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Category: Cosby Insurance Group

Obama Administration Delays Small Business Enrollment On Federal Exchange

Several media outlets, including two national newspapers, covered the Obama Administration’s announcement over the holiday weekend of a one year delay to small business exchange enrollment on the Federal health insurance marketplace. Some sources focused on the mechanics of the policy shift while others centered their coverage on the political implications of the latest setback to the implementation of the Affordable Care Act.

The New York Times Share to FacebookShare to Twitter (11/28, Pear, Subscription Publication) reported that the Obama Administration announced on Wednesday a delay of one year to small business enrollment in Federal health insurance exchange. The delay applies to small businesses in states using the Federal government’s exchange. The new target date is November, 2014.

Politico Share to FacebookShare to Twitter (12/2, Millman) characterized the move as “another high-profile setback for HealthCare.gov.” Small business enrollment was previously scheduled to start last month. The Administration is emphasizing fixes to the individual signup process, which has been sharply criticized for ongoing problems.

The Wall Street Journal Share to FacebookShare to Twitter (11/28, Simon, Huston, Radnofsky, Subscription Publication) reported on the delay in an article headlined “Small-Business Delay Is Latest Blow For Health Law.” The Journal noted that the Affordable Care Act only requires health insurance coverage to be provided to employees by businesses with more than fifty employees.

McClatchy Share to FacebookShare to Twitter (11/27, Kumar) added that the Small Business Health Options Program (SHOP) had already had its debut delayed from October to November of this year.

The New York Times Share to FacebookShare to Twitter (11/27, Mandelbaum) noted in its “You’re the Boss” blog that, during the additional year in which the small business exchanges will not accept online enrollment, “small businesses can enroll in exchange-listed plans through an insurance agent or broker, or directly with the carrier.”

Bloomberg News Share to FacebookShare to Twitter (11/28, Wayne, Goldman) commented on the holiday timing of the announcement, comparing it to the timing of a one year delay to the employer mandate announced the day before Independence Day. The Affordable Care Act only requires health insurance coverage to be provided to employees by businesses with more than fifty employees.

The NPR Share to FacebookShare to Twitter (11/27, Chappell) “Two-Way” blog, and the Washington (DC) Post Share to FacebookShare to Twitter (11/27, Kliff) “Wonkblog” also reported on the announcement.

Small Business Delay Empowers ACA Opposition. The Washington Post Share to FacebookShare to Twitter (11/27, Harrison) noted in its “On Small Business” blog that “This marks by far the longest in a string of delays for the federal government’s employer marketplace — and elected officials and small business leaders are growing frustrated.”

The Washington Times Share to FacebookShare to Twitter (11/27, Howell) reported that the delay gives further fuel to Republicans opposing the Affordable Care Act who believe that the small business delay “is the latest sign President Obama’s signature achievement should be scrapped altogether.”

Health Care Costs Calculator

Are you saving enough for Health Care? Learn how your health can affect your retirement. Use the AARP Health Care Costs Calculator to estimate what you may have to pay for health care and ideas to minimize future costs.

Get started with this simple easy to use health care costs calculator here.

2013 Health Care Costs Survey

This AARP survey looked at the public’s awareness and concern about health care costs that they may incur during retirement. It also sought to determine whether or not non-retired adults are currently saving to cover health care expenses in the future.

Key findings include:
Most individuals have not taken steps to plan for health care costs in retirement. Across age groups, only about one-third (36%) have tried to estimate how much money they will need to save and have set money aside to cover these expenses in the future. Adults age 60-64 (40%) are just slightly more likely than those age 50-59 (35%) to have money set aside although these differences are not statistically significant.

While most adults age 50-64 have given health care costs in retirement some level of thought, a smaller percentage is confident that they will be able to afford the costs. Two-thirds of respondents have thought about the costs at least somewhat but only 52% are confident they can afford the costs. In fact, less than two in ten (16%) are very confident that they can afford the costs of health care in retirement.

Estimates of the actual costs of health care in retirement vary significantly. More than four in ten adults age 50-64 (42%) believe they will need to accumulate less than $100,000 to cover out-of-pocket health care expenses during their retirement.

In addition, sixteen percent believe it will cost less than $50,000 and 15% say they simply do not know.

Read full research survey and fact sheet here:
2013 Health Care Costs Survey (Full Text, PDF)2013 Health Care Costs Factsheet (PDF)

Why Cancellations?

The ACA and its implementing regulations set many new requirements for health insurance plans issued in 2014 and later. Plans issued before March 23, 2010, are in many cases grandfathered, and so are not subject to these requirements. However, plans issued since then but before January 2014 are not grandfathered, and so issuers were required to either cancel or modify them to make them compliant. Common examples of noncompliance include plans that did not cover one of the ACA’s essential health benefits (such as maternity or prescription drugs) or plans that did not have a low enough maximum on out-of-pocket spending by the member.

Individuals or small groups with a canceled policy are able to purchase compliant replacement policies on a guaranteed issue basis, although that has proven difficult for many consumers, which is due to the technical difficulties with some exchange websites.

Issuers likely had a variety of reasons for canceling policies rather than attempting to modify them (and in some cases, state law or regulation required one approach or the other). One simple reason had to do with the revised rate filing process that they went through in early 2013 in order to obtain regulatory approval for their 2014 premium rates. This process was set forth in federal regulations and sub-regulatory guidance that came out in late 2012 and early 2013.

If policies were modified but not formally canceled, issuers had to characterize the rate change as a rate increase, and increases could be substantial given the additional benefits included in the modified plans. Under the ACA, rate increases over a 10% threshold are subject to an additional federal review process, which requires filing additional forms and information, and additional potential for delay. Given these hurdles and the extremely challenging filing deadlines set by state and federal regulators, many issuers may have seen the “cancel/rewrite” option as a simpler way to achieve the goal of getting existing policyholders into compliant plans.

Read the full report here.