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Key Dates for the Affordable Care Act – Part I

January 13, 2014

Article courtesy of SBAM Approved Partner ASE

By: Kristin Cifolelli

It is hard to believe that it has been almost fours year since the Affordable Care Act was signed into law in March 2010.  If you follow the news or the political drama attached to the ACA, it certainly seems as if it has been longer than that. Since 2010, over 50 different provisions of the Affordable Care Act have been implemented.

But now that the calendars have rolled over to 2014, several of the most critical provisions of the ACA have officially gone live and there are many key dates that will impact individuals and employers alike in the coming year. Here are some of the provisions that kick in in January alone:

(January 1): Insurance coverage purchased either through the Federal Health Care Marketplace or through a State Based Exchange (SBEs) by December 24, 2013 became active.  Companies with fewer than 50 full-time equivalent employees or FTEs (in Michigan; 100 in some other states) that that signed up for coverage for their employees through the Small Business Health Options Program (SHOP) Exchanges will also see their coverage become active.  Many insurers have reported problems with the enrollment data that they have received from the federal government website that have included missing data and duplication. This has made it difficult to confirm whether healthcare enrollments are accurate and complete.  Over the next few days and weeks, as individuals show up at their doctor’s offices, hospitals or pharmacies, they will quickly find out whether their coverage is active or not.

(January 1): Lower income individuals who didn’t qualify for Medicaid in the past will now have access to coverage in states that expanded their Medicaid safety net program. Twenty-five states (including Michigan) and the District of Columbia expanded Medicaid under the Affordable Care Act.  Households with incomes between 100 and 138% of the Federal Poverty Level (FPL) are eligible for subsidized health coverage through the Medicaid program.

January 1):
Eligible employers that purchase health insurance for their employees in the SHOP Exchange may receive a tax credit up to 50% of the employer’s contributions toward health insurance premiums. The credit will only be available to an employer for two consecutive tax years.

(January 1):
The individual mandate goes into effect.  Nearly all U.S. citizens and legal residents are required to carry health insurance that meets minimum standards or face a “shared responsibility payment.” Tax returns filed in 2015 will need to include information regarding health insurance carried. The ACA allows for a 3-month lapse in coverage in a year before a penalty is assessed.  Therefore individuals without coverage will have until March 31, 2014 to sign up in order to avoid the fee. Those who had healthcare coverage that was cancelled as a result of the ACA will be exempt from the penalty this year.

(January 1): Insurers may no longer deny coverage for pre-existing conditions or because of the applicant’s health status or other factors. Employer group health plans may not impose annual dollar limits on essential health benefits.  Plans must limit annual participant out-of-pocket maximums to $6,350 for single coverage and $12,700 for family coverage.  Totals include copayments and deductibles but not premiums, and apply only to plans that are not grandfathered.

(January 1): Financial assistance through tax credits and subsidies will be available for lower income individuals who purchase health insurance coverage through an Exchange.  Credits are available for people with incomes above Medicaid eligibility and below 400% of the poverty level who are not eligible for or offered other acceptable coverage through their employer. The credits and subsidies apply to both premiums and cost-sharing. Individuals that receive either too much or too little in premium subsidies during the year will have those differences reconciled with the IRS in April 2015.

(January 10): In most cases, individuals who signed up for insurance through the Marketplace (i.e., either the Federal or State exchanges) by December 24, 2013 have until January 10 to pay  the first month’s premium in order to receive coverage for the month of January.  Individuals should check with their insurance company, since some are not expected to honor the grace period.

SBAM’s Decision Point can help you navigate through the complicated regulations of Health Care Reform. Please click here for details.

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