Today's health benefits continue to face unprecedented changes. People are working longer, the cost of health care continues to rise and companies increasingly find it hard to provide competitive benefits while staying on top of the changing healthcare reform. All these changes are confusing. Here are some facts about health insurance benefits:
Beginning in 2014, most health insurance plans will be required to cover essential health benefits (EHB) in 10 categories:
- Ambulatory patient services
- Emergency services
- Maternity and newborn care
- Mental health and substance use disorder services, including behavioral health treatment
- Prescription drugs
- Rehabilitative and habilitative services and devices
- Laboratory services
- Preventive and wellness service and chronic disease management
- Pediatric services, including oral and vision care
A pre-existing condition is any medical condition that is currently monitored or treated (taking medication for). It could be as minor as high blood pressure, allergies, acid reflux or as major as cancer, stroke, pregnancy or diabetes. Prior to the enactment of the Affordable Care Act, your insurance company could decide what is a pre-existing condition and refuse to sell you a policy, charge you two or three times more, or limit your benefits so that your condition is excluded. However, beginning in 2014, the law will prevent insurers from denying coverage to anyone who has a pre-existing condition.
On wages exceeding $250,000 for a married couple filing jointly - or $200,000 for singles - a new 0.9 percent Medicare tax kicks in on Jan. 1, 2013. For example, if you and your spouse earn $280,000, you would owe $270, or 0.9 percent of the $30,000, which is the amount over that $250,000 threshold.
Another new Medicare tax started on Jan. 1, 2013 as well - this one at 3.8 percent - on investment income over $250,000 for a married couple filing jointly or $200,000 for single filers. Investment income is generally referred to as interest, capital gains, dividends and rental income. This is a brand new tax to be reported on a person's or couple's tax return.
The Affordable Care Act will do away with lifetime and annual dollar limits on benefits, and it will limit the age rating so that a boomer can only pay three times as much as a younger person.
Small employers with 10 or fewer employees whose average wage is under $25,000 that provide insurance can get a tax credit of up to 35% of their cost of the employee's insurance premiums.
You can purchase individual or group health insurance on your own but it is better to use a well informed agent to fully understand the benefits and limitations of your individual health policy. A licensed contracted agent is needed to purchase group insurance.
The difference between group insurance and individual insurance is that group insurance is purchased by an employer on behalf of the employee, and the employer chooses the benefits for the employee. Individual insurance is purchased by an individual with no employer involved, and the individual chooses his/her own benefits, coverage and costs.
A deductible is the upfront portion you pay before the insurance carrier starts paying their percentage.
Coinsurance is the agreed percentage the insurance carrier pays on your behalf after you meet your deductible.
A rider is a coverage and/or change/exclusion to the policy.
A Health Savings Account (HSA) is a high-deductible health plan that is designed to dramatically bring down your premium. Unfortunately, many insurance agents are not well informed about HSAs and often do not understand or explain the benefits. We have HSA experts on staff to explain the tax breaks and low premiums these plans offer.
The Affordable Care Act does not cut Medicare benefits. In fact, health care reform expands Medicare coverage, by eliminating cost-sharing for preventive services, adding a yearly wellness visit, limiting some cost-sharing in private Medicare plans, and closing the Part D "Donut Hole."
As you can see the Affordable Care Act is changing the health benefits industry. Are you still confused about insurance benefits? Give us a call today at 920-215-4995 or click here for free quote. We look forward to the opportunity to serve you.