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Knock Out Blow? – Trump Ends Cost-Sharing Reduction Subsidies

The White House confirmed Thursday that it will stop making federal payments for cost-sharing reductions, payments to health insurers. The Department of Health and Human Services confirmed that the cutoff would be immediate. This action could throw the Marketplace into immediate turmoil as insurers start to evaluate their options for 2018.

Many, certainly democrats, have been calling for a bi-partisan solution to the health care problems in America. However, let’s not forget, it was the democrats that ramrodded the misnamed Affordable Health Care Act through the legislative process, behind closed doors, with absolutely no input from republicans.

Employee Benefit Advisors has blogged several times about legal challenges to the ACA, specifically pin pointing, the Obama administration saying they did not receive, but needed, an appropriation to make these payments to insurance companies. Obama used executive orders to put into place key finance regulations behind the ACA. Problem is, what can be done by executive order can be undone by executive order.

 

Employee Benefit Advisors provides employee benefits, tax-advantaged healthcare, compliance guidance for ACA and Health & Welfare DOL Audits, and PEO Advisory & Consulting Services.

Trump’s Executive Order – What it is & What happens next

President Trump signed an executive order in an attempt to improve access, increase choices and lower costs for healthcare.

What Is in the EO?

The EO directs the secretary of Labor to consider proposing regulations or revising guidance to expand Association Health Plans. The intent of this directive is to allow employers in the same line of business anywhere in the country to join together to offer healthcare coverage to their employees. It could potentially allow employers to form AHPs through existing organizations, or create new ones for the express purpose of offering group insurance. This could lead to the sale of insurance across state lines through AHPs; however, more action will need to be taken by the Department of Labor before this option can be available.

The EO directs the secretaries of HHS, Treasury and Labor to consider proposing regulations or revising guidance to expand short-term limited duration insurance (STLDI). This directive would allow the agencies to revisit the rule enacted by the Obama Administration that limited the length of STLDI plans to three months.

The EO directs the secretaries of HHS, Treasury, and Labor to consider proposing regulations or revising guidance to expand Health Reimbursement Arrangements. The intent of this directive is to allow employers to contribute more to their employees’ HRAs. HRAs are employer-funded accounts that reimburse employees for healthcare expenses, including deductibles and copayments. The IRS does not count funds contributed to an HRA as taxable income. The intent of this directive is to expand HRAs, which could provide employees with more flexibility in how their healthcare is financed.

What Happens Next?

The EO directs the secretary of Labor to act within 60 days to consider proposing regulations or revising guidance on AHPs. It also directs the secretaries of Treasury, Labor and HHS to act within 60 days to consider proposing regulations or revising guidance on STLDIs, and for the agencies to act within 120 days to consider changes to HRAs.

Within 180 days, the secretary of HHS, in consultation with the secretaries of Treasury, Labor and the Federal Trade Commission, must report to the president on state and federal laws, regulations and policies that limit healthcare competition and choice, as well as on actions that federal and state governments could take to increase competition and choice and reduce consolidation in healthcare markets.

The EO does not direct the agencies to adopt specific regulations; therefore, in order for any policies to change, the agencies will have to go through the traditional rule-making procedures of providing a proposed rule for public comment before being able to enact any final rules.

What about Open Enrollment for 2018?

At this time, nothing in the EO will affect open enrollment for 2018 unless regulatory action is taken by the agencies. Until any such regulations are enacted, the ACA and all of its regulations, penalties and enforcement remain.

 

Content provided by a statement from the National Association oh Health Underwriters of which Employee Benefit Advisors is a member.

What is Reference Based Pricing?

With RBP plans are designed to negotiate treatments with high-quality providers at reduced costs and can work in different ways, depending on the insurance carrier or TPA. – Sound like a PPO or HMO? Not quite.

RBP can have no network restriction, a network and use a network within a network. Call it Creative Networking where certain services may require the use of select networks, a Network within a Network.

All reimbursements are based on a fixed amount for a particular procedure, such as dialysis and hospital stays – two biggies, which certain providers will accept as payment in full. Reimbursement is based on a reasonable fee or multiple of Medicare. Under this type of arrangement, reimbursement rates range between 120% and 180% of Medicare.

RBP product could offer you 72-77% savings over traditional PPO plans. (A national survey found less than 1% of providers do not accept this type of health benefit plan.)

 

 

Discover the referenced based pricing solution that offers a significant improvement in savings without compromising quality care. Save on claims costs without provider and facility restrictions.

 

Employee Benefit Advisory provides employee benefits, tax-advantaged healthcare, compliance guidance for ACA and Health & Welfare DOL Audits, and PEO Advisory & Consulting Services.

Power of THE Pen – Trump holds the key to Repeal!

Many have forgotten that our Congress (Senate and State Representatives) and public employees are not fully subject to Obamacare. President Trump can change that with a stroke of THE Pen.

Congress was initially subject to the ACA. However, after a meeting with Senate Democrats in March 2013, Obama exempted Congress from section 1312(d)(3)(D). That section would have required Congress and their staff to buy insurance through an Obamacare exchange and does not authorize an employer contribution toward their premium. Congress and their staff would lose their taxpayer-funded, gold-plated health care rather than go into Obamacare and pay their own way.

The Office of Personnel Management (OPM), under the instruction of President Obama, ruled “the DC Health Link Small Business Market administered by the DC Benefit Exchange Authority, is the appropriate SHOP from which Members of Congress and staff purchase health insurance in order to receive a government contribution (subsidy). The Congress employees thousands, not the required 50 or fewer required to be eligible for the DC (or any) Exchange.

Federal Employees Health Benefits Program: Members of Congress and Congressional Staff, 78 Fed. Reg. 60653- 01 (Oct. 2, 2013). https://www.gpo.gov/fdsys/pkg/FR-2013-10-02/pdf/2013-23565.pdf

President Trump has the power to end this abuse by directing OPM to rescind the rule and issue a new one that conforms to the statutory requirement the congress and their staff pay their own premiums in the individual Obamacare Exchange.

Employee Benefit Advisory provides employee benefits, tax-advantaged healthcare, compliance guidance for ACA and Health & Welfare DOL Audits, and PEO Advisory & Consulting Services.

Why are costs for prescriptions so much higher in the United States?

Specialty pharmacy will be 50% of a health plan’s drug spend by 2018. By 2020 pharmacy will be 50% of total healthcare spend. Pharmacy is the most utilized and least understood of healthcare costs.

Why are costs for prescriptions so much higher in the United States than other countries? The easy answer is that Americans are paying a disproportionate share of the research cost for prescription drugs. The why is a little more complicated. It’s compulsory pricing, a law countries have on the books that states if the government can’t reach an agreement with drug companies over a price the government is willing to pay, the government can say the drug companies are not making their products available in the country, and can license a different company to make and sell the drug. Either drug companies negotiate a deal in with low profit, to cover manufacturing, or they lose their intellectual property rights.

So why not import drugs from other countries to bring more competition into the US market to lower costs? Safety. Large volumes of ‘unapproved’ drugs that enter the US pose a threat to the security of our nation’s drug supply. The potential of being flooded with unsafe and counterfeit drugs could kill thousands of Americans.

Proper security requires careful monitoring and control. Companies must put anti-counterfeiting and anti-tampering markings on every drug they make around the world. Although that currently works well in some countries, in others it’s problematic. We increase the threat of terrorism, ‘friendly’ or not, with each additional country we import prescription drugs.

 

Employee Benefit Advisors provides employee benefits, tax-advantaged healthcare, compliance guidance for ACA and Health & Welfare DOL Audits, and PEO Advisory & Consulting Services. We can customize a wellness plan for your budget and culture.

Here’s why the CBO report on AHCA is wrong – BIG TIME!

Opponents of the American Health Care Act say 24 million more Americans will lose coverage. However, that number is based on faulty assumptions. The CBO report uses the ACA’s March 16 baseline projections for comparison. Projections that have already proven inaccurate. This leads to three flawed assumptions.

1) Premiums will not be more expensive than under the baseline.
This is false. American’s saw significant premium increases in 2017 and if Obamacare is left intact future increases will undoubtedly occur.

2) Insures will not drop out of the system.
This is false. Carriers have already announced they are pulling out altogether.

3) The number of people under Obamacare will not decrease.
This is false. Under Obamacare the marketplace was expected to rise to 18 million by 2023 and then level off. However exchange enrollment actually dropped by about half a million between 2016 and 2017 — to 12.2 million. That suggests that the number of insureds has already begun to contract. Premium increases and insurance companies dropping out of the market have and will continue to force people to drop their insurance, impacting the original assumption even further.

Garbage in, garbage out.

Employee Benefit Advisors provides employee benefits, tax-advantaged healthcare, compliance guidance for ACA and Health & Welfare DOL Audits, and PEO Advisory & Consulting Services. We can customize a wellness plan for your budget and culture.

Rx Refills made easy!

Don’t like lengthy waits to refill your prescriptions? Prefer to have refills delivered to your door? Prefer someone else troubleshoot insurance & renew refills for you? Let me introduce you to Phil.

Phil is a service that manages your ongoing prescriptions. Phil partners with top-rated, locally-owned pharmacies that are licensed by the Pharmacy Board. These pharmacies will deliver your medications to you on time and answer any questions over the phone. Using the Phil app, you are able to refill on your own terms by scheduling when your medications arrive, ordering vacation refills etc.

Welcome to Phil – Smarter Prescription Refills: same copay, free delivery and a real time saver.

 

Phil takes 3 easy steps.
Step 1 – Sign Up and add your existing prescriptions to Phil.
Step 2 – Phil does the rest, they contact your old pharmacy and do the paperwork.
Step 3 – Receive your meds. Partner pharmacies deliver meds to your doorstep every month.

All partner pharmacies are rated 4-5 stars on Yelp®

Delivery is free. Phil will guarantee your copay will be the same as what you pay at your current pharmacy. Some rare exceptions may apply; in those cases, you’ll be contacted for approval. If you don’t have insurance, Phil partner pharmacies will quote you the lowest price they can obtain for you.

 

Employee Benefit Advisors provides employee benefits, tax-advantaged healthcare, compliance guidance for ACA and Health & Welfare DOL Audits, and PEO Advisory & Consulting Services. We can customize a wellness plan for your budget and culture.

Social Security – Where’s the AARP?

Do you know when you retire you may be paying taxes on your Social Security income? And yes, you already paid taxes on that income. It’s double taxation. (Our friends in Boston that had a bit of a tea party would love this one.)

Not everyone pays though. Only high income earners. – When you retire will you be a high income earner? – Don’t think so? I suggest you take another look. The government says “This usually happens only if you have other substantial income (such as wages, self-employment, interest, dividends and other taxable income that must be reported on your tax return) in addition to your benefits.”

And, they try to soften the blow by saying “No one pays federal income tax on more than 85 percent of his or her Social Security benefits based on Internal Revenue Service (IRS) rules.”

Who pays? You do, if you

  • file a federal tax return as an “individual” and your combined income* is
    • between $25,000 and $34,000, you may have to pay income tax on up to 50 percent of your benefits.
    • more than $34,000, up to 85 percent of your benefits may be taxable.
  • file a joint return, and you and your spouse have a combined income* that is
    • between $32,000 and $44,000, you may have to pay income tax on up to 50 percent of your benefits
    • more than $44,000, up to 85 percent of your benefits may be taxable.
  • are married and file a separate tax return, you probably will pay taxes on your benefits.

Note: Your adjusted gross income + nontaxable interest + ½ of your Social Security benefits = your “combined income”

And the income levels mentioned above are not adjusted for inflation.

Clients and followers of Employee Benefit Advisors know that despite being well versed in investing and retirement planning we do not dabble in retirement benefits. Our practice is strictly Health & Welfare. We decided to blog bout this issue because every time this topic comes up people are stunned.

Do you want to change this law? Write the AARP. How did they let this get through and why are they not addressing this issue?

 

Employee Benefit Advisors provides employee benefits, tax-advantaged healthcare, compliance guidance for ACA and Health & Welfare DOL Audits, and PEO Advisory & Consulting Services. We can customize a wellness plan for your budget and culture.

Men are the problem!

Men don’t go to the doctor unless their arm or leg is falling off or they are dying. Consequently they are a major reason for the large preventable claims your company is incurring. So men, get a reality check, and become a smart patient.

Human Resource Directors, read the following then think about this recommendation. “Employees that have their annual wellness exam should pay less for their employer provided health insurance.” (This recommendation is good for women as well, you don’t want to discriminate. And you can implement this staying HIPAA compliant.)

Guys, you may feel fine, but the numbers don’t lie: More men than women are likely to be diagnosed with diabetes and kidney disease. And according to the Centers for Disease Control and Prevention (CDC) 12.1% of US men have circulatory diseases like coronary heart disease, heart attack and stroke. Your body may be suffering from silent conditions that have little or no symptoms, such as hypertension or colon cancer. About 3.5 million people are diagnosed with skin cancer every year, and men are more likely than women to die from melanoma, the deadliest form of skin cancer.

You should talk to your doctor about your risk of prostate cancer – especially if you’re over 50, African American, or if prostate cancer runs in your family. If you’re a baby boomer, you should get tested for hepatitis C (HCV). More than 75% of adults infected with HCV, often a symptomless disease, were born between 1945-1965. Left untreated, HCV can cause life-threatening diseases such as liver damage, liver cancer and cirrhosis.

So no more excuses. The old “ignore-it-and-it-will-go-away” approach doesn’t work. It’s time to get informed and become a smart patient. Make that doctor’s appointment now.

Statistical information came from sharecare, www.shaecare.com, a great resource for men and women’s health.

 

Employee Benefit Advisors provides employee benefits, tax-advantaged healthcare, compliance guidance for ACA and Health & Welfare DOL Audits, and PEO Advisory & Consulting Services. We can customize a wellness plan for your budget and culture.

Health Care Reform – Where do we stand?

By now everyone knows the initial attempt to replace Obamacare with a more workable solution has failed. I’m sure another attempt will resurface later. Let’s focus on what we know and how President Trump’s executive order, signed in January, impacted Obamacare.

President Trump’s executive order is still in effect. – The primary focus of the executive order was for Federal agencies to minimize the economic burden of the Affordable Care Act (ACA), pending repeal of the law. However, until further guidance or legislation, all ACA requirements remain in effect, including penalties for noncompliance.

The executive order specifically calls upon agencies to exercise authority and discretion to:

  • exercise all authority and discretion available to them to waive, defer, grant exemptions from, or delay the implementation of any provision or requirement of the Act that would impose a fiscal burden on any State or a cost, fee, tax, penalty, or regulatory burden on individuals, families, healthcare providers, health insurers, patients, recipients of healthcare services, purchasers of health insurance, or makers of medical devices, products, or medications;
  • provide greater flexibility to States and cooperate with them in implementing healthcare programs; and
  • encourage the development of a free and open market in interstate commerce for the offering of healthcare services and health insurance, with the goal of achieving and preserving maximum options for patients and consumers.

Although the penalties for noncompliance remain in effect it does give the appearance that there is an out. However, I don’t recommend you be the one to test it.

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