health care legislation

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San Francisco HCSO 2015 reporting deadline: Extended to May 2nd

The City of San Francisco’s Office of Small Business just sent a reminder: you must file your Health Care Security Ordinance (HCSO) report for 2015, by April 30, 2016 or face a $500/quarter late filing fee.

Note: Private employers who employed fewer than 20 employees for all of 2015 (or non-profit employers that employed fewer than 50), do not need to file. Stop here.

Reporting instructions

Online reporting form

.Pdf preview of data required to file

If you are filing for the first time, or need assistance collecting data or running reports, please contact Allpointe as soon as possible so that we can help you in advance of the deadline.



What To Do With This Blue Shield Rebate Check?

Small businesses and individuals will be receiving a rebate from Blue Shield by August 1st.  Employers, please review the details here, about valid ways to return these refunded premiums to your employees.  Reducing the cost of future insurance coverage is a legitimate use of the rebate.

From Blue Shield:

Medical Loss Ratio Rebates and Notifications

Last month, we informed you that Blue Shield reported its 2012 Medical Loss Ratio (MLR) by market segment to the Department of Health and Human Services (HHS). We are now sharing our rebate information with you.

Blue Shield did not meet the MLR thresholds for the following market segments:

  • Individual and Family plans regulated by the Department of Insurance (DOI)
    The MLR threshold for this market segment is 80%. Blue Shield reported an MLR of 78.0%. The Individual and Family plan MLR was 2% below the 80% threshold. As a result certain subscribers will receive premium rebates by August 1, 2013. The 2% of premium revenue equals $13.3 million that will be returned to 226,034 Individual and Family plan subscribers who were enrolled in the Blue Shield Life plans that did not meet the MLR threshold. The average rebate amount per subscriber is about $59.
  • Small Business plans (50 or fewer employees) regulated by the Department of Managed Health Care (DMHC)
    The MLR threshold for this market segment is 80%. Blue Shield reported an MLR of 76.6%. The Small Business MLR was 3.4% below the 80% threshold. As a result, certain subscribers will receive dues rebates by August 1, 2013. The 3.4% of dues revenue equals $24.5 million that will be returned to 29,232 Small Business policyholders who were enrolled in the Blue Shield plans that did not meet the MLR threshold. The average rebate amount per Small Business policyholder is about $827.

Will Obamacare Kill Healthy San Francisco?

Chris Rauber is asking those questions at the San Francisco Business Times, and apparently, so is much of the San Francisco business community.  Well summed up by Jim Lazarus of the San Francisco Chamber of Commerce:

Among the problem area, according to Lazarus:

  • The federal individual mandate is not met by Healthy San Francisco.
  • The health reimbursement accounts now used by some San Francisco businesses to comply with the local mandate won’t be available next year.
  • Healthy San Francisco, after Jan. 1, will be primarily an “avenue of last resort” for individuals, including undocumented residents, who don’t qualify for other programs. “Some may be willing to stay in the program and pay the penalty” for not having individual insurance, Lazarus speculated.
I agree that these are the major sticking points, but it is the Employer Spending Requirement that the business community (especially the Golden Gate Restaurant Association) would really like to get out from under.  Businesses of 20-49 employees are particularly hard-hit here, as the Federal law exempts them, but San Francisco’s Health Care Security Ordinance does not.

Not to worry, says Mayor Lee.

Like many other parts of the Affordable Care Act and upcoming health care reform changes, we will put this in the “Likely to change between now and 2014” file.
UPDATE 8/1/14 – The Usual Suspects has a good collection of related articles on Healthy San Francisco going.

New Yorkers to Pay 50% Less for Health Insurance – NY Times

In yesterday’s NY Times, it was reported that individual health insurance premiums are expected to drop by 50% in 2014, when the full effect of the Affordable Care Act (a.k.a., “Obamacare”) kick in.  Here is the most shocking line in the article:

Because the cost of individual coverage has soared, only 17,000 New Yorkers currently buy insurance on their own.

New York state is home to almost 20,000,000 (that’s TWENTY MILLION) people.  And 17,000 of them buy their own health insurance.  According to the article, 2.6 million go uninsured.  Let’s let those numbers sink in for a moment.

New York is one of a handful of states that already has guarantee-issue coverage for individuals.  That is, medical underwriting does not exist; any individual can purchase individual coverage, even those with expensive, chronic diseases.  How many of the 17,000 do you think are completely healthy individuals, who do not receive coverage from an employer?  Right.  Well, no wonder the average cost to an individual is $1,500/month for these individual policies.  OK, here are a couple of takeaways:

  • The individual mandate — the requirement that all individuals purchase qualified health insurance in 2014 or pay a penalty — is crucial to the success of the Affordable Care Act.  We must force healthy people into the system, in order to sustain a competitive marketplace that benefits all individuals.
  • Can that 17,000 number possibly be correct?  Is it really true that 13% of New Yorkers go uninsured, 87% get their health insurance from an employer, and less than one-tenth of one percent purchase their coverage on the individual market?  California has twice as many residents as New York, and somewhere between 500,000 and one million purchase their own individual health insurance.

I will do a little more fact-checking and report back…

Rebates coming to small business from Anthem and Blue Shield of California

Chad Terhune of the LA Times reports that Anthem Blue Cross and Blue Shield of California will be required to issue rebates to small businesses this August, for failing to meet the minimum 80% medical loss ratio threshold in 2012, as required under the Affordable Care Act.

Blue Shield of California insures 29,000 small businesses in California, while Anthem Blue Cross is the largest small business insurer in the state, covering 45,000 small businesses.  Your Allpointe broker will be contacting you once specific dollar amounts are released.

Say Goodbye to the 90-day Waiting Period

Beginning in 2014, the Affordable Care Act will require a maximum 90-day waiting period for new hires to join a group medical plan.  California has taken this a step further: Governor Brown signed AB 1083 into law near the end of 2012, reducing that maximum waiting period further — to 60 days.  Let’s take that a step further, as the practical application for small business effectively makes the maximum waiting period one month or 30 days.  Why is this?  Well, currently every carrier for small groups uses a “first of the month following completion of the waiting period” as the eligibility date for a new hire.

If new employee Jane Smith begins work on March 15, 2014 and her employer has a 60-day waiting period, her effective date in the current system would be … June 1, 2014.  Seventy-seven days after her date of hire, or 17 days beyond the maximum waiting period.

We expect the carriers to adapt their plan contracts upon plan renewals in 2014, to help small employers adapt to the new requirements.  Kaiser Permanente officials have stated they will offer three waiting period options for plans that renew on or after January 1, 2014:

  • First of the month following date of hire
  • First of the month following 30-day waiting period
  • NEW: Sixty days following date of hire (partial months to be prorated)

We expect other carriers to offer the same or similar options.

Many of our small group clients in competitive industries already have a first of the month following date of hire policy, but others will need to prepare and adapt.

Small business heath care tax credit: a mirage?

One of the provisions of the Patient Protection and Affordable Care Act (PPACA) initially looked like it could be a huge boon to small businesses: a tax credit for dollars spent on employee health care.  Kaiser Health News has a very good summary of the tax credit, here.

We wrote about this back in April; six months later, as we talk to clients throughout the Bay Area and California, most small businesses do not qualify.  We attribute this primarily to the high cost of living in California’s urban areas, and because the tax credit phases out based on two criteria: number of employees over 10, and average salary over $25,000 annually.  Combine those two and we are finding that our clients either do not qualify at all, or the credit is so small so as not to be worth the effort of applying for it.

A factor that often gets missed is that the average salary criterion is measured by FTE – Full Time Equivalent, not just average annual salary.  So, your 30-hour/week, $40,000/year employee in fact does not fall within the threshold.

Still, there are a few small businesses that may qualify, so we encourage you to use the easy online calculator from the Small Business Majority.  Please contact us if you aren’t sure if you qualify.