Federal healthcare reform, also known as the Affordable Care Act (ACA), made several changes to group health plans. On February 12th, 2014, the administration published the final rule on Employer Shared Responsibility.
We are working closely with our employer clients to ensure that they understand their options under federal healthcare reform. We will continue to have a range of plans for our employer groups that meet both the ACA requirements and the needs of local employers, and will update these plans in line with changes to the regulations.
Here are some answers to some frequently asked questions about ACA related changes:
In 2015 and 2016, what is my company required to offer our employees?
For more information on employer shared responsibility.
What’s the penalty if we don’t meet the ACA requirements?
If you don’t offer minimum essential coverage from 2015 onward, you will be required to pay an annual penalty calculated as $2,000 per full time employee (FTE), minus 30 employees. You will not face a penalty because an employee receives a tax credit for dependent coverage.
If you do offer minimum essential coverage you may still have to pay a penalty if one or more of your full-time employees receives a tax credit or cost-sharing subsidy through the exchange. This could happen if the coverage is “unaffordable” or does not meet minimum value for your employees. This penalty is the lesser of:
How will this affect taxes and fees?
Larger employers will need to pay new taxes and fees. If you purchase coverage from Premera you will pay a pro-rated version of these fees and taxes for plan years beginning in 2013 which continue into 2014. You will pay the full cost for all plan years beginning in 2014. Please contact your Premera account executive for more information on ACA taxes and fees if you have a self-funded plan.
Is there a reinsurance assessment fee?
In 2014 both self-funded and fully-insured plans will pay a reinsurance assessment fee of $5.25 per member per month. This fee is estimated to decrease to $3.57 per member per month in 2015 and $2.31 per member per month in 2016.
What about the ACA tax on insured health plans?
Fully-insured groups will also be responsible for the ACA tax on insured health plans. We estimate that this will be 1.9 percent of premium in 2014, increasing to 2.7 percent of premium in 2015. It will remain at this rate for 2016 and beyond.
The ACA also includes provisions to encourage employee wellness programs which will allow you to provide discounts on employee rates as a reward for healthier behaviors.
Open enrollment for 2015 individual plans ended February 15. But you may be able to enroll or change plans now if you experience a qualifying life event.
Premera reps can confirm your subsidy eligibility and enroll you and your family through healthcare.gov or directly in a health plan. Call 877-PREMERA.
Programs that help members take a more active role in managing their health.