Health Care Reform Discussion

1. Health Care Reform Discussion Lisa J. Duquette Program Administrator lduquette@schoolcare.org August 17, 2010

2. Health Care Reform Senate Bill HR 3590: Patient Protection and Affordable Care Act + Reconciliation Bill HR 4872: The House Reconciliation Act = Final Health Reform Law Signed March 23, 2010

3. Today’s Focus Near term effect on NH schools Insight into future issues

4. Provisions Effective • First plan year starting on or after September 23, 2010 (6 months) July 1, 2011 • NH school group health plans subject to insurance reforms

5. 2010 • 3/30/2010 Elimination of Imputed Income §IRC 105(b) amended to exclude taxability of medical benefits for adult dependents children • 6/1/2010 Early Retiree Reinsurance Program reimbursement for 80% of cost for retirees age 55 - 64 who have claims in excess of $15,000 and below $90,000. (Program ends in 2014 or when the $5B funding is exhausted)

6. 2011 • 1/1/2011OTC medications – unless prescribed by a doctor over-the counter medications are no longer eligible for reimbursed pre tax reimbursement from FSA, HSA, or HRA

7. 2011 – July 1st! • Increase age limit to age 26 for uninsured dependents • No tax dependent requirement • Married/unmarried • NOT child or spouse of dependent • Up to 1/1/2014 grandfathered plans may exclude dependents if eligible for employment based coverage Be sure payroll system is updated Ensure FSA administration includes expense reimbursement for a dependent child until the year in which the child attains age 27

8. 2011 – July 1st! • Lifetime on essential benefits prohibited • Annual dollar limits on essential benefits prohibited (presumption that # of visits, # of procedures, and limits on cost are permissible) • Cost sharing on preventive care prohibited (grandfathered plans exempt) Increased premium cost of 1-4% for improved plan provisions

9. 2011 – July 1st! • Automatic Enrollment Requirements for employers with 200 or more FT employees • No regulations have been issued by DOL yet • Some interpret that this provision will be effective 1/1/2014 • CLASS Act – national voluntary long term care program…need more HHS guidance • employers required to automatically enroll employees and facilitate payroll deductions • employees must opt-out of program if not wishing to participate • pays cash benefits averaging $50 per day • five year (5) vesting period

10. 2011 – December 31st • W-2 reporting of the value of employer provided coverage (issue in January 2012) • Information only Need to accumulate information required for reporting.

11. 2012 • 9/30/2012 Tax Assessments on group health plans of $2 per participant for “comparative effectiveness research” • Applies to self-funded and insured plans • Reduced to $1 per participant 9/30/2013 • Scheduled to “sunset” for plan years ending after 9/30/2019 Increased cost from assessments passed along to employers/employees

12. 2013 – 2014 • 1/1/2013 FSA max limits reduced – may not exceed $2,500 • 2014 - prohibits waiting periods greater than 90 days Consider current collective bargaining agreement terms