The individual market is estimated to receive the highest rebates, where that possibly 31% of insurance consumers nationally will be getting an annual rebate of around $127 per person. In the small group market, about 28% of groups will be eligible for a rebate, with the average amount going to employers expected to be $21 per enrollee. In the large group market, 17% of fully insured large groups are sharing an estimate of $541 million in rebates. That translates to an average of $14 per enrollee over a year’s time.

What does this mean to you?

Kaiser based its estimates on preliminary data that health insurance carriers provided to their state department of insurance and the National Association of Insurance Commissioners on April 1. Actual rebate amounts, which will be reported to HHS by the heath insurance carriers using a slightly different form, have not yet been calculated and could vary. In addition, individuals and employers may receive a future premium credit from the insurance carrier, rather than an actual rebate check. Also, very significantly for most employer groups, the MLR rules allow employers to keep the portion of the rebate directly attributable to their employer contribution and use the remainder of the funds to benefit the employer plan generally.

The re-submitting of the bill has several more senators expressing their interest in cosponsoring the bill now that it has been re-filed. The sponsors are close to gaining the support of several Democratic offices to add to several Republicans that express interest.

What does this mean to you?

As S. 2288 continues to gain support, H.R. 1206 has recently closed on 200 cosponsors and is aggressively pursuing the target of 218, half of the chamber’s support, and will therefore qualify for a discharge petition. The S. 2288 legislation will continue to target minor changes based on the response to the MLR requirements and are therefore still not identical to H.R. 1206. If commissions become exempt from the MLR, it could provide state insurance regulators with greater flexibility when it comes to medical loss implementation.

What does this mean to you?

According to the National Association of Health Underwriters, the new rules do not include exemptions from the individual mandate, essential benefits, or quality standards. Nor does it include details about how federal exchanges that HHS will be required to set up for states that don’t create their own will work, or how  “partnership” exchanges where HHS and the states will split exchange management functions will work. Timothy Hill, deputy director of the Center for Consumer Information and Insurance Oversight (CCIIO) at HHS, says this information will be available to the public “soon,” and will be released after all five of the proposed federal regulations are finalized.

The final rule and related materials will be published in the February 14 Federal Register. The SBC will include coverage examples, which consists of a standardized health plan comparison tool for consumers. These examples will help consumers understand and compare a sample patient’s share of the costs of a particular plan and have a better idea of how valuable the health plan will be at times when they may need coverage depending on their medical situations.  

What does this mean to you?

The final rule does not directly affect business owners but renewing or purchasing insurance will now be a more involved process to make sure employees have the correct documents. There is some concern about the compliance date being too soon after final rule announcement. Employers and insurers requested an 18-month period from final ruling to compliance date but received only around 7 months.

According to the Director of the Center for Consumer Information and Insurance Oversight at the Centers for Medicare and Medicaid Services (CMS), Steve Larsen, “the agency has determined there is no legal way that it could provide regulatory relief to agents and brokers on the MLR.” However, HHS believes, “the success of exchanges depends on a strong and active role from agents and brokers.”

What does this mean to you?

Since January 1^st, when the rule took effect, some agents and brokers have seen up to a 50% reduction in their commissions. Carriers must invest at least 80% of individual and small-group premiums, and 85% of large group premiums on medical care, leaving the remainder for administrative costs, including agent and broker compensation. If commissions become exempt from the MLR, it could provide state insurance regulators with greater flexibility when it comes to medical loss implementation.

What does this mean to you?

If you are an employer filing fewer than 250 W-2 Forms, its optional until taxable year 2014 and if it’s over 250, it is optional until taxable year 2013.

There is now some concern about having enough time between the final ruling and the compliance date. The National Association of Health Underwriters (NAHU) suggested that once the final rule has been announced, employers and insurers be given an additional 18^th months to comply. NAHU feels that, “based on informal comments from the administration on this topic, it seems more like that a final rule will be issued within the next few months, with compliance potentially expected by January 1, 2013.” According to the DOL, it is anticipated that the once Departments’ final regulations are issued, it will include an applicability date that gives group health plans and health insurance issuers sufficient time to comply.

What does this mean to you?

Due to the large amount of information given in these two documents, there is a concern growing about having enough time for implementation along with a compliance date. Essentially, this gives a reprieve to the carriers in complying with this requirement under PPACA.  This again suggests that the implementation of many aspects of reform will continue to challenge the government to achieve it’s own expectations of meeting unrealistic timelines.

 A report by the Urban Institute’s Health Policy Center and sponsored by the Robert Wood Johnson Foundation researched employers and offering health insurance coverage. One argument is that through the new exchanges, some companies will likely stop their sponsored coverage, increase their employees salaries to cover purchasing individual policies through the exchange, and pay the penalties under the ACA.

What does this mean to you?

Although dropping coverage could be a realistic option for some, companies that offer employer-sponsored benefits as a way to set themselves apart in a competitive market should consider that dropping their sponsored coverage may not be in the their best interest if they want to obtain high caliber employees. Employers will have to make a personalized decision about whether or not dropping employer-sponsored coverage could hinder their position in a highly competitive market. Agents will play a key role in helping employers make these important decisions.

On October 14^th, Department of Health and Human Services (HHS) Secretary Kathleen Sebelius publically recommended to halt the implementation of the CLASS Act. Sebelius claims she “does not see a viable path forward for CLASS implementation at this time” and recommends a halt to the implementation efforts. In the days following Sebelius’ recommendation to halt implementation, the Obama Administration announced that it would not support the repeal of the CLASS Act.

What does this mean to you?

A major area of concern is the cost for the CLASS Act. Because no taxpayer funds may be used to pay plan benefits, it is unlikely that the program will remain financially solvent. Long-term care needs vary, and therefore may be better suited to remain a personalized decision. The suspension of CLASS Act does not affect the rest of the health care law.

 Click here to read a blog article by HHS Secretary Kathleen Sebelius about her recommendations.

Click here to read more information about the CLASS Act.

What does this mean to you?

Starting with plan years or policy years that began on or after September 23, 2010, health plans can no longer enforce a lifetime dollar limit on spending for services defined under essential health benefits. All plans, except grandfathered individual health insurance policies, must phase out annual dollar spending limits for these services by 2014. PPACA defines essential health benefits to include at least the following general categories and the items and services covered within the categories: ambulatory patient services; emergency services; hospitalization; maternity and newborn care; mental health and substance use disorder services, including behavioral health treatment; prescription drugs; rehabilitative and habilitative services and devices; laboratory services; preventive and wellness services and chronic disease management; and pediatric services, including oral and vision care. Insurance policies must cover these benefits in order to be certified and offered in Exchanges, and all Medicaid State plans must cover these services by 2014.