The year 2015 is coming to a close, which means it’s time for business owners to think about renewing or purchasing a health insurance plan for the coming year. NRHA’s health insurance expert Bob Chiesa, president of Custom Benefits Insurance Group of Michigan, provides insight to some important questions employers should ask. Next month, stay tuned towww.nrha.org for our “Ask the Expert” video featuring Chiesa and Brett Slama, account executive from Member Insurance, for more helpful advice.
Is my current plan Affordable Care Act (ACA) compliant?
In recent years, many new health insurance requirements have been introduced. While some carriers have taken a lead role in transitioning their groups and clients, ultimately, it is the employer’s responsibility to determine compliance. Business owners should be aware of two major changes that went into effect this year. A full-time employee is now defined under ACA as anyone working 30 or more hours per week. Additionally, the waiting period to offer employees medical insurance has been capped at 90 days. Due to these changes, many employers will have to offer coverage much sooner and to employees they may not have previously insured.
Do I need to comply with the Employer Mandate?
Under ACA, employers with over 100 employees had to comply with the Employer Mandate in 2015. Beginning in 2016, employers of more than 50 employees will be required to comply. This requires all businesses of this size to offer a medical plan and requires employers to charge no more than 9.5 percent of the employee’s gross household income as the employee contribution. A unique strategy for employers who fall into this category is to offer base and buy-up plans. Under ACA, an employer is only required not to exceed the 9.5 percent rule for the lowest ACA compliant plan. Many employers are offering a base plan that costs much less. If the employees want to choose
a buy-up plan, then they pay the difference while still keeping the employer in compliance.
Does my plan offer a composite rate or do rates vary by age?
Consider this: You have two equally qualified candidates for a job, but one is 32 years old and the other is 55 years old. As an employer, you’re put in an awkward situation knowing that hiring the younger employee could save you money on health insurance if rates vary by age, but you’re risking age discrimination if you consider that in your decision making. Due to health care reform, the majority of health insurance carriers for groups of fewer than 50 employees only offer rates by age. Moving forward, this will also affect groups of less than 100 employees. Consider how the type of rates offered by your carrier impacts your accounting and human resource departments.
Are the ACA and PCORI Fees and reinsurance fees included in the base rate?
The Patient-Centered Outcomes Research Institute Fees, or PCORI Fees, are due once per year in July, and then an initial reinsurance fee is due in December. For 2016, the PCORI Fees increased from $2.00 to $2.08 per insured member. However, the reinsurance fee was reduced significantly from $63 down to $44 per insured member. It is important to note that these fees are per person, so for a family of four the rates would be multiplied times four. There are a small number of carriers that are building these rates into the base rate, yet many are not and several carriers are itemizing these fees at the bottom of your invoice. The key is to be familiar with these fees and to take them into consideration when comparing carriers.
NRHA currently offers a complete range of health care coverage available to retailers and their employees. If you have additional questions about health insurance related issues or would like more information on NRHA’s health insurance options, please contact Bob Chiesa at 888-201-7408 or visit www.cbigi.com/nrha-program.
Source: Hardwareretailing.com – Written by: Hilary Welter