Tag Archives: group health insurance

Agencies issue final rule on the ACA’s orientation period

Employment-based orientation periods for group health plan eligibility under the 90-day waiting period limitation of the Patient Protection and Affordable Care Act (ACA) must not extend beyond one month before counting the 90-day period, according to a final rule released by the U.S. Departments of Labor, Treasury, and Health and Human Services. The final rule applies to group health plans and health insurance issuers offering group health insurance coverage for plan years beginning on or after January 1, 2015. Plan sponsors will be deemed in compliance through the end of this year by satisfying the provisions of the proposed rule that was published February 20, 2014—read this Client Action Bulletin for more perspective.

Under the 90-day waiting period requirement, group health plans and health insurance issuers offering group health insurance coverage may not impose a waiting period longer than 90 days for employees and their dependents. A waiting period is the time that must elapse before an individual who is otherwise eligible to enroll can become covered under the group health plan. Being “otherwise eligible” requires the employee to have satisfied plan-specified conditions, such as being in a certain job classification or obtaining a job-required certification.

The newly released final rule allows plan sponsors to apply a one-month orientation period for an employee to be eligible to enroll in a plan before counting the 90-day waiting period. The orientation period is measured by adding one calendar month and subtracting one calendar day, beginning with the eligible employee’s starting date. During this orientation period, the agencies “envision that an employer and employee will evaluate whether the employment situation is satisfactory for each party, and standard orientation and training processes will begin,” according to the final rule’s preamble.

The agencies also caution that compliance with the final rule will not be determinative of an employer’s compliance with the ACA’s shared responsibility provisions that require large employers (with 50 or more full-time-equivalent workers) to offer affordable, minimum value coverage.

For additional information about the newly issued final rule on the ACA’s orientation period, please contact your Milliman consultant.

Final and proposed rules issued on the ACA’s 90-day waiting period

Group health plans and group health insurance must not impose a waiting period longer than 90 days for employees and their dependents, under a final rule issued by the Internal Revenue Service (IRS), and the U.S. Departments of Labor and Health and Human Services. The final rule’s waiting-period limitation, which is part of the Patient Protection and Affordable Care Act (ACA), applies to plan years beginning on or after January 1, 2015. Other provisions of the final rule apply to plan years beginning on or after April 25, 2014, with plan sponsors and insurance issuers deemed in compliance during 2014 if they satisfy the requirements of the March 2013 proposed rule.

The agencies also separately issued a proposed rule on “employment-based orientation periods” to address concerns raised by some employers about the effect of the waiting-period requirement and bona fide orientation periods. Under the proposed rule, an employer’s orientation period may be no longer than one month, determined by adding one calendar month and subtracting one day to the waiting period. Employers may rely on the proposed rule for 2014, and a final rule will not be effective prior to 2015.

For Milliman’s perspective read this Client Action Bulletin.

2012 Commercial health insurance: Overview of financial results

With the Patient Protection and Affordable Care Act (ACA) enactment in March 2010, health insurers have had to comply with minimum loss ratio requirements, more stringent rate review, removal of annual benefit limits, first-dollar coverage of preventive care, and other requirements. While the largest reforms enacted by the ACA do not begin until January 1, 2014, for the individual and small group health insurance markets, there are now multiple years of insurer financial experience to evaluate how the ACA is impacting insurer’s profitability and expense structure.

This report uses data reported by health insurers in their Medical Loss Ratio Reporting Forms (MLR forms) submitted to the Center for Consumer Information and Insurance Oversight (CCIIO) in 2011 and 2012, along with 2010 Supplemental Health Exhibit (SHE) data, to summarize financial results in the commercial health insurance markets. The report provides an overview of health insurer financial results in 2012 and evaluates changes in the health insurance industry’s expense structure and profitability from 2010 to 2012, including changes in the medical loss ratio percentage.

Recent guidance on the ACA’s implementation

The federal agencies with regulatory authority under the Patient Protection and Affordable Care Act (ACA) have published numerous regulations and related guidance since April to help employers that sponsor group health plans navigate implementation of the healthcare reform law. This Client Action Bulletin briefly describes key guidance from the U.S. Departments of Treasury (IRS), Labor (DOL), and Health and Human Services (HHS) released April 1 to September 30, 2013, and applicable to group health plans and insurance in plan/policy years that begin in 2014.

What is the future for long-term care?

A new article in National Underwriter called “Is this the end for LTC?” looks to the future of long-term care (LTC). Here is an excerpt:

Group long-term care insurance is in a slump, and it is unclear when, if ever, the slump will end. The latest bad news for the market is that the percentage of organizations that offer the benefit either as a true group plan or voluntary benefit fell to 31% last year, from 46% in 2006, according to the Society for Human Resources Management, Alexandria, Va…

There is one sector of LTC that could provide some relief, however: group LTC. Although it has a history of low sales, it can still be a growth market for some producers, says Amy Pahl, principal and consulting actuary in the Minneapolis office of Milliman Inc.

One reason for her confidence is that as Americans age, they are becoming increasingly aware that there is a need to protect their assets at some point in their lives.

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ACO University

We weighed in several weeks ago with our perspective on accountable care organizations. Since then we’ve seen some interesting new information come out on this emerging topic: