The newsLINK Group - Healthcare Reform and the New Rules
Editorial Library Category: General Business Topics: Healthcare Reform Title: Healthcare Reform and the New Rules Author: newsLINK Staff Synopsis: Love it or hate it, the Patient Protection and Affordable Care Act (ACA) of 2010 (also called healthcare reform and Obamacare) has managed to survive a constitutionality review by the U.S. Supreme Court, a defunding threat by Congress, and even a primetime shout-out on national TV in the opening minutes of the recent CMA awards. Editorial: Healthcare Reform and the New Rules 4064 South Highland Drive, Millcreek, Utah 84124 │ thenewslinkgroup.com │ (v) 801.676.9722 │ (tf) 855.747.4003 │ (f) 801.742.5803 Editorial Library | © The newsLINK Group LLC 1 Love it or hate it, the Patient Protection and Affordable Care Act (ACA) of 2010 (also called healthcare reform and Obamacare) has managed to survive a constitutionality review by the U.S. Supreme Court, a defunding threat by Congress, and even a primetime shout-out on national TV in the opening minutes of the recent CMA awards. Now everyone in the U.S. gets to deal with the heavy lifting. This is something that will take analysis, because the rules are complicated and no one in the entire country has this problem nailed. Delays, problems, and missteps are sure to keep happening, such as the deadline change before employers have to provide employees with insurance and significant website issues. The main concerns for employers are cost and compliance. One key compliance feature that becomes effective January 1, 2014 is the mandate that all individuals have health insurance. It currently looks like the hard deadline for buying coverage (the one that avoids you having to pay any penalties) is actually February 15, 2014, six weeks after the January 1 deadline. Those who do not buy insurance for themselves will have to pay a $95 annual penalty or one percent of household income, whichever is greater. An International Foundation survey found that the ACA’s Patient-Centered Outcomes Research Institute (PCORI) fees and transitional reinsurance fees are the provisions of ACA that have the greatest cost impact, but at a one-percent to three-percent increase, even the cost of these is minimal. Although ACA fees are part of the cost, claims projections will create the greatest impact on renewals (both for those who are fully insured and those who are self-funded). Banks, like every other business, have to comply with the ACA requirements. However, one possible effect that the ACA could have on the banking business is one you may not have previously considered. Many people do not use a bank, especially among minorities and those who are uninsured. Experts think that 29,590 Utah residents will be eligible for tax subsidies so they can buy health insurance, but the estimate of unbanked Utah residents, according to Jackson Hewitt, a tax firm, is 30 percent. Nationally, 25 percent of those who are uninsured and eligible for subsidies are also unbanked. The Obama administration said in August 2013 that insurance companies will have to accept checks (paper and cashier), money orders, pre-paid debit cards, electronic fund transfers from bank accounts, and automatic deductions from credit or debit cards. They do not have to accept cash. This means that people who do not have a bank may well find that the best and most convenient way to pay insurance premiums is to go to a bank and open an account. The ACA can be considered a tremendous business opportunity for bankers and for new, previously unbanked customers. Even without considering premium payments, opening an account is a win-win situation. Being unbanked can cost an individual $1000 in fees per year, and more than $40,000 for someone who chooses to go through life that way. It is an expensive and marginalizing experience. Fortunately, ACA implementation is and will continue to be incremental. Business owners need to comply with the requirements for 2013, but they have a little time to decide how they will apply the requirements that go into effect later. In addition, the ripple effect from Obama’s deadline change will affect the following requirements: Assessment is the first step. Consider first the steps that have already been implemented, each of which now represents an annual requirement: ERISA plan documents are required. Each company needs to make sure the necessary paperwork is in order.
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