What the Health Care Reform Bill Means to You
Apr. 13, 2010
The passing of the Health Care Reform Bill has created some discussion and questions within Farm Credit. How will this affect me in the short term? Will this cost me more money? How much? Will my premiums go up? What will the future of health care look like?
Though the bill was passed March 23, there are still too many uncertainties to communicate exactly what it means. However, we would like to take a couple of moments to let you know what we are doing behind the scenes at Foundations to address the ramifications of the bill. As a reminder, this is the first major change in the U.S. health insurance system in decades.
The Health Care Reform Bill will require all Americans to have health insurance coverage by 2014. Health care insurance companies can no longer deny coverage to individuals with pre-existing conditions. Also, young adults can remain on their parents’ health plan until the age of 26. The cost of the Health Care Reform Bill has been estimated at $938 billion over the next 10 years.
There will be sweeping changes within the health care system with this bill. However, these changes will be gradual because they will be phased in from 2011 to 2018. Because the changes are so far off, it is nearly impossible to comprehend what this means for all of us.
Here is what we know right now: This legislation mandates changes that will impact our plans starting in 2011. (Eligibility for and provisions of the Foundations medical plans are not affected in 2010.)
Mandates beginning Jan. 1, 2011, that affect the medical plans include:
- Coverage of Adult Children up to the Age of 26
- Allows coverage for children that are either unmarried or married
- Under age 26
- Student status no longer required
- Not otherwise eligible for their own employer group insurance health plan
- Pre-existing Conditions Removed for Dependent Children under the age of 19
- N/A – Foundations self-insured medical plans do not apply pre-existing condition provisions; therefore, Foundations is already in compliance
- Eliminate Lifetime and Restrictive Annual Limits
- N/A – Foundations self-insured medical plans do not apply aggregate lifetime limits; therefore, Foundations is already in compliance
- The department of Health and Human Services will issue regulations later this year defining “restrictive annual limits. Foundations will then be able to determine how to comply with the guidance as issued by HHS.
- Eliminate Reimbursement of Non-prescription Medicines under Health Flexible Spending Account and Health Savings Account
- Over-the-counter drugs such as Advil, Priolosec, Claritin, Sudafed, etc., cannot be reimbursed through your FSA or HSA unless you have a prescription from your physician.
- Other over-the-counter, non-pharmaceutical items currently reimbursable under FSAs and HSAs can still be purchased and reimbursed through these accounts.
- The IRS provides the detailed publication 502 and will need to update this information for further guidance.
- Disclose the Value of Employee’s Total Health Coverage on Form w2
- We will begin to capture the total value of health coverage in 2011 and report that amount on the 2011 W-2 issued by Jan. 31, 2012.
What Are the Next Steps
We will continue to work closely with our consulting partner, Hewitt Associates, LLC, to address the short-term and long-term implications of this bill. Any changes to our medical plans will be communicated during the 2011 Annual Enrollment process.
