American Rescue Plan dramatically increases ACA (Obamacare) subsidies.

On March 11, 2021, the $1.9 Trillion “American Rescue Plan” became Public law 117-2 and on March 23, 2021, C.M.S. extended the COVID-19 S.E.P. – Special Enrollment Period – all the way until August 15, 2021. This means that the health insurance exchanges are now open to all applicants from February 15, 2021 to August 15, 2021. The American Rescue Plan not only makes A.P.T.C.s – Advance Premium Tax Credits – (“Obamacare subsidies”) available to millions of Americans who were not previously eligible but it also reduces premiums substantially (retroactive to January 1, 2021) for those who are already receiving an A.P.T.C. Currently, those who earn more 138% of the F.P.L. – Federal Poverty Level – and less than 400% of the F.P.L. are eligible for A.P.T.C.s. Those who make less than 250% of the F.P.L. are also eligible for C.S.R. – Cost Sharing Reductions. C.S.R.s dramatically decrease health plan deductibles and maximum O.O.P. – Out Of Pocket – expenses on Silver level health plans. Use the chart below to determine what those numbers look like in dollars and cents:

Real world implications:

The increased eligibility for A.P.T.C.s is not a small increase. It is the largest increase in federal health insurance subsidies for those who purchase Individual health insurance in U.S. history. The “American Rescue Plan” more than doubles the “subsidy cliff” (the point where one can no longer qualify for A.P.T.C.s) and in fact nearly eliminates it. Whilst these dramatic changes are not permanent (yet) they do apply retroactively (back to January 1, 2021) for those already receiving A.P.T.C.s and C.S.R.s and will also apply to those seeking Individual health insurance in 2022. To see if you qualify for enhanced subsidy amounts click the graphic below:

Presuming the K.F.F. calculator is correct, a couple living in Chicago age 60 and 59 (with no dependent children) and an annual M.A.G.I – Modified Adjusted Gross Income – as high as $202,000 can now qualify for an A.P.T.C. (albeit a small one). That equates to 1,172% above the Federal Poverty Level. Before the “American Rescue Plan”, that same couple would not have qualified for a subsidy if their M.A.G.I. was higher than 400% of the F.P.L. which is $69,680.

As you can see, the aforementioned “subsidy cliff” has been eliminated for all intents and purposes. More importantly though, since the median household income in Chicago is $57,238 and the median household income across the entire United States is $61,937, millions more will now qualify for much larger federal health insurance subsidies. In fact, that same couple who would have been barred from receiving a health insurance subsidy this month will qualify next month for a monthly A.P.T.C. of $949. That then reduces the monthly premium required for that couple from $1,707.97 to a much more affordable $758.97. They would save even more with the Blue Cross Individual HMO plans but unlike the PPO plans, the HMO plans are not accepted at our Teaching hospitals like Northwestern Memorial nor are they accepted at out of state Teaching hospitals like the MAYO clinic. Only the PPO plans include the “Blue Card” travel provision which allows you to travel to out of state hospitals for elective care.

Using another example. Assume a family of four living in Chicagoland – two parents age 46 and 45 with two children (age 20 and 19) – earns $75,000 in annual M.A.G.I. This month (March 2021) they would have qualified for a much smaller A.P.T.C. of only $789 but next month they will qualify for a monthly A.P.T.C of $1,037. That will then reduce their cost for the aforementioned lowest priced Bronze PPO plan from $1,641 monthly to only $604 monthly.

Basically for a two year period from January 1, 2021 (via retroactive reimbursement for existing policyholders) through December 31, 2022, no one eligible for subsidies will pay more than 8.5% of their M.A.G.I. – Modified Adjusted Gross Income – for health insurance if they choose the second lowest cost Silver plan available in their area. Many will pay much less than 8.5% depending on where their income falls within the F.P.L. – Federal Poverty Level chart above. For example, if your 2021 estimated M.A.G.I. is between 138% and 200% of the F.P.L. you will pay no more than 2% of your income for health insurance. If you’re between 200% and 250% of F.P.L. you will pay no more than 4% of your income. If you’re between 250% and 300% of F.P.L. you will pay no more than 6% if your income. If you’re between 300% and 400% of F.P.L. you will pay no more than 8.5% and (this changes everything) if your income is much higher than 400% of the F.P.L., you will still only pay 8.5% of your income for health insurance. That last part effectively ends the “subsidy cliff”.

All of these percentages are retroactive back to the start of 2021, even though the subsidy amounts won’t start to show up on HealthCare.gov until April 1, 2021, and won’t be automatically adjusted for current enrollees (they’ll have to log back into the exchange to resubmit their enrollment and get the new subsidy amount to update in real-time). Any additional premium tax credits can be claimed when marketplace enrollees file their 2021 tax returns.

How many more insured and at what cost to the taxpayer?

According to the Kaiser Family Foundation, “these additional subsidies could yield substantially lower premium payments for the vast majority of the nearly 15 million uninsured people who are eligible to buy on the Marketplace and the nearly 14 million people already insured on the individual market.” The CBO also estimates an additional 2.5 million more people will obtain health insurance subsidies by the end of 2023. All of which would not have qualified for subsidies before. The projected cost to the taxpayer according to the CBO – Congressional Budget Office and the J.C.T. – Joint Committee on Taxation – will be an increase in federal deficits by $34.2 billion over ten years (including an increase in direct federal spending of $22.0 billion and a reduction in revenues of $12.2 billion).

The I.R.S. “claw back” is eliminated for tax year 2020.

One of the most stressful components of obtaining a health insurance subsidy is worrying about what your actual income will be once more than a year passes after you initially estimated your income when you applied via the Marketplace. This happens because the subsidy you obtain is based upon the year in which you take it. And, those who apply for Individual health insurance during the annual ACA (Obamacare) open enrollment period apply between November 1st and December 15th of each calendar year. The income they are estimating at that juncture is how much they expect to earn by the end of the following year. Without a crystal ball, that is very difficult to do. If you end up earning more than you estimated, you will owe the difference back to our dear friends at the I.R.S. and, if you make more than the “subsidy cliff” amount (which until next month is 400% above the Federal Poverty Level) you owe it all back to the I.R.S. This is the aforementioned “I.R.S. claw back” provision. For many who were incorrect in their initial assumptions, this has led to shockingly large amounts owed back to the I.R.S. when their taxes are finally completed. For tax year 2020, there will be no “claw back” provision. If you were wrong on your estimates and you made more, there will be no ramifications. You will not owe the difference back to the I.R.S. regardless of your actual income level.

100% taxpayer subsidized COBRA premiums for 6 months.

For those eligible for COBRA continuation coverage after an involuntarily termination of employment or a reduction in hours worked, taxpayers will now subsidize their COBRA premiums at 100% from April 1st to September 30th via an “advance refundable payroll tax credit”. The CBO estimates that an additional 3 million people will take advantage of this new subsidy. Additional billions in costs to the taxpayer for this new subsidy are outlined by the J.C.T. here. Additional cost in time and labor to the employer who now must comply with not only developing and delivering updated COBRA election paperwork but facilitating COBRA premium collection and administration for their former employees is immeasurable at this juncture. Most especially because the COBRA subsidy is also available to those who have already enrolled in COBRA more than a year ago!

Ensuring subsidies for those eligible for unemployment.

Those who are eligible for unemployment benefits, will no longer be barred from obtaining health insurance subsidies due to their income being too low to qualify. After providing proof that they are eligible for unemployment benefits, the changes soon to be enacted under the “American Rescue Plan” ensure that they will qualify for not only the maximum A.P.T.C. but also the maximum C.S.R. if they choose a Silver level plan. The means they will pay the lowest possible premium and will have the smallest deductibles and copays as well as the lowest possible O.O.P. – Out Of Pocket – expense exposure.

Neither Healthcare.gov nor State exchanges are ready yet.

As of today’s date (03/14/2021) neither Healthcare.gov nor our state based exchanges have implemented these changes. So, you cannot obtain actual pricing that reflects these changes as of yet but you can use the aforementioned Kaiser calculator to determine an estimate of what your monthly premium will be if you purchase a Silver level plan. Bronze plans are of course even less expensive because the deductibles are much higher. Since the changes under the “American Rescue Plan” are slated to begin on April 1, 2021, Healthcare.gov, state exchanges and insurance companies will need time to comply. Once they have adjusted their quoting platforms you will be able to see actual prices and purchase the plan of your choice (or update your existing subsidy amount) by using this link.

04/28/2021 UPDATE: “American Families Plan” makes enhanced subsidies under American Rescue Plan PERMANENT.

On April 28, 2021 the Biden administration revealed details pertaining to the new “American Families Plan“. This additional spending bill will make the enhanced subsidies under the American Rescue Plan permanent.

Below is a replay of my discussion with Dan Proft and Amy Jacobson on Chicago’s Morning Answer pertaining to the changes coming to the ACA via the “American Rescue Plan” – 03/16/2021.

My evening with President Trump.

Here’s how my evening went at the Trump 2020 Victory fundraiser on Tuesday, June 25th at the Trump International hotel in Washington D.C. We arrived at the hotel which is GORGEOUS inside and out. See pic below:

As we were walking in, Mark Meadows and Jim Jordan were walking out. So, we of course told them how much we loved and appreciated them as they were getting into their car. Then we waited about 45 minutes until our wonderful POTUS walked in. Even though he was surrounded by Secret Service, he still took time to sign autographs. See that moment here.

Then, we entered the secure area where we were wanded by Secret Service and then given lanyards pictured below.

We were then told (much to our chagrin) that our phones had to be placed into these secure magnetized bags which were impossible to open until the evening was over. So, we couldn’t use our phones for the entire evening which meant NO pictures, unless of course I wanted to cough up another $13,800 ON TOP of the $12,200 I already donated. I just couldn’t justify that additional amount as much as I LOVE my POTUS. Not being able to take pictures REALLY sucked BUT later on, my new friend Sam Ukss realized that his “phone killer bag” was not working properly so he was able to snap the picture and capture the video below featuring President Trump, our new friend Deelip Mhaske, Jeannie and myself at our dinner table listening to our great POTUS speak. It’s not a long video but it is a video that I will treasure forever.

We were then directed down a flight of stairs where we dined on the most fabulous Hors d’Oevres like bacon wrapped scallops and other scrumptious things whilst also enjoying an open bar. Then, DJT Jr. and Kimberly Guilfoyle came into our room and gave two speeches about POTUS’s many accomplishments. As I listened, I realized that the diminutive man next to me was Lindsey Graham. Man is he TINY.

Anyway, it was at that moment while DJT Jr. was speaking that we heard someone yell from the floor above us over the railing “Don! Is that YOU?!” So, we all walked over to where the balcony overlooked us and leaning over was our great POTUS! See that moment here.

Shortly thereafter, these huge doors opened and we entered the grand dining room which had a bunch of tables draped with white clothes and on each plate was filet mignon, roasted potatoes, corn and peas and delicious raspberry cheesecake for dessert. It was the most elegant dinner I have ever consumed at a political fundraiser by far. There is NO rubber chicken at a Trump fundraiser. It was then that “half pint” (which is my new name for the shockingly diminutive Lindsey Graham) came on stage and gave a 15 minute speech about POTUS and his accomplishments and then out came our wonderful POTUS! Hoping the guy we sat with follows through and sends me the video so I’ll have a few minutes of that speech to share soon.

The ONLY good part of not being able to record anything is that POTUS was able to be himself. So he was HILARIOUS. At one point during his speech he said “with the tariff threat I was able to get Mexico to send 15,000 of their National Guard soldiers to their southern border to help stop illegals coming here. The FAKE NEWS said 15,000 is ‘nothing’. NOTHING?! That’s a f***ing army!” And of course the crowd began laughing loudly. He was cracking us up the whole time.

POTUS left shortly thereafter and after a LONG day which began at 5 a.m. we headed back to our hotel. Along the way, I snapped the picture below of the Washington Monument at sunset. Sometimes “the swamp” is actually beautiful.

It was definitely a once in a lifetime, historical moment. The first fundraiser for President Trump’s reelection campaign. That is WAY cool. He raised $6 MILLION that night. Of course I say ONCE in a lifetime because $12,200 is by FAR the most I have ever given to ANY politician and it sure as hell ain’t happening again. lol

I discussed my evening with the President on Chicago’s Morning Answer on 06/28/19. Click below to hear the replay.

The new RSC health care plan is the best health care plan I have ever read.

On October 22, 2019, the Republican Study Committee released the best health care proposal I have ever read. You can read it here. Below are the reasons why these common sense reforms will dramatically reduce health insurance premiums, increase consumer choice and protect our most vulnerable and those with preexisting conditions.

1.) Health insurance carriers would not be able to rescind, increase rates, or refuse to renew one’s health insurance simply because a person developed a new medical condition after enrollment.

2.) Individuals with high risk medical conditions would have affordable access to state-run Guaranteed Coverage Pools under which their health care costs would be subsidized with federal grants and further contained by any state-enacted premium-setting restrictions. This is is the way these risks were mitigated in 45 states before Obamacare.

3.) You can elect COBRA and then move to an individual plan with guarantee issue rights without having to exhaust COBRA first. The ACA currently prohibits those who have elected COBRA from moving to a lower priced Individual plan until the annual ACA open enrollment period begins in which case their coverage cannot begin until January 1st.

4.) Everyone seeking coverage in the individual marketplace would have guaranteed issue protections and could not be refused a plan based on the enrollee’s health status, medical condition, claims experience, receipt of health care, medical history, genetic information, evidence of insurability, or disability.

However, proof of prior coverage consistent coverage would once again be required which will prohibit gaming the system by remaining uninsured for long periods of time and then simply purchasing health insurance when you are then sick. This simple restoration of a common sense provision enacted under 1996 HIPPA law will reduce premiums for everyone. If a person does not have twelve months of continuous coverage, the person could be subject to an exclusion period of up to twelve months for an existing condition. Prior periods of continuous coverage would reduce any exclusion period month-for-month. Additionally, as was the case under HIPAA, states would be able to satisfy the RSC plan’s portability protections through the implementation of a Guaranteed Coverage Pool providing these same portability protections. Again, 45 states had either a High Risk health insurance pool or a Guaranteed Issue Individual mandate provision enacted for many years before Obamacare.

5.) States can satisfy the RSC plan’s individual marketplace portability protections through the implementation of a Guaranteed Coverage Pool that provides such protections. Accordingly, the coverage pool would have to:

1) Provide immediate access to a plan and prohibit condition exclusions for individuals who have maintained twelve months of continuous coverage.
2) Cap any condition exclusion period at twelve months.
3) Reduce any exclusions month-for-month for individuals with less than twelve months continuous coverage. Consequently, everyone with an existing condition who is seeking coverage in the individual market would be provided a pathway to obtaining complete coverage of all their conditions within just twelve months.

States would also be free under the RSC plan to enact shorter exclusion periods. Prior to the ACA, the vast majority of states with high-risk pools capped their exclusion period at six months or shorter.

6.) To ensure that ample options exist for Americans to possess continuous coverage, short-term health plans would also count toward periods of continuous coverage under the RSC plan. Additionally, the RSC plan would codify the Department of Health and Human Services’ new rule allowing short-term, limited-duration plans to last for a term of one year (and renewable for up to 36 months).

7.) 1332 waivers – seven states, including Alaska, Maine, Maryland, Minnesota, New Jersey, Oregon and Wisconsin, were awarded waivers under Section 1332 of the ACA to deviate from certain ACA mandates and redirect ACA subsidies toward uniquely designed reinsurance programs. Alaska applied for and was (finally) granted a 1332 waiver from CMS on July 11, 2017 thanks to President Trump. That waiver allowed Alaska to separate the most expensive consumers from the rest of that state’s risk pool and as a result health insurance premiums dropped from an expected increase of 40% to an actual increase of only 7%. The same risk mitigation strategies are now being adopted by other states like Hawaii, Maine, Maryland, Minnesota, and Oregon.

Wisconsin applied for and received an ACA waiver allowing them to create a state based reinsurance program sponsored in part by the Federal government. The “Wisconsin Health Care Stability Plan” will pay 50% of insurers’ claims between $50,000 and $250,000. The state projects it will spend $34 million of its own funds for these claims next year, with the rest coming from the federal government. The feds, however, aren’t expected to shell out any new money because reinsurance also helps the federal government. The lower rates mean it will spend less on premium subsidies for those who qualify. Those savings will be redirected to the stability plan.

An additional five states (Colorado, Delaware, Montana, North Dakota, Rhode Island) project premium reductions of up to 16 percent in 2020 due to 1332 waivers.”

8.) The cost to implement these state based risk mitigation systems is $17 billion annually. That may not seem ideal but it sets up a sustainable path for the individual marketplace and deters our nation from heading toward a government-run, one-size-fits-all health care system that would cost taxpayers more than $30 trillion over the next decade.

9.) Use can FINALLY use your H.S.A. dollars to pay for health insurance premiums which will equalize the tax favored status between individual and employer sponsored plans. By allowing individuals to use health savings accounts funds to pay for their health care premiums, the RSC plan allows individuals to take advantage of the triple-tax advantaged status of health savings accounts. First, funds that are deposited in a health savings account are not subject to income tax or payroll taxes (including individual and employer payroll taxes) when they are earned. Once in the account, funds are not subject to taxation for any interest accrued. Nor are funds taxed when they are removed from the health savings account and spent on qualifying medical costs. An individual who utilized their health savings account in this way would no longer be penalized for choosing to shop for a plan on the individual market. Under current law, for 2019, $3,500 may be contributed to health savings accounts for an individual, and $7,000 for families. In 2018, the House of Representatives passed legislation to increase the contribution caps to $6,650 for an individual and $13,300 for a family.

This limits are currently way too low. According to the Kaiser Family Foundation, the average annual family premium per enrolled employee for employer-based health insurance in 2017 was $18,687.148 Because of this, under the RSC plan, contribution limits would be increased even more to $9,000 per individual and $18,000 for families. The RSC plan would also allow working seniors, or anyone on Medicare, to have a health savings accounts and continue to contribute to it. Individuals enrolled in other public health insurance programs, such as those with Tricare, Indian Health Service, or Veterans benefits, would also be able to contribute to a health savings accounts. Furthermore, FSA and HRA balances could be converted into a health savings account,

10.) The FMAP rate for the expansion population would eventually match normal FMAP rates. There is no reason why an able-bodied adult without any dependents should be more heavily subsidized than a poor pregnant woman, elderly person, child, disabled individual, or parent.

11.) Association Health Plans. The RSC plan urges codification of the reforms promulgated by the Department of Labor that ensure Americans have greater access to Association Health Plans (AHP). Association Health Plans currently work by allowing small businesses to band together by geography or industry to obtain health care coverage as if they were a single large employer. Importantly, AHPs offer benefits comparable to employer-sponsored plans and cannot discriminate against patients with pre-existing conditions. They also “strengthen negotiating power with providers from larger risk pools and [provide] greater economies of scale,” according to the Department of Labor.

12.) Unfortunately, many states have passed laws impeding the provision of telemedicine by banning or heavily restricting its progress. Notably, the position of the American Medical Association still calls for doctors to be physically present when rendering medical services. This will end and you’ll be able to log on and consult with your doctor without driving all the way to the doctor’s office and waiting for God knows how long in a waiting room.

Major Kudos to the Republican Study Committee. I could not have written a better plan!

Group health insurance for one person ensures access to Chicago Teaching hospitals for small businesses owners.

In November of 2015, Chicagoland residents were shocked to learn that Northwestern Memorial hospital, University of Chicago medical center, Rush University medical center and the Lurie Children’s hospital would no longer accept patients who have ACA-qualified (Obamacare) individual health insurance plans.

This action led to a significant increase in the purchase of small group health insurance policies which still provide national PPO networks and still ensure access to the aforementioned teaching hospitals in Chicago.

For small corporations who could afford to insure themselves and 70% of their eligible full time employees (the usual minimum participation requirement), purchasing small group health insurance was a costly fix to the new narrow networks in the individual health insurance marketplace.

The ability to purchase group health insurance for you and your full-time employees is well known. What is not well known is the fact that you can purchase a small group health insurance policy without insuring any of your employees during a small window each year. That window begins on November 1st and ends on December 15th. The same time period the annual ACA Open Enrollment for individual plans begins and ends.

During this little known ‘relaxed underwriting’ period, an owner of a small corporation (less than 50 full-time employees) can purchase small group health insurance while employees ‘waive’ coverage without producing an eligible waiver. Normally, 70% of all full-time employees must participate in a group health insurance plan unless they have an eligible waiver such as an offer of group health insurance from a spouse’s employer or Medicare and Medicaid coverage. If you do decide to offer coverage to your full-time W2 employees during this Special Enrollment period, you do not have to insure any of your employees and instead can only insure yourself and or your family without insuring employees. Normal 70% minimum participation requirements are waived.

If you are a small business owner who is seeking to purchase small group health insurance and cannot afford to insure your employees or, your employees simply do not want to participate in a group health insurance plan. Now is the time to learn more about “relaxed underwriting period”. The cost for group health insurance is now commensurate with individual health insurance but the PPO network is much larger and far more inclusive than any of the narrow networks now available in the individual marketplace. Want to learn more? Click on “contact” at HealthInsuranceMentors.com

My testimony delivered at our state capitol today regarding Short Term health insurance plans.

My purpose here today is to ask for your help to protect an unrepresented minority. Specifically, those who have been priced out of the ACA marketplace and do not qualify for federal health insurance subsidies to lower their health insurance premiums. According to CMS – Centers for Medicare & Medicaid Services – numbers released yesterday, during last year’s ACA open enrollment period, 360,168 individual applications were processed in Illinois via our State/Federal partnership health insurance exchange. 282,491 of those applications were eligible for a Federal health insurance subsidy to help lower their premiums.

That means 77,677 applications did not receive financial assistance and were forced to pay the full price for health insurance. In addition to those who applied via our exchange and were denied a federal subsidy, there were an additional 127,459 applicants who applied OFF our exchange directly with insurance companies because they already knew they were not eligible for financial assistance. That equates to 205,136 applicants who were forced to pay the full premium for individual health insurance. A premium that has more than doubled since 2014.

The most important aspect of the ACA we can all agree on, is that the law was intended to provide some form of health insurance coverage to everyone, whether they could afford it or not. That’s why subsidies were written into the law. Unfortunately, for the 205,000 consumers who do not qualify for federal health insurance subsidies in Illinois that is no longer the case. For them, ACA-qualified coverage has become anything but ‘affordable’.

The full price for a family of four for the cheapest Bronze PPO plan with Blue Cross Blue Shield of Illinois with a $15,800 out of pocket expense in Chicago is now $1,835 per month which equates to $22,000 annually. This is why so many who do not qualify for health insurance subsidies have been priced out of the ACA marketplace and are now seeking other options that are not safe now but can be made much safer by this legislative body. Those non safe products are known as Non ACA-qualified Short Term policies. They are not safe now because this legislative body restricted the amount of time one can own these policies from 12 months to 6 months of maximum policy ownership and I am asking you to restore the amount of time one can own a non ACA-qualified policy back to 12 months so that they are once again safe to purchase.

It’s not that applicant’s who don’t qualify for federal health insurance subsidies don’t want ACA coverage. They’d be crazy not to want it. It is the most comprehensive health insurance coverage ever sold in the United States and there is no underwriting. Everyone gets coverage regardless of preexisting conditions. That is a VERY good thing. However, the recent actions taken by this legislative body are not only placing those priced out of the ACA marketplace at great peril but you are threatening the structural integrity of our health insurance exchange and the ACA overall.

It may sound strange that I’m asking you to fortify non-ACA policies in order to protect the ACA but there is sound reasoning and supporting data behind this request.

First and foremost, is the fact that consumers who purchase Short Term policies in Illinois are now placed at great risk if at the end of the 6 month policy period they are then laying in a hospital bed with a life threatening condition when their coverage ends. Even if that individual could qualify for another 6 month Short Term policy, that life threatening condition would be considered preexisting which means it would not be covered under their next 6 month Short Term policy. This would leave them uninsured entirely until the next annual ACA open enrollment period begins again in November in which case their coverage cannot begin until the 1st of the following year. This is why it is essential to have 12 month Short Term policies available in Illinois so that consumers stay consistently insured between ACA open enrollment periods. This way when the Short Term policy ends at the end of 12 months, it ends safely the following year during the ACA open enrollment period. If a family member develops a new medical condition they can obtain coverage for that new condition via the ACA exchanges.

Secondly, let’s identify the fiscal implications. Companies who provide health insurance, both ACA-qualified AND non ACA-qualified Short Term health insurance are required to contribute hundreds of billions of dollars in order to help stabilize the ACA health insurance marketplace and ensure those who are eligible for subsidies continue to receive them.

Section 1910 of the Affordable Care Act outlines the Health Insurance Tax which has resulted in $58 billion dollars being collected from health insurance companies since 2014. $14.3 billion of that was collected last year alone. That money is then used to stabilize the health insurance marketplace by ensuring that those who do qualify for federal health insurance subsidies continue to receive them. The health insurance tax is an essential risk mitigation system build into the ACA and without it premiums would be much higher and subsidies would be much smaller and available to fewer people.

The pertinent section of Section 1910 of the ACA was outlined in the final rules posted in the Federal Register on November 29, 2013. In those final rules the following paragraph outlines which type of health insurers are subject to this tax and I quote: “Section 9010(a) imposes an annual fee, beginning in 2014, on each covered entity engaged in the business of providing health insurance. Section 9010(c) provides that a covered entity is any entity that provides health insurance for any United States health risk during each year.” The important point to note here is that the tax is levied only on health insurance plans.

By restricting Short Term policies to 6 months this legislative body has unknowingly left these consumers with no other option but to enroll in similarly low priced “Christian Sharing Plans” which do not end abruptly but are also not insurance and as such are not required to contribute anything under the aforementioned health insurance tax. By shifting those dollars that would normally be spent on Short Term health insurance to Sharing Plans which are not insurance, you are undermining the structural integrity of the ACA and so is every other state legislative body that has restricted this type of health insurance to 6 months or less. As ACA-qualified policies continue to increase in price this trend is going to continue unless you take action to stop it.

Lastly, let me address the often repeated fallacy that Short Term health insurance policies are “junk” policies or that they are “skinny plans”. Whilst it is true that Short Term health insurance plans do not cover preexisting conditions, those that are offered by companies like United Healthcare do provide coverage for the vast majority of illnesses and injuries such as Cancer, Stroke, Heart Attack, Organ Transplants, Mental Nervous Disorders, Newborn care, Diabetes, Autism, Durable Medical Equipment, Home Health Care, inpatient and outpatient diagnostic testing as well as Nuclear Medicine, MRI and CT including a routine colonoscopy. They also provide coverage for inpatient and outpatient surgery, anesthesia as well as outpatient prescription drugs. They even provide first dollar coverage with no deductible required for outpatient doctor visits, urgent care visits and state mandated routine preventive care such as Mammograms, Cancer screenings and Contraceptives. That does not sound like a “junk plan” to me. Neither does it sound like a “skinny plan”. These policies also provide $2,000,000 in coverage annually for each insured member. So no, they do not provide all the protections that ACA-qualified policies do but they do provide very good coverage and for half the price. THIS makes them very attractive to those who do not qualify for health insurance subsidies.

Equally important to know is that both United Healthcare and National General which are the two largest Short Term health insurance policy providers in Illinois provide a national PPO network with their policies which includes in network access to Northwestern Memorial hospital, University of Chicago medical center, Rush university medical center and the Lurie Children’s hospital. None of those hospitals accept ANY individual ACA-qualified health insurance policy, not even those offered by Blue Cross Blue Shield of Illinois. No matter how much you pay for an ACA-qualified Individual policy in Illinois you cannot take your sick child to the premier Children’s hospital in the Midwest which is Lurie Children’s hospital. With non ACA-qualified Short Term policies you can walk right in the door at all four of those hospitals and hospitals around the nation.

In closing, because so many are now abandoning the ACA exchanges and can no longer safely purchase Short Term health insurance due to the aforementioned 6 month restriction and instead are now shifting those dollars to “Christian Sharing Plans” which are not insurance and as such do not contribute anything under the aforementioned health insurance tax. And because those who participate in “Christian Sharing Plans” have no policy, no contract and no regulatory recourse when Sharing Plans stop paying claims as they have done repeatedly. I am asking for this regulatory body to restore non ACA-qualified Short Term health insurance plans to 12 months in order to ensure that those who have been priced out of the ACA marketplace remain safely insured with actual health insurance without risk of running out of coverage in the middle of the year which can lead to disastrous consequences.

I thank you for your valuable time today. I will take questions if time allows.

THE TRUTH ABOUT REPUBLICANS AND PREEXISTING CONDITIONS

Contrary to popular belief, both Democrats AND Republicans have had a long history of ensuring that Americans have access to coverage for preexisting conditions. In fact, a bipartisan piece of federal legislation requiring coverage for preexisting conditions existed long before the implementation of the ACA – Affordable Care Act, known colloquially as “Obamacare”. Public law 104-191 also known as HIPAA – Health Insurance Portability & Accountability Act – of 1996 outlined in sections 2741, 2742 and 2744 the role that both health insurers and state regulators must play in ensuring coverage for those with preexisting conditions. That law was supported by both Democrats AND Republicans for more than a decade before Obamacare.

Not long after HIPAA was signed into law, states began developing one or more state run risk mitigation mechanisms to ensure that those in the individual health insurance marketplace were ensured access to coverage for preexisting conditions. 35 states decided to develop High Risk health insurance pools. In Illinois, our High Risk health insurance pool was called ICHIP – Illinois Comprehensive Health Insurance Plan. The existence of ICHIP ensured that Illinois residents who purchase their own individual health insurance were guaranteed coverage for preexisting conditions long before Obamacare. In order to qualify for ICHIP coverage one would have to have been denied coverage from a health insurer in the individual marketplace due to a preexisting condition or have exhausted COBRA continuation coverage from a former employer. If that individual applicant had kept consistent health insurance coverage without a lapse of more than 63 days, they were guaranteed immediate coverage from Blue Cross Blue Shield of Illinois via ICHIP. If they had a lapse in coverage of more than 63 days, they would have to wait up to 6 months before preexisting conditions would be covered. These regulations provided a strong impetus for consumers to keep consistent health insurance coverage in place. This prevented applicants from ‘gaming the system’ by waiting until they were sick to purchase health insurance coverage.

10 other states chose to implement an “Individual market guaranteed issue mandate.” Under this state run risk mitigation system, residents of those states were guaranteed coverage for preexisting conditions from a variety of health insurers operating in that state. For example, in the state of Ohio, there were multiple health insurance carriers that had to “guarantee issue” 4% of their block of business to people with preexisting conditions during an annual ‘open enrollment’ period. During this annual open enrollment period, each health insurance carrier had to report to the Ohio Department of Insurance as to whether or not they “met their 4% guarantee issue quota”. Once one health insurer met their 4% quota, all future applicants with preexisting conditions were then referred to one of the other health insurers operating in Ohio who had not met their 4% quota and those remaining applicants would then be guaranteed coverage from that carrier. Under this innovative and intelligent state run risk mitigation system, all health insurers in the state shared the risk and everyone had access to coverage for preexisting conditions. Again, long before Obamacare. See page 10 of the Ohio “Guide to Health Insurance”

To learn more more about consumer protections under HIPAA law, download
“Protecting Your Health Insurance Coverage” from CMS –
Centers For Medicare and Medicaid Services.

There is nothing new under the sun.

You probably noticed something familiar about how Ohio’s annual “open enrollment” period. You should, because that is how risk in the individual health insurance marketplace is managed today under the ACA. We now have a national ACA open enrollment period which begins on November 1st and ends on December 15th of each calendar year. During this 45 day window, all Americans can purchase individual health insurance regardless of their health history and preexisting conditions are not excluded from coverage.

Why though is this annual open enrollment window only 45 days long? Why can’t we just buy health insurance whenever we want? Why do we have to wait until November each year? The reason you cannot do so is because if you were allowed to buy health insurance whenever you want, no matter how sick you may be, you would simply wait until you were sick to buy it and you would have no impetus to keep that coverage after you received whatever medical treatment you were seeking at the time. This is akin to buying home owner’s insurance after your home burns down or car insurance after you wreck your vehicle. Allowing such behavior would rapidly bankrupt all health insurers in a very short time.

The purpose of “insurance” is to manage future risk if and when it may occur. It is not to absorb all risk as it occurs. It is the consistent payment of monthly premiums by multiple policy holders which allows insurers to build the necessary financial reserves from which to pay your claims if and when they may occur. This is why the annual ACA open enrollment period is restricted to a 45 day window once a year. It forces Americans to keep their health insurance coverage in place throughout the year to ensure they keep consistent coverage for preexisting conditions between open enrollment periods. Consistent payment of those premiums allows the health insurers to build the necessary financial reserves to pay your claims if and when they may occur.

Republicans allocated $100 billion plus to ensure coverage for preexisting conditions

The aforementioned preexisting solutions to preexisting conditions were only two of the types of protections that could have been implemented had the House Republican’s “American Health Care Act” survived Senate scrutiny or, if the Senate “Better Care Reconciliation Act” had survived John McCain’s 2 a.m. thumbs down vote. Both bills provided solid protection for consumers with preexisting conditions. Page 45 of the American Health Care Act created the “Patient and State stability fund” which outlined on page 51 more than $100 billion over the first 8 years for states to re-establish state run High Risk health insurance pools or other state and federally run risk mitigation systems. This is nothing new. In fact, our Illinois health insurance exchange is a state/federal partnership exchange. Both entities working together to ensure coverage for preexisting conditions.

So, the evidence proves that Republicans not only want to ensure preexisting conditions are covered but they are also willing to allocate many hundreds of billions of dollars to ensure that they are. The evidence also proves that we did not need Obamacare to ensure coverage for preexisting conditions. The states already had risk mitigation systems in place long before Obamacare and those systems or similar systems could be implemented once again.

The question is not if Republicans want to cover preexisting conditions. The question is how they are to be covered going forward. Mandating that health insurers cover preexisting conditions is fruitless if there are no health insurers left to provide said coverage for preexisting conditions. So many health insurers have exited the individual health insurance marketplace since Obamacare, including the nation’s largest health insurers, United Healthcare, Aetna, Humana, Anthem Blue Cross etc. This has left states like Indiana with only one health insurer left for those who purchase individual health insurance and that carrier only offers a small HMO option.

State based risk mitigation systems currently employed via ACA waivers granted by the Trump administration.

Alaska applied for and was (finally) granted a 1332 waiver from CMS on July 11, 2017. That waiver allowed Alaska to separate the most expensive consumers from the rest of that state’s risk pool and as a result health insurance premiums dropped from an expected increase of 40% to an actual increase of only 7%. The same risk mitigation strategies are now being adopted by other states like  
Hawaii, Maine, Maryland, Minnesota, and Oregon. 

Wisconsin applied for and received an ACA waiver allowing them to create a state based reinsurance program sponsored in part by the Federal government. The “Wisconsin Health Care Stability Plan” will pay 50% of insurers’ claims between $50,000 and $250,000. The state projects it will spend $34 million of its own funds for these claims next year, with the rest coming from the federal government. The feds, however, aren’t expected to shell out any new money because reinsurance also helps the federal government. The lower rates mean it will spend less on premium subsidies for those who qualify. Those savings will be redirected to the stability plan.

These are just two examples of how state’s can better manage risk at the local level by being granted waivers from the “one size does NOT fit all” government take over of the American health care system known as “Obamacare”. There will be more to come thanks ONLY to the leeway allotted to state’s by the election of President Donald J. Trump.

The truth about Trump not defending the latest legal challenge to Obamacare

President Trump’s D.O.J. has chosen not to defend Obamacare against the latest legal challenge to it led by Texas and 19 other states. That case argues (legitimately) that since the SCOTUS found the “Individual Mandate” constitutional in 2012 by defining it as a “tax” and later Republicans passed tax reform which included repeal of the Individual Mandate. The Individual Mandate can no longer be constitutional because there will be no more penalties assessed for not buying health insurance as of January 1, 2019. The D.O.J. is also arguing that two other Obamacare provisions should be struck down — one requiring insurers to cover those with preexisting conditions AT THE SAME PRICE AS THOSE WITHOUT PREEXISTING CONDITIONS. That does mean that if the state led case against Obamacare succeeds, that preexisting conditions would not be covered. It simply means that those with certain preexisting conditions could pay more than those without preexisting conditions which is how the system worked prior to Obamacare.

I discussed this issue in greater detail with Dan Proft and Amy Jacobson on Chicago’s Morning Answer on WIND. Click below for to watch the replay:

Cheaper non-Obamacare Short Term health plans lasting 365 days returning.

By May 1st of 2018 United Healthcare, Aetna, Cigna, Humana, Blue Cross and other carriers will once again be able to legally offer non-ACA (Obamacare) Short Term health insurance plans that will cover you for an entire year. This is thanks only to President Trump who reversed Barack Obama’s previous order restricting these much less expensive health insurance plans to 90 days of maximum policy ownership.

This is very good news for millions of healthy Americans who do not qualify for federal health subsidies and as such cannot afford to pay for individual health insurance that now costs more than their mortgage payment. THANK YOU President Trump!

Please note: Non ACA-qualified Short Term health insurance plans are not required to cover preexisting conditions or certain ACA (Obamacare) mandate “Essential Health Benefits” that are covered with ACA-qualified plans. These benefits are:

1.) Maternity and newborn care.
2.) Mental health and substance use disorder services.
3.) Certain Preventive care benefits such as routine mammograms and cancer screenings are covered with Consecutive Short Term health insurance plans.
4.) Pediatric services (including both oral care and vision care).

 

 

Group health insurance for one person ensures access to Chicago Teaching hospitals for small businesses owners.

In November of 2015, Chicagoland residents were shocked to learn that Northwestern Memorial hospital, University of Chicago medical center, Rush University medical center and the Ann & Robert H. Lurie Children’s hospital would no longer accept patients who have ACA (Obamacare) qualified individual health insurance plans.

This action led to a significant increase in the purchase of small group health insurance policies which still provide national PPO networks and still ensure access to the aforementioned teaching hospitals in Chicago.

For small corporations who could afford to insure themselves and 70% of their eligible full time employees (the minimum participation requirement), purchasing small group health insurance was a costly fix to the new narrow networks in the individual health insurance marketplace.

The ability to purchase group health insurance for you and your full-time employees is well known. What is not well known is the fact that you can purchase a small group health insurance policy without insuring your employees during a small window each year. This year that window begins on November 1st and ends on December 15th. The same time period that 2018 ACA Open Enrollment for individual plans begins and ends.

During this little known ‘relaxed underwriting’ period, an owner of a small corporation (less than 50 full-time employees) can purchase small group health insurance while employees ‘waive’ coverage without producing an eligible waiver. Normally, 70% of all full-time employees must participate in a group health insurance plan unless they have an eligible waiver such as an offer of group health insurance from a spouse’s employer or Medicare and Medicaid coverage. If you do decide to offer coverage to your full-time W2 employees during this Special Enrollment period, you do not have to pay any portion of your employee’s premium. Normally, you must pay 25% of your employee’s premium.

If you are a small business owner who is seeking to purchase small group health insurance and cannot afford to insure your employees or, your employees simply do not want to participate in a group health insurance plan. Now is the time to learn more about “relaxed underwriting”. The cost for group health insurance is now commensurate with individual health insurance but the PPO network is much larger and far more inclusive than any of the narrow networks now available in the individual marketplace. Want to learn more? Click on “contact” at HealthInsuranceMentors.com

Consistent Short Term health insurance returns as ACA Open Enrollment begins

On October 12, 2017 President Donald Trump signed this Executive Order designed to restore consumer choice in the Short Term health insurance marketplace. Short Term health insurance is the only kind of non-ACA (Obamacare) qualified health insurance available in the individual marketplace. While both ACA-qualified health insurance and non-ACA qualified Short Term health insurance policies are considered major medical health insurance, or comprehensive health insurance and both cover major health events in your life, there are important differences between the two. ACA-qualified health plans are guaranteed issue, meaning you cannot be denied coverage based on preexisting conditions. ACA-qualified health insurance plans are also required to cover certain “Essential Health Benefits” that are not covered with non-ACA qualified Short Term health insurance plans. “Essential Health Benefits” that are not covered with Short Term health insurance policies are as follows:

1.) Maternity and newborn care
2.) Mental health and substance use disorder services
3.) ACA mandated Preventive care benefits, routine mammograms and cancer screens ARE COVERED with Consecutive Short Term health insurance policies.
4.) Pediatric Services (including both oral care and vision care).

On March 31, 2017 a preexisting Obama era regulation limited Short Term health insurance coverage to 91 days of policy ownership. This regulation exposed millions of Americans to new and unique risk factors. Prior to March 31, 2017, consumers could purchase Short Term health insurance policies that would last for the entire year without interruption. So, there was no risk of your policy ending in the middle of the year outside of the annual ACA open enrollment period. Those who developed new medical conditions during the first 91 days of Short Term policy ownership, faced the new risk of not being able to qualify for another Short Term policy when their first Short Term policy ended at the end of 91 days. Consumers placed into this difficult position would then be left uninsured and uninsurable in the individual marketplace until the next annual ACA open enrollment period began again when they could once again obtain coverage for preexisting conditions. President Trump’s executive order plans to rectify that situation as soon as the 60 day comment period expires. So, we should be able to once again purchase Short Term health insurance that provides consistent coverage for 365 days as early as January or February of 2018.

Until then, the health insurance industry has responded by creating “Consecutive” Short Term health insurance coverage that will be available for purchase as of 12/01/2017. With these new Short Term health insurance policies from National General Accident and Health you are guaranteed to be issued up to four Consecutive Short Term health insurance policies, each lasting 90 days. You answer health questions only for the first policy which lasts 91 days, then on day 92, National General guarantee issues you a second policy, 90 days later they gaurantee issue you a third policy and finally a fourth policy 90 days later all without evidence of further underwriting and without any new preexisting condition clause. So, you can now remain consistently insured for up to 360 days without answering any new health questions and without the fear of conditions developed during the first, second, third or fourth policies being excluded.

Click here to download the brochure for National General’s Consecutive Short Term health insurance. National General Consecutive Short Term health insurance policies use the Aetna Open Choice PPO network. This network includes access to Northwestern Memorial hospital, University of Chicago Medical Center, Rush University Medical Center and the Ann & Robert H. Lurie Children’s hospital as well as many other hospitals and medical providers nationwide. Search Aetna’s Open Choice PPO network here. For quotes and to apply online for Consecutive Short Term health insurance policies from National General click their logo. Please note: You can only purchase Consecutive Short Term plans AFTER 12/01/2017.

Please note: Because U.S. Senate Republicans failed to repeal or even repair the PPACA (Obamacare) the fine for not having ACA-compliant health insurance is still law and still being enforced by the IRS. This being the case, you will be fined 2.5% of your AGI – Adjusted Gross Income – by the IRS for purchasing non-ACA compliant Short Term health insurance. 

National General Holding Corporation is a publicly traded company with $2.5 billion in annual revenue. Their new “Consecutive Guaranteed Issue” Short Term health insurance plans are underwritten by Time Insurance Company (est. in 1892), National Health Insurance Company (incorporated in 1965), Integon National Insurance Company (incorporated in 1987) and Integon Indemnity Corporation (incorporated in 1946). These four companies, together, are authorized to provide health insurance in all 50 states and the District of Columbia.

Short Term health insurance for less than 91 days

If you need short term coverage for less than 91 days you can purchase coverage from United Healthcare which includes their Choice PPO network. To get quotes and apply click the link below.

2018 ACA (Obamacare) Open Enrollment begins on 11/1/2017 and ends on 12/15/2017

The 2018 PPACA (Obamacare) Open Enrollment period begins on November 1, 2017 and ends on December 15, 2017.  During this 45 day window, individuals and families can purchase guaranteed issue individual health insurance (with no preexisting condition exclusions). Coverage will not begin until January 1, 2018. Depending on your projected 2018 MAGI – Modified Adjusted Gross Income – you may qualify for one or more federal health insurance subsidies to lower your premium, deductible, coinsurance and copays. To learn the income levels necessary to qualify for health insurance subsidies scroll down this page. If you do not qualify for subsidies please click “Shop for unsubsidized plans OFF the exchange” below to purchase health insurance directly from the carrier of your choice.  Questions? Call (630) 674-1551. Out of state? Call toll free (866) 724-7123.

Buying on the exchange? If you do qualify for subsidies please click “Shop for subsidized plans ON the exchange” below. You will be able to pick a plan, get your subsidies and finish the entire process much faster than using Healthcare.gov alone. HealthSherpa speeds up the Healthcare.gov process.

                   

Determining your elibility for subsidies

Depending on what you expect your 2018 total household MAGI – Modified Adjusted Gross Income = (after deductions but before taxes) to be, you may qualify for a significant APTC – Advance Premium Tax Credit (federal subsidy) under the new health care law to lower your premiums. You may also qualify for a Cost Sharing subsidy to lower your deductible. If you believe your 2018 total household MAGI will be lower than:

$48,240 for an individual
$64,960 for a couple
$81,680 for a family of three
$98,400 for a family of four
$115,120 for a family of five
$131,840 for a family of six

you will be better off financially by shopping for a plan on the exchange (via Healthcare.gov) in order to receive an Advance Premium Tax Credit and/or a Cost Sharing reduction to reduce the premium and deductibles of either the Bronze, Silver, Gold or Platinum Qualified Health Plans.

Buying on the exchange? If you qualify for a subsidy please click the link below. You will be able to pick a plan, get your subsidy and finish the entire process much faster than working solely with Healthcare.gov

Shopping from another state? Call us toll free at (866) 724 7123 or scroll down to get quotes from carriers in your state. 

Please note: If your income is lower than the 2018 Federal Poverty Level Information – 2018 FPL in your state, which is less than 138% of the FPL – Federal Poverty Level in states that expanded Medicaid and less than 100% of the FPL in states that did not.  You will be offered Medicaid will not be able to qualify for subsidized health insurance. You can purchase health insurance even if you qualify for Medicaid but you must do so without a subsidy. Click the chart below to determine the current Federal Poverty Level and percentages above it. 2018 Federal Poverty Levels will not be released until late January of 2018 so, the 2017 FPL chart must be used to determine 2018 subsidy eligibility.

Please also note: If you qualify for a federal health insurance subsidy and your state has expanded CHIP – Children’s Health Insurance Plan – under Medicaid you may not be able to insure your children on your policy. Healthcare.gov will instead send them to Medicaid. You may wish at that juncture to purchase private health insurance at full price for your children instead.

Blue Cross Blue Shield of Illinois proposed 2018 premium increases

Blue Cross Blue Shield of Illinois proposed (not APPROVED) 2018 premium increases for Individual policies are as follows:

38.2% for BlueCare Direct HMO plans

14.5% for Blue Precision HMO plans

9.3% for Blue FocusCare HMO plans

5.4% for Blue Choice Preferred PPO plans.

Source: http://www.chicagotribune.com/business/ct-obamacare-rates-released-0802-biz-20170801-story.html