HealthCare Advocates' Blog

HealthCare Advocates recommended in a new book by the renowned author and writer Gail Sheehy. The link to her book: http://www.harpercollins.com/books/9780061661204/Passages_in_Caregiving/index.aspx?HCHP=TB_Passages+in+Caregiving

COBRA – Another Extension

On April 15, 2010, the Continuing Extension Act of 2010 was signed into law. By passing this law, the federal government has – again – extended the COBRA subsidy by lengthening:
1) The period during which the involuntary termination occurred. The employees’ termination date has been extended to those individuals involuntarily terminated from employment through May 31, 2010. All employees that qualify for COBRA are entitled to a 15 month, 65% COBRA subsidy.

2) The law also provides retroactive eligibility for individuals who were involuntarily terminated after the prior COBRA subsidy expired on March 31, 2010. Individuals involuntarily terminated after March 31, 2010 but before April 15, 2010, are now eligible to receive the subsidy.

President Obama’s healthcare reform bill that was signed this past March included some help for nursing mothers. The bill requires employers to provide break time for an employee to express breast milk for a nursing child. This provision is effective until the child is one year old.

On March 23, 2010 President Obama signed the healthcare reform legislation into law. This new legislation is expected to help cover an additional 32 million Americans. How does this law affect you?

Changes That Will Take Effect in 2010
• Insurance companies cannot rescind coverage when a person gets sick

• Insurance companies cannot place lifetime benefit caps on coverage.

• Insurance companies cannot deny coverage to children with pre-existing conditions.

• Children may stay on their parent’s plan until age 26.

• Uninsured people will have immediate access to coverage through high-risk pools if they have been denied coverage due to a pre-existing condition.

• Small businesses will receive tax credits to help purchase health insurance for their employees.

• Medicare beneficiaries will receive a $250 rebate when they hit the “doughnut hole.”

• Medicaid will be expanded to cover people with incomes up to 133% of the federal poverty limit.

Changes That Will Take Effect in 2011

• Medicare beneficiaries will receive a 50% discount on brand-name prescriptions while in the doughnut hole.

• Insurance companies will be required to spend at least 80% of their premiums on medical claims. The interest on the monies earned by the insurance companies is not affected.

Changes That Will Take Effect in 2013

• Social Security payroll taxes will be increase for individuals making more than $200,000 and families earning more than $250,000. Unearned income will also be subject to a 3.8% tax.

Changes That Will Take Effect in 2014

• Americans will be required to carry health insurance or pay a $695 penalty; qualifying families will be able receive subsidies to help pay for insurance. There are some exceptions to this mandate.

• Medicaid programs will be required to include childless adults.

• Individuals and small companies will be able to purchase insurance through state exchanges. Illegal immigrants are barred from purchasing insurance from the exchanges.

• Small businesses with 50 or more employees must provide coverage to employees or pay a penalty.

• Insurance companies will be prohibited from denying coverage or charging more based on health status.

Changes That Will Take Effect in 2018

• Expensive employer based plans will be subject to a 40% excise tax. The thresholds are $10,200 for individuals and $27,500 for families.

Changes That Will Take Effect in 2020

• The Medicare prescription drug coverage gap will be eliminated; seniors will still be responsible for 25 percent of the cost of their medications until Medicare’s catastrophic coverage starts.

Congress is preparing to vote on President Obama’s latest healthcare bill, will it pass?  In an NBC News & Wall Street Journal Poll, 46% of Americans said they would like the bill to pass. 45% of Americans do not want the bill to pass.

Despite opinions about the bill, one thing is clear. The majority of Americans do not like the way our government is handling this issue.

On March 2, 2010, the Temporary Extension Act of 2010 was signed into law. By passing this law, the federal government has – again – extended the COBRA subsidy by lengthening:

1) The period during which the involuntary termination occurred. The employees’ termination date has been extended to include March 1 through March 31, 2010. All employees that qualify for COBRA are entitled to a 15 month, 65% COBRA subsidy.

2) An individual who did not elect to receive benefits under COBRA when his/her hours were reduced will now be eligible to receive the COBRA subsidy if that person is involuntarily terminated from employment between March 1 and March 31, 2010.

As the recession continues HealthCare Advocates is noticing an increase in the number of complaints that people have about their insurance premiums being taken from their paycheck, but coverage is terminated for non-payment. Yes, it seems that there are an increasing number of employers that are deducting insurance premiums from the employees’ paychecks, but are using that money to meet payroll obligations instead of paying the employees’ insurance premiums.

The majority of these complaints come from smaller employers but to be safe, you too should protect yourself. The best way to protect yourself from having your insurance terminated is to call your insurance company each month and verify that coverage is still effective. If it is, everything is fine. If it is not, verify if your employer has been paying the monthly premiums.

If you find yourself in this situation, you may want to contact HealthCare Advocates for assistance.

In 2009, the federal government provided a subsidy for monthly COBRA premiums because of the rising unemployment rate. Under this, an eligible person only had to pay 35% of the premiums charged, the balance was paid by the employer – which was later compensated by the federal government by way of a tax credit. The subsidy applied to nine COBRA premium payments. To be eligible, the individual only had to have been involuntary terminated from employment between September 1, 2008 and December 31, 2009.

The federal government has now extended the subsidy by lengthening:

1) The period during which the involuntary termination occurred. The employee’s termination date must be between September 1, 2008 and February 28, 2010.

2) The maximum period for receiving the COBRA subsidy has been extended for an additional six months (a total of 15 premium payments).