Good Neighbor Insurance (www.gninsurance.com and dev.gninsurance.com) is continuing to update our clients on the new health insurance laws. There are six major coverage options for those in the US and even though some of the rules and regulations are similar for all many differences are there and it all depends on how old you are and for whom you work. Many critical details of this new insurance law will be clarified in the months and years to come.
These six major coverage options are:
(1) Individual or family coverage (private health care plans)
(2) Employee/employer group option for small businesses (typically under 50 employees)
(3) Employee/employer group option for large businesses (typically larger than 50 employees)
(4) Exchange options through the state you are residing in (fully integrated 1-1-2014 and are quasi-state/federal government and private insurance coverage combined)
(5) Medicare (which include Parts A, B, C, and D) for those 65 years onwards
(6) Full government health plans like Medicaid, CHIP, TRICARE, VA and other coverage plans as may be designated by the Department of Health and Human Services based mostly on financial criteria and/or military service
High Risk Pools
Q – Can people who meet the requirements purchase insurance today from the high risk pool in AZ?
A – There is no high risk pool in AZ, the only high risk pool available to Az residents is the federal pool. www.pcip.gov
Q – And am I reading correctly, if he/she was on a Short Term plan, those are not considered credible coverage?
A – Depends, some STM’s are creditable and some are not. If a Certificate of Creditable Coverage is available from the issuer, then it’s creditable.
Q – I have a client that has RA and her COBRA payments are killing her- could she go either without insurance or a limited benefit plan for 6 months and then join this pool?
A – To go on the high risk pool, she must be 6 months bare – limited medical would be okay, but STM would depend on whether it’s a creditable plan.
The Pre-existing Conditions Insurance Plan (Federal High Risk Pool)
Regulations further explain that in order to be eligible to enroll, the individual must be without creditable coverage for the 6 months prior to applying for PCIP.
Eligibility for the PCIP Program (§ 152.14)
Under section 1101(d) of the Affordable Care Act and subparagraphs (1), (2) and (3) of § 152.14(a) of this interim final rule, an individual is eligible to enroll in a PCIP if he or she: (1) Is a citizen or national of the United States or is lawfully present in the United States as determined in accordance with section 1411 of the Affordable Care Act; (2) has not been covered under creditable coverage, as defined in section 2701(c)(1) of the Public Health Service Act as of the date of enactment, during the 6-month period prior to the date on which he or she is applying for coverage through the PCIP; and (3) has a pre-existing condition, as determined in a manner consistent with guidance issued by the Secretary. We further provide in § 152.14(a)(4) that an individual must be a resident of a State that falls within the service area of a PCIP.
Since both limited benefit and short term plans are not considered creditable coverage, having those types of plans will not compromise the individual ‘ s eligibility for PCIP.
Below is the definition of creditable coverage:
“What is creditable coverage?
Most health coverage is creditable coverage, such as coverage under a group health plan (including COBRA continuation coverage), HMO, individual health insurance policy, Medicaid or Medicare.
Creditable coverage does not include coverage consisting solely of excepted benefits, such as coverage solely for limited-scope dental or vision benefits”
PPACA Summary of Benefits
The 60-day advance notice issue has proven to be a bit confusing. Section 2715 of PPACA relates to summary of benefits, which is not required until 24 months from enactment (March 2012 – this is a NEW form). Interim Final Regulations specifically state that PHSA (Public Health Services Act – originally enacted in 1944) section 2715(d)(4), which “requires a plan or issuer to give 60 days advance notice to an enrollee before any material modification will become effective” may apply. This is talking about the Summary of Material Modifications. There may need to be additional guidance, but as the article makes clear, employers must still comply with the Summary of Material Modifications requirement.
Q – On the patient protection – the notice states “when applicable”…and for plans and issuers that require or allow for the designation of a primary care provider…or provide coverage for OB or Gyn care and require the designation… So, this notice only has to go out if the plan has these, such as an HMO?
A – That is correct. If the plan does not require designation of a primary care physician, there is no need for this notice.
Q – Can you clarify the “carve out” penalties and when they will become effective for “grandfathered” and “non-grandfathered” health plans?
A – If a plan fails the highly compensated test for plan years beginning after September 23, 2010, the penalty is $100 per day per incident. This does NOT apply to grandfathered plans.
Adult Children Coverage
Q – Can you explain students and the new coverage until 25, even if married scenario?
A – Actually, the coverage is to age 26. All “adult children” are eligible for enrollment in their parent’s plans as of the first day of the first plan year following 9/23/2010. The only exception is for grandfathered plans, if the “adult child” has coverage through another employer sponsored plan (their own or a spouses) they are excluded. The special enrollment must be 30 days long and there is a DOL Model Notice that must be distributed.
Q – Is a Short Term Medical plan considered “creditable coverage” under HIPAA?
A – If the STM issues a certificate of creditable coverage. Not all STM’s issue certificates.
Q – Under the new Health Care Reform plan will Medicare still be around? Will there still be Medicare replacement policies?
A – There are going to be a number of changes to Medicare (specifically the Medicare Advantage plans), but yes, it will still exist.
Doug Gulleson loves to scuba dive overseas and makes sure he has his US health care and travel health care information with him at all times when he travels (check out his diving travels at www.douggulleson.com). Keep our blog close by you, www.gntravelinsurance.com , for continual updates on the changes with the US health care system.