Preparing your company for the Affordable Care Act
Many companies who currently offer group health insurance must be cognizant of the current changes taking place under the Affordable Care Act. This is important as changes are being made to the types of plans companies are allowed to offer. For example, under new regulations, all health care plans are prohibited from applying annual or lifetime dollar limits. Carriers are not able to cancel insurance due to unintentional mistakes that the consumer may have made on their application. Plans must also allow consumer’s children to remain on the plan until 26 years of age. Under the Affordable Care Act, employers are given time to allow their current plans to be grandfathered in. For example, for those with plans which existed before March 23 2010 under which employees have been continuously covered, would be considered to be a grandfathered plan. In this case, the plan may not be required to meet all the requirements that new plans implemented after this date are required to meet. Unlike new plans, grandfathered plans are not required to cover certain preventative treatments at no additional cost to the employees, amongst other exceptions. Therefore it is important that the employers are aware of the current status of their health care plans and how they can run the risk of losing their grandfathered status if changes are made to these. Employers are able to find more information regarding the status of their plan through the Center for Consumer information and Insurance Oversight (CCIIO).
To help support employers through the health care reform, HR consulting companies who specialize in benefit and other HR support, can offer tailored services for the specific needs of the company. They can advise and prepare companies to make the necessary changes under the Affordable Care Act, such as addressing budgetary concerns and choosing the most appropriate cost effective plan. They can also help companies choose appropriate software solutions to help administrate benefits and integrate these with other company processes. Employers must also determine if they are required to meet other regulations, such as W-2 reporting or if they are eligible for small employer tax credits. They should also determine if they are considered to fall under the definition of larger businesses by calculating their full time employees and less than full time employees using a specified calculation. This is important, as employers who fall under the category of a large business and who do not offer health insurance, will be subject to a penalty.
As changes may occur in the future, companies should ensure that their current software solutions are flexible enough to incorporate new plans and allow for the possibility of working with new carriers.