Health Insurance Reform Updates

October 1, 2013 is the first key date of many for implementation of the Health Insurance Reform provisions enacted by Congress and the President.   Here are some of the key provisions and requirements that are upcoming:

Individual Mandate and Health Insurance Marketplace

As most folks know, everyone is required to have health insurance starting on January 1, 2014.  For those that do not have health insurance, each state is required to open health insurance exchanges on October 1, 2o13 for its residents to purchase health insurance. The open enrollment period for acquiring insurance through the exchanges runs from October 1, 2013 to March 31, 2014.  If you do not have insurance and do not acquire insurance will need to pay a fee (tax).  The fee (tax) is for 2014 is $95 per adult and $47.50 per child, with a maximum family fee of  $285.  The collection of the fee (tax) will be done on the 2014 tax return.

Employer Insurance Notice Issuance

Employers are required to give notice to their employees  about their coverage and the opening of the health insurance marketplace. Notices for existing employees are due by October 1, 2013.  For new employees starting after October 1, 2013, notices are to be given within the first 15 days of their employment.

Premium Tax Credits 

For individuals that acquire health insurance through the health insurance marketplace and whose income is between 100% and 400% of the federal poverty level, a refundable and advanceable tax credit is available to offset the cost of the insurance.  This credit does have some exceptions.  The largest exception is that the credit is not available if the individual has the ability to obtain health insurance through a federal group (like Medicare or Medicaid) or employer group health insurance plan.

Small Business Credits

Small businesses that have less than 25 full time equivalent (FTE) employees with an average FTE salary less than $50,000 and purchase insurance through the Small Business Options Program and pay at least 50% of the total cost of the insurance may qualify for a tax credit.  The credit is 35%  of the employer contribution for 2013 and 50% of the employer contribution for 2014, however starting in 2014, the credit is limited to two consecutive years.

If you have any questions regarding these upcoming changes, feel free to contact me and I would be glad to answer your questions.