Impact of new Health Care Regulations
Beginning in 2014, nearly every American will be required to have medical plan coverage or face tax penalties. Here are some key facts you need to know about how new regulations may affect you.
Why are these changes taking place?
The Patient Protection and Affordable Care Act (PPACA, or ACA) was approved in 2010, and is intended to increase the number of Americans with medical plan coverage, improve outcomes, and reduce overall health care costs. The ACA will achieve these goals through a combination of mandates, subsidies and tax rules. Parts of the ACA have already taken effect, but important new regulations will take effect Jan. 1, 2014.
What is changing for 2014?
There are two important changes that will take effect Jan. 1, 2014.
- Individual Mandate – A component of the ACA known as the individual mandate requires most Americans to carry medical/pharmacy coverage meeting certain minimum standards or face tax penalties. For the 2014 tax year the individual penalty is one percent (1%) of income; this increases to two percent (2%) in 2015 and two and a half percent (2.5%) in 2016 (minimums apply for low wage earners). In addition, the ACA requires large employers like Banner Health to offer appropriate medical/pharmacy coverage to their full-time employees or pay penalties.
- Health Marketplace –Each state must offer a marketplace where individuals can easily shop for and compare different medical plans.
- The marketplace (which has sometimes been called a health exchange), is required to accept applications regardless of your health status, so you can’t be denied coverage based on your medical history or conditions.
-- Individuals whose employers have decided to pay penalties rather than offering medical coverage, or whose employer plans do not meet certain standards, may be eligible for subsidies to help with the cost of enrolling in a plan through the marketplace.
- If you meet certain financial guidelines, you may be eligible for assistance through programs like Medicaid.
- The marketplaces must open by Oct. 1, 2013 and offer coverage that will begin Jan. 1, 2014.
- States may create a marketplace on their own or in partnership with the federal government, or may choose to simply use the federal marketplace. You will be hearing more about how your state will provide its marketplace through local advertising.
How will these changes in 2014 impact my Banner Health benefits?
Banner Health already offers medical/pharmacy coverage to our full-time and part-time employees, and we will continue to do so. We are still designing our 2014 benefit plans, but we will definitely offer a plan that meets the ACA requirements.
This means that if you meet the eligibility rules, you will be able to enroll in a medical/pharmacy plan through Banner that will let you meet the requirements of the individual mandate, avoid the tax penalties, and have part of the cost of your monthly premiums paid by Banner Health (as we do today).
What if I don’t have coverage through Banner in 2014?
If you aren’t eligible for or don’t want to enroll in Banner benefits coverage, you may want to consider the following options:
- Enroll through your spouse’s or domestic partner’s plan
- Enroll through your parent’s plan if you are under the age of 26
- Contact your state’s health marketplace for assistance
- Pay the tax penalties for not having coverage.
What do I need to do right now?
The most important step you can take right now is to get informed. You need to take personal accountability for learning more about these new regulations and how they will impact you. We will continue to provide information through the employee website, eNews and as part of our Annual Enrollment communications. We also encourage you to visit www.healthcare.gov.
If you have questions related to the ACA, the state marketplaces, or the tax penalties, please visit www.healthcare.gov or talk to your personal financial/tax advisor.
If you have questions about how Banner Health’s employee benefits will help you to meet the ACA requirements, we are still designing our 2014 benefit plans and will share more details as they become available. Watch for more information in the coming months.