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Tag: Affordabile Care Act

HRB Solutions plant growing out of money

Cadillac Tax

The Cadillac Tax imposes a 40% excise tax on coverage in excess of certain thresholds. When originally enacted with a 2018 effective date, the thresholds were $10,200 for self-only and $27,500 for family coverage. The tax has since been delayed twice (including this delay), and the thresholds will be updated prior to the new Jan. 1, 2022 effective date.

Many employers, unions, insurers and industry groups have opposed the tax based on concerns around administrative and financial burdens for employers and adverse outcomes for employees. Cigna is a founding member and on the executive committee of The Alliance to Fight the 40, a coalition of public and private sector stakeholders that seeks a full repeal of the Cadillac Tax. To learn more about these efforts, visit www.fightthe40.com.

Health Insurance Industry Fee (a.k.a. Health Insurer Tax)

The short-term spending bill also suspends the Health Insurance Industry Fee for 2019. This fee began in 2014 and only affects insured health plans. It was previously suspended for 2017 but went back into effect on Jan. 1, 2018.

If you have any questions or would like to find out more about how these changes impact your business, please contact us.

Additional resources

Piggybank, HRB solutions health care solutions

The Kaiser Family Foundation in conjunction with the Health Research and Educational Trust (HRET) recently announced their 2017 Employer Health Benefits Survey. This survey covers over 150 million people. It helps to provide fresh information about employer-sponsored health benefits. The 2017 report is the nineteenth survey of this type.

Quoted abstract from the Health Benefits Survey

“This annual survey of employers provides a detailed look at trends in employer-sponsored health coverage including premiums, employee contributions, cost-sharing provisions, and employer practices. The 2017 survey included more than 2,100 interviews with non-federal public and private firms. Annual premiums for employer-sponsored family health coverage reached $18,764 this year, up 3% from last year, with workers on average paying $5,714 towards the cost of their coverage, according to the Kaiser Family Foundation/Health Research & Education Trust 2017 Employer Health Benefits Survey. The 2017 survey includes information on the use of incentives for employer wellness programs, plan cost sharing, and firm offer rates. Survey results are released in a variety of ways, including a full report with downloadable tables on a variety of topics, summary of findings, and an article published in the journal Health Affairs”

The survey is very comprehensive and contains many pages of tables and charts that describe the current condition of the employer marketplace today.

Please contact us if you have any questions or check out the survey.

Here are a few 2017 Health Benefits Survey highlights

• The average premium for single coverage through an employer-sponsored plan is $6,690 up 4% over last year.
• The average premium for family coverage through an employer-sponsored plan is $18,764 up 3% over last year.
• Worker’s wages increased 2.2% and inflation increased 2.2%
• On average covered workers contribute 18% for single and 31% for family towards premium payments. With workers in small firms contributing a larger percentage than those workers in larger firms.
• Dwindling its share over the last 8 years by 8%, the PPO continues to be the most common plan type followed by High-deductible plan, HMO, POS and less than 1% in a conventional/indemnity plan.
• 15% of the workers in small firms and 79% of the workers in large firms are enrolled in plans that self-fund in some capacity. This is very similar to the numbers from last year.
• Most workers have some type of deductible such as a general annual deductible, cost-sharing, copayments or coinsurance for office visits and hospital stays.
• 53% of firms offer health benefits to some of their workers and 89% of the people surveyed work in firms that offers health benefits.
• A clear majority (over 94%) of all firms offer coverage to spouses of those eligible. Over 92% of all firms offer health benefits coverage to non-spouse dependents.
• Many firms that offer health benefits also offer supplemental benefits as well. These include dental, vision, critical illness insurance, hospital indemnity insurance and long-term care insurance. With firms more likely to contribute towards dental and vision than the others.
• A small number of firms (minimally 8%) collect health information from workers through wearable devices such as a Fitbit.
• 4% of firms with at least 50 workers offer health benefits through a private exchange. Many more are considering it going forward.

Conclusion highlights from the 2017 Health Benefits Survey:

• Employer-sponsored health benefits market displays no big changes over 2016
• Premium increases are modest and not much change in cost sharing or enrollments.
• Employers continue to invest in promotion of wellness and build incentives around programs that collect information about their employees.
• No signs that long term declines in the offer and coverage rates are reversing with the percentage of workers covered at work remains at 62%
• There continues to be a significant variation around premiums and contribution amounts. Large number of workers in small firms pay a substantial share of the cost of family coverage. This calls into question whether this is a viable source of coverage for the dependents.
• Even with the uncertainty of the ACA (Obamacare), employers seem to have adapted to the provisions without significant disruption. Even if repeal and replace efforts succeed the impacts on the group market will be relatively small. There may be some small changes made, but the costs and coverages will most likely not change in any meaningful way.
• One to watch – The Cadillac tax could affect the market over the next couple of years. Because this law has been pushed out to 2020 and with Congressional support for pushing it out further, the pressure on employers has been alleviated to some extent. This could change dramatically if the tax is not further delayed.

For more information on the survey methodology, please visit the Methodology section at http://ehbs.kff.org/.

For more information on how this information will impact your business contact us here at HRB Solutions Inc

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