Presented by: Phil Lebherz, with Ankeny Minoux

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Health Care Reform The Uninsured in California

• Presented by Phil Lebherz, with Ankeny Minoux

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sources which are thought to be reliable, but the
reader should not assume that the information is
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Agenda

• Health Care Reform Legislation Overview
• The Uninsured in California Positive Progress
• Keynote Phil LebherzPerspective on Legislation
  and the Future of Health Insurance
• Q A

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Legislative Timeline

• March 23rd, 2010
• Patient Protection and Affordable Care Act
• March 30th, 2010
• Health Care and Education Reconciliation Act
  of 2010

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Approaches to Expanding Coverage
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Individual Mandates and Subsidies
6
Individual Tax Consequences
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Employer Mandates

• Employers with 50 or fewer EEs are exempt
• Employers with gt50 EEs who do not offer coverage
• Employers with gt50 EEs who do offer coverage
• Employers with gt200 EEs to automatically enroll
  their employees

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Small Business Tax Credits

• For employers with up to 25 employees
• 2010-2013, up to 35 tax credit
• 2014 and beyond, up to 50 tax credit

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Insurance Exchanges
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Changes to Private Insurance

• Temporary High Risk Pool (2010)
• Insurance Exchanges (2014)
• Carriers Medical Loss Ratios
• 80 for small group (100 and below)
• 85 for large group.
• Premium increase review process
• Excise tax on Cadillac plans

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Changes to Private Insurance

• No lifetime limits
• Dependent coverage to age 26
• No rescinding except in cases of fraud
• No pre-existing on children (2010), everyone
  (2014)
• No experience rating

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Changes to Private Insurance

• Deductibles not to exceed 2,000/4,000
• Limit waiting periods to 90 days
• Allow states to merge IFP small group
• SG definition changes to 2-100

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Grandfathering Provision

• Current Plans unaffected by mandates
• Only Changes Allowed
• Add or delete new employees/dependents
• Part of collective bargaining agreement
• Exceptions
• No waiting periods over 90 days
• Prohibition on Lifetime Limits
• New standard for recissions
• Dependent coverage to age 26
• Certain annual limits (group only)

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Financing - Taxes

• Cadillac Plan Tax
• Insurer Fees
• Health Insurers - 8B (2014) - 14.3B (2018)
• Pharma - 27B
• Medical Device - 20B
• Medicare Payroll Tax
• .9 increase for wages gt 200k/250k
• Tax now applies to unearned income
• Tanning Services 10 tax

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Timeline for Change - 2010

• Temporary National High Risk pool created
• Tax credits for small employers
• Dependent coverage increased to age 26
• Remove Lifetime limits prohibit pre-existing
  exclusion for children
• Minimum Preventive service level w/o cost sharing
• Establish premium increase review process
• 250 Rebate for Medicare beneficiaries

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Timeline for Change - 2011

• Excludes OTC Rx from HSA/HRA/FSA distributions
• Increase tax on distributions from HAS/FSA not
  used for qualified medical expenses to 20

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Timeline for Change - 2013

• CO-OP program for non-profit member run insurance
  companies
• Operating rules for Health Insurance
  administration
• Increase itemized deduction to 10
• Limit FSA contributions to 2500

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Timeline for Change - 2014

• Require health coverage
• End exclusions for adults with pre-existing
  conditions
• Assess LG employers for not offering coverage
• Create State-based Exchanges for IFP and SG
• Require GI coverage for SG market and Exchanges
• Reduce OOP limits for lower income members
• Limit Deductibles to 2000/4000

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Timeline for Change 2014 (cont)

• Limit waiting period to 90 days
• Create essential health benefits package
• Allow states to merge IFP and SG markets
• Require carriers to meet new operating standards
  and reporting requirements
• Expand Medicaid to all individuals under age 65
  under 133 FPL
• Impose fees on the health insurance sector

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Timeline for Change 2015 and later

• 2016
• Permit states to form health care choice compacts
  and allow insurers to sell policies in any state
  participating in the compact
• 2018
• Impose an excise tax on insurers of
  employer-sponsored health plans with high values