Category Archives: Health Care

Eileen Elliott in the news: Vermont Health Exchange and Small Businesses

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Dunkiel Saunders attorney Eileen Elliott published an article, Navigating the health exchange for small businesses, in the Creative Corner in the Burlington Free Press. In her article, Eileen describes the upcoming health exchange, Vermont Health Connect, and how the changes will affect small businesses.

Eileen also spoke with the Associated Press about the health care changes in Vermont. The article, Businesses may get sticker shock on health care, describes the national implications of the Affordable Care Act on small businesses.

In addition, Eileen was a guest on WDEV’s The Mark Johnson Show, where she answered questions about Vermont’s Health Exchange.

Dunkiel Saunders helps health-care providers, including nonprofit institutions and organizations, corporate entities, and private practitioners, understand and navigate the complex and rapidly evolving area of state and federal health-care law. The full description of the firm’s health care practice can be found on the Dunkiel Saunders site.

VT Single Payer is Coming Into Focus

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Vermont is working hard to get its health exchange – called Vermont Health Connect – up and running by this October, when businesses with 50 or fewer employees and individuals will begin using it to enroll in health insurance.  Blue Cross/Blue Shield of Vermont and MVP Health Care have submitted their proposed rates for premiums to the State for review.  One other provider, the member-owned Vermont Health Coop, is trying to get licensed as an insurer so it, too, can sell insurance on the exchange.  The proposed premiums are in line with amounts being paid today.

In many ways the fact that the proposed rates did not skyrocket as predicted is not surprising.  Over the last two decades, Vermont created Dr. Dynasaur for children, banned health insurance companies from imposing higher rates on the sick and elderly than they would on the young and healthy, expanded Medicaid, created  and subsidized the Vermont Health Access Plan (VHAP) and Catamount for uninsured low income adults, and devised pharmacy programs to ease the cost of medications.  All these changes had the effect of insuring more Vermonters and providing increased access to health care.  In Vermont, unlike the rest of the country, over 94% of the population is insured.  Our health insurance companies have already had to adapt to Vermont’s requirements, which made it easier for them to propose rates that are consistent with the national insurance reforms that are new to other insurers and states.

Nonetheless, there is concern for the people whose premiums will increase under the proposed rates.  Principally, these people seem to be lower income single parents who were previously insured through Catamount.  Catamount, like VHAP, will be going away January 1, 2014.  These individuals will qualify for federal subsidies under “Obamacare,” which caps premiums at a certain percentage of household income.  There will probably be state subsidies as well.  Right now, the Vermont House approved state subsidies that lower the federal caps an additional 1.5%.  Still, even with proposed premiums that are in line with what we pay today, plus federal and state subsidies, one vulnerable slice of our population, lower income single parents, may pay more.  The Senate is struggling with how to help this group.  As always, it is an issue of where to find the money.

While the funding is being analyzed and debated in Montpelier, it is important to remember the good that comes to all Vermonters from the exchange.  Coverage will be standardized so people can shop for and understand what their insurance will cover.  Insurance products will differ in the amount of out of pocket costs, but the essential benefits will be the same across the board.

Out-of-pocket costs, including premiums, will be capped.  No matter what chronic or catastrophic health condition occurs, the likelihood of having to file bankruptcy because of overwhelming health care costs is vastly reduced.

Vermonters cannot discount the difficulty faced by those of its citizens who may face cost hikes, as modest as they may appear to many people.  But this State’s progress in moving toward an understandable and affordable health care system is an achievement no other state can claim.

photo by Jonathanking

Eileen Elliott interviewed on Inc.com

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Adam Bluestein from Inc.com interviewed Dunkiel Saunders partner Eileen Elliott on April 2nd about the Affordable Care Act.

The article, “What Will Obamacare Do To Your Insurance Premiums,” focused on how Vermont’s proposed rates for the insurance exchange will affect small businesses and theorized what this will mean for other states.

Of course, Vermont isn’t exactly like the rest of America (Bernie Sanders, anyone?). It has a history of progressive healthcare policy. Community rating, which prohibits insurers from varying rates based on health status, went into the effect in the state in the mid-90s, and insurers already have been required to meet most of the ACA’s other requirements. Inc.com.

Find a description of the firm’s healthcare practice on the Dunkiel Saunders website.

photo by ernstl

8 Key Questions Vermont Businesses Should Ask Now to Get Prepared for the New State Health Exchange in October 2013

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The health care system in Vermont is poised for a major overhaul in 2013, as health insurance shifts from a predominately employment-based system to a health care exchange-based system that is not tied to employment.   While we will not know exactly how such a system will be financed until the legislature begins considering that issue in January of 2013, we do know that changes are coming. You do not need to wait to see how that debate turns out to start preparing for the changes that Vermont’s health care reform will bring to your business and employees.

We have previously addressed some of the fundamental issues business owners need to understand about the new system  – including among others, what an exchange is, and  some of the tax benefits available to businesses and individuals and families  under the new system.

If you have a business in Vermont, whether or not you currently offer health insurance to your employees, you will need to ask yourself some fundamental questions to prepare for the advent of the health insurance exchange next fall.  You may decide not to offer health insurance, but to make the right choice for your business, it is vital to understand a few key issues.

In this post, we touch on some of the key issues that will determine if, and how, such an exchange may apply to your business.  Here are 8 questions to ask to better understand how your business will be classified under the new system.

 1.       Am I a Small Business?

You are a small business if you employed an average of 50 or fewer full time employees during the preceding calendar year.   Employers with up to 50 employees will have to buy health insurance on the exchange, called Vermont Health Connect, if they intend to offer health insurance to their employees.  Vermont Health Connect will be the only place small businesses and individuals will be able to purchase health insurance – no other market will exist for these two groups.

Self-employed persons are considered to be small businesses.

Starting in 2016, small employers will be defined as having 100 or fewer employees, on average, during the preceding calendar year.   At that point, employers employing 100 or fewer people will have to buy health insurance on Vermont Health Connect.

Starting in 2017, all employers, regardless of size, will be required to buy health insurance on Vermont Health Connect.

2.  How many employees do I have?

The “50 or fewer” employee trigger for purchasing health insurance on Vermont Health Connect means the employer had a least one and no more than 50 full-time employees on at least 50% of the working days in the preceding calendar year.  A full-time employee in this case is defined as an employee who works 30 or more hours per week.  Part-time employees, therefore, are not counted in the “50 or fewer” tabulation.

Vermont Health Connect will be providing an employee calculator to help employers figure out their size.  The Vermont Health Connect website is found here.

3.       Are owners of small businesses considered employees?

Yes, as long as they work on average at least 30 hours per week.

4.       What is the relevant time period for determining the number of employees? 

You count the number of employees you employed the previous calendar year.  You must have employed 50 or fewer full-time employees for at least half of the working days during the previous year. Vermont Health Connect will begin to operate in October 2013, so presumably business owners will be looking back to the total number of full-time employees in 2012.

5.       If I grow to over 50 employees after I’ve bought on the exchange, what happens? 

Nothing.  Once you are buying through Vermont Health Connect and you exceed 50 full-time employees, nothing happens.  Even if your business grows, you will not get kicked out of the exchange as long as you continue to offer your employees health insurance through the exchange.  Remember, the size limits are temporary only, so starting in 2017, regardless of your size, if your business offers health insurance to its employees, it will have to offer health insurance through the exchange.

6.       What if I am a Vermont employer with workers who live in multiple states?

If you have 50 or fewer full-time employees, you may offer health insurance to all your employees through Vermont Health Connect.   It does not matter where your employees live and work as long as you are a “qualified employer” under Vermont’s health reform law.  From 2013 through 2015, you are a “qualified employer” if you employed, on average, 50 or fewer employees during the preceding calendar year, your principal place of business is in Vermont, and you elect to provide coverage of your employees through Vermont Health Connect, regardless of where the employee resides.

Starting in 2016, the size of qualified employers will increase to employers with 100 or fewer employees, and in 2017, size will no longer matter.

7.       What if I am a Vermont employer with worksites outside Vermont?

The answer is the same as above.  The definition of “qualified employer” includes employers that have a principal place of business in Vermont and elect to provide coverage to their full-time employees through the exchange.  So, you can offer coverage through Vermont Health Connect to all your full-time employees regardless of whether they work in Vermont or at one of your out-of-state sites.

8.       What if I am an employer from outside Vermont with Vermont facilities? 

Your business may still elect to provide coverage through the Vermont health benefit exchange for all of your full-time employees who are principally employed in this state.  The definition of “qualified employer” includes out-of-state companies who meet the size requirements (50 or fewer full-time employees starting in 2013) and choose to offer health insurance through Vermont Health Connect to their full-time employees who are principally employed in Vermont.

The answers to these questions are simply a starting point for understanding how your business will proceed to comply with the new law.  You first need to understand how the size of your business affects your responsibilities, which then helps you to start thinking about the costs and benefits of offering health insurance to your employees.

There are, of course, many other questions to address.  For example, larger businesses (above a 50 full-time equivalent employee threshold) need to understand the assessment that will be due if the business  either fails to offer coverage or the coverage offered is unaffordable.  And both large and small businesses need to understand their employees’ responsibilities under Vermont law and how the federal law and Vermont law dovetail or diverge.

We will cover these and other topics in future blog posts as we continue to explore health care reform issues to help businesses understand and prepare for the changes that are coming. In the meantime, if you want additional information, we encourage you to visit the State’s health reform website.

The information provided in this blog is generic and based on the general definitions and provisions in the new legislation (Acts 48 and 171).  This blog post and the information it contains should not be interpreted as legal advice for any specific situation.  Individuals with specific questions about their business are encouraged to consult an attorney.

Image by ernstl on flickr.  

Health Care Reform – Materials from VBA Annual Meeting

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Available below are the materials presented at the 134th annual VBA meeting on September 21 by Eileen Elliott, Karen Tyler, Stephen W. Kimbell, Esq., and Robin J. Lunge, Esq., along with the Henry J. Kaiser Foundation’s summary of the new health reform law.

Small Business Tax Credit and Penalties

Vermont Health Benefit Exchange Update

Summary of New Health Reform Law

 

 

 

Eileen Elliott and Karen Tyler to Present at VBA Annual Meeting

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image by ernstl on flickr

Dunkiel Saunders attorneys Eileen Elliott and Karen Tyler, along with Stephen W. Kimbell, Esq. and Robin J. Lunge, Esq., will present on health care reform at the 134th annual VBA meeting on September 21st at Lake Morey Resort in Fairlee, Vermont.

The seminar, Federal and State Health Care Reform: Anticipating the Effects on Your Clients and Firm, will be held from 3:30 to 5:30 PM and will be 2.0 MCLE credits.

This session will focus on state and federal health care reform by addressing what the health care delivery and financing changes may mean to your clients and your firms. The speakers will discuss the essential elements of the federal and state reform efforts and the timeline for anticipated change. Although there are many unanswered questions about state financing, the panel will discuss the issues facing businesses, including law firms, in the state and what we know (and don’t know yet) about the changes those businesses can expect in the next several years, including employer/employee tax credits, the effect on work-forces that cross state lines, worker’s compensation, & health savings accounts.

Details on the VBA meeting can be found here: https://www.vtbar.org/Calendar/Signup.aspx?EventNo=2046

Seminar materials may be found here: https://www.vtbar.org/UserFiles/Files/EventAds/4a.%20Health%20Care%20Reform%20Materials.pdf

The Affordable Care Act is Constitutional

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photo by dbking on Flickr

The long awaited U.S. Supreme Court decision on the constitutionality of the federal health care reform law (the Affordable Care Act) was issued this morning, and the law has been upheld.   Although it is a complicated decision that will provide fodder for analysis for months and years to come, the upshot is that Congress has the power to impose a tax on people who decline to buy health insurance.  This means that the “individual mandate” stands.  While Congress cannot compel people to buy health insurance, it has the power to impose consequences in the form of a tax if people refuse to do so.

The decision also confirmed the constitutionality of using the Medicaid program as the vehicle in the states to expand the insured population.  But the ACA sought to cut off all Medicaid funding to states that refuse to expand the program, and the Court struck down that provision as unconstitutional because Congress does not have authority to force states to regulate.  Instead, states that refuse to expand their Medicaid program will lose only the new funding that would have come along with the expansion.

In a nutshell, today’s decision upholding the federal law means that Vermont’s plans remain intact: for using the funds it anticipates receiving under the Affordable Care Act for its health insurance exchange (estimated to be $300,000,000 to $ 400,000,000) as a springboard to a single payer system.   Vermont will implement the exchange in 2014, at which time individuals and employers of 50 or fewer people will buy insurance through the exchange.  By 2017, most employers in Vermont will be required to buy health insurance through the exchange, and at that point, Vermont will apply for federal waivers of the exchange requirements so it may use the exchange money for a single payer system.

Although there are many unanswered questions, the big question of what happens immediately to Vermont’s reform efforts has been answered today.  We move forward, as planned.

Tomorrow on VPR’s Vermont Edition, Bob Kinsel will interview Anya Rader Wallack, Chair of the Green Mountain Care Board, and Robin Lunge, Director of Health Care Reform, about Vermont’s next steps in light of today’s decision.

Please read the decision here:  http://www.supremecourt.gov/opinions/11pdf/11-393c3a2.pdf

Health Care Reform, Step Five: Understand what Green Mountain Care is now and what it may become in the future

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This is confusing because what Green Mountain Care is right now is not what the health reform law contemplates for the future.  Green Mountain Care is currently the collective name for Vermont’s public health insurance programs:  Medicaid, Catamount Health, VHAP, Dr. Dynasaur, Medicaid, Premium Assistance, and Pharmacy Assistance.  Information about the insurance options offered in Green Mountain Care is available at www.greenmountaincare.org or 1-800-250-8427.

Ultimately, Green Mountain Care is to become the “publicly financed health care program delivering affordable, high-quality health care coverage to all residents of Vermont.”  This is the single payer plan.  There are a number of essential milestones that must be met before Green Mountain Care will go into effect, including getting a waiver under the federal ACA from the obligation to operate a health insurance exchange and arranging sustainable financing that provides a “silver” level of coverage for Vermonters while cutting the cost growth curve, reducing administrative expenses, and paying providers fairly.

We are not there yet, however, and will likely not be there until after 2017, when the federal waivers are scheduled to become available.  For now, it is the creation and implementation of Vermont’s health insurance exchange that is the pivotal “next step” for Vermonters, and it will affect all small businesses (50 or less employees) and individuals starting in 2014.

We will continue to stay abreast of the developments associated with state and federal health care reform and write about them here, so please stay tuned.

Health Care Reform, Step Four: Understand the Tax Credits that Are Available for Individuals and Families, As It May Affect Whether You Provide Health Insurance

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There are individual tax credits available for low and middle income individuals and families to help them buy health insurance.  If you are a small employer with 50 or fewer employees, you may decide to stop offering insurance and allow your employees to buy on the exchange if it is cheaper for them to get better coverage than you could afford to provide as a business.  A large part of the impetus for reform in Vermont is to relieve employers of the responsibility to provide health insurance to their employees.  There is no penalty attached to dropping coverage for employers with 50 or fewer workers.

Starting in 2014, these premium tax credits will be available to help individuals and families who make up to 400% of the Federal Poverty Level (currently $89,400 for a family of 4) afford private coverage by offsetting a portion of the cost of health insurance premiums.  The tax credits are structured so that individuals and families will spend no more than a specified portion of their income on health insurance premiums.  The size of the tax credits is on a sliding scale based on income, so people with the lowest incomes will receive the largest tax credit.  You should consult with your attorney or tax professional about these credits and your potential eligibility to take advantage of them.

Health Care Reform, Step Three: Understand the Tax Credits Available to You for Purchasing Insurance on the Exchange

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The Affordable Care Act helps small businesses and small tax-exempt organizations afford the cost of providing health insurance to their employees through tax credits.  Businesses that employ 25 or fewer employees and pay $50,000 or less in annual wages are eligible for a tax credit that may cover up to 35 percent (up to 25% for non-profits) of the employer’s contribution to health insurance premiums.  This tax credit is available for eligible businesses for the 2010-2013 tax years.  If you learn that you were eligible for a tax credit in an earlier year, you may file an amended return.  The tax credit will increase in 2014 to 50% (35% for non-profits).

Also, since the amount of the health insurance premium payments are more than the total credit, eligible small businesses can still claim a business expense deduction for the premiums in excess of the credit. More information about the credit, including tax tips, guides, and answers to frequently asked questions, is now available on the IRS Web site, www.IRS.gov.  Of course, you should consult with your attorney or tax professional about these credits.

Next week’s post will discuss Step Four: Understand the Tax Credits Available for Individuals and Families.