CalCPA ProtectPlus

Losing a loved one is never easy, but for surviving family members, the loss can be even more overwhelming when faced with the loss of medical coverage. This is especially difficult for the surviving spouse and dependents of sole practitioners who are unlikely to qualify for COBRA or CalCOBRA. In order to provide some peace of mind to its members, ProtectPlus copay and HSA-eligible plans offer a unique benefit known as Rights of Survivorship to all ProtectPlus plan participants. Under Rights of Survivorship, the covered spouse and eligible dependents of a deceased plan member may retain their ProtectPlus medical coverage without going through underwriting. Survivor benefits begin after COBRA and CalCOBRA benefits have been exhausted, or if the surviving spouse does not qualify for COBRA or CalCOBRA, the extended coverage kicks in immediately.

Coverage continues until the earliest of the following events:

The date the individual(s) reaches age 65; b. The date the surviving spouse remarries; c. The date the individual(s) becomes covered under any other group health plan regardless of whether that coverage is less valuable; d. The date the individual(s) becomes entitled to Medicare; or e. The first of the month for which the surviving spouse or eligible child(ren) fails to make the required payment for the continuation coverage.

If you have any questions about the Rights of Survivorship benefit, or other questions about ProtectPlus copay and HSA plans, contact Banyan Administrators, managers for the CalCPA ProtectPlus programs, at (877) 480-7923.

Please note that Rights of Survivorship do not apply to Anthem Blue Cross HMO Participants.

We’ve been providing health and welfare benefits to California CPAs for over 50 years and we know how important it is for members to get fast, accurate answers to their health insurance questions. Now you can get answers even faster when you use the “Live Chat” feature on the www.cpaprotectplus.com website. CalCPA ProtectPlus strives to find new and better ways to make health insurance simple and understandable for CalCPA members. The addition of live chat is the perfect way to get help without picking up the phone!

Make sure to check it out! Look for this button on the top right of the website!

Here are some details about our new Live Chat feature:

• Chat is available M-F, 8:00 a.m. – 5:00 p.m. (PST)
• Chat online with the same Banyan representatives who have helped you in the past
• Fast response time
• Option to print transcript of chat
• No menu tree – you go straight to a representative that can help you

Banyan Administrators continues to provide us with beneficial information about several different aspects of the Health Care Reform and how it affects us. Over the next months and years, employers will be faced with numerous changes, many of which require regulatory clarification. Banyan will continue to keep us up to date and on target with decisions that affect our plans.

The following information is from Banyan Administrators:

News

W2 Reporting IRS Releases Notice 2012-09

On January 2, 2012, the IRS released Notice 2012-09 which updates and amends Notice 2011-28 regarding the reporting of employer-sponsored group health plan on the 2012 W-2 Forms as required by the Health Care Reform Act.  Notice 2012-09 does not change the reporting requirement for employers, but, does provide additional guidance and clarification on certain topics.  Some highlights of the new Notice includes: 

• Clarification of the interim relief reporting requirement for employers filing fewer than 250 Forms W-2.
• The cost of coverage for employee assistance programs (EAP), wellness programs, or on-site medical clinics do not have to be reported if the employer does not charge a premium with respect to that type of coverage provided under COBRA to a qualifying beneficiary.
• Employers may include the cost of coverage for benefit programs, such as Health Reimbursement Accounts, that are excluded from the reporting requirement and clarification on how to calculate the cost.
• Clarification on other unique situations such as if a pay period extends over the end of the tax year on December 31^st, if a composite rate is charges for active employees but not for COBRA qualified beneficiaries, if certain related employers are not using a common paymaster, etc. 

To view IRS Notice 2012-09, please click here.

Health Care Reform W2 Reporting Interim Final Rules

What You Need to Know Now About: W-2 Reporting

On March 31, 2011, the Internal Revenue Service (IRS) released the 19-page Interim Final Rules on the Health Care Reform W-2 reporting requirements. The IRS is still taking comments on the rules for the next 60 days. 

1.       What needs to be reported on the W-2 form?

Employers must report the costs for a group health plan. This does not include dental and vision plans unless the plans are integrated in the group health plan. Disability and long term care plans are also excluded from the reporting requirement.

2.       How do I determine the cost for the group health plan?

The cost includes both the employee contribution and employer contribution. Employers with fully-insured health plans should use the monthly premium rate. Employers with self-funded health plans should use the COBRA premium equivalent rates less the 2% administrative fee. Employer contributions into Medical Savings Accounts (MSA), Health Savings Accounts (HSA), Health Reimbursement Accounts (HRA) and, in most instances, Flexible Spending Accounts (FSA) are excluded.

3.       Where do I enter this information on the W-2 Form?

The information is entered in Box 12 on the W-2 form using code DD.

4.       Will the amount be included as taxable income for my employee?

No it will not. The first page, first bullet of the IRS Interim Final Rules state, “This reporting to employees is for their information only, to inform them of the cost of their health care coverage, and does not cause excludable employer-provided health care coverage to become taxable.”

5.       When do I have to be ready to comply with the new W-2 reporting requirement?

If you issue more than 250 W-2 forms for tax year 2011, you are required to comply with the new requirement for the 2012 tax year W-2 forms that are distributed to employees in January, 2013. You do have the option to comply earlier, if desired. However, remember that a terminating employee in calendar year 2012 can ask for an early W-2 so, in reality, you will need to be ready to comply as early as January, 2012.

Employers that issue 250 or fewer W-2 forms for tax year 2011 can receive “transition relief” from this requirement until January, 2014.

[Information Source]

Banyan Administrators continue to provide us with beneficial information about several different aspects of the Health Care Reform and how it affects us as well as other interesting health care facts. Over the next months and years, employers will be faced with numerous changes, many of which require regulatory clarification. Banyan will continue to keep us up to date and on target with decisions that affect our plans.

The following information is from Banyan Administrators, LLC:

What You Need to Know About: Enhanced Women’s Preventive Services

On 7/14/2010, the Department of Health & Human Services (HHS) released the list of A and B services determined by the US Preventive Services Task Force. These preventive services were categorized by adult, women and pediatric services. In the Department of Labor’s (DOL) Interim Final Rules released on 7/19/2010, the DOL also stated that additional preventive services for women were still being debated for inclusion. On 8/1/2011, the DOL issued Interim Final Rules on Enhanced Women’s Preventive Services resulting in considerable media coverage particularly concerning oral contraceptives now being payable with no cost share, such as a copay. However, the actual implementation of the new preventive services provisions is more complicated and the rules are still subject to change.

1.  Does this health care reform provision apply to “grandfathered” plans?

No, grandfathered plans do not need to comply with this provision. If, in the future, your health plan loses its grandfathered status, this reform will apply to your plan.

A grandfathered plan can voluntarily choose to comply with the provision and when the 2010 list of preventive services were released in July, 2010, some grandfathered plans did choose to comply and provide some, if not all, of the preventive services on the list with no cost share to the participant. The DOL rules for enhanced women’s preventive services does not address this scenario so the opinion is that a grandfathered health plan can still voluntarily decide to provide some, or all, of the services listed with no cost share to the participant.

2.  What are the enhanced women’s preventive services?

In addition to the 15 women’s preventive services issued on 7/19/2010 that included anemia screenings, mammography screenings, cervical cancer screenings, etc., 8 additional preventive services have been added:

• Well-woman visits, annually
• Gestational diabetes screenings for pregnant women between 24 and 28 weeks of gestation and at first prenatal visit for pregnant women at high-risk of diabetes
• Human papillomavirus testing beginning at age 30 and no more frequently than once every 3 years
• Counseling for sexually transmitted infections, annually
• Counseling and screening for HIV, annually
• Contraceptive methods and counseling, as prescribed
• Breastfeeding support, supplies and counseling in conjunction with each birth
• Screening and counseling for interpersonal and domestic violence, annually (continue reading…)

Banyan Administrators continue to provide us with beneficial information about several different aspects of the Health Care Reform and how it affects us as well as other interesting health care facts. Over the next months and years, employers will be faced with numerous changes, many of which require regulatory clarification. Banyan will continue to keep us up to date and on target with decisions that affect our plans.

The following information is from Banyan Administrators, LLC:

Despite Potential PPACA Problems on the Horizon…HSA Enrollment Continues to Rise

Since health savings accounts (HSAs) were first authorized in January of 2004 as a tax-advantaged portal for medical savings, America’s Health Insurance Plans (AHIP), which is a trade association representing the health insurance industry, has conducted an annual survey of the HSA market. According the 2011 AHIP survey, HSA plan enrollment in the United States has almost doubled over the last three years, going from 6.1 million participants in 2008 to 11.4 million participants in 2011. From 2010 to 2011, the number of Americans covered by HSAs linked to high-deductible plans (HDHPs) increased by 14%.

Other key findings from the AHIP survey are:

• Large-group coverage was the fastest growing market for HSA plans between 2010 and 2011, with a growth of 26%.

• Individual market coverage was the second fastest growing market for HSA plans, with a growth of 15%.

• Over 6.3 million individuals were enrolled in HSA plans in the large-group market.

• Around 2.8 million individuals were enrolled in HSA plans in the small-group market.

• Approximately 2.4 million individuals were enrolled in HSA plans in the individual market.

The Impact Of The Patient Protection and Affordable Care Act On HSAs

As it relates to HSA plans, AHIP has noted that some of the provisions in the Patient Protection and Affordable Care Act (PPACA) could create some potential unintended consequences that might disrupt, if not limit, the availability of HSA plan coverage. Three of the main problems noted by AHIP include:

1. Medical loss ratio regulation.

This requires an insurer to spend 80% or more of a consumer’s premiums on direct, non-administrative patient care and improvements to such care’s quality. AHIP asserts that medical loss ratio regulations will be especially problematic for HSA-eligible HDHPs. Participating in a qualified HDHP is a requirement to participate in an HSA. HDHPs provide individuals with a low-premium, high-deductible alternative to traditional health plans. These plans might have lower benefit costs, but they certainly aren’t always cheaper to administer from a per-enrollee standpoint. As a result, they may naturally have lower medical loss ratios. (continue reading…)

Banyan Administrators have been providing us with beneficial information about several different aspects of the Health Care Reform and how it affects us. Over the next months and years, employers will be faced with numerous changes, many of which require regulatory clarification. Banyan will continue to keep us up to date and on target with decisions that affect our plans.

The following information is from Banyan Administrators:

Health Care Reform W2 Reporting

What You Need to Know Now About: W-2 Reporting

On March 31, 2011, the Internal Revenue Service (IRS) released the 19-page Interim Final Rules on the Health Care Reform W-2 reporting requirements. The IRS is still taking comments on the rules for the next 60 days. 

1.       What needs to be reported on the W-2 form?

Employers must report the costs for a group health plan. This does not include dental and vision plans unless the plans are integrated in the group health plan. Disability and long term care plans are also excluded from the reporting requirement.

2.       How do I determine the cost for the group health plan?

The cost includes both the employee contribution and employer contribution. Employers with fully-insured health plans should use the monthly premium rate. Employers with self-funded health plans should use the COBRA premium equivalent rates less the 2% administrative fee. Employer contributions into Medical Savings Accounts (MSA), Health Savings Accounts (HSA), Health Reimbursement Accounts (HRA) and, in most instances, Flexible Spending Accounts (FSA) are excluded.

3.       Where do I enter this information on the W-2 Form?

The information is entered in Box 12 on the W-2 form using code DD.

4.       Will the amount be included as taxable income for my employee?

No it will not. The first page, first bullet of the IRS Interim Final Rules state, “This reporting to employees is for their information only, to inform them of the cost of their health care coverage, and does not cause excludable employer-provided health care coverage to become taxable.”

5.       When do I have to be ready to comply with the new W-2 reporting requirement?

If you issue more than 250 W-2 forms for tax year 2011, you are required to comply with the new requirement for the 2012 tax year W-2 forms that are distributed to employees in January, 2013. You do have the option to comply earlier, if desired. However, remember that a terminating employee in calendar year 2012 can ask for an early W-2 so, in reality, you will need to be ready to comply as early as January, 2012.

Employers that issue 250 or fewer W-2 forms for tax year 2011 can receive “transition relief” from this requirement until January, 2014.

If you have any questions on this health care reform provision, please discuss with a member of your Banyan Consulting team.

[Information Source]

It’s been more than a year since the Group Insurance Trust contracted with Banyan Administrators, LLC for administrative services, and from early on, subscribers and Trust staff have been consistently pleased with Banyan’s expertise and responsiveness.

Staffed by a service center team where all members are fully licensed in California, three full-time and two part-time dedicated agents are on hand every day from 8 a.m. to 5 p.m. to handle member comments, inquiries, and billing. Two additional full-time staff members respond to incoming emails, faxes, and forms. Tom Zimmerman, Banyan’s Insurance Group Leader, provides a long list of issues that representatives commonly address, including “billing, coverage, claims, COBRA and CalCOBRA, enrollment, eligibility, forms, ID cards, open enrollment changes, quotes, plan changes, and underwriting.”

He adds that whenever the Banyan team is responding to members, they make secure handling of personal data a high priority. Banyan employs both a web encryption system and a password protected email system. The latter can be set up for incoming as well as outgoing emails, so if members need to supply vital information, they should contact Banyan before emailing the data to arrange for a secure transfer.

Performance Stats

As part of its contract with the Trust, Banyan is required to keep statistics on its performance in handling member calls, and the results are impressive. Since November 2009, the average phone response time has been 29 seconds and the average includes two open enrollment periods when calls were very heavy. Better still from a customer point of view, 95 percent of all email or telephone inquiries were resolved on the initial contact. In addition, Banyan’s average time to review and process incoming paperwork is less than two days with an accuracy rating of better than 99 percent on premium invoices and enrollment changes. (continue reading…)

Banyan Administrators have been providing us with beneficial information about several different aspects of the Health Care Reform and how it affects us. Over the next months and years, employers will be faced with numerous changes, many of which require regulatory clarification. Banyan will continue to keep us up to date and on target with decisions that affect our plans.  Over this past week, Banyan has provided answers to many questions regarding how the Health Care Reform Cadillac Tax will affect you. We are sure you will find the following information from Banyan Administrators valuable. This article is part 2 of 2. If you missed last week’s article, click here.

Health Care Reform Cadillac Tax

What You Need to Know Now About: The Cadillac Tax

Another component of the Patient Protection and Affordable Care Act (PPACA) commonly referred to as the Health Care Reform Act is a tax on benefit-rich or “gold-plated” insurance plans. This tax is often referred to as “The Cadillac Tax” and, although it is not scheduled to go into effect until 2018 and may see several revisions in design before then, some plan sponsors are beginning to develop strategies to address it.

1.  I sponsor a grandfathered health plan. Am I subject to The Cadillac Tax?

Yes. The Cadillac Tax is applicable to both grandfathered and non-grandfathered health plans. 

2.  Are there any exceptions for certain groups of employees such as collectively bargained union groups?

During initial debate about implementing The Cadillac Tax for 2013, there was debate about excluding federal employees and union groups from the provision; however that was abandoned when the implementation of the tax was delayed to 2018. At this time, union groups will also be subject to the tax in 2018.

There are some adjustments to the current 2018 Annual Value Amounts for certain groups. For example, insurance plans that have an above average population of older workers or female workers may have higher 2018 Annual Value Amounts based on a still to be determined formula. The reasoning is that the higher cost to insure these groups is due to risk factors and not to benefit-rich plan designs.

This line of reasoning is also responsible for higher 2018 Annual Value Amounts for retirees and workers in high-risk professions (firefighters, coal miners, etc.). The amounts for these professions are set at $11,850 for an individual and $30,950 for a family plan. 

3.  How many plan sponsors might be subject to The Cadillac Tax?

Initially, when the tax was scheduled to go into effect in 2013 the CBO estimated that by 2016 19% of all workers would be subject to The Cadillac Tax.

With the delayed implementation date of 2018, several studies and estimates have been performed and assuming just an average annual trend of 8%, the projection is in the range of 40%-60% of all plan sponsors will trigger The Cadillac Tax. Of course, all these projections assume the plan sponsor does not make any significant plan design changes like increased deductibles and other employee out-of-pocket costs and that the details of The Cadillac Tax as currently constituted for 2018 remain unchanged. (continue reading…)

Banyan Administrators have been providing us with beneficial information about several different aspects of the Health Care Reform and how it affects us. Over the next months and years, employers will be faced with numerous changes, many of which require regulatory clarification. Banyan will continue to keep us up to date and on target with decisions that affect our plans.  Over the next couple of weeks, Banyan will be providing answers to many questions regarding how the Health Care Reform Cadillac Tax will affect you. We are sure you will find the following information from Banyan Administrators valuable.

Health Care Reform Cadillac Tax

What You Need to Know Now About: The Cadillac Tax

Another component of the Patient Protection and Affordable Care Act (PPACA) commonly referred to as the Health Care Reform Act is a tax on benefit-rich or “gold-plated” insurance plans. This tax is often referred to as “The Cadillac Tax” and, although it is not scheduled to go into effect until 2018 and may see several revisions in design before then, some plan sponsors are beginning to develop strategies to address it.

1.  Why was “The Cadillac Tax” included in the Health Care Reform Act?

There are two primary reasons for the inclusion of The Cadillac Tax in the Health Care Reform Act. The first is to stem the rise of health care costs. One belief is that excessively benefit-rich plan designs encourages higher utilization, even overuse, of health care services by the plan participants and, as a result, have a greater influence in driving escalating health care costs.

The second reason is to generate revenue to help pay for covering the uninsured.   The Congressional Budget Office (CBO) estimates that The Cadillac Tax will generate $149B over a 10-year period.

2.  What plan sponsors and plan designs are subject to The Cadillac Tax?

Beginning in 2018, if a benefit-rich insurance plan has an annual value of more than $10,200 for an individual and $27,500 for a family, then the insurance plan is subject to a 40% excise tax. 

The 2018 annual value amounts of $10,200 and $27,500 include medical, prescription drugs, administrative fees and also include employee and employer contributions to flexible spending, health reimbursement or health savings accounts.  Stand-alone vision and dental plans are not included in the calculation. However, there has been some recent confusion on the topic as it appears that the cost for a self-funded dental plan must be added to the calculation whereas a fully-insured dental plan does not. More guidance from the IRS/DOL is needed.

3.  How is the 40% excise tax calculated and who pays it?

The 40% excise tax is calculated on the amount above the annual value amount. For example:

A.     2018 Annual Value Amount – Individual     $10,200

B.     Insurance Plan’s Actual 2018 Annual Value Amount – Individual     $11,200  

C.     Difference Insurance Plan’s Amount v. Allowed Amount (B – A)     $1,000 

D.     40% Excise Tax – “The Cadillac Tax” (C * 40%)     $400 

The excise tax is paid by the plan sponsor and is paid for each participant in excess of the 2018 allowed amount so, in this example, if the plan sponsor has 500 participants with Individual coverage in the insurance plan at an 40% excise tax of $400 each participant, then the plan sponsor would pay a Cadillac Tax of $200,000.

Of course, although the plan sponsor is responsible for paying The Cadillac Tax, many may pass on some, if not all, of the cost on to the plan participants in some form such as higher employee contributions. 

4.  Will the Annual Value Amounts for Individual and Family change after 2018?

Yes, it is anticipated that the Annual Value Amounts for subsequent years will be indexed and will increase. At the moment, the expectation is that the amounts will increase, annually, by the medical inflation rate. Usually, this rate averages between 3%-5%. 

It should also be noted that some plan sponsors might find in 2018 that they do not trigger the tax, however, because their insurance plan costs continue to rise faster on an annual basis than the medical inflation rate that in a subsequent year such as 2019, 2020, etc., they will trigger the tax.

[Image Source, Information Source]

CalCPA and its related entities are moving. Our offices will close at 5:00 pm on Friday December 17 and will reopen in our new headquarters on January 3, 2011. All direct phone extensions and fax numbers will change. All 800 numbers will remain the same. Please be aware that telephone and email services will be down from 12/20 – 12/22, but are expected to resume on 12/23. During the closure, please contact Banyan Administrators, LLC 877-480-7923 for assistance. Our new address is: 1800 Gateway Drive, Suite 201, San Mateo, CA 94404. Phone (800) 556-6771.

It’s often said, if you don’t know where you have been, you can’t know where you are going. So, as the Board of Trustees and staff of the Group Insurance Trust position themselves to meet the challenges ahead in 2011, looking back on 2010 will help set the course for the coming year.

A year of change began when the Trust transitioned to its new plan administrator, Banyan Administrators, LLC. When Banyan replaced the Trust’s prior long-time administrator Seabury & Smith, it was with the expectation that the Trust would soon be able to provide its members with modern, improved services. We have not been disappointed. Since Banyan assumed responsibility for managing the Trust’s group insurance plans, improvements have been apparent each passing month. This summer Banyan began rolling out online self-service management capabilities to participating firms. As firms are trained and comfortable with the self-management site, a new group of firms is then invited to take part. By the end of 2011 we expect that all firms wishing to manage common tasks (such as new hire enrollments, terminations, demographic changes, dependent adds and deletions and other tasks associated with benefit management) will be trained and actively managing their benefit programs. Participating firms may also have noticed the comprehensive and timely distribution of 2011 plan renewal information. (continue reading…)

Maintaining a successful health plan demands constant attention to changing conditions and regularly updating plan designs. It means responding to an evolving market, adapting to public policy initiatives, and taking advantage of new medical developments. That’s why there are always changes for the Group Insurance Trust to announce during the annual open enrollment period. This year, with the passage of the Patient Protection and Affordable Care Act (“health care reform”) the number of changes are greater than usual and carry a more serious financial impact.

Following is an outline of the most important plan modifications subscribers will see this year. Some are in response to health care reform but not all.

Health Care Reform Mandates

Beginning January 1, every health plan must comply with the following provisions:

• All dependents up to age 26 are eligible for coverage
• No cost-sharing for in-network preventive services
• No pre-existing limitations for children under 19
• Prior authorization or higher cost-sharing disallowed for out-of-network emergency services
• New rules for appeals process
• Removal of lifetime maximum limits (copay and HSA plans)
• Removal of lifetime limits for hospice care (copay and HSA plans)
• Removal of annual limits on durable medical equipment (HMO plans)

Premium Rates

Naturally, all these mandated changes come at a price. Over the past seven years, the Group Insurance Trust has delivered single digit increases that were well below national and regional trends. However, a thorough analysis of the costs associated with these mandated benefits, plus unusually high claims experience in 2009, resulted in an increase to CalCPA ProtectPlus medical plan rates that is significantly higher than that of previous years.

Because each firm’s rates are based on a combination of factors, each firm’s increase is unique. Renewal packets, including rate information specific to each firm, were mailed to participating firms on November 1. If you did not receive your renewal package please contact Banyan Administrators, LLC at (877) 480-7923 immediately. (continue reading…)

Banyan Administrators have been providing us with beneficial information about several different aspects of the Health Care Reform and how it affects us. Over the next months and years, employers will be faced with numerous changes, many of which require regulatory clarification. Banyan will continue to keep us up to date and on target with decisions that affect our plans.  Over the past few weeks, Banyan has provided answers to many questions regarding Medicare and how the reform affects you. If you missed the first two articles in this series, make sure to check them out – Article #1 and Article #2. We are sure you will find the information valuable.

The following information is provided by Banyan Administrators:

Arguably the greatest volume of reforms through the Patient Protection and Affordable Care Act (“Affordable Care Act”) signed into law on 03/23/2010 involve Medicare. Some of the provisions are direct reforms to Medicare while other provisions of the Affordable Care Act may have an indirect, but intentional, impact on the program. The following Q&A will give you an overview of the reforms to the Medicare program and how they are all intended to work together.

1.  What are the Medicare Part D reforms?

The first Medicare Part D reform is the closing of the “donut hole”. For Medicare Part D enrollees in 2010, coverage breakdowns as follows: 

• $2,830 – After the enrollee pays the first $310 in drug costs (the deductible), the plan pays 75% of the drug cost up to $2,830 with the enrollee paying the other 25%, then
• $2,831-$4,550 – The “donut hole” – The enrollee pays 100% of their drug costs up to $4,550, then
• $4,551+ – “catastrophic coverage” – The enrollee pays a $2.40 copay for generic drugs. For other drugs the enrollee pays either $6.00 or 5% of the drug cost, whichever is greater.

Beginning in 2010, the reforms going into effect to address the donut hole are: 

• 2010 – Enrollees in the “donut hole” received $250 rebate checks from Medicare
• 2011 – If an enrollee reaches the donut hole, they will be given a 50% discount on the total cost of the brand name drugs while in the gap. Medicare also will phase in additional discounts on the cost of both brand name and generic drugs.
• By 2020 – Effectively close the donut hole so that the plan pays 75% of the drug cost with the enrollee paying the remaining 25%.

The second Medicare Part D reform is the elimination of the Medicare Part D Subsidy paid to employers who sponsor a retiree drug plan.  (continue reading…)

Banyan Administrators have been providing us with beneficial information about several different aspects of the Health Care Reform and how it affects us. Over the next months and years, employers will be faced with numerous changes, many of which require regulatory clarification. Banyan will continue to keep us up to date and on target with decisions that affect our plans.  Over the next few weeks, Banyan will be providing answers to many questions regarding Medicare and how the reform will affect you. We are sure you will find the information valuable.

If you missed the first article in this series that was posted last week, click here.

The following information is provided by Banyan Administrators:

Arguably the greatest volume of reforms through the Patient Protection and Affordable Care Act (“Affordable Care Act”) signed into law on 03/23/2010 involve Medicare. Some of the provisions are direct reforms to Medicare while other provisions of the Affordable Care Act may have an indirect, but intentional, impact on the program. The following Q&A will give you an overview of the reforms to the Medicare program and how they are all intended to work together.

1.  What is the future of Medicare?

What could not have been foreseen in 1965 when Medicare was created was that the United States was coming to the end of the post-World War II “Baby Boom”. More “Baby Boomers” are reaching Medicare eligibility than are being replaced in the work force by younger workers.  With Medicare being funded by FICA taxes, at some point, it mathematically becomes impossible to fund all the benefits for all the Medicare enrollees. (continue reading…)

Banyan Administrators have been providing us with beneficial information about several different aspects of the Health Care Reform and how it affects us. Over the next months and years, employers will be faced with numerous changes, many of which require regulatory clarification. Banyan will continue to keep us up to date and on target with decisions that affect our plans.  Over the next few weeks, Banyan will be providing answers to many questions regarding Medicare and how the reform will affect you. We are sure you will find the information valuable.

The following information is provided by Banyan Administrators:

Health Care Reform – Medicare

What You Need to Know Now About: Medicare

Arguably the greatest volume of reforms through the Patient Protection and Affordable Care Act (“Affordable Care Act”) signed into law on 03/23/2010 involve Medicare. Some of the provisions are direct reforms to Medicare while other provisions of the Affordable Care Act may have an indirect, but intentional, impact on the program. The following Q&A will give you an overview of the reforms to the Medicare program and how they are all intended to work together.

1.  What is the history of Medicare?

As early as 1945, President Harry S. Truman proposed a government administered national social insurance program. It was not until the Social Security Act of 1965 signed into law by President Lyndon B. Johnson that the Medicare program was created. The first senior enrolled into the Medicare program was former President Harry S. Truman. Former First Lady Bess Truman was the second senior enrolled.

The first two programs created in 1965 were Medicare Part A and Medicare Part B. Since that time, Medicare Part C (1997) and Medicare Part D (2006) have been added.

Medicare Part A is hospitalization insurance providing coverage to the Medicare enrollee for inpatient hospital stays. Medicare Part A also pays for other facility-based skilled services such as care at a skilled nursing facility, but, on a limited basis. Most Medicare enrollees do not pay a premium for Medicare Part A coverage because they (or a spouse) have paid enough into the program through payroll taxes prior to retirement. Medicare enrollees do have to meet a Medicare Part A deductible before any benefits are paid. In 2010, the Medicare Part A deductible is $1,100 for an inpatient stay up to 60 days.

Medicare Part B is medical insurance providing coverage to the Medicare enrollee for outpatient services provided by a physician. Services include physician services, nursing services, x-ray, laboratory and diagnostic tests, vaccinations, renal dialysis, outpatient hospital procedures, etc. No benefit is provided for prescription drugs unless the drug is administered by a physician. Participation in Medicare Part B is voluntary if an eligible retiree wishes to participate; the premium amount will be deducted from his social security benefit. In 2010, Medicare Part B monthly premium, on average, is $100.50. The Medicare Part Benrollee also has to meet a $155 deductible and then pay 20% coinsurance.

In 2008, there were 45 million enrollees in Medicare making it the nation’s largest single health care payer in the nation. By 2030, it is expected that enrollment will reach 78 million. In 2008, Medicare spending reached $599 billion which was 20% of the total federal government spending. At $599 billion, Medicare is only surpassed by Social Security and defense spending. (continue reading…)

—A Note from Susan Young, Executive Director of the Group Insurance Trust of the California Society of CPAs

In addition to the quality medical care and competitive prices members have come to expect, when you subscribe to a CalCPA-endorsed ProtectPlus health plan, you get the added benefit of an administrative support team whose sole purpose is to make your insurance dealings clear, easy, and responsive. This is never more critical than when you find yourself facing a denied claim. If this should happen, here are the steps you can take to get an explanation and, at least sometimes, a decision reversed.

Begin by calling the Anthem member service phone number on the back of your medical ID card. You should have your EOB (explanation of benefits) in hand so that you can ask why a particular treatment was either denied or only partially paid. If the answer isn’t clear, or you feel the claim wasn’t handled properly, your next step should be to call the ProtectPlus service representatives at Banyan Administrators at (877) 480-7923. Every member of the Banyan team is a licensed agent and is there to serve you. Moreover, they are your advocates. Their job is to make sure you get the care you need as smoothly as possible, so you shouldn’t feel shy about asking. This is what your insurance plan is all about.

If the Banyan agent doesn’t solve the problem to your satisfaction, Banyan can walk you through the Anthem appeals process. Appeals are handled slightly differently depending on whether they concern completed care, treatments in progress, or future procedures. Anthem will provide a written response within 30 business days with the results of its decision.

At this point most disputes are resolved, but if you are still not satisfied you have the final option of filing for an Independent Medical Review (IMR). The IMR is provided by the California Department of Insurance (DOI). There is no charge to you for this service and the DOI’s decision is binding. Simply complete and submit the one-page application to request a review. Anthem will provide the applicable medical records and claims documentation required by the DOI and you can add any pertinent information in support of your claim. The Department will inform you of its determination in approximately 30 business days following submission of the IMR request.           

Because the ProtectPlus program is a Multiple Employer Welfare Arrangement (MEWA), ProtectPlus plan participants must submit their IMR application to the Department of Insurance which oversees MEWAs. IMR requests for many other healthcare plans in California are reviewed by the Department of Managed Care.  You can download the IMR application at http://www.insurance.ca.gov/0100-consumers/0020-health-related.

Banyan Consulting LLC has been providing us with beneficial information about different aspects of the Health Care Reform and how it affects us. Over the next months and years, employers will be faced with numerous changes, many of which require regulatory clarification. Banyan will continue to keep us up to date and on target with decisions that affect our plans. 

To view this article in PDF format, click here.

The following information is provided by Banyan Consulting LLC:

What You Need to Know Now About:  Lifetime and Annual Limits

The Patient Protection and Affordable Care Act (“Affordable Care Act”) signed into law on 03/23/2010 includes changes to any limits on the benefit amount payable on a per participant basis by an employer-sponsored group health plan.  These provisions take effect on the first day of the first plan year following 9/23/2010.  Lifetime limits on a per participant basis will be prohibited.  Annual limits on a per participant basis will still be permitted on a restricted basis until 2014 when those, too, are prohibited.

1. Does the health care reform provision on Lifetime and Annual Limits apply to “grandfathered” health plans?

Yes, this provision applies to both grandfathered and non-grandfathered health plans.  Also, your plan’s funding arrangement, fully-insured or self-funded, does not impact your requirement to comply.

2. Currently, my employer-sponsored group health plan has a $1,000,000 lifetime maximum.  What do I need to do in order to be compliant?

Effective with the first day of your next new plan year after 9/23/2010, you must remove the $1,000,000 lifetime maximum and replace it with an unlimited lifetime maximum.

You will also need to determine if there has been any plan participants who had reached the $1,000,000 lifetime maximum and were dropped by the plan.  You will need to contact them, alert them of the new unlimited lifetime maximum, and offer them the opportunity to re-enroll into the health plan effective on the first day of your next new plan year after 9/23/2010.

3. Do the lifetime and annual maximum changes apply only to in-network providers?

The Interim Final Regulations issued by the Department of Labor on 6/23/2010 are not entirely clear on this subject; however, the interpretation of the regulations is that there is no distinction for network participation.  The lifetime and annual limits are on a per participant basis and provider network affiliation does not factor into the reform provision. (continue reading…)

Banyan Administrators have been providing us with beneficial information about different aspects of the Health Care Reform and how it affects us. Over the next months and years, employers will be faced with numerous changes, many of which require regulatory clarification. Banyan will continue to keep us up to date and on target with decisions that affect our plans. 

To view this article in PDF format, click here.

The following information is provided by Banyan Administrators:

Another component of the Health Care Reform Act signed into law on 3/23/2010 is that beginning with the 2011 tax year, employers must report the aggregate cost of applicable employer-sponsored health insurance coverage on employees W-2 forms.  General information about this requirement has been provided, however, the Department of Labor (DOL) has not yet issued Interim Final Rules on this provision of the Health Care Reform Act.

1. When does an employer have to be ready to be in compliance with this new reporting requirement?

Employers must be prepared to accurately report this information on an employee’s 2011 W-2 form as early as February, 2011.  Although employers will be sending most of the 2011 W-2 forms to the employees in January, 2012, if an employee terminates employment in 2011, they do have the right to request an early 2011 W-2 form.  Employers must be prepared for this possibility. (continue reading…)

Banyan Consulting LLC has been providing us with beneficial information about different aspects of the Health Care Reform and how it affects us. Over the next months and years, employers will be faced with numerous changes, many of which require regulatory clarification. Banyan will continue to keep us up to date and on target with decisions that affect our plans. 

To view this article in PDF format, click here.

The following information is provided by Banyan Consulting LLC:

One component of the Health Care Reform Act signed into law on 3/23/2010 requires minimum coverage, without employee cost-sharing, for services rated A or B by the US Preventive Services Task Force.  Beginning with the first day of the first plan year beginning on or after 9/23/2010, plans can no longer require a copay or apply a deductible or coinsurance to these services.  On 7/14/2010, the Department of Health & Human Services (HHS) released the list of A and B services determined by the US Preventive Services Task Force.

1.  Does this health care reform provision apply to “grandfathered” plans?

No, grandfathered plans do not need to comply with this provision.  If, in the future, your health plan loses its grandfathered status, this reform will apply to your plan.

2.  What are the A and B rated preventive services?

The A and B rated preventive services are segmented into 3 categories which are:

•  Adult Covered Preventive Services
•  Women (including Pregnant Women) Covered Preventive Services
•  Children Covered Preventive Services

There is still some debate on additional services for women that, most likely, will not be resolved until August, 2011.  There is lobbying from organizations such as Planned Parenthood, for example, who want birth control to be included in the preventive services category.  More information is sure to follow. (continue reading…)

 Banyan Consulting LLC has been providing us with beneficial information about different aspects of the Health Care Reform and how it affects us. Over the next months and years, employers will be faced with numerous changes, many of which require regulatory clarification. Banyan will continue to keep us up to date and on target with decisions that affect our plans. 

The following information is provided by Banyan Consulting LLC:

With the passage of the Patient Protection and Affordable Care Act on March 23, 2010, effective January 1, 2011 over-the-counter (OTC) medicine will no longer be eligible for reimbursement from a Flexible Spending Account (FSA), Health Reimbursement Account (HRA) or Health Savings Account (HSA) unless accompanied by a prescription or medical necessity statement from a medical provider.  The new regulation only applies to OTC medicine so many OTC supplies that are, currently, eligible for reimbursement through an FSA, HRA or HSA will not be affected. To read more, click here.