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Important Items for Employers Regarding Health Care Reform

Friday, April 1st, 2011
Chicago Health Insurance

Public health poster at the national museum of health and medicine.

The new provisions in the health care law can be complex and difficult to understand, especially in how they relate to employer-sponsored group health plans. It is important for employers to understand and plan for the changes in their obligations under the new plan, as failure to do so can mean fines or penalties for any violations.

Grandfathered Plans - Health Care Reform allows plans that were in effect on 3/23/10 to have grandfathered status. This means that these plans can delay implementation of certain required provisions. These existing plans can change only very slightly to maintain their grandfathered status. This means no increases to participant costs or decreases in benefits.

Coverage for Adult Children up to Age 26 – Plans beginning on or after 9/23/10 must provide dependent coverage for members with adult children until they reach age 26. Children no longer have to be full-time students, reside with parents, or be unmarried.

Pre-existing Conditions for Children under Age 19 – Plans beginning after 9/23/10 may not impose pre-existing conditions on children less than 19 years of age.

Lifetime Limits and Restrictions on Annual Limits – All plans after 9/23/10 are prohibited from imposing lifetime limits on essential health benefits, and are restricted in the dollar amount of annual limits imposed. After 1/1/14, these limits will be banned. Currently, these essential benefits include ambulatory patient services, emergency services, hospitalization, maternity and newborn care, mental health and substance use disorder services, including behavioral health treatment, prescription drugs, rehabilitative services and devices, laboratory services, preventive and wellness services and chronic disease management, and pediatric services.

Equal Treatment of In-network Versus Out-of-network Emergency Services – After 9/23/2010, plans must treat out-of –network emergency services like visits to the E.R. the same as they do for in-network emergencies. Plans will no longer be able to pre-authorize emergency services.

Provide Preventive Care Benefits without Costs to Participants – After 9/23/10, plans may not impose cost-sharing requirements on preventative care services and benefits. This means plans cannot impose co-pays, deductibles, or co-insurance on services like annual physicals, immunizations, and mammograms.

Rescissions Allowed Only in Limited Circumstances – After 9/23/10, plans may not rescind existing coverage or terminate existing plans except with notice to enrollees and then, only in the case of fraud or misrepresentation.

New Appeals Processes – After 9/23/10, plans must have written internal and external appeals procedures. The law stipulates specific methods and structure for these appeals.

Reimbursement of Over-the-Counter Medications Without a Prescription – Beginning 1/1/11, a health care flexible spending plan, health savings account, or health reimbursement arrangement may no longer reimburse over-the-counter medication without a prescription.

Health FSA Contributions Are Capped effective January 1, 2013 – Regardless of plan year, employees may only defer up to $2,500 into a health flexible spending account plan.

Tax Credits for Small Employers – For tax years 2010 through 2013, small employers (those employing fewer than 25 full-time equivalents with average annual wages of less than $50,000) who purchase health insurance for their employees may receive a sliding scale tax credit. Small employers with 10 or fewer workers with an average wage of $25,000 or less may receive the full value of the credit. To qualify for a tax credit, an employer must contribute at least 50 percent of the total premium cost of a benchmark premium.

Subsidy for Retiree Coverage – Effective immediately and available until 1/1//14, group health plans may be reimbursed for certain expenses they incur for early retiree medical coverage. Early retirees are between age 55 and the age at which they become eligible for Medicare.

Provide Breast-Feeding Breaks to Nursing Mothers – Effective in March of 2010, employers must give employees who are nursing mothers reasonable break times to express milk for their children during the one-year period after birth. A private space, other than a bathroom, must be made available.

If you want to know more about health insurance policies or get a free quote, click here for a free Chicago Health Insurance quote.

Health Insurance Terms You Should Know

Thursday, May 20th, 2010

Health Insurance TermsWhen looking at a health insurance plan or accompanying paperwork, whether it’s part of an employer provided group plan or an individual plan, you need to know exactly what you’re reading.  Here is a few of the most important terms that you should understand about health insurance. It is by no means an exhaustive list, but should help to get you started when shopping around for health insurance.

Co-insurance – This is the amount that is considered the insured person’s responsibility.  On average, the split between a person’s co-insurance responsibility and the company contribution is 80/20; meaning that you pay 20 percent of your health insurance premium and your employer pays 80 percent.

Coordination of Benefits – If the insured has two or more sources that would pay for a certain condition or treatment (such as being covered by a spouse’s insurance plan along with your own) the insurance company would not pay double benefits. Instead, they would coordinate benefits to make sure that each plan pays their portion for the service or treatment.

Co-payment – The fixed amount that the insured is required to pay at the time of service. A co-payment is usually required for basic doctor’s visits and when purchasing prescription medications. The amount can range depending on which play you subscribe to and your premium payment level. Many group plans like those provided by your employer will have payments of around $15-$20 for doctor visits and prescription drugs.

Deductible – Deductible refers to the amount of money that the insured needs to pay before any benefits from the health insurance policy can be used. This amount is generally a yearly figure that resets at the beginning of the next year. Some services such as doctor visits may be available without meeting the deductible amount first. Usually there are separate amounts for individual deductibles as well as family deductibles.

Exclusions – Exclusions are the things that an insurance policy will not cover.

Grace Period – This is the amount of time a person has to pay for their health insurance premiums before their coverage is cancelled. This is important if your state or insurance company rules require that you not have any gaps in your coverage, and especially important if you do not want to lose your coverage because of non-payment.

Lifetime Maximum – This is the most amount of money a health insurance policy will pay for the entire life term of the policy. There are different individual lifetime maximums and family lifetime maximums, so pay attention to both amounts.

Out-of-Pocket – This is exactly what it sounds like: The amount of money the insured pays out of their own pocket. The term may be used to refer to how much the co-payment, coinsurance, or deductible amounts are. The term annual out-of-pocket maximum refers to how much the insured would have to pay for the whole year out of their pocket not including premiums.

Pre-existing Conditions – This term refers to health conditions, ailments, or situations that exist before an individual obtains a health insurance policy. Group plans do not prejudice based on pre-existing conditions, but individual health plans generally require that health questionnaires be filled out and a medical exam to test for pre-existing conditions be completed before an individual applies for coverage. Individual plans will often deny or limit coverage based on the results of their findings, especially in the case of pre-existing conditions. This is a major difference between group and individual health insurance plans.

Waiting Period – This is the amount of time a person must wait until health insurance coverage becomes available or they are eligible.

For more information on individual health insurance please visit Premier Insurance Services of Chicago for a free Chicago health insurance quote.

What to look for when shopping for individual health insurance

Thursday, April 8th, 2010

Health Insurance

If you’re frustrated with the amount of money being deducted by your employer from your paycheck each month for health insurance, you may have considered going out on your own and buying your own individual health insurance at one point or another. Or perhaps your employer has hit upon hard times and decided that they can no longer provide you with health insurance. In either case, you might want to crunch some numbers and see if buying your own health coverage is a smart, money saving option.

Doing Your Homework

Some people may not even realize how good they have it until they leave their job and try to buy their own insurance. In most cases, they can’t afford to purchase comparable coverage on their own. That’s because large businesses and corporations benefit from buying in bulk and try to pass that benefit on to their employees. That’s why they call it a benefit. Employers are trying to use their benefit package to attract and keep good employees.

There’s also no guarantee that you will be accepted for an individual policy. Individual plans are more restrictive and pre-existing conditions may exclude you from consideration of coverage by some individual health insurance companies. Do your homework, though. Some states have “guaranteed issue” laws that require health insurers to offer you a policy regardless of which medical problems or background you have. Check your local laws and regulations before you decide to make the jump. Individual insurance providers may also increase your rates over time as you age, so take that into consideration as well.

Think Price

Price is probably the main reason you want to shop around for your own coverage, so you should know ahead of time that you can shop for bargains on premiums, which can sometimes vary by as much as 50 percent for the same person with the same health background and age, depending on which company you are getting a quote from.

Don’t fall into the belief that you’re healthy and can save all of your money by foregoing coverage completely, either. All it takes is a one serious accident to put you into “medical bankruptcy.” You can also lose your rights to coverage of pre-existing conditions if you go without insurance for 63 days or more, a time period set by the Health Insurance Portability and Accountability Act (HIPAA).

Here’s a list of questions to ask when shopping for individual health insurance:

  1. Do you want to keep your doctor? – Finding a good doctor whom you enjoy working with is important. That’s why you want to make sure that you can keep your doctor when you switch from your employer provided plan to your own individual provider.
  2. What are your anticipated health care needs? – Think of the services you use regularly. Do you need optical, dental, chiropractic? Do you or members of your family need some type of special, regular care for a particular health condition? Will you be covering your children or a dependant parent? Will your needs increase over the next few years, in turn increasing your premiums or costs?
  3. What can you afford? – You’ll need to figure out two different average yearly costs for your healthcare. One is the premium, and the other is your out of pocket costs. Each one can affect the other. A higher premium may lower your out of pocket expenses and vice versa. You’ll need to figure out what will fit within your budget. You’ll also need to figure out if the amount you’ll pay will end up being less than the amount your employer is currently deducting from your paycheck.

It’s incredibly important to find out all of the specifics for any health insurance plan you’re looking at. Here are some key areas to look at:

  • See if the plan covers prescriptions and x-rays. Prescriptions are the most often used part of a health plan. X-rays are routine parts of many treatments and can become expensive if not covered.
  • Make sure specialists are covered if you use them. This includes alternative medicine such as acupuncture or other specialties such as chiropractors and psychotherapists.
  • Find a comprehensive plan that covers more even if the deductible is higher. You might be able to find a cheaper plan than your employer offers, but don’t sacrifice key coverage such as hospital stays, which can get pricey.
  • Ask what the costs are for emergency care. This includes co-pays and deductibles. Also be sure to read the fine print on what your provider defines as “emergency care” as these definitions can and do vary from one provider to another.

This is by no means an exhaustive list of considerations to look at or questions to ask. Do your own homework and research all of your options carefully. Make sure that any “deal” you are offered is really worth gambling your family’s health on. If you are a careful shopper, you might be able to put a little extra money in your pocket each month.

For more information on individual health insurance please visit Premier Insurance Services of Chicago for a free Chicago health insurance quote.

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