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New Taxes

Zinser · January 20, 2014 · Leave a Comment

Starting in 2014, there are new charges on health insurance companies and on individual taxpayers to fund the ACA (PPACA or ObamaCare).

The first one is known as HIT – the health insurance tax.  This is an assessment on some health insurance companies based on their market share. Health insurers oppose the tax because it will lead to increased premiums, which is what health care reform wants to avoid.  A study by the consulting firm Oliver Wyman confirmed the tax will increase premiums by more than $2,800 per person and $6,800 per family over 10 years.

The second tax is on individuals making more than $200,000 and couples making more than $250,000.  They will pay a 3.8% tax on dividends and capital gains when they file their 2013 returns this year.  This income group also saw a 0.9% Medicare wage tax increase in 2013.

For the next three years, insurers will pay $63 per health insurance recipient; this is known as a reinsurance fee.  The $12 billion collected will be used to spread out risk so insurance companies that end up taking on the sick will be protected.

The penalty for being uninsured begins this year.  Individuals won’t have to pay it until they file their 2014 returns, the penalty this year is $95 or 1% of income, whichever is greater.  Next year, the penalty rises to $325 or 2% of income.

The last fee is on insurance companies that sell their health plans on healthcare.gov; they will pay a monthly user fee of 3.5% of the premiums for health plans sold on the website.

This information was taken from an email I received from Humana.

Kentucky Expands Medicaid

Zinser · May 10, 2013 · Leave a Comment

Yesterday Governor Steve Beshear announced Kentucky’s decision to expand Medicaid.  A link to the article in the Courier-Journal is below:

http://www.courier-journal.com/article/20130509/PRIME07/305090046

Figures from the 2012 U.S. Census Bureau tells us that 308,000 Kentuckians will now be eligible for this coverage.  The next step is for these newly eligible citizens is to enroll.  The National Association of Health Underwriters (NAHU) have always touted that many uninsured citizens could obtain coverage if they were to sign up for it.  Some citizens don’t even know that they’re eligible for “free” coverage.  Hopefully this will change.

Another point to keep in mind with this expansion is that hopefully Employer Based premiums will be lowered because these premiums have a “tax” included that helps offset the bills for the uninsured.  Hopefully that will be removed.

Let’s also hope that these newly enrolled citizens will start using their insurance.  One problem that uninsured people encounter is that they wait to get their healthcare.  By waiting, they’re more likely to seek service in the Emergency Room, which is the most costly place to seek service.  Now that they have Medicaid, hopefully they will seek preventive care and stay out of the Emergency Room.  Opponents have said this will flood doctor’s offices.  I guess we’ll have to wait and see.

The last point I’d like to cover is what kind of impact will this have on Employers.  Under this Expansion, a single person making up to $15,856 annually, will be eligible for Medicaid.  This is just a tick above the minimum wage level (assuming a 40 hour work week).  Something that I’d like to know is how many Kentuckians with full-time employment (under the new law that’s over 30 hours per week) would qualify for Medicaid.  These newly eligible citizens maybe considered a  “Qualified Waivers” to an Employer Sponsored Plan.  A Qualified Waiver is someone that has coverage elsewhere under another insurance plan.  An example would be someone today being covered under their spouse’s plan.  The employer doesn’t have to cover that spouse, and the employer isn’t harmed in their participation percentage with their health insurance company because the employee is covered under a spouse’s plan.  I know, it’s confusing.  The point is (and I’m still waiting for insurance companies to verify this, although today this is accurate) that these newly Medicaid eligible recipients will now be considered a qualified waiver in an employer sponsored plan.  How many new Medicaid recipients make this amount of money and work 30+ hours for one employer?

 

Flow Chart for Employers

Zinser · December 12, 2012 · Leave a Comment

Below is a flow chart for all sized employers.  The flow chart is an easy configuration to determine whether or not your employer will pay a penalty if they don’t offer affordable coverage.

Remember, your employer doesn’t have to offer coverage, the employer can still decide that it’s in their best interests to pay the fine than to offer coverage.

PPACA FLOW CHART

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Zinser Benefit Service - Small Business Insurance

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