Presented by:

Sandy WaltersExecutive Vice President & Senior Consultant

Kelly & Associates Insurance Group

How the Exchanges / MarketplaceWill Effect Your Business

&The Latest Updates of ACA

• Avoid $2,000 penalty by offering any plan

• Avoid $3,000 penalty by either

- Offering qualified and affordable plan - Having employee take any plan

TWO EMPLOYER RULES FOR LARGE GROUP

COUNTING EMPLOYEES

Variations in Counting:• If an employer fails to provide its full-time employees (and

their dependents) the opportunity to enroll in “minimum essential coverage,” and

• One or more full-time employees enrolls for coverage in an exchange and qualifies for a premium tax credit or cost-sharing reduction, then

• Employer penalty = $2,000 for each of its full-time employees in the workforce

• Must have qualified coverage if affordable (less then 8% of family income )

• Can only receive either subsidy if

- Income under 400% poverty level- Not offered qualified and affordable plan from any

size employer - Does not participate in any other plan - Not eligible for Medicaid

EMPLOYEE RULES

2013 POVERTY GUIDELINES FOR 48 CONTIGUOUS STATES AND DC

Persons in Family/Household Poverty Guideline

For families/households with more then 8 persons, add 4,020 for each additional person

1 $11,490

2 $15,510

3 $19,530

4 $23,550

5 $27,570

6 $31,590

7 $35,610

8 $39,630

Salary / HourMonthly Salary

130 Hours(30 Hours / Week)

Annual Salary(30 Hours / Week)

30 Hours Max Monthly

Contribution (9.5%)

Monthly Salary173.33 Hours

(40 Hours / Week)Annual Salary

(40 Hours / Week)40 Hours Max

Monthly Contribution (9.5%)

$7.50 $975.00 $11,700.00 $92.63 $1,299.98 $15,599.70 $123.50$8.00 $1,040.00 $12,480.00 $98.80 $1,386.64 $16,639.68 $131.73$8.50 $1,105.00 $13,260.00 $104.98 $1,473.31 $17,679.66 $139.96$9.00 $1,170.00 $14,040.00 $111.15 $1,559.97 $18,719.64 $148.20$9.50 $1,235.00 $14,820.00 $117.33 $1,646.64 $19,759.62 $156.43

$10.00 $1,300.00 $15,600.00 $123.50 $1,733.30 $20,799.60 $164.66$10.50 $1,365.00 $16,380.00 $129.68 $1,819.97 $21,839.58 $172.90$11.00 $1,430.00 $17,160.00 $135.85 $1,906.63 $22,879.56 $181.13$11.50 $1,495.00 $17,940.00 $142.03 $1,993.30 $23,919.54 $189.36$12.00 $1,560.00 $18,720.00 $148.20 $2,079.96 $24,959.52 $197.60$12.50 $1,625.00 $19,500.00 $154.38 $2,166.63 $25,999.50 $205.83$13.00 $1,690.00 $20,280.00 $160.55 $2,253.29 $27,039.48 $214.06$14.00 $1,820.00 $21,840.00 $172.90 $2,426.62 $29,119.44 $230.53$15.00 $1,950.00 $23,400.00 $185.25 $2,599.95 $31,199.40 $247.00$17.50 $2,275.00 $27,300.00 $216.13 $3,033.28 $36,399.30 $288.16$20.00 $2,600.00 $31,200.00 $247.00 $3,466.60 $41,599.20 $329.33

$25.00 $3,250.00 $39,000.00 $308.75 $4,333.25 $51,999.00 $411.66

Medicaid Level at 138%Family Size Rate

Single $15,860 $10.172 $21,400 $13.723 $26,950 $17.28

4 $32,500 $20.83

SALARY-HOURS-MAX CONTRIBUTION

DC COVERAGE ASSISTANCE OPTIONS IN 2014

Children Pregnant Women

Parents Adults w/o Children

Medicaid

Premium tax Credits

Premium Credits & Cost-sharing AssistanceIneligible

Approximate Income Levels as a Percent of Poverty

400%

300%

250%

200%

133%

100%

EXCHANGES

MEDICAID EXPANSION

EXCHANGE: PROS & CONS

Pros SHOP

• Tax Credit

• Employee Choice

• Under 25 Employees

• Under 50K Average Salary

• Contribution must be at least 50%

• Max Credit - Under 11 Employees & Under 25K Salary

TAX CREDIT

EMPLOYER CHOICE VS. EMPLOYEE CHOICE

EXCHANGE: PROS & CONS

Cons SHOP

• Work with Government Entity

• Same Plans Outside the Exchange at Same Price

• Limited Plans

• Strict Participation Rules in Shop

• Disclosure of Info to Government

• Higher Probability of Data Theft

EXCHANGE: PROS & CONS

Pros of Individual Coverage

• Subsidy

EXCHANGE: PROS OF INDIVIDUAL EXCHANGE

Subsidy

• Family Income Under 400% Poverty Level

• No Group Qualified Affordable Single Coverage Available

• Family Income Under 250% Poverty Level

EXCHANGE: PROS & CONS

Cons Individual

• Lose Pretax Savings

• Employers Contribution

DC HEALTH LINK – WHO HAS ACCESSDC RESIDENTS, LAWFULLY PRESENT

Purchaser

Types of Coverage

Individual Coverage Group CoverageIncome-Eligible

Subsidized Coverage

All legally-present District residents District residents with access to employer coverage that doesn’t meet the affordability or quality tests

Small employers and their employees (50 or fewer FTEs prior calendar year – expands to 100 or fewer FTEs in 2016)

Sole proprietorship, partnership, or S-Corp. with only owners (0 non-owner employees) Undocumented District residents Not Exchange-Eligible

(May be eligible for DC HealthCare Alliance coverage)

DC RESIDENCY REQUIREMENTSIndividuals & Families• Persons under age 19 or one who is homeless can self-attest to residency• Otherwise, documentation such as a lease , deed or letter from

roommate can prove residency• Moving our of DC would cause loss of eligibility for DC Health Link plan• 30 days to inform DC Health Link of change in residency

– Plan eligibility can continue until end of month following month of reported change.

– Premium payment required for that month.

Small Businesses• No check on individual’s legal status or residency for small business

enrollees

CHOICE OF PLANS

Small Business Plans Individual and Family Plans

Aetna Aetna

Care First BlueCross Blue Shield

Care First BlueCross Blue Shield

Kaiser Permanente Kaiser Permanente

United HealthCare

TRANSITION TO ONE MARKETPLACE DC HEALTH LINK

2014 2015 2016

Individual policyholders• New and renewing(non-grandfathered)

Small businesses• Up to 50 employees and

current offering health coverage, upon renewal

Small businesses• Up to 100 employees,

upon renewal

Small businesses• No currently offering

health coverage• Currently offering

coverage if they chose

PREMIUM CALCULATION

• DC will not permit a surcharge for tobacco users• Each employee will have a different premium

based on his/her age• Family premiums will be a total of each family

member’s age rate• Family premium – tour premium plus

spouse/partner’s premium + child(ren)’s premium• Up to 3 children under age 21 included in family

premiums

EMPLOYER CONTRIBUTIONSDC Health Link will allow a small employer to select its contribution level1. Select one plan to base contributions on, the “reference plan”2. Select a Percentage to contribute for employees and dependents

to enroll in reference plan3. The contribution remains fixed based on the reference plan.

Employees enrolling in any other allowed plan will pay the difference in premium to “buy-up” or “buy-down”

Age REFERENCE PLAN Gold PPO Premium

Employer Pays (80%)

Employee Pays

Platinum PPO Premium

ENROLLED PLAN Employer Pays (same as Ref Plan)

Employee Pays

Vince 27 $275 $220 $55 $310 $220 $90

Joyce 40 $365 $292 $73 $417 $292 $125

COUNTING EMPLOYEESTo calculate the number of “full-time equivalent (FTE)” employees:1. Count all employees who worked on average 30 hours per week or more2. Count the number of hours worked on average by part-time employees

and divide by 30, rounding up to the next higher number for any fractions

3. Add the two numbers togetherNote: Count all employees, not just those that are eligible for

health benefits.For example: SmallCo has 20 full-time employees working 30 hours per week and 4 part-time employees working 15 hours per week4. Full-time employees 205. Part time hours divided by 30 26. Total full-time equivalents 22

• Individual Coverage 50% and 75% Paid by Employer

• Annual Income $30,000• Monthly Income $2,500• Hourly Income$14.42

• Individual Coverage

• Monthly Premium $300

SAMPLE ON AND OFF EXCHANGE

SAMPLE ON AND OFF EXCHANGE

ExchangeGroup

50% 75%

Monthly Salary $2,500 $2,500 $2,500

Medical Premium NA $150 $75

Adjusted Gross $2,500.00 $2,350.00 $2,425.00

Federal Tax 15% $3.75 $352.50 $363.75

State and County Tax 10% $2.50 $235.00 $242.50

FICA 6.2% $155.00 $145.70 $150.35

Medicare 1.45% $36.25 $34.07 $35.16

Total Deduction $816.25 $767.27 $791.73

Net Pay $1,683.75 $1,582.73 $1,633.27

Exchange Premium $222.00 NA NA

Net Cost $1,461.75 $1,582.73 $1,633.27

Difference $121.73 $171.52

Questions