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Ready or not, health care changes coming

Posted: August 31, 2013 - 7:48pm  |  Updated: September 3, 2013 - 9:58am

Ready or not, certain changes to the health care market are on the way, and small businesses will be impacted.

As some parts of the Affordable Care Act take effect Oct. 1, Alaskans will see changes in the healthcare market, Josh Weinstein said at an Aug. 19 Anchorage Chamber of Commerce Make it Monday presentation.

Weinstein works for Northrim Benefits Group, which recently launched an “Enroll Alaska” program to help residents navigate the new insurance market.

Essentially, everyone fits into one of four plan types: individual and family coverage, self-funded plans that cover less than five people, small group coverage (less than 50 people) and large group coverage (more than 50 lives).

Weinstein said he expects to see self-funded plans grow in the coming years, as the plans help employers escape some tax issues associated with other plans, and are not subject to the same rating rules as small group plans. However, employers utilizing self-funding rather than purchasing insurance policies, like some of Alaska’s school districts, will see other changes from the act that are still being studied.

New taxes, altered plan requirements, and new health insurance exchanges — paired with mandated individual insurance — are on the way, Weinstein said.

In all, the impacts to small businesses can be difficult to gauge.

A major component of the act is the 20 new taxes needed to generate about $2.6 trillion over 10 years, Weinstein said.

Those include a “Cadillac tax” on certain high-value plans, a tax on health insurance premiums, an excise tax on medical devices, the insurance mandate penalties and even a tax on tanning beds.

Medicaid changes are also part of the financial plan. Weinstein said that states such as Alaska that don’t increase Medicaid eligibility are causing hardships for hospitals, because there’s less federal reimbursement, and the new structure assumes the expansions will occur, otherwise the hospitals feel the pinch.

Come Jan. 1, 2014, individuals and businesses will both be subject to certain costs.

Individual and family coverage will be mandated, and the tax penalty for not having coverage will start at $95 or 1 percent of annual household income in 2014, and rise by 2016 to $695 or 2.5 percent of household income. Businesses will also have to provide insurance, or pay a certain penalty for not doing so.

While the individual mandate will take effect in 2014, the mandate for employers with 50 or more employees to provide minimum coverage has been delayed by the White House until at least 2015.

The taxes and fees are meant to support many of the changes that have already occurred, and those that are still on the way.

ACA implementation has been ramping up for the past few years, Weinstein said.

The changes passed in the 2010 law included the removal of dollar-based lifetime limits on coverage, definition of essential benefits that all insurers must provide, a high risk pool was established, and the small business tax credits were created.

Those, however, can be difficult to understand and its uncertain whether very many businesses will get them, Weinstein said. That year, adult children under age 26 also were allowed to remain on their parents’ insurance plan, emergency services were covered at in-network level and insurers also were notified that dollar-based annual limits would be gone in 2014.

The requirement for insurers to remove annual caps on out-of-pocket expenses has also been delayed beyond the January 2014 deadline established in the law.

In 2011 and 2012, additional changes took effect, including minimum loss ratio rebates, increased tax-penalties for non-qualified health savings account rebates and the expansion of women’s preventive services.

This brought more changes, including increased Medicare payroll taxes for higher income earners. One of the biggest is yet to come — new health care exchanges are supposed to open Oct. 1.

Come 2014, the most talked-about set of changes will hit, Weinstein said.

Plans are guaranteed, there will be no pre-existing condition limitations, and lifetime benefits limits will be phased out.

There are, of course, certain exeptions. Individuals can go without health insurance for 90 days, which is also the maximum waiting period for employers to wait to provide it to new employees. Certain exemptions will also be available, including for religious reasons, those using healthcare sharing models and others.


Businesses must navigate the changes, starting with figuring out if they are large or small based on full-time equivalent employees (30 or more hours per week), and then looking into the specifics for each group. Some requirements will phase in over the next few years, but all employers should be prepared for close accounting of their plans and double-checking the details to prepare for audits, Weinstein said.

As for small employers, Weinstein said the changes are mixed.

For 2014, he said, plan for volatility. Gender and industry ratings will be gone, and plans will be rated by community, rather than by individual group performance.

Ultimately, Weinstein said he still believes there is a value in offering health benefits, particularly because of the value it creates for the employee.

Larger employees see fewer requirements and less changes, including allowances for gender ratings.

If an individual doesn’t have employee coverage, how they get coverage will change. Beginning Oct. 1, Alaska will have a federally facilitated marketplace where all plans are laid out for comparison and purchase.

Weinstein said Alaska made a “wise call” on the decision to not set up its own exchange, allowing the federal government to set it up instead.

The plans will have the same essential benefits as other plans in the country, and be judged based on the same tiered standards. The federal government, however, will be responsible for the information technology driving the exchange, and much of the groundwork. That was a good choice for a small state that likely couldn’t operate an exchange in perpetuity without a significant cost, Weinstein said.

The ACA changes dictate much of a plan’s pricing.

Ultimately, prices will be somewhat leveled, going up for the healthiest and getting cheaper for others. Weinstein said that today, a young person might be able to get a plan for $100 per month. Under the new requirements, a plan might cost $200 per month.

For individual and family plans, males and females will pay the same rates, although Alaskans can pay a higher cost than other states because of a geographic factor, he said, and tobacco users can also pay more. The government has also set the maximum ratio between plans for younger and older people.

Subsidies will also come into play in the new pricing changes, also for those without access to “good” and “affordable” job-based coverage. Those making 100 to 400 percent of the federal poverty level will be eligible for the tax credit, while those making less than that will likely be eligible for Medicaid.

The goal of the subsidy is to bring spending down to less than 9.5 percent of household income for health insurance, Weinstein explained.


Molly Dischner can be reached at

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robert white
robert white 09/01/13 - 11:51 am

Insurance companies don't want it, the people as a majority don't want it, many states don't want it, but President Obama, (our inexperienced world leader) and Mark Begich are shoving this down our throats. Don't forget you have to pass it before you know what's in it!! Now to save face in Syria and ego and help our enemies for the over throw. Does anyone know what's going on in Washington?

JohnPeterZenger 09/01/13 - 04:07 pm
News, by definition, is

News, by definition, is supposed to be objective.

The corporate line, which is repeated from corporate funded echo chambers, is not, and has never been, news, it's corporate propaganda, it's nothing more, nothing less.

The purported 'news' article above will not objectively inform you of much of anything , except it will demonstrate how the corporate derived line of disinformation is to be presented.

The courts may have ruled that corporations are 'people',
but that can't change the fact that those corporations don't have your best interests in mind as they go about their 'business'. Their business is to enrich themselves. Don't be fooled into thinking they go about that 'business' by putting your best interests first. The public's interests have always been sacrificed in the name of corporate profits. There is no good reason to ignore that, or allow that to continue. The corporations are not at all concerned with your best interests.

If you wish to learn how health care reform is going to impact you personally, look somewhere else, the corporate echo chamber will not provide you with an objective realistic view.

The corporate disinformation echo chamber will attempt to bend you to their advantage, and they don't care if it all comes at your expense.

After all, your expense is what they are ardently hoping you'll give to them. That is their reason for being, it isn't in your best interests to ignore that.

beckster 09/02/13 - 05:48 pm

Paragraph 12 should read that the penalty for 2014 is $95 single / $285 family * or * 1% of " adjusted gross income - whichever is greater".

Raoulduke 09/03/13 - 02:13 pm

These corporate news echo chambers have been dumbing up the American public for decades.Unfortunately! A great number of people are to lazy,or apathetic to get the true facts of the situation.Some of this disinformation balances on the absurd.

bluffbunny 09/04/13 - 10:33 am
health care?

Sounds like one big MESS, to me.
We used to have the best medical care in the world, and people from other countries that HAVE "universal health care' would come here for treatment.
Now this ignoramus thinks HE has a better solution?
I predict this thing will self-destruct and prove to be a huge disaster. As its' founder said, a gigantic train wreck!
Civil disobedience brought down the British empire, perhaps enough people will just refuse to participate, that THIS,too, will be impossible to implement, and when we have some new people in power, they may decide it has to go.

JohnPeterZenger 09/05/13 - 01:57 am
Sounds like a mess? Not a

Sounds like a mess? Not a very concise criticism, got any actual examples that will bolster such a doom and gloom supposition? Any actual specifics you care to cite that would justify such an outcry?

On the surface, it appears you've listened only to the corporate disinformation campaign waged by those who don't wish to be regulated, and whose only wish is to unduly profit off your healthcare and perhaps you've neglected to investigate for yourself whether that 'sound' you think you've heard has any actual basis in fact.

Affordable healthcare, binding patient protections and the law actually barring the insurance companies from denying you policies isn't a bad thing. Expanded coverages, preventative care, improved senior coverage, again, not bad things. 44 million uninsured Americans will gain access currently denied them, that's a bad thing how?

'Predicting' a huge disaster is hyperbole. Hyperbole that just happens to coincidentally be exactly the same hyperbole as the corporate disinformation campaign has been wanting you to blindly accept.

Think for yourself, and don't fall for the deception inherent in the corporate echo chamber's line of disinformation.

Got questions? Want actual realistic factual answers?

Start here:

Corporate shills aren't going to provide you with objectivity or for that matter, anything as useful to you as actual facts. They've only got the line of disinformation they wish to feed you. There's better sources from which one may responsibly inform themselves.

As a side note, not sure about the credibility of the 'ignoramus' reference, though, it is maybe pertinent to note that the current healthcare reform plan is Mitt Romney's idea, and it was Congress who approved it. The Affordable Care Act may have been signed into law by the current president, but it wasn't his idea.

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