HEALTH CARE REFORM AFFECTS TO INDIVIDUALS AND BUSINESSES 

AS OF MARCH 30, 2010

HEALTH INSURANCE EXCHANGES

  • State based exchanges will provide insurance to the uninsured and self-employed. Subsidies will be available to individuals and families with income levels between 133% and 400% of the poverty level.(The current Federal Poverty Level for a family of 4 is $22,050).
  • Effective 2014, separate exchanges will be created for small businesses.
  • State will receive fundinging for the exchanges for 1 year until January 1, 2015.

PAYING FOR THE PLAN

  • Effective in 2012, the Medicare Payroll Tax will be expanded to include unearned income for families making more than $250,000 or individuals making more than $200,000.
  • The tax would be 3.8% on investment income.

MEDICARE CHANGES

  • The Medicare prescription drug "donut hole" would be covered by 2020.
  • Those who hit the donut hole for 2010 will recieve a $250 rebate.

MEDICAID CHANGES

  • Expands Medicaid to include 133% of the federal poverty level which is currenly $29,327 for a family of four.
  • Requires states to expand Medicaid to include childless adults in 2014.
  • Newly eligible will be covered 100% by the Federal Government through 2016.

INSURANCE REFORMS

  • No denials for preexisting conditions for children under 19. (Plans beginning on or after 9/23/10).
  • No denials for preexisting conditions for anyone starting 2014.
  • Children can stay on parent's insurance policy through age 26.(Plans beginning on or after 9/23/10)

MANDATES

  • Everyone must purchase health insurance in 2014 or face an annual fine of $695 with some exceptions for low income people.
  • Employers with more than 50 employees must provide health insurance or pay a fine of $2,000 per worker each year if any worker receives federal subsidies to purchase health insurance beginning in 2014. The first 30 employees are not counted for the fine.
  • Employers will report the value of employer-provided health benefits on employee's W2 beginning in 2012.
  • Employers with more than 200 employees will be required to automatically enroll thier employees in their health plans with each employee receiving the opportunity to opt out of the plan.
  • Health plans must provide coverage for certain evidence-based preventive care, certain immunizations, and certain additional preventive care and screenings for women. Coverage must be provided on a first dollar basis with no cost share with participants, co-pays, coinsurance, etc.(Plans beginning on or after 9/23/10.)
  • Health coverage cannot be cancelled for a participant except for fraud or intentional misrepresentation. (Plans beginning on or after 9/23/10.)

 TAX CREDITS AND REIMBURSEMENTS

  • A new small employer tax credit covering 35% of health care premiums for small businesses with less than 10 employees and average annual wages of less than $25,000. Effective 2010-2013.
  • A new small employer tax credit covering 50% of the health care premiums for small businesses with less than 25 employees and average annual wages of less than $50,000. Employer contributions must be 50% of the premium for qualifed health plan. Effective 2010-2013.
  • A temporary reinsurance program will be created to provide reimbursement for employers that provide health insurance for retirees aged 55 to 64. The government will reimburse employers for 80% of the cost of benefits in excess of $15,000 provided per enrollee.