase the mandated ratio of premium pricing from 3:1 to 5:1 to help reduce monthly health insurance premium costs to younger people.  Currently the PPACA requires that the maximum rate differential between the oldest subscriber and youngest cannot be more than 3 times the youngest subscriber's rate.

To understand what is at issue for younger California residents (and other states as well), we need to first look at rate differential under the current underwriting (can be denied if too risky) system which enrolls only generally healthy individuals.

For my area zip code 95020:

Clear Protection Plus 3300 PPO (most popular plan in CA) at standard monthly rate:

Age 19 - $86.00
Age 63 - $347.06
Age 19 Adjusted to PPACA Ratio - $115.67 (immediate 35% Rate Increase)

1/3 of the age 63 rate would be $115.67.  Under the current system (not a gu…

IRS Projects $20,000 Annual Family Health Premium by 2016

In a final regulation release recently, the IRS (Internal Revenue Service) projects that the national average Bronze plan for a family (of 5) (lowest metal level) could run $20,000 per year for health insurance.  In the same year (2016) the penalty on that family for not having qualified health insurance coverage would be $2,400.  

Some actual examples from the IRS:

"(i) In 2016, Taxpayers H and J are married and file a joint return. H and J have three children: K, age 21, L, age 15, and M, age 10. No member of the family has minimum essential coverage for any month in 2016. H and J’s household income is $120,000. H and J’s applicable filing threshold is $24,000. The annual national average bronze plan premium for a family of 5 (2 adults, 3 children) is $20,000. "(ii) For each month in 2016, under paragraphs (b)(2)(ii) and (b)(2)(iii) of this section, the applicable dollar amount is $2,780 (($695 x 3 adults) + (($695/2) x 2 children)). Under paragraph (b)(2)(i) of this section,…

HR 544 Addresses Health Premium Ratio for ObamaCare

A new bill, House Resolution 544, was introduced on February 6th by Congressman Phil Gingrey (R-GA) and Jim Matheson (D-UT).  

HR 544, 'Letting Insurance Benefit Everyone Regardless of Their Youth' or Liberty Act, addresses the reality of high premiums for younger people due to the current PPACA (ObamaCare) requirement that the ratio of premium between youngest and oldest be not more than 3:1.

Fearing that 3:1 ratio will cause rates to be especially high for younger adults, HR 544 would change the required ratio from 3:1 to 5:1 or as directed by each state allowing a potential lowering of premiums for those younger health insurance subscribers.  

HR 544 is titled "To amend title XXVII of the Public Health Service Act to change the permissible age variation in health insurance premiums" and information/updates can be found at the Congress beta site: HR 544


Basic Health Plan (BHP) To Be Delayed Until 2015

HHS has announced that the Basic Health Plan (BHP) will be delayed for one year and should be implemented by 2015 under ObamaCare.

The Basic Health Plan is a plan or plans designed to fill in the area between Medicaid (Medi-Cal in California) and subsidy level plans in the exchange.  The Basic Health Plan (BHP) would provide a very low cost coverage option for those who do not qualify for no-cost Medicaid and cannot afford to pay the premium required for subsidized Silver Tier health plans.

According to Kaiser News, HHS apparently "ran out of time" to provide guidance to have the BHP program running by 2014.

This is not particularly good news for those in the 100%-150% FPL ranges.  


Who Can Help Me Enroll In California Health Insurance In 2014?

The first annual Open Enrollment Period (OEP) for ObamaCare will begin October 1, 2013.  At that time, individuals and families in California and the rest of the country can begin the process of selecting a new health insurance plan to begin on January 1, 2014.  The intial OEP will run a full six months to allow sufficient time for millions of California residents to buy new health insurance plans and for those with existing plans to change those plans either voluntarily or due to having non-grandfathered coverage.

Outside of the Exchange

Those wishing to purchase health insurance coverage outside of the CA Health Benefits Exchange will need to use a licensed health insurance agent (either an independent broker or carrier-direct sales unit) to make that purchase.  Outside of exchange sales will be very similar to the way things work today.

Inside of the Exchange and Medi-Cal/Healthy Families

Those wishing to purchase health insurance coverage inside of the exchange, particularly those who…