Metro Articles

Healthcare Reform Update

Nathan Smith Tuesday, April 13, 2010

It is being reported to us that if your company has less than 50 employees, you won't face any penalties by not offering insurance under the current guidelines. However, tax credits may be available to those companies with 25 or fewer employees with an average wage of up to $50,000. If you purchase coverage through one of the state-run programs, you could receive a tax credit for each contribution to an employee. These credits, which offer incentives of up to 35% the cost of premiums, will raise to 50% in 2014.

Be prepared for some significant changes that will be happening in the next 6 months. There will be less restrictions for those with pre-existing conditions, and no lifetime limits on health plan coverage. The age of a dependent on a parents' policy is raised up to 26, and health care providers will not be able to rescind coverage.

What remains to be seen is how the health reform will affect healthcare costs. Health spending is projected to rise 6.1% which amounts to nearly 20% of the US economy. This trend will keep the employer-based healthcare system largely in place, so key players in the reform are saying that group medical through insurance brokers will still fill a major role in providing medical benefits.

Metro would like to assist you with any questions or concerns you may have. Please contact us at your convenience to discuss your current group medical solution.

2010 -Subsidies begin for small business to provide coverage to employees-Insurance companies barred from denying coverage to children with pre-existing illness-Children permitted to stay on their parents' insurance policies until thier 26th birthday .
2011 -Set up long-term program under which people pay premiums into system for at least five years and become eligable for support payments if they need assitance in daily living-Drug makers face annual fee of $2.5 billion.
2013 -New medicare taxes on individuals earning more than $200,000 a year and couples filing jointly earning more than $250,000 a year-Tax on wages rises to 2.35% from 1.45%-New 3.8% tax on unearned income such as dividends and interest-Excise tax of 2.9% imposed on sale of medical devices .
2014 -Create exchanges where people without employer coverage, as well as small businesses, can shop for health coverage. Insurance companies barred from denying coverage to anyone will pre-existing illness -Requirement begins for most people to have health insurance. Subsidies begin for lower and middle-income people. People at 133% of federal poverty level pay maximum of 3% of income for coverage. People at 400% poverty level pay up to 9.5% of income. -Medicaid, the federal state-program for the poor, expands to all Americans with income up to 133% of federal poverty level. -Subsidies for small business to provide coverage increase. Businesses with 10 or fewer employees and average annual wages of less than $25,000 recieve tax credit of up to 50% of employer's contribution. Tax credits phase out for larger businesses. -Employers with more than 50 employees that don't provide affordable health coverage must pay a fine if empoyees recieve tax credits to buy insurance. -Insurance industry must pay annual fee of $8 billion -Independant Medicare board must begin to submit recommendations to curb Medicare spending, if costs are rising faster than inflation .
2016 -Penalty for those who don't carry coverage rises to 2.5% of taxable income or $695, whichever is higher. .
2017 -Businesses wuth more than 100 employees can buy coverage on insurance exchanges, if state permits it. .
2018 -Excise tax of 40% imposed on health plans valued at more than $10,200 for individual coverage and $27,500 for family coverage. .

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