by US Rx Care | Oct 8, 2019 | Health care costs
The much-maligned “Cadillac tax,”
which was supposed to be implemented as a tax on high-value group health plans
with premiums above a certain level, may finally be seeing the end of the road.
Already the implementation of the
tax, which was created by the passage of the Affordable Care Act, has been
postponed twice. It was originally supposed to take effect in 2018 under the
ACA. The tax was delayed two years by Congress
in 2016, pushing implementation ahead to 2020. It was delayed again in 2018 and
is currently scheduled to take effect in 2022.
But now the House has
overwhelmingly voted to ditch it once and for all.
The Cadillac tax is an excise tax that applies to any group health policy that would cost more than $11,200 for an individual policy, or $30,150 for family coverage. Starting in 2022, a 40% tax would apply to any premium above those levels (so if an individual policy cost $12,000 a year, the tax would apply to the $800 excess over the $11,200 level).
Although the insurance company
would have to pay the tax, it is widely believed that insurers would pass it on
to the employer.
Widespread distaste for the tax
The tax was maligned by both employers and labor unions, many of which receive generous benefits packages that would have been subject to the tax. Labor disliked it because they felt that employers would cut benefits to avoid paying it or pass the tax on to employees. Employers disliked the tax because, well, it’s another tax – and a hefty one at that.
But supporters of the ACA said
the tax was necessary to pay for the law’s nearly $1 trillion cost and help
stem the use of what was seen as potentially unnecessary care.
While there is widespread support
for repealing the tax, not everyone is on board. A group of economists and
health experts wrote a letter to the Senate on July 29 in which they argued
that the tax “will help curtail the growth of private health insurance premiums
by encouraging employers to limit the costs of plans to the tax-free amount.”
The letter also pointed out that
repealing the tax “would add directly to the federal budget deficit, an
estimated $197 billion over the next decade, according to the Joint Committee
on Taxation.”
This summer, the House of
Representatives voted 419 to 6 to repeal the tax. Currently, a Senate companion
bill has 61 co-sponsors, but the legislation has not yet come up for debate.
That said, most observers expect that the bill will soon be put up for a vote, meaning that the Cadillac tax will likely be sent to Cadillac ranch – having never seen the light of day.
by US Rx Care | Oct 3, 2019 | PBM
The Trump administration has decided not to
pursue a policy that would have put an end to rebates paid to pharmacy benefit
managers, which could put the focus again on how drug companies set their
prices.
The proposal would have barred drug
companies from paying rebates to PBMs that participate in Medicare and other
government programs. According to the administration, the proposed rules were
shelved because Congress had taken up the issue to control drug costs.
The spotlight has been harsh on some of the
country’s largest PBMs, which have been accused of pocketing a substantial
portion of the rebates for themselves while passing on only a sliver of the
rebates to the insurance companies that hire them and the health plan enrollees
that pay out of pocket for the drugs.
Rebates had become a popular target of
criticism in Washington after drug companies lobbied aggressively to cast them
as the reason for high prices. PBMs negotiate drug discounts in the form of
rebates, often keeping some of that money for themselves.
However, many pundits say that the rebate
system put in place by large, national PBMs incentivizes drug companies to keep
list prices high, which in turn defeats the purpose of the PBMs – that is, to
reduce the out-of-pocket costs that health plan enrollees pay for their
prescription drugs.
Like insurers and PBMs, some of which have
sought to undermine the practice with accumulator adjustment programs, the
Trump administration believes such coupons may be driving up health care
spending by getting patients to opt for higher-priced name-brand drugs over
generics.
The Centers for Medicare & Medicaid
Services proposal unveiled in January would have essentially blocked drug
manufacturer rebates from going to PBMs and health plans that serve Medicare
and Medicaid patients, starting next year.
Now that the push to eliminate rebates has
come to end, the focus looks like it’s shifting to how drug companies price
their products. We will keep you posted if any legislation surfaces in this
area.
by US Rx Care | Sep 24, 2019 | Health care costs
As open enrollment is right around the
corner, now is the time to make a plan to maximize employee enrollment and help
your staff select the health plans that best suit them.
You’ll also need to make sure that you
comply with the Affordable Care Act if it applies to your organization, as well
as other laws and regulations.
Here are some pointers to make open
enrollment fruitful for both your staff and your organization.
Review what you did last year
Review the results of last year’s
enrollment efforts to make sure the process and the perks remain relevant and
useful to workers.
Were the various approaches and communication channels you used effective and did you receive any feedback about the process, either good or bad?
Start early with notifications
You should give your employees at least a
month’s notice before open enrollment, and provide them with the materials they
will need to make an informed decision.
This includes the various health plans that
you are offering your staff for next year.
Encourage them to read the information and
come to your human resources point person with questions.
Help in sorting through plans
You should be able to help them figure out
which plan features fit their needs, and how much the plans will cost them out
of their paycheck. Use technology to your advantage, particularly any
registration portal that your plan provider offers. Provide a single landing
page for all enrollment applications.
Also, hold meetings on the plans and put
notices in your staff’s paycheck envelopes.
Plan materials
Communicate to your staff any changes to a
health plan’s benefits for the next plan year through an updated summary plan
description or a summary of material modifications.
Confirm that their open enrollment
materials contain certain required participant notices, when applicable – such
as the summary of benefits and coverage.
Check grandfathered status
A grandfathered plan is one that was in
existence when the ACA was enacted on March 23, 2010, and is thus exempt from
some of the law’s requirements.
If you have a grandfathered plan, talk to
us to confirm whether it will maintain its grandfathered status for the next
plan year. If it is, you must notify your employees of the plan status. If it’s
not, you need to confirm with us that your plan comports with the ACA in terms
of benefits offered.
ACA affordability standard
Under the ACA’s employer shared
responsibility rules, applicable large employers must offer “affordable” plans,
based on a percentage of the employee’s household income. For plan years that
begin on or after Jan. 1 of next year, the affordability percentage is 9.86% of
household income. At least one of your plans must meet this threshold.
Get spouses involved
Benefits enrollment is a family affair, so
getting spouses involved is critical. You should encourage your employees to
share the health plan information with their spouses, so they can make informed
decisions on their health insurance together.
Also, encourage any spouses who have
questions to schedule an appointment to get questions answered.
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by US Rx Care | Sep 18, 2019 | Uncategorized
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by US Rx Care | Sep 17, 2019 | Health care costs
As the workforce ages and many
employers want to keep on baby-boomer staff who have the experience and
institutional knowledge that is irreplaceable, one issue that always comes up
is how to handle health insurance.
Once your older workers reach
the age of eligibility for Medicare, under current law you can help them pay
for Part B and D premiums with a Medicare Premium Reimbursement Arrangement.
These types of arrangements became legal after legislation was signed into law
in 2013 to help employers provide benefits to their Medicare-eligible staff.
But the issue surfaced again
recently when the Trump administration came out with new guidance for health
reimbursement arrangements that paves the way for employers to set up HRAs to
reimburse staff for health premiums in their personal (not company group)
health plans.
Anybody who is about to turn 65
has a six-month period to sign up for basic Medicare, but if they want
additional coverage they can pay for Medicare supplemental coverage such as
Parts B and D.
Part B covers two types of
services:
Medically necessary services: Services or supplies that are needed to diagnose or treat your medical condition and that meet accepted standards of medical practice.
Preventive services: Health care to prevent illness (like the flu) or detect it at an early stage, when treatment is most likely to work best.
Part D, meanwhile, covers
prescription drug costs.
The dilemma for employers has
often been whether to keep the Medicare-eligible employee on the company health
plan or cut them free on Medicare.
Smaller employers – those with
20 full-time-equivalent employees – have the option to open a Medicare Premium
Reimbursement Arrangement for those employees if they are coming off a group health
plan and into Medicare.
For small employers, it’s legal
to set up an arrangement like that, as long as doing so is at the employee’s
discretion. Employers are not allowed to push an employee into a Medicare
Premium Reimbursement Arrangement in order to get them off the company’s health
plan.
The good news for employers is
that they often can reimburse their employees in full for Part B and D, as well
as Medicare Supplement, and still pay less than they would pay in group
employee premiums alone.
On top of that, the employee
gets a lower deductible and overall out-of-pocket experience with less, if any,
premium contribution.
What you need to know
Here’s what you should know if you’re considering one of these arrangements:
A
Medicare reimbursement arrangement is one where the employer reimburses some or
all of Medicare part B or D premiums for employees, as long as the employer’s
payment plan is integrated with the group’s health plan.
To
be integrated with the group health plan:
- The employer must offer a minimum-value group health plan,
- The employee must be enrolled in Medicare Parts A and B,
- The plan must only available to employees enrolled in Medicare
Parts A and B, or D, and
- The reimbursement is limited to Medicare Parts B or D, including
Medigap premiums.
Note: Certain employers are subject to Medicare
Secondary Payer rules that prohibit incentives to the Medicare-eligible
population.
by US Rx Care | Sep 11, 2019 | Uncategorized
New guidance from the IRS will help people
enrolled in high-deductible health plans get coverage for pharmaceuticals to
treat a number of chronic conditions.
Under the guidance, medicinal coverage for
patients with HDHPs that have certain chronic conditions – like asthma, heart
disease, diabetes, hypertension and more – will be classified as preventative
health services, which must be covered free with no cost-sharing under the
Affordable Care Act.
The background
The guidance, which takes effect
immediately, is the result of a June 24 executive order issued by President
Trump directing the IRS to find ways to expand the use of health savings
accounts and their attached HDHPs to pay for medical care that helps maintain
health status for individuals with chronic conditions.
The executive order was in response to a
number of reports that have shown that people with HDHPs will often skip
getting the medications they need or take less than they should because they
cannot afford to foot the full cost of the medication even before they meet
their deductible.
This can lead to worse issues like heart
attacks and strokes, which then require more and even costlier care, according
to the guidance.
The latest move is a significant step that
should greatly reduce the cost burden on individuals with chronic conditions,
as many of the medications they need to treat their diseases can be extremely
expensive.
The IRS, the Treasury Department and the
Department of Health and Human Services have listed 13 services that can now be
covered without a deductible, and have promised to review add or subtract
services from the list on a periodic basis, according to the guidance.
Here is the full list of the treatments,
and the conditions they are for:
Angiotensin-converting enzyme (ACE) inhibitors – Congestive heart failure, diabetes, and/or coronary artery disease.
Anti-resorptive therapy – Osteoporosis and/or osteopenia.
Beta-blockers – Congestive heart failure and/or coronary artery disease.
Blood pressure monitor – Hypertension.
Inhaled corticosteroids – Asthma.
Insulin- and other glucose-lowering agents – Diabetes.
Retinopathy screening – Diabetes.
Peak-flow meter – Asthma.
Glucometer – Diabetes.
Hemoglobin A1c testing – Diabetes.
International Normalized Ratio testing – Liver disease and/or bleeding disorders.
Low-density lipoprotein testing – Heart disease.
Selective serotonin reuptake inhibitors – Depression.
Statins – Heart disease and/or diabetes.
The items above were chosen because they
are low-cost, proven methods for preventing chronic conditions from worsening
or preventing the patient from developing secondary conditions that require
further and more expensive treatment.
