Deadline Approaching for Health Care Waiver
The new Health Care Reform law will bring a lot of changes, and potentially a lot of added costs, to certain businesses if it is implemented as currently legislated. These costs won’t be evenly shared, either. For unlike small and medium sized businesses, most large corporations and unions were exempt from the law until 2014 because of waivers received from the government.
The new Health Care Reform law (Patient Protection and Affordable Care Act) requires that employers who provide a group health care plan must ensure that the plan’s benefits coverage is at least $750,000 for each individual.
Here are the current requirements:
For plan years starting between September 23, 2010 and September 22, 2011, plans may not limit annual coverage of essential benefits such as hospital, physician and pharmacy benefits to less than $750,000. The restricted annual limit will be $1.25 million for plan years starting on or after September 23, 2011, and $2 million for plan years starting between September 23, 2012 and January 1, 2014. For plans issued or renewed beginning January 1, 2014, all annual dollar limits on coverage of essential health benefits will be prohibited.
It is important to review your group health insurance program and ensure that it meets with the requirements. If not, your company could be looking at massive additional taxes in the form of “penalties”.
Some industries will be particularly hard hit by these regulations. For instance, many restaurants and manufacturers that hire hourly and low wages employees could have a hard time meeting this requirement–especially if they are offering mini-meds. Low income employees typically do not like to pay the regular health care premiums and prefer lower cost mini-meds which cover their basic needs.
To obtain the waiver from this requirement, companies have until September 22, 2011.
Interested companies need to present evidence that demonstrate meeting the annual coverage requirements would result in diminished access to benefits or a significant increase in premiums.
The waivers need to be applied through the Center for Consumer Information and Insurance Oversight (CCIIO).
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