Individual Health Insurance Exchange (Marketplace) Subscribers and the 90 Day Grace Period to Pay Your Premium

Below is how BCBS of IL will handle claims for those people who have gotten a health insurance plan on the Exchange (Marketplace) AND receive a subsidy (Advance Premium Tax Credit).

It is my understanding that most other insurance carriers will be following a similar methodology, hence why I am posting this.

This is NOT for Small Group SHOP plans.

Blue Cross and Blue Shield of Illinois Providers Notified of ACA Grace Period Provision Providers will be receiving information in the Blue Cross and Blue Shield of Illinois (BCBSIL) provider newsletter about the Affordable Care Act (ACA) provision that allows Health Insurance Marketplace enrollees who receive the advance premium tax credit (APTC), a three-month grace period to pay their premium — provided they have already paid at least one month’s premium in full. It is important to note that not all members who purchase coverage on the Marketplace will receive the tax credit. During the three-month grace period, members are eligible for covered services under their plan.

The provision requires all payers to complete claims (for covered services rendered) in the first month of the grace period. For covered services rendered during months two and three, payers must either pay or hold claims for processing once the payments have been received. Notification of Eligibility Providers will be informed through eligibility and benefits verification when a member has entered into a grace period during months two and three of the grace period. All preauthorization letters will encourage providers to confirm whether the member is in a grace period prior to providing services. Claims Processing Payment for all allowable services provided during the first month of the grace period will be the responsibility of BCBSIL, subject to member cost sharing. During the second and third months of the grace period, BCBSIL will pend the claims the member incurs during this period. If the member pays all outstanding premium payment(s) in full, claims incurred during this period will process according to the member’s benefits. If the member has not paid premiums in full by the end of the grace period, BCBSIL will terminate the member’s policy retroactive to the first day of month two of the grace period. BCBSIL will deny any claims pended in months two and three of the grace period. Pharmacy Claims A member’s pharmacy claims will be denied during months two and three. If the member retroactively pays the premium in full, they may submit claims for prescriptions dispensed during this time to BCBSIL. If a member elects to receive a 90-day supply of a prescription during month one of the grace period, the member will receive the full 90-day prescription and BCBSIL will pay this claim. Member Responsibility for Payment We are encouraging providers to notify their patients that they will be responsible for payment of any outstanding claims for the full cost of provided services, if their health care coverage terminates at the end of the grace period.

2015 Cost-Sharing Limits for ACA Compliant Plans

Below is from BCBS of Illinois. Note the link to the final rule. Also note that if the health insurance provider cannot meet the Medal requirements (for Bronze, Silver, Gold) with such a low deductible, then they are allowed to make it higher than the limit. This is what we are seeing in the market today.

From BCBS of Illinois

Legislative Update 
2015 Cost-Sharing Limits

The U.S. Department of Health and Human Services’ Notice of Benefit and Payment Parameters for 2015 final rule set the following cost-sharing parameters for 2015.

• Out-of-pocket Maximum: The maximum annual limit on cost sharing will be $6,600 for self-only coverage and$13,200 for family coverage. As a reminder, if a plan is non-grandfathered, out-of-pocket member expenses for in-network essential health benefits (EHBs) cannot exceed these out-of-pocket limits.

• Deductible Limit for Small Groups (1-50): The maximum annual limit on small group deductibles will be$2,050 for self-only coverage and $4,100 for family coverage. As a reminder, non-grandfathered small group plans must cap deductibles for in-network EHBs at these amounts.

• Pediatric Dental Coverage: Stand-alone pediatric dental plans covering pediatric dental EHBs will have cost-sharing limits of $350 for coverage of one child and $700 for coverage of two or more children.

This communication is intended for informational purposes only. It is not intended to provide, does not constitute, and cannot be relied upon as legal, tax or compliance advice. The information contained in this communication is subject to change based on future regulation and guidance.

What Do I do after March 31st if I still want a health insurance plan?

This Q & A comes from BCBS and is important to understand. If you don't sign up by March 31 2014 open enrollment deadline, you WON'T be able to purchase a health plan (except a short term medical which imposes a pre-existing condition clause), except by one of the below reasons.

See below.

Q What if a person’s situation changes and he needs health care coverage? Can he go to the Marketplace outside of the open enrollment period?

A  If a person loses his job or has another qualifying life event, he may qualify for a special enrollment period on the Marketplace. A person will qualify if:

• He loses minimum essential coverage, including through divorce.
• He gains a dependent or becomes a dependent through marriage, birth, adoption or placement for adoption or foster care.
• He becomes a citizen, national or lawfully present individual.
• He is eligible to enroll but didn’t because of a mistake, misrepresentation or inaction of an officer, employee or agent of the Marketplace.
• The plan he enrolled in substantially violated a material provision of its contract with the individual.
• He becomes newly eligible for premium tax credits or cost-sharing assistance.
• He becomes ineligible for premium tax credits or cost-sharing assistance.
• He makes a permanent move and has access to new health plans.
• He is a member of an American Indian tribe (American Indians can enroll in a plan or change plans one time each month).
• He demonstrates to the Marketplace that he has other extenuating circumstances that qualify him for special enrollment.
• When any of these situations happen, he will have 60 days to go to the Marketplace to enroll in a health insurance plan or change plans.

Two Year Extension Granted on Canceled Health Plans   

 By Larry Grudzien

(AP) - Warding off the specter of election-year health insurance cancellations, the Obama administration Wednesday announced a two-year extension for individual policies that don't meet requirements of the new health care law.

The decision helps defuse a political problem for Democrats in tough re-election battles this fall, especially for senators who in 2010 stood with President Barack Obama and voted to pass his health overhaul.

The extension was part of a major package of regulations that sets ground rules for 2015, the second year of government-subsidized health insurance markets under Obama's law - and the first year that larger employers will face a requirement to provide coverage.

Hundreds of pages of provisions affecting insurers, employers and consumers were issued by the Treasury department and the Department of Health and Human Services. It will likely take days for lawyers and consultants to fully assess the implications.

The cancellation last fall of at least 4.7 million individual policies was one of the most damaging issues in the transition to a new insurance system under Obama's law. The wave of cancellations hit around the time that the new HealthCare.gov website was overwhelmed with technical problems that kept many consumers from signing up for coverage. It contradicted Obama's promise that you can keep your insurance plan if you like it.

The latest extension would be valid for policies issued up to Oct. 1, 2016. It builds on an earlier reprieve issued by the White House.

REGULATION HIGHLIGHTS

Other highlights of the regulations include:

- An extra month for the 2015 open enrollment season. It will still start Nov. 15, as originally scheduled, after the congressional midterm elections. But it will extend for an additional month, through February 15 of next year. The administration says the schedule change gives insurers, states and federal agencies more time to prepare. This year's open enrollment started Oct. 1 and ends Mar. 31.

- New maximum out-of-pocket cost levels for 2015. Annual deductibles and copayments for plans sold on the insurance exchanges can't exceed $6,600 for individuals or $13,200 for families. While not as high as what some insurance plans charged before the law, cost sharing remains a stretch for many.

-An update on an unpopular per-member fee paid by most major employer health plans. The assessment for 2015 will be $44 per enrollee, according to the regulations. Revenues from the fee go to help insurers cushion the cost of covering people with serious medical problems. Under the law, insurance companies can no longer turn the sick away. The per-person fee has been criticized by major employers. It is $63 per enrollee this year, and is scheduled to phase out after 2016. Some plans, including multi-employer arrangements administered by labor unions, will be exempt from fees in 2015 and 2016.

-Treasury rules for employers and insurers to report information that's crucial for enforcing the law's requirements that individuals carry health insurance, and that medium-to-large employers offer coverage. Although officials said the reporting requirements have been streamlined, businesses see them as some of the most complicated regulations to result from the health care law. The Internal Revenue Service will collect the information, because it is in charge of dispensing tax credits for individuals and small businesses to buy coverage as well as levying fines on those who fail to comply. The individual mandate is already in effect; the employer requirement begins to phase in next year.

-Notice of a potential delay, optional for states, in a promised feature of new health insurance markets for small businesses. The feature would allow individual employees - not the business owner - to pick their coverage from a list of plans. The health insurance exchanges for small businesses have been troubled by technical issues this year. Small Business Majority, a group that supports the health care law, said it's disappointed. The administration says no final decision has been made.

HOW MANY AFFECTED?

It's not clear how many people will actually be affected by the most closely watched provision of the new regulations, the two-year extension on policies that were previously subject to cancellation. The administration cites a congressional estimate of 1.5 million, counting individual plans and small business policies.

About half the states have allowed insurance companies to extend canceled policies for a year under the original White House reprieve. The policies usually provided less financial protection and narrower benefits than the coverage required under the law. Nonetheless, the skimpier insurance was acceptable to many consumers because it generally cost less.

"It's not likely to affect a large number of people but it certainly avoids difficult anecdotes about people having their policies canceled," said Larry Levitt of the nonpartisan Kaiser Family Foundation, an expert on insurance markets. "I think it's a small and dwindling number of people who are affected."

For More Information:

If you have any comments or questions regarding any of above information, please do not hesitate to call me at 630-779-1144 or Larry Grudzien at (708) 717-9638