January 1, 2010 (Retroactive date)

Small business tax credits — Starting in 2010, the government will provide a tax credit to small employers that pay at least 50 percent of their employees’ health insurance premiums. The full value of the tax credit is 35 percent of the small employers’ cost for businesses with up to 10 employees and average annual wages of less than $25,000. The tax credit also applies on a reduced sliding scale to small employers with up to 25 employees and average annual wages of $50,000. This applies to both grandfathered and non-grandfathered plans.

Part D donut hole decreased via $250 rebate — In 2010 only, seniors participating in Medicare Part D will receive a $250 rebate when they hit the "donut hole," or gap in prescription drug coverage that occurs when spending on covered Part D drugs, including co-pays and deductibles, exceeds $2,830. The Department of Health and Human Services announced in April rebates would begin starting June 15. Once you have hit the prescription drug donut hole, you will be eligible for a $250 rebate. That check will be sent directly to you from Medicare within three months of when you hit the donut hole. There's no application process and no private company will be involved in getting your rebate check to you.

Tax changes for non profit Blue plans (Section 833 changes) — Nonprofit Blue Cross plans will continue to be taxed at lower tax rates if they continue to spend at least $.85 of every premium dollar on health care.

March 23, 2010
(Enactment date)

Federal funds to states for rate review of insured products — Health and Human Services will work with states to review all "unreasonable" premium increases for all underwritten plans starting in 2010

Consumer information grants to states — Starting in 2010, Health and Human Services will provide $30 million in grants to states to set up health insurance consumer assistance or health insurance ombudsman programs to:

• Assist with the filing of complaints and appeals
• Collect, track, and quantify problems and inquiries
• Educate consumers on their rights and responsibilities
• Assist consumers with enrollment in plans
• Resolve problems with obtaining subsidies

States receiving grants must collect and report data on the types of problems and inquiries encountered by consumers. The data will be shared with state insurance regulators, the Secretary of Labor and the Secretary of Treasury to identify areas where enforcement action is necessary

Grandfathered plan and enrollee status if in effect on enactment — Health plans in which an individual is enrolled on March 23, 2010, either as part of a group or as an individual member, are called grandfathered plans. These plans have special effective dates for some health care reform requirements and are completely exempt from others. Grandfathered group plans are allowed to enroll new employees and their dependents and dependents of currently covered employees without jeopardizing their grandfathered status. Similarly, individuals in grandfathered plans may add dependents to their policies. Any plan not in existence prior to March 23, 2010 is considered a non-grandfathered plan.

June/July 2010

. National high-risk pool begins — The State of Michigan is working with Health and Human Services to create a temporary high-risk pool program. There is still much information to come from the government about who exactly would qualify to be in a high-risk pool. It is likely the pool will only impact a very small percentage of the population — those with very high-risk pre-existing conditions who do not have insurance today and haven’t had it for the last six months. This is to help expand access now until other reforms begin in 2014.

Until all carriers are required to accept anyone, regardless of health status as we already do, people rejected for pre-existing conditions that don't qualify them for the risk pool will only have Blue Cross as an option. This is why we continue to advocate for change in Michigan now to ensure everyone has broad access and choice.

The state has approached BCBSM along with a number of other insurers to help it determine how best to move forward. 

Early retiree reinsurance for employer-provided retiree benefits — The early retiree reinsurance program, which will pay 80 percent of the claims between $15,000 and $90,000 for early retirees between the age of 55 and 64 in a group health plan, will be running by July 2010. Details and directions about how employers can apply will be posted on the new Health and Human Services web portal. Applications will be completed by employer groups and will likely require:

• The projected amount of reimbursement to be received for the first two plan year cycles with specific amounts for each plan year.
• A statement that policies and procedures are in place to detect and reduce fraud, waste, and abuse.
• A description of the procedures or programs the employer has in place to generate cost savings with respect to chronic and high-cost conditions.
• An assurance that the employer has a written agreement with its health insurance carrier or group health plan to provide Health and Human Services information and data necessary to verify compliance with program requirements.
• A summary of how the employer will use the money to lower employer health benefit costs or premiums, or premiums, deductibles, coinsurance or copayments for plan participants

HHS internet portal for individuals and small group — The web portal will help consumers navigate their options in the individual and small business private market and help them determine if they may be eligible for a variety of existing public programs, including high risk pools, Medicaid, Medicare and the Children’s Health Insurance Program (CHIP).

September 2010

HHS regulations on state Exchange waivers — Health and Human Services will consider requests from states to be exempt from multiple reform provisions, such as Exchanges, essential benefits and mandates. In order to get such a waiver, states would have to present an alternative plan that would provide coverage at least as comprehensive and affordable, to at least a comparable number of residents, as the federal legislation would achieve.

Health Information Technology standards — Health and Human Services will provide standards on how health plans will be required to manage various kinds of data and conduct financial transactions

Dependent coverage to 26 — All group health plans that offer coverage for their employees’ children must extend eligibility to married or unmarried children of covered employees up to age 26. There are no additional criteria to qualify other than being a child of a policy holder under age 26. For plans not in existence (non-grandfathered plans) on or before March 23, they have to do this starting with the first plan year beginning after Sept 23, 2010. Plans that existed (grandfathered plans) on or before March. 23, 2010, have to do this with the first plan year beginning after Sept. 23, 2010, but only for adult children up to age 26 who are not eligible for employer-sponsored coverage elsewhere. Starting in 2014, the requirement for employer-sponsored coverage elsewhere goes away. BCBSM already covers dependents up to age 26 for fully-insured customer groups until the end of the calendar year and will work with self-insured customers to do the same if they choose to comply early

Restrictions on rescissions — Starting with plan years after Sept. 23, no health plan can rescind (cancel) health coverage for premium paying members except in cases of fraud.

No pre-existing exclusion period for people under age 19 — Anyone under 19 with a pre-existing condition cannot be denied coverage for that condition at any time starting with the first plan year beginning on or after Sept. 23, 2010. In addition, insurers are not allowed to impose waiting periods for coverage of pre-existing conditions for people under 19. This will change in 2014 for everyone as the bill requires all carriers to accept everyone, regardless of health status.

Preventive services with no cost-sharing — Starting with plan years beginning on or after Sept. 23, 2010, plans must provide coverage without cost-sharing for:

• Select services recommended by the U.S. Preventive Services Task Force
• Immunizations recommended by the Advisory Committee on Immunization Practices of the CDC
• Preventive care and screenings for infants, children and adolescents supported by the Health Resources and Services Administration
• Preventive care and screenings for women supported by the Health Resources and Services Administration

No lifetime limits or restrictive annual limits — Beginning with the first plan year on or after Sept. 23, 2010, plans may not place lifetime limits on essential health benefits, and only “restricted” annual limits (to be defined by HHS) will be permitted on essential benefits (this annual limit provision does not apply to grandfathered individual plans). Beginning with plan years starting after Jan. 1, 2014, there will be no annual limits on essential health benefits.

Health and Human Services still has to define “essential health benefits.”

Medical Loss Ratio Reporting — Medical loss ratio (MLR) is the percentage of health insurance premiums spent by an insurance company on health care services. The reform law requires that large group plans spend 85 percent of premiums on clinical services and activities for the quality of care for enrollees. Small group and individual market plans must devote 80 percent of premiums to these purposes. Beginning Sept. 23, 2010, health plans will be required to report MLRs to Health and Human Services.

Patient Protections — All new plans starting on or after Sept. 23, 2010, that provide for designation of a primary care provider must allow the choice of any participating primary care provider who is available to accept them, including pediatricians. A plan may not require authorization or referral for a female patient to receive obstetric or gynecological care from a participating provider and must treat their authorizations related to OB/GYN services as the authorization of a primary care provider. This is already law in Michigan, and all carriers comply.

Emergency Services — If a plan provides coverage for emergency services, the plan must do so without prior authorization, regardless of whether the provider is a participating provider. Services provided by nonparticipating providers must be provided with cost-sharing that is no greater than that which would apply for a participating provider and without regard to any other restriction other than an exclusion or coordination of benefits, an affiliation or waiting period, and cost-sharing.

January 1, 2011

Medical Loss Ratio rebates — Medical loss ratio (MLR) is the percentage of health insurance premiums spent by an insurance company on health care services. Starting Jan. 1, 2011, insurers must provide a rebate to consumers if the percentage of premiums expended for clinical services and activities that improve health care quality is less than 85 percent in the large group market and 80 percent in the small group and individual markets

Increases HSA/MSA early withdrawal penalties — Starting Jan. 1, 2011, the penalty for withdrawals from Health Savings Accounts that are not used for qualified medical expenses will increase from 10 percent to 20 percent, and the penalty for unqualified withdrawals from Archer Medical Savings Accounts will increase from 15 percent to 20 percent

Donut hole phase out begins — Beginning in 2011, Medicare Part D enrollees who reach the “donut hole,” a gap in prescription drug coverage that occurs when spending on covered Part D drugs including co-pays and deductibles exceeds the initial coverage limit ($2,830 in 2010), will receive a 50 percent discount on the cost of their brand-name drugs in the gap as agreed to by pharmaceutical manufacturers.

Over time, Medicare will gradually phase in additional subsidies in the coverage gap for brand-name drugs (beginning in 2013) and generic drugs (beginning in 2011), reducing the co insurance rates for Part D enrollees in the gap from 100 percent to 25 percent by 2020.

Medicare Advantage changes — For some individuals with Medicare Advantage plans, coverage will stay the same or improve. For others, benefits may be reduced or cost-sharing may increase. Medicare Advantage benefits that may be reduced will be additional benefits often associated with these kinds of plans, such as reduced cost-sharing, free eyeglasses and gym memberships.

Part D: protected classes — There are currently six “protected classes” of drugs that health plans are required to include in Medicare Part D prescription coverage. Health and Human Services will consider expanding this to include more drugs. Currently, the six protected classes include antidepressant, antipsychotic, anticonvulsant, antiretroviral, immunosuppressant and antineoplastic drugs. Protected classes were identified in 2008 to ensure Medicare Part D enrollees would have coverage for drugs they already use to control certain conditions.

Prescription required for HSA, HRA, FSA reimbursement - A physician prescription is required for over-the-counter drugs, medicines and biologicals to be considered eligible for reimbursement for Health Reimbursement Accounts, Health Savings Accounts or Flexible Spending Accounts.