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Operational Adjustments in the Health Care Marketplaces as Plans Leave the Exchanges

Posted by Susan Donegan on Mon, Sep 12, 2016

CMS said it plans to roll out a pilot program to assess the effect of more stringent requirements for people signing up for insurance through the ACA's public exchanges outside of the open enrollment period. "Our intent in conducting such a pilot would be to evaluate the impact of pre-enrollment verification of special enrollment period eligibility on compliance, enrollment, continuity of coverage, the risk pool, and other outcomes. The scope of the pilot is still being determined." (Business Insider, 9/6/16)

To help make it easier for consumers to choose health insurance plans, the federal government, is encouraging insurers to offer “simple choice plans” as an option this fall. The goal is to make comparing plans easier for consumers, according to a report from KHN. Acing the consumer shopping experience is crucial for the success of offering standardized plans. “Otherwise you might as well not bother,” Sabrina Corlette of the Georgetown Center for Health Insurance Reform told KHN. (Fierce Healthcare, 9/2/16)

Aetna, UnitedHealthcare and Humana–the company Aetna recently tried to merge with–are all leaving exchanges. On top of these departures are smaller providers, including several government-funded carriers. The biggest problem cited is demographics. Namely, the people signing up for the program are older and sicker than expected. Some may also be taking advantage of insurers by waiting until they are sick or need medical help to sign up. (Law Street, 9/1/16)

Federal officials continue to make operational adjustments in the health care marketplaces and meet with some insurers to encourage them to offer more plans in areas of the country that are forecast to be low on competition following the withdrawal of some major insurers for 2017, said Department of Health and Human Services Secretary, Sylvia Burwell. (Kaiser Health News, 9/1/16)

A new McKinsey & Co. analysis of regulatory filings for 18 states and the District of Columbia found that 75% of the offerings on their exchanges in 2017 will likely be health-maintenance organizations or a similar plan design known as an exclusive provider organization, or EPO. Only a quarter of the exchange plans next year would still be preferred-provider organizations, or PPOs, with a larger selection of doctors and hospitals and include out-of-network coverage. (Wall Street Journal, 8/31/16)

The Obama administration will roll out a big push later this year encouraging the 28.6 million folks who remain uninsured to sign up when open enrollment begins in November. An enrollment boost would likely signal that healthier people are entering the market. Providing coverage on the individual exchanges remains a struggle. Insurer downsizings mean that 19% of all enrollees will only have a single company to choose from, up from 2% this year, according to a new Kaiser analysis. And 38% of enrollees may only have two insurers in their exchanges. (CNN Money, 8/29/16)

Tags: healthcare reform, ACA, healthcare exchanges, HIX

CMS Targets Special Enrollments, Quality Star Ratings, and Provider Network Inaccuracies

Posted by Susan Donegan on Fri, May 13, 2016

Aetna Inc. expects to continue selling Affordable Care Act exchange plans in 15 states, and the insurer said it may expand into new areas. Aetna Chief Executive Mark T. Bertolini told analysts that Aetna still saw its position in the ACA marketplaces as a “good investment.” But he also made pointed comments about the need for changes to the law to ensure a sustainable business. (Wall Street Journal, 5/11/16)

CMS tightened the use of special enrollments, specifically making the rules around moving to a new home more restrictive to avoid any gaming of the system. Co-ops also can seek outside funding from investors to build up their capital, something that was outlawed previously. CMS Acting Administrator Andy Slavitt told the Senate earlier this year that he thought allowing private investors to inject money into the co-ops would give them a better chance to be successful. (Modern Healthcare, 5/6/16)

Data from the first three years of Affordable Care Act marketplace plans will provide insurers a clearer picture of healthcare costs, allowing for more accurate premium pricing for 2017 that could offer sustainability within the marketplace, according to a report from the Kaiser Family Foundation (KFF). Policy experts say additional data collected over the past three years will offer more certainty as insurers attempt to align premiums with healthcare costs. (FierceHealthPayer, 5/6/16)

Anthem, Inc. "is well-positioned to continue growth through the exchanges if the market stabilizes. The insurer would like to roll out] more creative and innovative products on exchanges." — Anthem Chairman, President and CEO Joseph Swedish said in a recent conference call with investors to discuss first-quarter 2016 earnings (AIS Health Business Daily, 5/5/16 Click here to read the INSIDE HEALTH INSURANCE EXCHANGES E-ALERT in which this quote appeared. Free for HEX subscribers; $17 for non-subscribers).

CMS is delaying the quality star ratings of health plans on the federal and state-based marketplaces that use the federal platform, from 2017 to the open enrollment period for 2018. The delay will give CMS additional time to conduct focused consumer testing of how the star ratings are displayed on The star ratings provide consumers with comparable information about the quality of healthcare services through survey data on enrollee experiences. (Healthcare Finance, 5/5/15)

CMS intends to fine and impose enrollment sanctions on Medicare Advantage plans with substantial errors in their reported provider networks. In its final year, the Obama administration will use waning resources to go after managed care plans for a decades-old problem—provider network inaccuracies. Medicare Advantage oversight is one more step in a building reaction to “narrow network” health plans that spans regulators and markets. This reaction is remaking how regulators oversee health plan provider networks, and will check the drive to narrow networks just as the business case for doing so grows more compelling. (Managed Healthcare Executive, 5/2/16)

Tags: healthcare reform, ACA, HIX

Sixth Anniversary of Affordable Care Act

Posted by Laura McMullen on Fri, Apr 01, 2016

We just passed the sixth anniversary of the Affordable Care Act’s passage and many media outlets have been reflecting on the progress or lack thereof. This post, Repealed or Repaired, on The Health Care Blog by Paul Keckley, author of The Keckley Report, offers a good summary of how we got here, what we’ve learned, and predictions about what’s coming next.

Some highlights:

  • “The law has fundamentally changed the structure of the healthcare industry across the board.” Providers are taking risk through value-based contracting. Insurers are merging. Venture capitalists are betting on efficiency and innovation. Employers are shifting cost to employees and offering benefits through exchanges.
  • “States must play a key role in implementing health reforms.” Health reform in New York State is different from Florida even though both are large states with significant urban populations. Likewise, Iowa and Arkansas are equally different even though both are smaller rural states.
  • “The likelihood of repeal is low; the inevitable is its repair.” Methodologies for defining and measuring value of care are needed. Clarification of antitrust rules around provider consolidation is also needed. Other needs include liability reform and “adequate funding for preventive and primary care that’s inclusive of mental health, dentistry, ophthalmic care, and nutrition, and others.”

Do you have any predictions for what the ACA of the future will look like?

Tags: healthcare reform, ACA, HIX

HIX News: Third Open Enrollment Season Opens Smoothly

Posted by Susan Donegan on Fri, Nov 13, 2015

The third open enrollment period is underway on the public exchanges and we’re reading about plan changes, network changes, and price changes. Here’s a roundup of interesting datapoints, perspectives, and news.

The third open enrollment season opened much more smoothly than the inaugural season in 2013. “Still, big questions linger: Of the estimated 10.5 million uninsured people who are eligible to get coverage on the exchanges, how many can be persuaded to buy health plans? And how many of nearly 10 million existing customers will renew coverage — and at what price?” (Washington Post, 11/1/15, Click to read more)

The public health insurance exchanges are reviving condition-specific health plans. One of the newest offerings is the Innovation Health Leap Diabetes Gold plan, offered on the Virginia exchange. The product is a joint venture of Aetna Inc. and Inova Health System for individuals with diabetes and offering access to a range of providers and services that a diabetic would need. (AIS Health Business Daily 11/10/15,Click to read more, subscription required)

8 of 10 ... shoppers on public health insurance exchanges will pay less than $100 per month this year after tax credits, and 7 of 10 will pay less than $75 a month, according to HHS. (AIS Health Business Daily 11/10/15, Click here to read the INSIDE HEALTH INSURANCE EXCHANGES E-ALERT article in which this datapoint appeared. (Free for HEX subscribers; $17 for non-subscribers).

A new study by the Kaiser Family Foundation (KFF) reports 32.3 million Americans under the age of 65 are currently uninsured. Many consumers don’t understand or act on the health information they receive and have trouble navigating the system. Improving health insurance literacy rates can help increase consumer enrollment and use of insurance coverage for the uninsured populations. “Health literacy is the degree to which individuals have the capacity to obtain, process and understand basic health information to make appropriate health decisions and seek services needed.” (Huffington Post, 11/11/15, Click to read more)

Five open enrollment trends affecting how employers offer benefits to their employees in 2016: moderate premium increases, more costs shifting to employees, ACA requirements expand to include employers with at least 50 full-time employees, large employers are promoting wellness, and benefits targeted financially at specific segments of the workforce. (Paychex, 11/10/15, Click to read more)

Affordability is one of the biggest challenges to boosting enrollment in year three of the ACA. The people eligible for the lowest subsidies to buy health insurance were the least likely to sign up for 2015 plans. The percentage of individuals choosing health plans dropped from about 75% for those earning $23,540 or less to about 14% for those earning about $47,000, new research from the Urban Institute and the Robert Wood Johnson Foundation (RWJF) shows. (USA Today, 11/9/15, Click to read more)

Connected Health reports higher traffic in week one of 2016 open enrollment on its Smart Choices™ Marketplace platform than in the first month of 2015 enrollment. "ConnectedHealth's strong numbers early on underscore the growing reception we're seeing in the private exchange industry from employers and consumers alike, particularly at a time when recent reports indicate that state exchanges and co-ops are struggling to find their footing," said Joe Donlan, president of ConnectedHealth. (ConnectedHealth 11/10/15, Click to read more)


Tags: healthcare reform, ACA, HIX

HIX News: Premiums for Benchmark Plans are Increasing

Posted by Laura McMullen on Fri, Nov 06, 2015

The third open enrollment period is underway on the public exchanges and we’re reading about plan changes, network changes, and price changes. Here’s a roundup of interesting datapoints, perspectives, and news.

Premiums for benchmark plans are increasing in all states. 7.5% ... will be the average premium increase for benchmark plans (i.e., the second-lowest-cost silver plans) across all 37 states where CMS operates part or all of the exchange, but the variations from one state to another will be enormous (e.g., Indiana residents will see a 12.6% decrease, while Oklahomans will have an average increase of 35.7%), CMS said on Oct. 26. (AIS, Health Business Daily, 11/5/15, Click for more info; subscription required)

Plan designs are changing to reduce deductibles and limit or remove out-of-network benefits. More HMOs and fewer PPOs are available. (AIS Health Plan Business Blog, 11/6/15)

Fewer plans are offered, in general. After the 2015 marketplace saw a 28% increase, the evolution of in 2016 will bring an overall reduction of 12% (40% fewer PPOs and 8% more HMOs/EPOs) in health insurance plan offerings. (CNBC, 10/29/15)

BCBS plans are adjusting. Blue Cross Blue Shield of Arizona is only selling HMOs on the public exchange in Arizona for 2016 while HealthNet and UnitedHealth Group’s All Savers subsidiary are still selling PPOs. HCSC discontinued non-group PPOs in Illinois, New Mexico, and Texas because claim costs exceeded premiums collected. Florida Blue is keeping its PPO offerings on public exchanges and adding HMO offerings in several counties targeted at people who are eligible for subsidies. (AIS Report on Blue Cross Blue Shield Plans, 11/2/15, login required)

Market forces are affecting carriers. Large insurers are expanding: United HealthCare is selling on exchanges in 11 additional states. Fourteen more states have one or more new issuers applying to join the exchange marketplace. Sixteen states report issuers are leaving, for instance Assurant. Small carriers, such as CO-OPs are failing. Premium rates and shopping tools to help identify plan providers and coverage for medications are the most important features for consumers. (Avalere Observations: What to watch for in 2016 exchange open enrollment, 10/27/15)

Tags: healthcare reform, ACA, healthcare exchanges

CO-OPs: early casualties in the marketplace

Posted by Laura McMullen on Tue, Oct 27, 2015

We explored the health insurance CO-OPs that were created under the Affordable Care Act in a blog post earlier this year. There were 23 in 26 states at the beginning of 2015 and, as of October 16, eight had ceased operations, according to Employee Benefit News, and will not sell plans for 2016 on the public exchanges. The Commonwealth Fund reports that the CO-OPs received $2.44 billion in public funds and enrolled 500,000 people collectively.

Why Are CO-OPs Failing?

In a statement on their website, the National Alliance of State Health CO-OPs (NASHCO) attributes the closures to the CMS decision to pay 12.6% of the 2014 risk corridor. The statement goes on to mention lower ACA enrollment projections, consolidation of the health insurance market, and unexpected risk adjustment obligations as additional factors in the closure of CO-OPs in Tennessee, Colorado, and Oregon.

The failure of nearly one-third of CO-OPs “reflects a combination of factors: low pricing and higher utilization than expected against those prices; inability to leverage competitive prices from providers; greater than anticipated losses from risk adjustment; and most recently and acutely, much less payment than expected from risk corridors,” explains Katherine Hempstead, a director at the Robert Wood Johnson Foundation in Princeton, N.J., in Employee Benefit News.

What Are Risk Corridors?

In a brief called Explaining Health Care Reform: Risk Adjustment, Reinsurance, and Risk Corridors, the Kaiser Family Foundation explains that risk corridors are a three-year program to “limit losses and gains beyond an allowable range” in the first three years of the ACA as people with pre-existing conditions enroll. HHS does this by charging Qualified Health Plans (QHPs) that have lower than expected claims and distributing the funds to QHPs that have higher than expected claims. The methodology allows for shortfalls in collections and government funding, stating “if risk corridors collections for a particular year are insufficient to make full risk corridors payments for that year, risk corridor payments for the year will be reduced pro rata to the extent of any shortfall.” For 2014, $362 million were collected from plans with expenses below their allowed rate and $2.87 billion was needed to pay all of the QHPs with expenses above the allowed rate leading to the 12.6% reimbursement rate. Many carriers have large receivables based on these calculations that they are not going to collect. For CO-OPs, with smaller budgets and less in reserves, an uncollectible receivable can be devastating.

Risk Adjustment Obligations and Other Regulations

The Kaiser Family Foundation brief explains that risk adjustment is a permanent program designed to protect against adverse selection and risk selection by “redistributing funds from plans with lower-risk enrollees to plans with higher-risk enrollees.” Payments are calculated based on actuarial risk scores. In some cases, CO-OPs were able to attract healthier people and became liable for large risk adjustment payments. The lower-than-anticipated risk corridor payments and restrictions on outside investment made these payments a larger problem for CO-OPs than for other insurers.

The Pew Trusts Stateline blog noted that CO-OPs had other restrictions to contend with:

  • Obstacles to obtaining outside financing as a condition of the federal loan
  • Inflexible pay-back requirements
  • Parameters around how the borrowed funds could be spent, including prohibitions on advertising
  • Limited opportunities for new investment

A Competitive Market: Lower Enrollment Projections and Increased Merger Activity

Original estimates from the White House and Congressional Budget Office expected as many as 20 million people purchasing health insurance on exchanges while the latest estimates are just 10 million. The Washington Post reports that some of the obstacles preventing people from enrolling are:

  • The cost of plans even with government subsidies
  • The value of current plans based on a year of usage
  • The difficulty of reaching uninsured people – about half are young adults, more than one-third are minorities, and 80% have less than $1,000 in savings

Recent surveys of employers found that they view the mergers as a mixed blessing: better negotiating leverage will drive down provider cost for insurers ultimately lowering premiums but larger insurers will reduce competition ultimately increasing premiums.

CO-OP Failures As Part of the Bigger Picture

The CO-OP 30% failure rate is in line with the failure rate reported by the Bureau of Labor Statistics for health care and social assistance companies after two years. Health care and social assistance have been among the industries with the highest survival rates historically – across all industries the failure rate is 90%, according to Forbes magazine.

In fact, there aren’t many new entrants in the health insurance industry because of the barriers to entry. On September 15, 2015, the New York Times reported that “only two for-profit companies that were not already health insurers have entered the state marketplaces so far: Oscar, a New York-based upstart with a Silicon Valley flair and plans to take on California and Texas in 2016, and ZoomPlus, which just received approval to sell policies in Oregon.”

Health insurance is a complicated business made even more so by the changing regulatory environment. What impacts are you seeing in your top and bottom markets from risk corridors and risk adjustment obligations?

Tags: health insurance, Affordable Care Act, healthcare reform, ACA, healthcare exchanges

Pros and Cons of Health Insurer Mergers for Employers

Posted by Laura McMullen on Wed, Aug 05, 2015

mergerAetna acquires Humana. Anthem acquires Cigna. Centene acquires Health Net. Assurant Health is bought by National General. These are big moves that are creating bigger companies in an already huge $2.9 trillion industry. There’s been lots of analysis about the acquisitions, like this Modern Healthcare article from July 2015 that explains how gaining more Medicare Advantage business is the purpose of these mergers, but the perspective that I’m finding most interesting is what employers are saying.

Consolidations Are a Mixed Blessing

A Business Insurance article published after the Aetna/Humana and Centene/Health Net deals were announced described the results of an Aon Hewitt employer survey of nearly 100 employers. Jim Walker, Aon Hewitt’s global chief innovation officer for health and benefits consulting, wasn’t surprised at the results. “On the one hand, consolidation will give insurers more clout in negotiating with health care providers. On the other hand, employers are concerned that fewer and bigger health insurers will mean they have less leverage in negotiating with insurers.” Here are some of the top line results of the survey:

  • Three-quarters of the employers surveyed thought the impact would reduce options or have no effect.
  • More than half said they were considering changes to their health plan strategies.
  • More than three-quarters said the industry consolidation would not affect their short-term decision-making about retiree options.

Another Business Insurance article published a week later, after the Anthem/Cigna deal was announced to result in the nation’s biggest health insurer, offered similar perspective. Here are a few quotes:

“From the employer side, the deal can be ‘good news,’ if the much larger Anthem can ‘cut better deals with medical providers,’ concurs Dave Osterndorf, a partner and chief health care actuary at Health Exchange Resources in Mequon, Wisconsin.”

“Adding Cigna's book of business ‘may rebalance provider negotiation leverage in Anthem's favor after years of provider consolidation that has gone pretty much under the radar screen,’ says Brian Marcotte, president of the National Business Group on Health in Washington. “Large employers will have concerns about the merger between Anthem and Cigna because employers will be left with only three major insurers who can support large multi-state employers on a nationwide basis.”

PricewaterhouseCoopers predicts medical cost trend to increase 6.5% in 2016, with a projection of 4.5% after benefit design changes, in their Behind the Numbers 2016 report. The trend is increasing more slowly than in years past although healthcare costs continue to outpace inflation so employers are understandably still interested in reducing the impact of healthcare costs in their bottom lines.

Balancing Cost and Choice

I’ve written that headline a million times in my healthcare career. Most of the time, I’ve been describing benefit options to employees but it applies to the choice facing employers as well. They want to offer health insurance for a variety of reasons – the other companies in their industry offer it, they’ve always offered it, healthy employees are more productive than sick employees, etc. As the costs continue to rise, employers hold the line on their costs and shift more to the employees through higher deductibles and more premium cost-sharing.

The mergers and acquisitions we’re seeing now are bringing that choice to the forefront again for employers. Which way are your customers leaning?

Tags: health insurance, healthcare reform, healthcare benefits, health insurers, medicare, medical insurance, health insurance mergers

Guest Blog: The Affordable Care Act Part 2 – What’s Ahead for Small Businesses?

Posted by Louis Balbirer on Wed, Sep 24, 2014

Louis BalbirerLouis Balbirer of Kaufman Rossin writes a guest blog post for NetMinder about changes related to healthcare reform. This is the second post in a two-part series discussing opportunities and challenges of the Affordable Care Act. The first part of this series focused on large businesses.

In the four years since the passage of the Affordable Care Act (ACA), there have been a number of changes that can make it difficult for small businesses to interpret their responsibilities under the law. 

At the latest C-Suite Breakfast Series, co-sponsored by Kaufman Rossin and Vistage, a panel of experts discussed changes for small and large businesses brought on by the Affordable Care Act. Specifically, panelists told us what’s better, what’s worse and what’s ahead for small business owners.

Panelists included:

What are some opportunities for small businesses?

Small businesses, defined under the healthcare law as having 50 or fewer full-time equivalent employees, are exempt from many ACA requirements. The Affordable Care Act presents many small business owners and their employees with opportunities for tax credits, lower insurance rates and more extensive coverage.

The following are some of the ways the ACA could benefit smaller businesses:

  • The Federal Small Business Health Options Program (SHOP) marketplace allows small business owners to control the coverage they offer to employees and the premiums they pay for coverage.
  • According to the panelists, the quality of insurance coverage and healthcare are expected to increase because the Affordable Care Act mandates a broadened scope of coverage for certain conditions that were previously uninsured.
  • The lack of penalties for dropping insurance and the availability of the Exchange for employees make it easier for small employers to save by choosing not to offer health insurance for their employees.
  • Additional delivery systems allow employers to choose how they offer insurance to their employees. SHOP, the Marketplace and private exchanges allow employers to veer from the traditional model (or continue with it) when selecting health insurance options for their business.
  • Small businesses with 25 or fewer full-time equivalent employees are eligible for a maximum 50% tax credit if they pay premiums on behalf of their employees enrolled in a qualified healthcare plan through SHOP.

What has the Affordable Care Act made more challenging for small business?

Although they are exempt from parts of the healthcare law, small businesses still face some challenges as a result of the ACA.

The following have been made more challenging since the passage of the Affordable Care Act:

  • Employers must participate by buying and paying SHOP fees even if only one employee participates in an insurance plan.
  • Some small business owners will need more resources (including more employees) to properly comply with the tracking and reporting requirements under the ACA.
  • Some employers are discouraged from hiring because they do not want to have to comply with the pay or play mandate required of businesses with more than 50 full-time equivalent employees. Employees who work 30 or more hours per week are considered full-time under the ACA.

What’s ahead for small business owners?              

Small business owners should prepare to comply with the upcoming reporting requirements under the healthcare law and consult their broker and accountant with any questions, including how ACA-related tax changes may affect their tax bill.

I spoke with Joy Batteen, director of human resources at Kaufman Rossin and a panelist at the C-Suite Breakfast Series, about important next steps for small business owners.

“If a small business is considering hiring a broker, but is concerned about the cost, now is the right time to make that move,” said Batteen. “Hiring a knowledgeable broker – someone you can trust – makes dealing with ACA changes much easier. The law will affect different employers in different ways; the most important thing businesses can do is be prepared.”

Louis Balbirer, CPA, is a director of tax services with Kaufman Rossin, one of the top CPA firms in the U.S He has 20 years of experience providing tax and accounting services to clients and can be reached at


Tags: NetMinder, health insurance, Affordable Care Act, Healthcare, healthcare reform, health reform, healthcare benefits, ACA, healthcare exchanges, insurance companies

Guest Blog: The Affordable Care Act Part 1 – What’s Ahead for Large Businesses?

Posted by Louis Balbirer on Fri, Aug 29, 2014

Louis BalbirerLouis Balbirer of Kaufman Rossin writes a guest blog post for NetMinder about changes related to healthcare reform. This is the first post in a two-part series discussing opportunities and challenges of the Affordable Care Act for small and large businesses. Material shared here was presented at the C-Suite Breakfast Series event, co-sponsored by Kaufman Rossin and Vistage.

By January 1, 2015, large businesses will need to decide if they are going to extend coverage to their employees or pay the annual fee for declining to “play.” For businesses, understanding their obligations under the Affordable Care Act (ACA) now and in the coming months is more important than ever.

The ACA was the topic of the most recent C-Suite Breakfast Series. A panel of experts discussed the impact of the Affordable Care Act on small and large business.

Panelists included:

What are some opportunities for large businesses?

Companies with more than 50 full-time equivalent employees are considered large businesses under the healthcare law. Large businesses are subject to many rules under the ACA that do not apply to small businesses.

The Affordable Care Act presents several opportunities for large businesses related to the insurance coverage options they provide to their employees.

  • The opening of the Small Business Health Options Program (SHOP) marketplace to businesses with 50-100 full-time employees in 2015 will offer employers additional insurance plan options.
  • According to the panel discussion, quality of insurance coverage and healthcare is expected to increase for employees at large businesses.
  • The delay of the Employer Shared Responsibilities Provisions until January 1, 2015, for businesses with more than 100 full time equivalent employees, allows employers more time to strategically position themselves to provide insurance in order to avoid associated penalties. Qualifying businesses with 50-100 full time equivalent employees have until January 1, 2016, to comply with the provisions.
  • Businesses that choose to participate in health insurance plans can use benefits as a recruiting tool to potentially attract higher-quality candidates than those who choose to pay the fees associated with not providing coverage.

What has the Affordable Care Act made more challenging for large businesses?

Large businesses have a greater responsibility than small businesses under the Affordable Care Act. A number of deadline changes have made the roll-out of the healthcare law even more confusing for large employers. Added expenses, additional reporting and mandatory coverage for all full-time employees are further complicating the process for large employers.

The following challenges face large businesses under the healthcare law:

  • Reporting responsibilities for large businesses mean added infrastructure is needed. In 2015, large businesses must start reporting on whether insurance was provided to employees, what type of coverage was offered, and some companies may be required to report on the value of the insurance provided to each employee on his or her W-2.
  • Guidance and regulations continue to evolve, making it challenging to plan and comply with the law.
  • Cost of insurance has increased (in most cases) due to plan design limitations and fees or taxes imposed by the Affordable Care Act.
  • Insurance rates may increase for employers if plan participation is low.
  • Employees may not be able to keep their current insurance plans due to ACA mandates.
  • Large companies that do not offer affordable coverage may be subject to penalties of up to $3,000 per subsidized employee.

What’s ahead for business owners?

Large businesses need to decide if they are going to pay or play by the January 1, 2015, deadline.

“When we talk about next steps, I recommend that companies prepare for the compliance and reporting requirements,” said panelist Alexis DeLuca. “Inevitably, whether a large business chooses to pay or play, they’re likely going to end up with a larger reporting burden than they planned for.”

According to DeLuca, businesses should take steps to ensure they are ready to comply with the changes as they roll out. Investing in the infrastructure needed to accurately report, capturing the required data and planning ahead for annual assessments of health insurance options by contacting an insurance broker or a tax advisor will help large businesses manage the impact of Affordable Care Act.

Louis Balbirer, CPA, is a director of tax services with Kaufman Rossin, one of the top CPA firms in the U.S. He has 20 years of experience providing tax and accounting services to clients and can be reached at

Tags: NetMinder, health insurance, Affordable Care Act, insurance broker, healthcare reform, ACA, healthcare exchanges, Health plan

UnitedHealthcare Plans to Expand Exchange Presence

Posted by Laura McMullen on Tue, Aug 12, 2014

UnitedHealthcare is betting that the health insurance exchanges are sustainable for the long-term, Kaiser Health News reported in July in a post titled Biggest Insurer Drops Caution, Embraces Obamacare.

What’s behind this decision?

  • understandingtheaca resized 600The marketplaces look viable, even without some of the government safeguards like risk-sharing and reinsurance support that will end after the first few years.
  • The pricing is clearer. With six months of claims experience from millions of people, UnitedHealthcare believes they can accurately rate their products.
  • The regulations are in place. Many of the pending lawsuits have been decided.
  • Consumer behavior is more certain. Even with all of the delays and challenges during the initial implementation of the federal exchange, millions of transactions have been completed and UnitedHealthcare believes “there’ll be some shopping, even though people don’t have to shop,” according to Jeff Alter, head of UnitedHealthcare’s employer and individual insurance division. “The natural consumer play of an exchange is going to cause a shopping experience.”

Does UnitedHealthcare’s entry change anything about your exchange strategy? Is this an attractive market for starting or expanding an insurance company?

Tags: health insurance, Affordable Care Act, healthcare reform, ACA, healthcare exchanges, consumer choice, Obamacare, insurance companies





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