The 2011 continuing budget resolution, agreed to in broad terms by Congress this past weekend, would end two programs funded by the Affordable Care Act, according to a summary of H.R. 34, the Fiscal Year 2011 Continuing Resolution released by Rep. Hal Rogers (Ky.), the chairman of the House Appropriations Committee.
Congress is expected to vote on the specific budget reductions this week.
A reported $2.2 billion cut would be made in the Consumer Operated and Oriented Plan (CO-OP) program, under which grants and loans may be made to assist in the creation (or expansion) of qualified nonprofit health insurance issuers under ACA Sec. 1322. These nonprofits are designed to offer qualified health plans in the individual and small group markets (ACA Sec. 1322(a)). The nonprofits would compete with for-profit insurers for business in the individual and small group markets. This $2.2 billion cut appears to support instead those who want to reduce government "interference" in private, for-profit business.
The resolution also would eliminate the free choice voucher program (ACA Sec. 10108), under which employees who are exempt from the individual mandate but who do not qualify for premium subsidies are eligible for a voucher equal to the amount the employer would have spent on individual or family coverage. An employer could deduct for the amount of any free choice voucher provided, which is treated as an amount paid for compensation for personal services actually rendered.
Evidence of ACA opponents methodically carving away at the law? Will any leader stop the destruction?
Wednesday, April 13, 2011
Monday, April 11, 2011
ACA Medicare Provisions Improve Benefits, Spend
Just before a budget agreement was reached between the White House and Congress, Wisconsin Rep. Paul Ryan, chairman of the House’s Budget Committee, released his budget proposal, The Path to Prosperity: Restoring America’s Promise, which would convert the Medicare program into a voucher program for future beneficiaries to purchase private health insurance.
Meanwhile, the Centers for Medicare & Medicaid Services has released 2012 policies for Medicare health and drug plans implementing provisions of the Patient Protection and Affordable Care Act (ACA) that are related to the Medicare Advantage (MA, or Part C) and Prescription Drug Benefit (Part D, or PDP) Programs. The final rule includes provisions to raise revenues, curtail spending, and protect beneficiairies.
CMS estimates that implementing all the proposals in the final rule will result in net savings to the Medicare program of about $76 billion for fiscal years 2011 through 2016. Most of these savings are due to the ACA’s reforms to MA payments.
Key ACA provisions implemented in the final rule would achieve the following results:
• Limit to original (fee-for-service) Medicare levels cost-sharing under MA plans for specified services (administration of chemotherapy services, renal (kidney) dialysis services, and skilled nursing care).
• Prohibit MA plans from charging cost-sharing for in-network preventive services for which there is no cost sharing under original Medicare.
• Implement the new requirement that higher income Part D beneficiaries pay an Income Related Monthly Adjustment Amount.
• Implement statutory changes to close the Part D coverage gap (the “donut hole”).
Provider participation requirements would achieve the following results:
• Prohibit Part C and D program participation by MA organizations and Part D sponsors whose owners or directors served in a similar capacity with another organization that terminated its Medicare contract within the previous two years.
• Require that Part C and Part D organizations (1) use physicians or other appropriate health care professionals with sufficient medical and other expertise, including knowledge of the Medicare program, to review organization determinations involving medical necessity, and (2) employ a medical director who is responsible for ensuring the clinical accuracy of all organization determinations and appeals involving medical necessity.
To strengthen beneficiary protections, CMS is authorized to require MA plans to periodically mail enrollees an explanation of benefits for their medical benefits. This will help ensure that beneficiaries receive regular updates on their health care use and out-of-pocket costs so that they can better evaluate their options for health care coverage.
To enable CMS to limit Part C and D program participation to stronger applicants and to remove consistently poor performers, CMS will set requirements for those plans’ fiscal solvency. For plans that lack a minimum 14 months of performance history, CMS will deny a new application or service area expansion due to insufficient information to determine the plan’s capacity to comply with the requirements of the Part C or Part D programs.
For more information. For a comprehensive analysis of the Patient Protection and Affordable Care Act, including the full text of the law and additional information on health reform implementation and other recent developments in employee benefits, just click here.
Meanwhile, the Centers for Medicare & Medicaid Services has released 2012 policies for Medicare health and drug plans implementing provisions of the Patient Protection and Affordable Care Act (ACA) that are related to the Medicare Advantage (MA, or Part C) and Prescription Drug Benefit (Part D, or PDP) Programs. The final rule includes provisions to raise revenues, curtail spending, and protect beneficiairies.
CMS estimates that implementing all the proposals in the final rule will result in net savings to the Medicare program of about $76 billion for fiscal years 2011 through 2016. Most of these savings are due to the ACA’s reforms to MA payments.
Key ACA provisions implemented in the final rule would achieve the following results:
• Limit to original (fee-for-service) Medicare levels cost-sharing under MA plans for specified services (administration of chemotherapy services, renal (kidney) dialysis services, and skilled nursing care).
• Prohibit MA plans from charging cost-sharing for in-network preventive services for which there is no cost sharing under original Medicare.
• Implement the new requirement that higher income Part D beneficiaries pay an Income Related Monthly Adjustment Amount.
• Implement statutory changes to close the Part D coverage gap (the “donut hole”).
Provider participation requirements would achieve the following results:
• Prohibit Part C and D program participation by MA organizations and Part D sponsors whose owners or directors served in a similar capacity with another organization that terminated its Medicare contract within the previous two years.
• Require that Part C and Part D organizations (1) use physicians or other appropriate health care professionals with sufficient medical and other expertise, including knowledge of the Medicare program, to review organization determinations involving medical necessity, and (2) employ a medical director who is responsible for ensuring the clinical accuracy of all organization determinations and appeals involving medical necessity.
To strengthen beneficiary protections, CMS is authorized to require MA plans to periodically mail enrollees an explanation of benefits for their medical benefits. This will help ensure that beneficiaries receive regular updates on their health care use and out-of-pocket costs so that they can better evaluate their options for health care coverage.
To enable CMS to limit Part C and D program participation to stronger applicants and to remove consistently poor performers, CMS will set requirements for those plans’ fiscal solvency. For plans that lack a minimum 14 months of performance history, CMS will deny a new application or service area expansion due to insufficient information to determine the plan’s capacity to comply with the requirements of the Part C or Part D programs.
For more information. For a comprehensive analysis of the Patient Protection and Affordable Care Act, including the full text of the law and additional information on health reform implementation and other recent developments in employee benefits, just click here.
Friday, April 8, 2011
Congress votes to repeal health reform law’s 1099 reporting requirement
The Senate passed, by a vote of 87 to 12, H.R. 4, the Comprehensive 1099 Taxpayer Protection and Repayment of Exchange Subsidy Overpayments Act of 2011. The bill, already passed by the U.S. House of Representatives, repeals Form 1099 reporting requirements included in the Patient Protection and Affordable Care Act (ACA). This is the first amendment to the ACA since its passage in March 2010.
The ACA revised the reporting requirements so that all businesses would have to file a Form 1099 to identify vendors to whom they pay $600 or more in a year. Although the additional reporting was intended to improve tax compliance, Congress acknowledged that the administrative burden on small businesses merited repeal. Repeal of expanded business information reporting is certain to reduce the burden on taxpayers, especially on small businesses.
Specifically, H.R. 4 repeals the ACA reporting changes to Sec. 6041 of the Internal Revenue Code, which provide rules for payments to corporations, provide additional regulatory authority, and impose a reporting requirement with respect to gross proceeds from property. The repeal is effective for payments made after December 31, 2011, which is the effective date of the original ACA provision.
President Barack Obama is expected to sign the bill into law. According to a statement released by Obama's press secretary, "We are pleased Congress has acted to correct a flaw that placed an unnecessary bookkeeping burden on small businesses. Small businesses are the engine of our economy, and eliminating the 1099 reporting requirement is the right thing to do.... And the Administration remains eager to work with anyone with ideas about how we can make health care better or more affordable for all Americans."
Impact of repealing ACA's 1099 reporting rule. Repeal of the ACA’s 1099 reporting rule means that the pre-ACA 1099 reporting rules for business payments continue unchanged. In particular, businesses must continue to issue Form 1099s for payments of $600 or more to service providers. Additionally, repeal means that the long-standing exception to required information reporting for payments made to corporations remains intact.
Paying for the ACA's 1099 repeal. The reporting requirement was expected to increase federal revenues by as much as $21.5 billion over the next ten years. To offset this loss in revenue, H.R. 4 pays for the repeal by requiring certain taxpayers to repay some or all of the health insurance tax credits they otherwise would be eligible for starting in 2014 under the ACA.
Under the 2010 health reform law, beginning in 2014, taxpayers who purchase qualified health care coverage through an American Health Benefit Exchange are entitled to a refundable income tax credit equal to the health insurance premium assistance credit. Generally, the credit is available to taxpayers (individuals or families) with household income between 100 percent and 400 percent of the federal poverty level (FPL). If the advance payments exceed the allowable credit, the excess is an increase to the taxpayer’s taxes for the year. However, ACA limits the increase in taxes to a maximum $400 (or $250 for unmarried taxpayers) for individuals with family income below 400 percent of the FPL for the family size involved.
The ACA revised the reporting requirements so that all businesses would have to file a Form 1099 to identify vendors to whom they pay $600 or more in a year. Although the additional reporting was intended to improve tax compliance, Congress acknowledged that the administrative burden on small businesses merited repeal. Repeal of expanded business information reporting is certain to reduce the burden on taxpayers, especially on small businesses.
Specifically, H.R. 4 repeals the ACA reporting changes to Sec. 6041 of the Internal Revenue Code, which provide rules for payments to corporations, provide additional regulatory authority, and impose a reporting requirement with respect to gross proceeds from property. The repeal is effective for payments made after December 31, 2011, which is the effective date of the original ACA provision.
President Barack Obama is expected to sign the bill into law. According to a statement released by Obama's press secretary, "We are pleased Congress has acted to correct a flaw that placed an unnecessary bookkeeping burden on small businesses. Small businesses are the engine of our economy, and eliminating the 1099 reporting requirement is the right thing to do.... And the Administration remains eager to work with anyone with ideas about how we can make health care better or more affordable for all Americans."
Impact of repealing ACA's 1099 reporting rule. Repeal of the ACA’s 1099 reporting rule means that the pre-ACA 1099 reporting rules for business payments continue unchanged. In particular, businesses must continue to issue Form 1099s for payments of $600 or more to service providers. Additionally, repeal means that the long-standing exception to required information reporting for payments made to corporations remains intact.
Paying for the ACA's 1099 repeal. The reporting requirement was expected to increase federal revenues by as much as $21.5 billion over the next ten years. To offset this loss in revenue, H.R. 4 pays for the repeal by requiring certain taxpayers to repay some or all of the health insurance tax credits they otherwise would be eligible for starting in 2014 under the ACA.
Under the 2010 health reform law, beginning in 2014, taxpayers who purchase qualified health care coverage through an American Health Benefit Exchange are entitled to a refundable income tax credit equal to the health insurance premium assistance credit. Generally, the credit is available to taxpayers (individuals or families) with household income between 100 percent and 400 percent of the federal poverty level (FPL). If the advance payments exceed the allowable credit, the excess is an increase to the taxpayer’s taxes for the year. However, ACA limits the increase in taxes to a maximum $400 (or $250 for unmarried taxpayers) for individuals with family income below 400 percent of the FPL for the family size involved.
H.R. 4 would increase the amount of the excess credit that has to be repaid by the taxpayer, by providing an increasing cap based on household income. Under the new law, the amount of the credit is based on an individual's estimated income, and the repayment would vary from $600 to $2,500, for married taxpayers. For unmarried taxpayers, the caps would be 50 percent of the specified amounts: $300, $750, and $1,250.
