Financial Impact – Health  Reform, Premiums, Taxes & Fees

Financial Impact Links

Overview of ACA Taxes & Fees 

Check out the  Millman Study 4.2013 it’s the most comprehensive report and explanation that I’ve seen.   Here’s a 2 page summary from Blue Cross.

Major sources of deficit reduction include:^[199]

higher Medicare taxes on the wealthy;

new annual fees on health insurance providers;

similar fees on the healthcare industry such as manufacturers and importers of brand-name pharmaceutical drugs and certain medical devices;

limits on tax deductions of medical expenses and flexible spending accounts;

a new 40% excise tax on “Cadillac” insurance policies – plans with annual insurance premiums in excess of $10,200 for an individual or $27,500 for a family;

revenue from mandate penalty payments;

a 10% federal sales tax on indoor tanning services;

and spending offsets such as a reduction in Medicare reimbursements to insurers and drug companies for private Medicare Advantage policies that the Government Accountability Office and Medicare Payment Advisory Commission found to be overpaid (relative to government Medicare);^[252][253]

and reductions in Medicare reimbursements to hospitals that do not meet standards of efficiency and care.  Learn More  Wikipedia

Breaking News

HHS will now pay 100 percent of claims costs between $45,000 and $250,000 — an increase from the previous rate of 80 percent. ^{The Hill 6.17.2015}

Resources & Links

Donald Care – American Health Care Act – Repeal Taxes – starting on page 68 Rev. 3.6.2017

States being forced to pick up ACA Insurer Fee CA Health Line 5.18.2015

Health Insurer Taxes  Flyer Blue Shield Rev 5.2013

Forbes 11.7.2013 explanation of ObamaCare Charts – ACA – National Health Care Expedenture and the Uninsured

UHP expects substantial increase in costs flyer 3.2013

IRS Summary of NEW taxes

The limit of $6,350 for an Individual and $12,700 for a family out of pocket costs has been postponed for 1 year for some insurers.  ^{New York Times   DOL FAQ’s}   Part of the justification is that some insurers have different parts of the coverage like Mental Health or Rx Drugs covered by other Insurance Companies.  On the other hand CA has AB 639 pending to put limits in.

Medical Inflation in general

Obama’s promise to save $2,500 to $3,000 Politico

Restaurants adding surcharges so that they can get Health Insurance for Employees californiahealthline.org   LA Times 2.18.2014   articles.latimes.com/

President Barack Obama’s proposed 2015 budget contains $5.5 billion slated to be paid to insurers who suffer significant losses on plans sold through the state and federal insurance exchanges. The risk-corridor program has been pilloried by congressional Republicans as a bailout for the insurance companies, even as experts have said it would produce a net surplus.

But the president’s budget also includes $5.5 billion in anticipated revenues from insurers who profit on plans sold through the government-run online marketplaces. That means Obama is counting on the risk-corridor program to be budget neutral, contrary to a Bloomberg News report that said the program would be a money-loser for the government.  modernhealthcare.com

Final Market Rules

Final Market Rules 45 CFR Parts 144, 147, 153, 154, 155, 156 and 158

Facebook Comments 

• Someone posted this article on Facebook about the Supreme Court case awarding 12 billion to insurance companies… politico.com/supreme-court-rules-government-must-pay-billions-to-obamacare-insurers–
• Why do you think your comment about people that don’t have coverage during this pandemic, is relevant?
  • I feel my comment about the uninsured on Facebook is relevant for several reasons:
    • 1 The critique of President Trump and his opposition to ACA/Obamacare
    • 2. “who had sicker customers than expected in the newly overhauled insurance marketplaces”
    • Where did these “sicker” customers come from, if not the uninsured?
    • Sure, there was COBRA and HIPAA but how many knew about it or actually applied?
    • There was also Mr. MIP, but at $50 one time write up fee, how could a Insurance Broker afford to sell it, without going on Medi Cal himself?
    • 3. lawsuits brought by three small insurers, including one that blamed the risk corridors shortfall for its collapse in 2016. Today’s decision will also benefit insurers who brought dozens of identical lawsuits in lower courts.
• Many of these insurers, known as co-ops, shuttered in the law’s early years partly because they didn’t receive the risk corridor funds they expected.
• which helped insurers pay poor customers’ medical bills.
• Blue Cross pretty much went out of the market in CA in 2018
• These companies apparently foresaw the problems and immediately withdrew!
  • Aetna
  • Assurant
  • CIGNA
  • United Health Care
    • Then to top it all off… Covered CA cancelled Grandfathered Plans that President Obama said you could keep, just so that they could get the previously insurance and healthy customers and bypass professional agents. biz journals.com/covered-california-contracts-required
    • Covered California, which required insurers to cancel existing individual policies in order to qualify to participate in the federally subsidized exchange.
      • it assures a large and balanced risk pool of individual and family plan subscribers.”
      • potential deluge of sick people seeking coverage and not enough healthy ones to make the project actuarially sound.
      • Peter Lee, Covered California’s executive director, said this week that that as many as 800,000 to 900,000 people may be affected by the cancellations, and other estimates put the number closer to 1 million.

#Cadillac Tax Repealed on Really Nice Employer Health Plans

• Cadillac Tax repealed by President Trump in December 2019   ^{CIGNA *  Very Well} *
  • The Cadillac Tax, set to begin in 2018 – 2020 ^{Word & Brown 8.20.2019} *  ^{CA Health Line 12.21.2015} as part of the ACA, is a 40% tax on benefits over certain thresholds. HRAs, HSAs, Major Medical coverage and other items are included in the coverage that counts towards this tax.  The tax will hit insurance and related perks valued at more than $10,200 for singles and $27,500 for families. So for family benefits worth $30,000, the tax would apply to the $2,500 that’s above the limit.  The administration has long argued it is a modest step to get health care costs under control. It “will affect only a small portion of the very highest-cost health plans — a total of 3 percent of premiums in 2013,”  About one-third of employers will be hit by the tax in 2018 if they do nothing to change their plans   ^{4.7.2015 Word & Brown from Politico  CIGNA *} 
  • January 2017 – Senators Dean Heller (R-NV) and Martin Heinrich (D-NM) introduced S. 58, after Representatives Mike Kelly (R-PA) and Joe Courtney (D-CT) introduced H.R. 173, legislation to repeal the ACA’s Cadillac/excise Tax, which will impose a 40% excise tax on health plans that exceed certain cost thresholds beginning in 2020
    • Health Net Update   1.19.2016
    • Why Employers are really cutting benefits?
    • Not the Cadillac Tax  Los Angeles Times 8.27.2015
    • Next Big ObamaCare Battle – Cadillac Tax  CA Health Line 9.17.2015
    • 4.29.2015 – Legislation introduced to eliminate Cadillac Tax
    • 26 U.S. Code § 4980I – Excise tax on high cost employer-sponsored health coverage
    • American Health Care Act – Donald Care  retain the ACA’s so-called Cadillac tax on high-value plans but delay it until 2025 – page 85 3.6.2017 Revision
    • Check out Group Supplemental Plans to avoid the tax!

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